RULING MISCELLANEOUS COMMERCIAL CAUSE NO

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA (COMMERCIAL DIVISION)

AT DAR ES SALAAM MISCELLANEOUS COMMERCIAL CAUSE NO. 017625 OF 2024 UNICOOL EAST AFRICA CO. LTD ...................………………….APPLICANT

VERSUS CHINA RAILWAY JIANCHANG ENGINEERING CO. LTD ....... RESPONDENT

RULING Date of Last Order: 09/10/2024 Date of Ruling: 15/11/2024 GONZI, J. The Applicant filed the present application under section 14(1) of the Law of Limitation Act praying for orders that: 1. That the Honourable Court be pleased to grant an order for extension of time within which the Applicant to file an award for the purpose of challenging it on the grounds of technical delay and illegality of the impugned decision. 1 2. That Costs of the application to follow the event.

3. Any other relief(s) the Honourable Court may deem fit to grant. The application was supported by an affidavit of Mr. Litete Haji Ndungo, Learned Advocate for the Applicant. Mr. Ndungo, Advocate, stated that the Applicant is aggrieved with the Ruling of the Arbitrator delivered on the 29th September, 2023 in the arbitration proceedings between the Applicant and the Respondent. He attached copies of the proceedings and the Arbitrator’s Ruling as “Annexure Unicool-1” to the affidavit. He stated further that on the 9th November 2023, the Applicant being aggrieved by the decision of the arbitrator, timely filed the award in court vide Misc. Commercial Cause No. 68 of 2023 for the purpose of challenging it. Later on, the Applicant prayed to withdraw the application with leave to refile the same as the application was found to be improperly filed in court. He attached a copy of the Court proceedings and Orders as “Annexure Unicool- 2” to the affidavit. He stated further that the Applicant, again, filed the Award properly in court vide Misc. Commercial Cause No. 8861 of 2024 only to be caught by time limitation pursuant to the recent decision of the High Court of Tanzania Commercial Division. Before it could be objected to, he prayed 2 to withdraw the petition and was allowed to do so with leave to refile the same. He has now come to this court with an application for extension

of time within which to file the Petition to challenge the Arbitral Award in question. Mr. Litete Haji Ndungo, Learned Advocate, stated that the arbitral Award is tainted with serious illegalities which need the court’s intervention and these include but are not limited to, the arbitrator illegally dismissing the arbitration w and denial of the Applicant’s right to be heard. It was stated that it is fair for this court to grant the extension of time for the Applicant to file the award in court out of time so as to address the illegalities of the award. Mr. Litete stated that the Respondent shall not in anyhow be prejudiced if the order for extension of time is granted. The Application was resisted by the respondent who filed a counter affidavit of Athanas Wigan, Learned Advocate. Mr.Wigan stated that the Applicant’s Advocate was caught by time limitation as the reason for the withdrawal of Miscellaneous Commercial Cause no. 8861 of 2024 before this honorable court. He added further that the applicant was not diligent as the Miscellaneous Commercial Cause No. 68 of 2023 before this honorable court was withdrawn for being filed inappropriately and Miscellaneous Commercial 3 Cause no. 8861 of 2024 was withdrawn for being out of time. He stated further that the dismissal of the arbitration proceedings was not tainted with any illegality as alleged in the Applicant’s Affidavit and

that the Applicant has not demonstrated good grounds to be allowed to file the matter in court to challenge it. The hearing of the application was done by way of written submissions. Mr. Litete Haji Ndungo, Learned Advocate, represented the Applicant whereas Mr.Athanas Wigan, Learned Advocate, represented the Respondent. Mr. Ndungo, Learned Advocate, submitted that the application is brought under Section 14(1) of the Law of Limitation Act [CAP 86 R.E 2019] and that the grounds upon which the application is brought are technical delay and illegality of the arbitral award where the applicant’s right of being heard was unreasonably curtailed by the arbitrator for being strictly tied by technicalities in deciding the preliminary objection raised by the Respondent. He submitted that, the Applicant, being aggrieved with the decision/ruling delivered by the sole arbitrator, on 29 September 2023, timely filed the award in court vide Misc. Commercial No. 68 of 2023 without following the 4 procedures stipulated under Regulation 51(4) or 51(5) of The Arbitration (Rules of Procedure) Regulation 2021 mistakenly thinking that, the decision of the Arbitrator as a ruling whose procedure for filing in court does not follow the cited provision of the law. He argued that on 2nd April, 2024, when the application came for hearing, the Respondent raised a preliminary objection that the application

was not properly before the court for the reasons that the decision of the arbitrator is not a ruling rather it is an award which had to follow the proper procedures for filing it in court. The Applicant conceded in order to file a proper application by withdrawing the application with leave to refile. He argued that subsequently, on 4th April, 2024, the Applicant sought leave of the Arbitrator to file arbitral award in court and on 5th April, 2024 the sought leave was granted by the Arbitrator and therefore Misc. Commercial Cause No. 8861 of 2024 was filed in this court. He argued that before the application came for hearing, on 10th July, 2024 the Applicant noted that there was a recent decision of this Court in Loius Dreyfus Suisse SA Versus Kahama Oil Mills Ltd; Misc. Commercial Cause No. 67 of 2023 which was decided on 7th June, 2024 and which ruled that, the time limit for filing of an award in court is 60 days. Thus the Applicant found himself caught with time limitation something 5 which necessitated the application to be withdrawn in order to file the present application for extension of time on technical grounds and illegality of the arbitral award. Mr. Litete Haji Ndungo, Learned Advocate, submitted that in the circumstances, the applicant has not inordinately delayed to file the application and the applicant was diligent and there was no apathy, negligence or

sloppiness in challenging the arbitral award rather the delay is on technically grounds which arose from the mistaken belief that the decision is a ruling which does not need a leave of the arbitrator to file it in court. It was also a mistaken belief of the applicant that, it was within time to file the award before the applicant came to know of the recent ruling of this court on time limitation. Mr. Ndungo, Learned Advocate, submitted that technical delay is good and sufficient reason for the court to exercise its discretion to extend time. He relied on the case of Constantine Victor Versus Muhimbili National Hospital, Civil Application No. 214/18 of 2020, Court of Appeal of Tanzania at Dar es Salaam (TanzLII) where it is held that, technical delay is good ground to warrant extension of time. He added that the Applicant did not 6 take long time between filing of the two applications, which were technically withdrawn. He added that the intended application/petition is an arguable case whose degree of prejudice is high to the Applicant than the Respondent taking into account that the Applicant is claiming more that TZS. 500,000,000/- under the dismissed arbitration proceedings. Mr. Ndungo, Learned Advocate, submitted that the second reasons for extension of time, is illegality of the impugned award of the sole arbitrator in dismissing the arbitration proceedings on technical

ground. It was illegal because the arbitrator in deciding that the Applicant was time barred to raise the claims against the Respondent, he did not consider that the construction project was not yet closed and that no final accounts were prepared. It was also illegal for the arbitrator to base on evidential facts to determine the preliminary objection contrary to the famous principle in Mukisa Biscuit’s case thus curtailing the Applicant’s right to be heard. He concluded that on the strength of the reasons advanced by the Applicant, the court has been properly moved to exercise its judicial discretion to grant extension of time to the Applicant. 7 In his reply submissions, Mr. Wigan, Learned Advocate, submitted that, the gist of the application is section 14(1) of the Law of Limitation Act, which, among other things, makes a clear indication that the court may, for any reasonable or sufficient cause, extend the period of limitation for the institution of an appeal or an application. He submitted that for this Honourable Court to grant an extension of time it needs to ascertain if the Applicant has advanced reasonable or sufficient cause for this Honourable Court to make an extension of time as enshrined under the landmark case of Lyamuya Construction Company Ltd. Vs. Board of Registered Trustees of Young Women's' Christian Association of Tanzania, Civil Application No. 2 of 2010 (unreported) where the Court of Appeal of Tanzania gave the guidelines or factors to be considered in granting or refusing an application for an extension of time to be as follows:- 1. The applicant must account for all the periods of delay.

2. The delay should not be inordinate.

3. The applicant must show diligence and not apathy, negligence or sloppiness in the prosecution of the action that he intends to take.

4. If the Court feels that there are other sufficient reasons such as the existence of a point of law of sufficient Importance, such as the Illegality of the decision sought to be challenged. 8 Mr. Wigan submitted that the applicant has failed to establish and account for each day of the delay as required, since according to paragraph 2 of the affidavit in support of the application, the applicant clearly indicates that the ruling was delivered sometimes on 29th September 2023 and the last date of filing ought to have been not later than 28th November 2023, which marked the end of the sixty days period from the date the award was issued. Therefore, the applicant ought to have accounted for each day of delay from 28th November and not otherwise, something which the applicant has failed to demonstrate in the application, the accompanying affidavit and submissions. Mr. Wigan, submitted that the applicant’s submissions has demonstrated two different occasions in which the applicant made prayers to withdraw the matter for what the applicant termed as technical grounds. He argued that the applicant cannot enjoy the exclusion of time in the calculation of the period of limitation. He relied on the case of Linyungang Zhongfu Lianzhong Composites Group Co. Ltd & Another vs Mtibwa Sugar Estates Ltd (Misc. Commercial Cause No. 26 of 2023) [2024] where this honorable court at Page 12 held

that: 9 “The only issue is whether the period of limitation stopped to run from 7th December 2022 to 25th May 2023 during the time when the Petitioner was in court prosecuting the firstly instituted application which was withdrawn with liberty to reinstitute it? Does time stop to run where a matter is withdrawn with liberty to reinstitute? My answer is in the negative.” Mr. Wigan, submitted that the above decision has demonstrated the parameters of ORDER XXXIII Rule (1) & (2) of the Civil Procedure Code, Cap 33; R.E 2019 which states as follows:- 1-(1) At any time after the institution of a suit the plaintiff may, as against all or any of the defendants, withdraw his suit or abandon part of his claim. (2) Where the court is satisfied- (a) that a suit must fail by reason of some formal defect; or (b) that there are other sufficient grounds for allowing the plaintiff to institute a fresh suit for the subject matter of a suit or part of a claim, it may, on such terms as it thinks fit, grant the plaintiff permission to withdraw from such suit or abandon such part of a claim with liberty to institute a fresh suit in respect 10 of the subject matter of such suit or such part of a claim.

2. In any fresh suit instituted on permission granted under rule 1, the plaintiff shall be bound by the law of limitation in the same manner as if the first suit had not been instituted. Mr. Wigan insisted that the applicant is required to account for each day of the delay from the last date the sixty days period had elapsed that is from 28th November 2023, which the applicant has miserably failed to do. In further submissions, Mr. Wigan, Learned Advocate, submitted that in an application for extension of time, the delay should not be inordinate. He argued that taking into account that the applicant ought to have filed the award in this honorable court not later than 28th November 2023 being sixty days from the date the award was issued, this instant application was filed on 24th July 2024, more than six months from the last date the award ought to have been filed. Hence there was an inordinate delay. Mr. Wigan, Learned Advocate, submitted that the applicant for an extension of time must show diligence, and not apathy, negligence or sloppiness in the prosecution of the action that he intends to take. He argued 11 that according to the affidavit accompanying the application, particularly paragraph 3 & 4 of the affidavit in support of the application and the applicant’s submissions, it is clear that the matter was withdrawn twice on different occasions, whereby it was firstly

improperly filed and later was filed out of time. Mr. Wigan submitted that the above circumstances which led to withdrawal of the applications, before this instant application, clearly indicate negligence on the part of the applicant and therefore do not constitute a good cause for grant of extension of time. He relied on Civil Appeal No. 16 of 2017 between TAUKA THEODORY FERDINAND vs EVA ZAKAYO MWITA (As administrator of the Estate of the Late Albanus Mwita (Deceased) & 3 others decided by the Court of Appeal of Tanzania (unreported) where at page 26 the court held as follows:- “Such lack of diligence or laxity does not constitute a good cause, we agree with the learned single Justice that the applicant did not establish a good cause for grant of extension of time.” Mr. Wigan went on to submit that the applicant has failed to vividly demonstrate the illegality or any point of law of sufficient importance to warrant the grant of this application. He argued that none of the paragraphs 12 from the applicant’s affidavit has indicated illegality that can be vividly seen and clearly demonstrated as it was held in the case of DAMAS ASSEY & ANOTHER vs RAYMOND MGONDA PAULA & OTHERS, Civil Application No. 32/17 of 2018, by the Court of Appeal of Tanzania at Dar es Salaam where it was held at page 19 that: “The alleged illegality should be vividly seen and clearly demonstrated in the

supporting affidavit. I have since perused all paragraphs in the applicant’s affidavit and observed that, apart from mentioning the word ‘illegality’ under paragraph which tried to demonstrate or even highlight clearly the said illegality.” Mr. Wigan argued that apart from mentioning the presence of the illegality of the award, the applicant ought to have vividly and clearly demonstrated the alleged illegality in its affidavit in support of this application something which the applicant has miserably failed to do so. He added that by the applicant indicating at paragraph 5 of the applicant’s submissions that the matter was dismissed for being time-barred despite the construction project and final account not being issued, it was not enough demonstration of illegality. He argued that apart from the fact that the said 13 averments were not included in the applicant’s affidavit, the said submissions do not qualify to demonstrate illegality to warrant the court to grant the extension of time under this application since the applicant's submission contain extraneous matters that were not previously advanced in the applicant’s affidavit in support of this application. Mr. Wigan, concluded by arguing that the applicant has failed to account for each day of delay, the applicant has failed to show any illegality on the first ground to be granted an extension of time; also the

applicant has failed to adduce sufficient reasons. He therefore prayed that this honorable court be pleased to dismiss this application with costs. In his rejoinder submissions, Mr. Ndungo, Learned Advocate, submitted that the Applicant demonstrated diligence in following up the matter save for the reasonable mistake of believing that, filing of the award in court is within 6 months which had been the practice of this court for decades in reference to Item 18 to the Schedule of the Law of Limitation Act [CAP 89 R.E 2019] and various decisions including the case of Bogeta Engineering Ltd vs Nanyumbu District Council (Misc. Commercial Cause 9 of 2019) [2020] TZHCComD 2050 (14 September 14 2020)TanzLII before the coming into force of the recent decision of Loius Dreyfus Suisse SA Versus Kahama Oil Mills Ltd. Mr. Ndungo, Learned Advocate, rejoined further that Counsel for the Respondent seriously failed to distinguish between actual delay and technical delay. He argued that in the case of Fortunatus Masha v. Willium Shija & Another [1997] T.L.R. 154 the Court differentiated the terms actual delay and technical delay to mean that: "with regard to the second point, am satisfied that a distinction should be made between case involving real or actual delays and those like the present one which only involve what can be called technical delays in the sense that the original appeal

was lodged in time but the present situation arose only because the original appeal for one reason or another has been found to be incompetent and a fresh appeal has to be instituted. In the circumstances, the negligence if any really refers to the filing of an incompetent appeal not the delay in filing it. The filing of an incompetent appeal having been dully penalized by striking it out. The same cannot be used yet again to determine the timeousness of applying for filing the fresh appeal. 15 In fact in the present case, the applicant acted immediately after the pronunciation of the ruling of this Court striking out the first appeal." Mr. Ndungo, Learned Advocate submitted that it is on records that, the referred Misc. Commercial No. 68 of 2023 to register the award in this court was filed on the 30th October, 2023 well within time before the said 28th November, 2023 as submitted by Counsel for the Respondent. He added that the said application was withdrawn with leave to refile on 2nd April, 2024. He added that in order for the applicant to benefit with the rule of technical delay, the withdrawn or struck out application should first be shown to have been filed on time as it has been stated in various case laws. Mr. Ndungo, Learned Advocate, reiterated his submissions in chief and the prayers made. That marked the end of the written submissions by the Learned Counsel

for both sides. I thank them both for their insightful submissions and arguments. In determining the present application, I stand guided by the principle that in applications for extension of time, like the present one, there is no hard and fast rule as to what amounts to “sufficient cause”. Each case should be determined on its own merits bearing in mind the prevailing circumstances of the case. This rule was restated in the case of REGIONAL 16 MANAGER, TANROADS KAGERA V. RUAHA CONCRETE COMPANY LTD CIVIL APPLICATION NO.96 OF 2007 (CAT unreported), where the Court held that: “What constitutes sufficient reasons cannot be laid down by any hard or fast rules and this must be determined by reference to all the circumstances of each particular case”. In order to bear in mind the prevailing circumstances of the case at hand, I have looked at the record of the Miscellaneous Commercial Cause No. 8861 of 2024 for Wednesday July 10th 2024 which was withdrawn with liberty to refile the same. This was the second case that the Applicant had filed in court in an attempt to challenge the Arbitral Award and which he was constrained to withdraw with liberty to refile the same on account that he had learned of existence of a recent decision of this Court in Loius Dreyfus Suisse SA Versus Kahama Oil Mills Ltd; Misc. Commercial Cause No. 67 of 2023 decided on 7th June, 2024 and which had ruled

that the time limit for filing of an arbitral award in court is 60 days. So what transpired in court that day? The proceedings read as follows: “Wed Jul 10 2024 17 Proceedings: Advo. Litete: My Lord, the matter is before you for orders. The respondent is absent. However, I have noted that there are missing documents which are necessary to be included herein. I pray to withdraw this matter with leave to refile so that the necessary credentials are incorporated. Court: The prayer for withdrawing this matter is granted. No costs awarded. The applicant is at liberty to refile the same. No costs awarded. C.K.K. Morris Judge”. From the above, it is obvious that the Respondent had never raised any Preliminary Objection against the Miscellaneous Commercial Cause No. 8861 of 2024 although the Respondent was party to the withdrawn application. The record shows that the Miscellaneous Commercial Cause No. 8861 of 2024 was not dismissed due to being time barred, but was withdrawn with leave to refile it subject to the law of limitation. The Applicant after finding himself to be out of time, has prefaced the intended petition to 18 challenge the Arbitral Award with the present application for extension of time to do so. There is no time limit within which one should apply for extension of time. An Applicant for extension of time is required to show a sufficient cause for the delay and or for

extension of time. The Applicant has relied on technical delay as the sufficient cause for delay and hence for extension of time. The Applicant has shown that since the moment the impugned arbitral award was issued by the arbitrator, he has been in the court corridors attempting to set aside the arbitral award but that his efforts have always been thwarted by procedural and legal obstacles constraining him to withdraw the applications twice. It is an undeniable fact that up to July 10th 2024, the Applicant was in Court vindicating his rights in an attempt to challenge the arbitral award. That is perfectly what constitutes a technical delay in law. There was no objection by the respondent against Miscellaneous Commercial Cause No. 8861 of 2024 being filed out of time. The same was withdrawn with leave to refile it. Withdrawal of a case with leave to refile it does not stop the law of limitation. That is why the applicant has brought this application for extension of time before re-filing the withdrawn petition. The argument by Mr. Wigan would have been valid had the Applicant refiled the withdrawn Petition straight ahead relying on the 19 leave to refile that had been granted during the withdrawal of Miscellaneous Commercial Cause No. 8861 of 2024 on 10th July 2024. That is not the case. There is no time limit within which one should apply for extension of time. Mr. Wigan argued

that even the previously withdrawn applications which form basis for technical delay had been filed outside the prescribed time limit. In my view, that argument ought to have been raised against the said withdrawn applications when they were being filed and while they remained pending in court. At any rate, Mr. Wigan has missed the point made by Mr. Ndungo that the Applicant had demonstrated diligence in following up the matter save for the reasonable mistake of believing that filing of the award in court had a time limit 6 months which had been the practice of this court for decades in reference to Item 18 of Part III of the Schedule to the Law of Limitation Act [CAP 89 R.E 2019], a position that was backed up by various decisions of this court including the case of Bogeta Engineering Ltd vs Nanyumbu District Council (Misc. Commercial Cause 9 of 2019) [2020] TZHCComD 2050 (14 September 2020)TanzLII. That was the position before the coming into force of the recent decision of Loius Dreyfus Suisse SA Versus Kahama Oil Mills Ltd (supra) that restated the law to the effect that the limit for filing an award in court for 20 the purpose of seeking its recognition and enforcement or for challenging it is actually 60 days. This means that going by the then supposed position of the law prior to the rule in Loius Dreyfus Suisse SA Versus Kahama Oil Mills Ltd being established, which

position the Applicant genuinely believed to be the settled judicial position, his application was filed timely only to be caught up by a new position of the law that was unveiled while the applicant’s case was already pending in court. I understand that a precedent has a retrospective operation unless stated otherwise, but in my view the circumstances which necessitated the applicant’s Miscellaneous Commercial Cause No. 8861 of 2024 to be withdrawn with liberty to refile it did not constitute apathy, negligence or sloppiness in the prosecution of the action that he intended to take. I therefore find that the delay was technical in the circumstances. The second ground upon which the application at hand was founded was illegality. The Applicant alleged an illegality by the Arbitrator denying the Applicant his right to be heard. Much has been said by both sides on this regard. However, as I am inclined to allow the application at hand on the ground of technical delay, I find it prudent not to dwell much into the ground of illegality since that ground has a bearing to the petition intended to be 21 filed after this extension of time is granted. To avoid prematurely determining the envisaged petition challenging the award on grounds of illegality, I will not canvas the ground of illegality. In fine, the application is granted. The applicant is granted a 30 days extension of time from the date of this Ruling within which to file an award for the purpose of challenging it. I make no order as to costs. It is so ordered. A. H. GONZI

JUDGE 15/11/ 2024 Ruling is delivered in Court this 15th day of November, 2024 in the presence of Mr. Ibrahim Kibanda Advocate holding brief for Mr. Stephen Mhando, Advocate for the Applicant. A. H. GONZI

JUDGE 15/11/ 2024 22