20180531 TZCA Dar es Salaam

-' IN THE COURT OF APPEAL OF TANZANIA AT DAR ES SALAAM {CORAM: MBAROUK, J.A., MWARIJA, J.A., And MWANGESI, J.A.) CIVIL APPLICATION NO. 345/16 OF 2017 YARA TANZANIA LIMITED-------------------- APPLICANT VERSUS DP SHAPRIYA & COMPANY LIMITED -------- RESPONDENT {Application for revision of the proceeding in Commercial Case No. 37 of 2016 and Miscellaneous Commercial Cause No. 55 of 2016 of the High Court of Tanzania {Commercial Division) at Dar es Salaam) (Songoro, J.) dated the 19th May, 2016 in Miscellaneous Commercial Cause No. 55 of 2016 RULING OF THE COURT 4 th May & 6 th June, 2018 MWANGESI, J.A.: The application at hand is by notice of motion made under the provisions of section 4 (3) of the Appellate Jurisdiction Act, Cap 141 R.E 2002 (the AJA), and Rule 65 (1), (2), (3), (4) and (7) of the Court of Appeal Rules, 2009. (the Rules), whereby, the applicant is moving the 1 Court for an order that, the proceeding, ruling and order of the High Court (Commercial Division) in Miscellaneous Commercial Cause No. 55 of 2016 and Commercial Case No. 37 of 2016 and subsequent proceeding thereto, be quashed and the respondent's claims in Commercial Case No. 55 of 2016 be struck out or stayed indefinitely. The notice of motion is supported by two affidavits. The first one was sworn by Mr. Alexandre Macedo, who happens to be the principal officer of the applicant company, while the second affidavit was sworn by Mr. Nuhu Mkumbukwa, the applicant's learned advocate. The notice of motion has however been greeted with a notice of preliminary objection from t~e respondenti founded on four grounds namely; first that, the application is misconceived and bad in law for being · an alternative to an appeal process and in contravention of section 5 (1) (b) (v) of the AJA, which allows appeals against a decision to stay or not to stay a suit, pendipg arbitration. In the circumstance, the appellant should have appealed against the decision sought to be revised. Secondly, that the appellant has a remedy in the High Court to move it to correct the alleged errors in its order of the 19th May, 2016, which is the subject of these proceedings, which errors if any, have not 2 ,· been brought to the attention of the High Court to date, or for whatever sufficient reason by way of review under Order XLII Rule 1 (1) (a) and (2) of the Civil. Procedure Code, Cap. 33 R.E 2002 (the Code). It was contended that, the applicant should have exhausted that remedy of review in the High Court first, before resorting to come to this Honorable Court. -- ---- Thirdly, lhat the application is·-prejudicial an-d intended-to pre""empt the hearing of a pending Miscellaneous Commercial Application No. 92 of 2016, _filed byJne applicantinth~_:Commercial Divisiori qfJhe High C9urt, in-"· which the applicant is praying. for stay of· proceedings pending arbitration relating to the amended plaint, which the respondent was allowed to file, after the suit was allowed to proceed in the trial Court. And, fourthly that, this -application is misconceived and bad in law as the Court has been wrongly moved to exercise powers under the jurisdiction of the High Court, .specifically the prayer to this Court to strike out the suit pending in the High Court or staying indefinitely the proceedings pending in the High Court Commercial Division. The brief facts of the matter leading to the objected application as could be gleaned from the records of the High Court can be stated that, 3 . ' the respondent is the plaintiff ·in Commercial Case No. 37 of 2016 wherein, the applicant is the defendant.• The suit between the parties is founded on a contract covenanted between them whereby, it is contended by the· plaintiff/respondent in the suit that, the defendant/applicant has breached some of the terms of the· contract. Meanwhile, the plaintiff/respondent · lodged Miscellaneous Commercial Cause No. 55 of 2016 in which, she asked_ the Court to issue~ an interim injunctioo order, r.~straining the defenda~t/applicant from demanding or receiving any payments in advance on account of the contract entered between the respondent and the applicant. In the said disputed contract between the applicant and the respondent, there is a clause in the terms of the contract that is clause 20.4 which stipulates that, in case of any kind of dispute arising between the parties in connection with or out of the contract, the same has to first be referred to arbitration·, before resorting to Court proceedings. When the issue of the said clause in terms of the contract was raised by the applicant before the trial Court, the presiding Judge in a ruling that was handed down on the 31 st March, 2016, ordered for stay of the proceedings in terms of the provisions of section 6 of the Arbitration Act, Cap. 15 R.E 2002, for a 4 period of thirty days, to enable the parties to comply with the requirement of the clause in the terms of the contract, of referring the dispute to arbitration. On the 19th day of May, 2016, which was after the expiry of the thirty days which had been given by the Court in the ruling of the 31 st March, 2016, the parties appeared before the Court where another ruling was handed down, by ordering conffnuation of the hearing of the-·suit in Court for the reason that, the need for arbitration did not arise any more, as the - ... ·" .;.••parties -were not-ir1terested to ,pursue ,it. It- was this,later ruling of the trial, Court, which triggered the applicant to lodge the current application for revision. When the application was called on for hearing before us, Mr. Nuhu Mkumbukwa learned counsel, entered appearance · for the applicant whereas, Messrs. George Kilindu, Roman Masumbuko and Simon Mrutu, jointly appeared for the respondent. In compliance with _the cherished dictates of practice in litigation, the preliminary objection which had earlier on been lodged on behalf of the respondent as indicated above, had to be· attended first. 5 · In amplification of the first ground of the preliminary objection, Mr. Kilindu argued that, since the order of the Court dated the 19th May, 2016, which is sought by the applicant to be revised is appealable in terms of the provisions of section 5 (1) (b) (v) of the AJA, if the applicant was aggrieved by the same, the proper course which he ought to have taken was to appeal against it, and not to apply for revision before this Court. The learned counsel referred us to the decision in Mantrac Tanzania Limite~ Vs. Junior Construction Company Limited and Three Others, Civil Application:.No. 552/16 of 2017 (untJ~Q_Qr:ted),_Jn-:for:tificat~o.A of his averment. Mr. Kilindu submitted further that, there are certain situations whereby, applications as the on~ lodged by the applicant, have been given preference of being treated as exceptional circumstances. He however hastened to add that, such exceptional circumstances have to be strongly demonstrated in Court by the applica_nt. ·Nevertheless, in the current appUcation, there has never been any attempt to do so neither in the notice of motion nor in the affidavit in support of the notice of motion. Placing reliance· on the holding in the case of Transport Equipment Limited Vs. Devram P. Valambhia, [1995] TLR 161, the learned counsel 6 urged us to uphold the preliminary objection and dismiss the application with costs. With regard to the second ground of the preliminary objection, the learned counsel for the respondent submitted that, in terms of Order XLII Rule 1 (a) of the Code, the applicant had a remedy in the High Court, by moving it to rectify the so called errors committed by that Court in its ruling dated the 19th May,. 2016. The law is settled, argued the learned counsel, that before one resorts to the jurisdiction of the Court, he has to exh~.u~t -a1i· th~- ·a~aiia5'ie . ~e~edies 'in' ·1:1,·e H.igh court: ·R~ference to that effect, was made to the .decisions in the cases of Mabibo Beer, wines and spirits Limited Vs. · Lucas Mallya and ·Commissioner for Customs Tanzania Revenue Authority, Civil Application No. 160 of 2008 and African Marble Company Limited {AMC) Vs. Presidential Parastatal Sector Reform Commission {PSRC), Civil Appeal No. 47 of 2007 (both unreported). On the third ground of the preliminary objection, Mr. Kilindu informed the Court that, currently there is a pending application at the High Court for stay of the proceedings to await the outcome of arbitration. The same was lodged by the respondent subsequent to the ruling of the High Court . 7 dated the 19th day of May, 2016, which refused to further stay the proceeding. As a result, the respondent lodged an amended plaint, from which the pending application for stay lies. In view of the position of law as held in the case of Mabibo Beers, Wines and spirits Limited Vs. Lucas Mallya and Commissioner for Customs Tanzania Revenue Authority (supra) that, proceedings in the lower court should not be interfered with by the superior court until its logical conclusion has been made, he implored us to refrain from giving any decision which will ... , prejudicethe.,pending pr:oc::eeding in the:High Court. Finally, the learned counsel for the respondent challenged the alternative reliefs which have been asked for by his learned friend in the application that is, of either the Court to strike out the proceedings which· are pending before the High· Court or to stay them indefinitely. In his view, such prayers are misconceived in that th_is Court lacks the requisite jurisdiction so to do. In his free advice to his learned friend, such prayers ought to have been presented before the High Court where the proceedings are being conducted. To cement the contention, reference was made- to the decision in the,case of VIP Engineering and Marketing Limited Vs. Mechmar Corporation (Malaysia) Berhard of Malaysia, 8 .., Civil Application No. 163 of 2004 (unreported). In fine, Mr. Kilindu urged us to sustain the preliminary objection and dismiss the application for want of merit with costs. In rebuttal, Mr. Nuhu submitted that, all the grounds of preliminary objection which have_ been raised by his learned friend are baseless and misconceived because, they are not based on points of law but on factual - - matter:s which- are- not--self-pro0f. AH of- them require evidence to be established .. That being the case, they do not qualify to be termed r~= .•..c-~.' -~="prehrfi1nafy45t5Ject1on····1n ""l1ne•-•with''the fiold1ng·· ·of·t11e~--rahdmar1<·case ~ ·or'~m~U~->~--.. -d ·Mukisa Biscuits Manufacturing Company Limited Vs. West End Distributors Limited [1969] EA 696. In the alternative, Mr. Nuhu responded to each particular ground of the preliminary objection starting with the first one that,· the order which they are moving the Court to revise is the one which was made on the 19th day of May, 2016 whereby,· the Court refused to stay the. proceedings to await arbitration process. This order in his submission, is not among appealable orders listed· under the provisions of section 5 (1) (b) of the AJA. He submitted further that, in case the Court would be satisfied that the order is appealable, he- i.mplored us to treat it as a special case with 9 exceptional circumstances in line with what was held in the case of Moses Mwakibete Vs. the Editor of Uhuru, Shirika la Magazeti ya Chama and National Printing Company Limited [1995] TLR 134, due to the . number of irregularities that were occasioned in the conduct of the matter by the trial Court and thereby, causing serious confusions. He named such irregularities to include, . ·mixing submissions in respect of the main -Commercial-Case and the Miscellaneous Commercial cause. On the second ground of the preliminary objection that the order was · amena51e ""by' way~ of review,, m·lne vievr~·dr~tffe·,1ea-rneff~·cckfnseY'for' the applicant, it was not for the reason that, many things had been lumped together by the trial Court. In that regard, the learned counsel went on to submit, the decisions which have been relied upon by his learned friend to buttress his contention were· distinguishable to the circumstance of the case at hand. · Mr. Nuhu did as well challenge the third ground of the preliminary objection by arguing that, the proceedings alleged by his learned friend to be pending at the High Court were illegal from the fact that, they were commenced subsequent to the illegal order of the High Court delivered on the 19th May, 2016, which is the one being challenged in the. instant 10 application. And, on the· fourth ground of the preliminary objection, the learned counsel for the applicant argued that, this Court is vested with powers to grant the sought reliefs. To that end, he strongly urged us to dismiss the preliminary objection with costs, and proceed to hear the merits of the application. · At issue for the Court to·determine in the light of what was submitted from either side above, is whether or not the notice of motion before us is maintainable. The order of the High Court dated the 19th day of May, 2016 which .is sought t0 be revised be~:ffs'ltYefolfowingworaYFig:-""·'"~·-, ..._.._._.,.c'_~...""-'..-- · ''Both the applicant and the respondent had a joint responsibility to initiate and pursue the arbitration. Since parties are not interested to go to arbitration. as per their contract clause, the Court finds it has no reasons to stay the bearing of the application for an order of temporary injunction and the main suit ✓' What we discern· from the wording in the above quoted order .of the I High Court is that, the basis. for the applicant to require our intervention in the proceedings of the High Court is the refusal by the High Judge to stay the proceedings. The subsequent question which does crop up, is as to I whether or not such order was appealable. Premising our views on the 11 stipulation under the provision of section 5 (1) (b) (v) of the AJA, we hold that the order was appealable without leave. The said provision reads ipsissima verba thus: ''5 (1) In civil proceeding~ except where any other written law for the time being in force provides otherwise, an appeal shall lie to the Court of Appeal- {a) n/a {b) against 'the~following-arders of the .High Court, made under~its original jurisdiction that is to say- {i) n/a {ii) n/a {iii) n/a {iv) · n/a (v) An order staying or refusing to stay a suit where there is an agreement to refer to arbitration. [Emphasis supplied] The position of law in regard to appealable orders is well settled. In the case of Moses Mwakibete Vs. the Editor, Uhuru, Shirika la 12 ... ' Magazeti ya Chama and National Printing Company Limited (supra) the Court stated that: "The revisionalpowers conferred to the Court under the then section 2 (3) {now section 4 {3}} of the AJA, are not meant to be used as an alternative to the appellate jurisdiction of the Court. Accordingly, unless acting on its own motion/ the Court cannot be moved-- to use -its revisional jurisdiction under • section 2 (3) in cases where the applicant has the ,. ___ titlbt .at.appeal ,wfth,.or ;.without-lezive"'aild has· not exercised that right" And, in a later decision of Halais Pro-Chemie Vs. Wella A. G. (1996] TLR 269, the Court did move fu_rt~er whereby, it laid down some pre-requisites in which a party may move the Court to invoke its revisional jurisdiction that is: first, in matters which are not appealable with or without leave, and secondly, in a situation where the appellate process has been blocked by judicial process. The foregoing settled position of law notwithstanding, we are in agreement with the submission of the learned counsel for the applicant that, there are certain situations wherein, the Court can be moved to invoke its revisional jurisdiction even though the right of appeal lies. This 13 can happen in exceptional circumstances put to the Court by the applicant. The holding in the case ·of Halais Pro-Chemi (supra), has put such situation in the following words that is; ''Except under exceptional circumstance~ a party to proceedings in the High Court cannot invoke the revisional jurisdiction of the Court as an alternative to the appellate jurisdiction of the Court. ,✓ With the foregoing position in mind, we had-to ask ourselves if in the ..application-.-at.,'.hand,1 .tbe:'capplicaiifhas managed to demonstrate any such situation. The grounds of the notice of motion which we think are relevant to the determination of this application are those contained in paragraphs 4 to 7 of the notice of motion which read: , ' 4. The Commercial Court erred in law in holding that the parties were duty bound to initiate the arbitration after the Court had stayed the suit for thirty days. 5. The Commercial Court erred in law in failing to enforce the negative aspect of the arbitration agreement meaning that the grant of. a stay in court proceedings must not be conditional on the 14 . existence or commencement of any .arbitration proceedings. 6. The Commercial Court erred in putting a time limit on the referral of the dispute to arbitration. 7. The Commercial Court was functus officio and erred in law to resume Jurisdiction and order the case to proceed after it had stayed the suit on the 31st day of March 2016. In regard to the affidavit sworn by Mr. Alexandre Macedo in support . . of the,·notice,.,,of:+mofi6n;,,,,we":;have noted .<that the. twenty. paragraphs -"-- ,.:. "" . . . . . . . ., .. '_., contained therein, are a narration of the sequence of facts in regard to the contract which was concluded between the applicant and the respondent, and the rise of the subsequent misunderstanding, which culminated to the lodgment of the civil suit in the High Court (Commercial Division), and what proceeded thereafter resulting to the disputed order. The same story is noted to have been recapitulated· in the affidavit of learned counsel Mr. Nuhu Mkumbukwa, in support of the same notice of motion. From the contents of the notice of motion herein above .shown and the affidavits in support of the notice of motion, it is apparent to us that, neither in the notice of motion nor in the affidavits in support of the notice 15 From the position held in the first ground of the preliminary objection above, it is our feeling that, the need to discuss the remaining other grounds of the preliminary. objection does not arise. To that end, the preHminary objection which was raised by the respondent is hereby sustained. Consequently, the application by the applicant is struck out, and we direct the respondent to have its costs. Order accordingly. DATED at DAR ES SALAAM this 31 st day of May, 2018. M.S. MBAROUK . . . . - . . ji.isrtc'f OF APPEAi.. A.G. MWARIJA JUSTICE OF APPEAL S.S. MWANGESI JUSTICE OF APPEL I certify that this is a true copy of the original. E.F. DEPUTYR RAR COURT OF EAL 17