Victor Thomas Sawe v Xin Si Lu Company Ltd

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA IN THE SUB - REGISTRY OF MANYARA AT BABATI (PC) CIVIL APPEAL NO 27899 OF 2024 (Arising from Civil Appeal No 20458 in the District Court of Babati, Originating from Civil Case No 12 of 2024 in the Babati Primary Court) VICTOR THOMAS SAWE………………..…………………..……. APPELLANT VERSUS XIN SI LU COMPANY LIMITED……………..…………...……RESPONDENT JUDGMENT 10th Dec. 2024 and 28th Feb. 2025 N. J. MWIHAMBI, J.: Xin Si Lu Company Limited (the respondent) instituted a civil case in the Babati Primary Court (the trial court) against the appellant (Victor Thomas Sawe) for the payment of TZS. 12,882,400/= from the sales in a fish business that they were both engaged in through a contractual agreement. The trial court ruled in favor of the respondent. Dissatisfied with that decision, the appellant appealed to Babati District Court where he lost the appeal and has now knocked doors of this Court in a second appeal. The gist of the matter is as follows: the respondent is a company which engages in fish processing and export business in different 1 Regions in Tanzania including Manyara, Dodoma and Arusha. The respondent employed the appellant as a sales officer from May 2023 to work in Karatu and June 2023 to work in Arusha. Later on, he was sent to Dodoma where it is alleged that he disappeared with the respondent’s money amounting to TZS. 12,888,400/= which was justified by Philipo Kavungo, the second witness of the respondent in the trial court and also an accountant. The appellant denied the allegations before the trial court. There arose a preliminary objection before the trial court that the respondent had no cause of action against the appellant as it is an employer- employee relationship hence any dispute arising therefrom constitutes a labor dispute/case. The trial court overruled the objection and at the end of the day ruled in favor of the respondent that the appellant breached his contractual agreement with the respondent. The appellant appealed to the Babati District Court complaining that the trial court ruled in favor of the respondent without giving weight to the evidence which was adduced before it. The District Court dismissed the appeal. Still dissatisfied, the appellant has appealed to this Court as alluded hereinbefore. The appeal has been brought on four grounds. The parties being legally represented; Mr. Fredrick Musiba for 2 the appellant and Mr. Abdallah Kilobwa for the respondent argued the appeal orally. The complaint on the first ground is that the District Court failed to consider that the trial court lacked jurisdiction on the matter. Mr. Musiba argued that the trial court had no jurisdiction over the matter before it because the matter falls into a labor dispute between an employer and employee, citing the case of George Msikula v Fravius Fotidas, (PC) Civil Appeal No. 42 of 2022, HC Bukoba. Mr. Kilobwa contested the argument and stated that the matter before the trial court was civil in nature and not a labor dispute. He further argued that the case of Msikula (supra) is distinguishable in this regard. The second ground is that the appellate magistrate erred in relying on unqualified audit report which was tendered by unqualified person. Mr. Musiba argued that the person who prepared and tendered exhibit Z1 (audit report) is neither an accountant nor an auditor which is contrary to section 2 of the Accounting and Auditing Registration Act [Cap. 286]. Mr. Kilobwa replied that the said report is not an audited report but a report showing how the business was conducted. On the third ground, the appellant complains that the appellate magistrate erred by assuming that there is a shortage of TZS. 3 12,880,400/= without having a financial statement which show the loss of that particular year. Mr. Musiba argued that it is a requirement of the law that every company must have a financial statement for the particular year but the respondent failed to tender its financial statement to prove the loss of money which was caused by the appellant. It was the reply of Mr. Kilobwa that what was claimed by the respondent was not the loss of income in a year but an actual loss caused by the appellant hence in this regard there was no need of having a financial statement to prove the said loss. On the fourth ground, the appellant complains that the appellate magistrate erred by failing to consider the weight of the evidence adduced by the appellant. Mr. Musiba submitted that there was another person who was working with the appellant in Dodoma and he was the one who stole the money but the appellate magistrate never considered that evidence. Mr. Kilobwa contested and stated that the trial court and the first appellate court considered the evidence adduced by both parties before delivering their judgments. After hearing the rival arguments of the parties, it is apparent on the face of record that the fate of this appeal lies on whether the appellant and the respondent were bound together by a contractual 4 agreement or employer-employee relationship, and the answer will determine whether the trial court had jurisdiction to hear the case. Zeng Yan, the first witness of the respondent before the trial court testified that the appellant was the employee of the respondent and that the loss claimed happened in the course of his employment. It is not a disputed fact that the appellant was the employee of the respondent. This fact is also confirmed by the appellant himself in his testimony before the trial court: “Kampuni Xin Si Lu Limited Company ni kampuni iliyoniajiri kama sales person na kulingana na makubaliano na kampuni jukumu ni kutafuta soko la samaki, kupokea mzigo baada ya kupata soko na kupima mzigo ninavyoupima na kupokea pesa kutoka kwa wateja na kupeleka kwenye akaunti mbili za kampuni ambapo ni NMB na NBC…” The most argued issue by the appellant from the trial court to this Court is that the case instituted by the respondent before the trial court was not proper because of the employer-employee relationship that the parties have hence, the cause of action did not arise from the breach of contract for it to be a civil case but a labor dispute. At this juncture the Court has this to ask: what is a contract? Is the relationship between the appellant and the respondent an employment contract? Do the 5 allegations of the respondent against the appellant fall in the breach of employment contract? Do the allegations of the respondent against the appellant fall into a labor dispute? An agreement which forms a contract has been defined by section 2 (e) and (h) of the Law of Contract Act, Cap 345 R.E 2019: “(e) every promise and every set of promises forming the consideration for each other, is an agreement; (h) an agreement enforceable by law is a contract;” From the quoted provision of law, it is quite clear that an agreement, in this case, any agreement enforceable by law is a contract, hence, it can be an employment contract or a business contract. It is the evidence of the appellant that he entered into an agreement with the respondent through employment to look for a fish market, to receive goods in this case, fish, after getting the market, to receive money from customers of the goods and to deposit the money into NMB and NBC accounts. It is obvious that the appellant and the respondent entered into a contractual agreement through employment and in this case, an employment contract. It was the allegations of the respondent before the trial court that after receiving the goods, the appellant did not deposit the money as he 6 was supposed to do so according to their agreement and this is what led the respondent to institute a civil case before the trial court. What is a labor dispute? A labor dispute is defined by section 4 of the Employment and Labour Relations Act [Cap 366 R.E 2019] that: “dispute”- (a) Means any dispute concerning a labour matter between any employer or registered employer’s association on the one hand, and any employee or registered trade union on the other hand; and (b) Includes an alleged dispute; It is in the view of this Court being guided by the quoted provision that what the respondent alleges is the failure of the appellant to deposit the proceeds of sale into the respondent’s account hence the breach of their agreement. For this, the argument of the appellant that the matter falls into the labor dispute because of the appellant’s failure to perform his duties as a sales person is unfounded. The fact that the appellant and the respondent had an employer-employee relationship does not make the dispute fall into a labor dispute. With these reasons as explained, the first ground lacks merit. 7 The remaining grounds that is the second, third and fourth grounds rest on the weight of evidence. It is a settled law that the first appellate court is entitled to re-evaluate the entire evidence adduced at the trial, subject it to critical scrutiny and arrive at its independent decision. This fact has been stated in a lot of case laws and the same is also referred in the case of Registered Trustees of Joy in The Harvest v Hamza K Sungura (Civil Appeal 149 of 2017) [2021] TZCA 139 at page 7. I am of the firm view that the first appellate court did not discharge its duty of re-evaluating the evidence of the trial court before reaching its conclusion. The Court in the case of Sixbert Bayi Sanka v Rose Nehemia (Civil Appeal No. 68 of 2022) [2023] TZCA 227 stated: ” As it is plain that this is the third appeal, the Court’s mandate to interfere with the concurrent findings of facts of the three courts below is restricted. This Court can only do so where there is misapprehension of evidence or misdirection or non-directions which has occasioned a miscarriage of justice or where there is violation of some principles of law or procedure.” The Court also in the case of Registered Trustees of Joy in The Harvest v Hamza K Sungura (supra) at page 11 that: “We are as well, aware of the fact that this is not only a second appeal, but the appeal is seeking to fault findings of two concurrent 8 decisions. Ordinarily, this Court would not readily disturb such findings, unless it can be demonstrated that the findings of the lower courts, are clearly unreasonable or are a result of a complete misapprehension of the substance of the evidence or that the findings are based on a violation of some principle of law culminating into a miscarriage of justice.” With the light of the above cited cases, I am of the view that, now that the issue of jurisdiction of the trial court is solved, there is a misapprehension of the substance of evidence that was adduced before the trial court by the first appellate court. With that said, I proceed to re-evaluate the evidence on record. I will now move to the evidence adduced by the parties before the trial court. Section 110 (1) and (2) of the Evidence Act [Cap. 6 R.E 2019] provides: “(1) Whoever desires any court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts must prove that those facts exist. (2) When a person is bound to the existence of any fact, it is said that the burden of proof lies on that person.” The respondent alleges that the appellant in the course of employment caused a loss to the company amounting to TZS. 12,882,400/=. According to the cited provision of law, it was the respondent’s duty to 9 discharge the burden of proof. When the respondent’s representative, Zeng Yan was cross examined before the Primary Court, he stated that: “Tunachodai ni TZS. 12,882,400/= kwa mdaiwa ikiwa ni hasara aliyoipa kampuni yetu na kuondoa [sic] bila kulipa hela ya mauzo ya samaki…kwa hapa sioni document yoyote inayoonyesha mdaiwa hakutuma hela ya samaki. Hakuna delivery note yoyote ila tuna utaratibu wa magroup ya whatsap katika siku ambayo huwa wafanyakazi wanatoa taarifa pindi wanapopata taarifa ya mizigo ya samaki tunayowatumia.” The accountant, Philipo Kavungo who appeared as the second witness for the respondent before the trial court had this to say upon being cross examined: “Sijui na sifahamu makubaliano ya wafanyakazi wa mdai. Nachofahamu nilieleza mdaiwa kupokea box 197 Dodoma na box 37 Karatu. Jumla box 234, na hivyo nilielezwa tu na kisha kupewa vielelezo na kurecord na kisha kufanya hesabu. Sifahamu (mdaiwa) Victor alitumiwa mizigo kwa gari au namna gani na sikuambiwa na haikuwa sehemu yangu kwani nilipelekwa kwa ajili ya kufanya hesabu ya fedha na ukaguzi wa fedha.” Philipo Kavungo on being cross examined went on to say that: “Bank statement ndio inaonyesha malipo yamefanyika, na hivyo ni jukumu la mdaiwa na kampuni yake. Mwaka huu 8/1/2024 ndio 10 nimefanya kazi hiyo ya uhasibu na nilipewa taarifa zote kuhusiana na mdaiwa alipokuwa akifanya kazi. Bbank statement ya kampuni sikuitisha nilitumia tu group chati za whatsap ambayo ndiyo kampuni huwasiliana na wafanyakazi wao na ndipo nilipopata ukweli wa taarifa yote ya mdaiwa…” I have done my homework of perusing the trial court’s file and the following are my observations: there is nowhere on the records that the respondent explained the terms and conditions of the contract, how the offer was communicated to the appellant and how it was accepted. Zeng Yan and Philipo Kavungo, the respondent’s witnesses have relied their allegations on the communication they did with the appellant through WhatsApp chats and the same were not tendered before the trial court for proof. The appellant does not dispute the fact that he had an obligation to deposit the sales money into the respondent’s NMB and NBC bank accounts and he did so through exhibit V1. However, the respondent did not submit before the trial court the bank statement which in this case is a crucial evidence, to prove before the court on the dates it received deposits from the appellant and on the dates it did not receive so as to prove that the alleged loss was caused by the appellant. 11 I have carefully looked into exhibit Z1 and it is my opinion that although it was admitted as an exhibit, the report cannot stand as a proof that the appellant caused a loss of TZS. 12,882,400/= to the respondent. I say so because in exhibit Z1, there are no names or signature of the person who prepared the report, there is no seal of the respondent to confirm the information therein is true. The report does not show the source of information and for this how can it be proven that the person who prepared the report did not tamper with the information concerning the sales done by the appellant? Moreover, the report to prove the loss has been prepared from hearsay information provided to Philipo Kavungo. He testified that the main source of information he used was the WhatsApp chats which were not tendered in court as evidence. In the records there is no professional explanation on how the loss facing the appellant amounted to TZS. 12,882,400/=. What about the bank receipts that were tendered by the appellant? There is nowhere in the records of the trial court that those receipts were put into consideration to see how much money the appellant deposited against the alleged loss. It can be seen further from the evidence of Liu Sheny Yang, the third witness for the respondent before the trial court who tendered 12 exhibit Z5 being the book keeping records of the goods and sales. On being cross examined, she stated: “Mdaiwa alikuwa anapokea samaki wa kampuni na kuwauza na kisha kutumia fedha za kampuni. Nina uthibitisho wa daftari kielelezo “Z5” pamoja na meseji za group chart whatsapp. Hakuna sehemu amesaini sababu ni taarifa ninazoandika baada ya yeye mdaiwa kupokea mzigo hivyo hakuna namna anaweza kusaini. Akipokea mdaiwa ndio anatuma ujumbe kwa siku katika whatsaap amepokea. Hakuna delivery note yoyote aliyosaini mdaiwa Zaidi ya whatsapp meseji za mdaiwa…” I have looked carefully into exhibits Z1 and Z5 and I have observed that the said exhibits do not differ except that one is handwritten and another is typed. Both lack names and signatures of the persons who prepared them. Can it be the person who wrote exhibit Z5 is the same person who typed exhibit Z1? At this juncture, I am satisfied that no proof was placed before the trial court that the appellant was involved in the loss alleged by the respondent. Hence, according to section 110 (1) of the Evidence Act [Cap 6 R.E 2022] Xin Si Lu Limited Company had the burden to prove its case on the balance of probabilities; on the way things appear it has failed to discharge its duty. 13 For the reasons given above, I quash and set aside the concurrent findings of both the Babati Primary Court and the District Court of Babati. In the result the appeal is allowed with costs on this appeal and the two courts below. It is ordered. DATED at BABATI this 28th February 2025. N. J. MWIHAMBI JUDGE COURT: Judgment delivered today in presence of the Appellant and Mr. Fredrick Musiba, Advocate for the Appellant and Mr. Abdallah Kilobwa, Advocate for the Respondent. B/C: Ms. Fatina Haymale (RMA) is present. Right of appeal explained. N. J. MWIHAMBI JUDGE 14