VIC

IN THE HIGH COURT OF UNITED REPUBLIC OF TANZANIA TABORA SUB REGISTRY AT TABORA LAND APPEAL NO. 32 OF 2023 (Originated from the decision of the District Land and Housing Tribunal for Tabora District in Land Application No. 36 of 2019) VIC CHAMI INVESTMENT...................................................... APPELLANT VERSUS CRDB BANK.......................................................................... RESPONDENT JUDGEMENT Last Order: 4/07/2024 Judgement date: 7/8/2024 MANGO, J. The Appellant instituted Land Application No. 36 of 2019 before the District and Housing Tribunal of Tabora praying for the following reliefs: - i. An order of the restraining Respondents to dispose the disputed house ii. The declarations order that the sale transactions over the disputed house are null iii. An extension of time within which to pay the debts out of described time and iv. Any other relief(s) as may be After full trial, the Tribunal dismissed the application and ordered the Appellant to pay the debt due to him within 60 days failure of which and in absence of any agreement to the contrary, the Respondent have the right to sell the collateral by way of public auction. Dissatisfied by the decision of the trial tribunal, the Appellant appealed to this court armed with two grounds of appeal which read:- 1. That the Hon. Trial Chairperson erred in law and fact to decide in favour of the Respondent that the Appellant have to pay the debt owes from the Respondent while there is evidence in record that the Appellant already paid the debt 2. That the Hon. Trial Chairperson erred in law and fact to rule in the favour of the Respondent herein above without considering the evidence adduced by the Appellant The Appeal was argued by way of written submissions. The Appellant was represented by Flavia Francis learned advocate while the Respondent was represented by Mtaki Mugaya Kaitila Mtaki learned advocate. In her submission, the Appellant's counsel submitted on all the two grounds of appeal collectively. According to the learned counsel, the Respondent advanced a loan to the Appellant. The Appellant defaulted in paying the loan as a result, the Respondent issued a demand note to the Appellant's loan guarantor. After receiving the demand note, the Appellant decided to file Land Application No. 36 of 2019 before the District Land and Housing Tribunal for Tabora challenging realization of the collateral to satisfy the outstanding loan balance. The learned advocate challenged the manner the default notice was issued. In this she argued that, the notice was served to the guarantor, Victor Fredrick Chami, who was not party to the proceedings before the tribunal and not party to this appeal. She is of the view that, the Respondent ought to have served the Appellant with the default notice. She supported her 2 argument with the provision of section 127 (1) of the Land Act which requires a default notice be served to the mortgagor. He concluded on this point that, since the Appellant was not served with the sixty days statutory notice, the Respondent has not proved his case on balance of probabilities. The Appellant's advocate also challenged the manner exhibits tendered by the Respondent were admitted. She argued that, all documentary evidence tendered by the Respondent were not read after being admitted as evidence, thus, they should be expunged from record. She backed up her argument by the decision of this Court in the case of Theresia Yae Gifting vs Noni Tluwayand Another ( Land Appeal No. 83 of 2022)[2023] 727/C 17428(12 May 2023). She argued further that, the Appellant has paid the loan in full but the Respondent insists on disposing the collateral to satisfy the loan which has already been paid. She then prayed the Court to allow the appeal. In his reply submission, Advocate Mtaki responded on two issues that were raised by the Appellant's advocate in her submission. On the issue of service of default notice to the Appellant, he argued that the requirements of section 127 of the Land Act [Cap. 114 R.E 2019] was not violated by the Respondent. He explained that, the Appellant cannot be separated from Victor Fredrick Chami because it is the same Victor Fredrick Chami who trades as VIC Chami Investment. He is of the view that, the loan advanced to the Appellant binds the proprietor of the Appellant, the said Victor Fredrick Chami. He referred the Court to page 13 of the typed proceedings at which testimony of the said Victor Fredrick Chami appears. He reproduced part of Mr. Victor Fredrick Chami's testimony which indicates that the Appellant sole proprietor 3 conceded that the loan was advanced to him. Citing the decision of the Court of Appeal in the case of Hood Transport Company Limited versus East African Development Bank Civil Appeal No. 262 of 2019, the learned counsel argued that parties are bound by their pleadings. The learned counsel added that there is no dispute that the demand notice was served to Victor Chami and all exhibits indicates that the loan was advanced to the Appellant through her sole proprietor Victor Fredrick Chami. On the alleged full payment of the loan, the Respondent counsel submitted that evidence on record establishes that the loan was not fully paid. He highlighted part of Victor Fredrick Chami's testimony which establishes that he still owes the Respondent Bank Ten million shillings (TZS 10,000,000/-) as a loan. According to him, Mr. Chami admitted that he still owes the bank Thirty million Tanzanian Shillings (30,000,000/-) which includes principal unpaid loan balance and interest thereto. The learned Counsel submitted further that, expulsion of exhibits DI, D2, D3, D4, D5, and D6 for the irregularities pointed out by the Appellant's counsel will not vitiate the Appellant's testimony. I have considered submissions made by both parties and Court record. I will concentrate much on the grounds of appeal than issues that have been raised by the Appellant's counsel in her submission. I will start with the first ground of appeal in which the Appellant alleges that he has fully satisfied the loan that was advanced to him by the Respondent bank. The contents of the application filed before the tribunal and the Appellant's submission before this Court establish that the loan advanced to the Appellant was not fully paid. This is evident from the prayers made by the Appellant before the 4 tribunal and the testimony of Victor Frederick Chami, the sole witnessand proprietor of the Appellant. According to the testimony of Victor Fredrick Chami (SMI), the total loan was TZS 69,000,000/-, he paid back only TZS 53,000,000/- and he still owes the bank TZS 10,000,000/-. With this testimony, the first ground of appeal is bound to fail as the Appellant who had the duty to prove that he fully satisfied the loan, failed to prove his allegations, he instead admitted that he has not fully paid the loan through the testimony of his own witness. The second ground of appeal is also meritless since evidence on record establishes clearly that the trial tribunal considered evidence adduced by the Appellant than that adduced by the Respondent. This is evident from the fact that, the decree issued by the tribunal does not indicate the total loan to be paid by the Appellant while SU1, Beatus Mabula testified clearly on the total outstanding loan balance. According to SU1, the amount due to the Appellant as on 1st February 2022 was TZS 35,600,000/-. In short, the trial tribunal considered evidence adduced by the Appellant and did not anyhow consider exhibits and oral evidence adduced by the Respondent. The Tribunal went further ordering the Appellant to pay the remaining loan balance within 60 days from the date of judgement. All these establishes that the Tribunal treated the Appellant fairly. It is my considered view that, this appeal has been preferred as a means of facilitating delay in paying the debt due to the Appellant. I hold so on the reason that the Appellant who was the Applicant at the tribunal did not deny to have not fully satisfied the loan advanced to him. With his admission, it is not clear why after being served with the default notice, he rushed to the 5 Court to challenge collateral realization instead of approaching the Respondent bank for variation of loan conditions or cooperating with the bank for smooth collateral realization. The Appellant and other persons who benefit from loan services offered by financial institutions should be aware that, financial institutions do not own the monies lend to them, they only act as an intermediary between those who deposits their monies for future use and those in need of financial assistance for investments purposes. Thus, in case of default in paying the loan(s) advanced to them on time, other clients of the financial institutions may also be affected unnecessarily. In some instances, such defaults affect performance of the financial institutions to the extent of causing their compulsory liquidation which has negative impacts on the economy of individual persons and the country at large. Bearing that in mind, they should not prevent the financial institutions from disposing the collaterals to recover the unpaid loan. They should actually cooperate with the financial institutions where need arise. In short I don't find any reason to fault the decision of the trial tribunal. The appeal is hereby dismissed with costs. Dated at Tabora this 7th day of August 2024 Z.D.MANGO JUDGE