| dc.description | PRIME CATCH (EXPORTS) LIMITED AND OTHERS VERSUS DIAMOND TRUST BANK TANZANIA LIMITED COURT OF APPEAL OF TANZANIA AT PAR ES SALAAM
CIVIL APPEAL NO. 273 OF 2019.
(Appeal from the Judgment and Decree of the High Court of Tanzania, Commercial Division at Dar es Salaam (Seheli) dated the 15th day of May, 2017 in Commercial Case No. 93 of 2016)
CORAM: MUGASHA, J.A, LEVIRA, J.A. and MWAMPASHI. J.A.
FLY NOTES:
Law of contract-Appeal-breach of contract –summary suit- Whether parties who were not privy to the mortigage deed may be impleaded in a summary procedure and summary judgement entered against them
Appeal-breach of contract-summary suit-whether the Appellants was denied right to be heard
Appeal-breach of contract-summary suit-whether the trial court was proper to inter summary judgement
BRIEF FACTS
This appeal is against a summary judgment and decree entered by the High Court (Commercial Division) at Dar es Salaam (the trial Court) in Commercial case No. 93 of 2016 dated 15th May 2017. In that decision, the trial court allowed all the respondent's claims against the appellants and ordered as follows:
1. Judgment in favour of the plaintiff against all the defendants jointly and severally for Payment of USD 237,389.27 p/us Tshs. 466,591,656.33;
2. Interest at a rate of 12% per annum on aforesaid sum of USD 237,389.27 and Tshs. 466,591,656.33 from 28* day of June, 2016 until the date of judgment
3. Interest at court's rate of 7% from the date of judgment untii the date of full satisfaction of the decretal amount; and
4. Costs of die suit
It is on record that on 13th December 2010 the respondent advanced to the first appellant a credit facility of USD 900,000 repayable within five years in sixty equal monthly installments. The second to fifth appellants guaranteed the loan. Apart from that, the first appellant mortgaged his four properties located on plots Nos.2, 3, 4 and 5 Block "A" Bukangala Area, Musoma Township with Titles No. 11815, 11816, 13728 and 13729. However, it turned out that the first appellant defaulted the payment of the said loan and the respondent on 4th March, 2016 issued a statutory notice of default on the first appellant in terms of section 127 of the Land Act, No.4 of 1999. Thereafter, the respondent filed a summary suit in the trial court against all the appellants. Since the appellants had no automatic right to appear and defend the summary suit, they filed an application for leave to appear and defend under Order XXXV Rule 3(l)(b), Rule 3(2) and section 95 of the Civil Procedure Code, Cap 33 R.E. 2002 (the CPC), but the same was struck out for non-citation of proper provision of the law. As a result, the trial court proceeded to enter summary judgment against the appellants. Aggrieved, the appellants filed Civil Appeal No. 189 of 2017 which was struck out for being time barred. Later, vide Miscellaneous Commercial Cause No. 222 of 2018, the appellants were granted leave to file their appeal out of time, hence the present appeal with the memorandum of appeal which comprises four grounds including
“ That the trial Court grossly erred in law in entering summary Judgment against ail the defendants while the suit involved partly mortgage and partly guarantors who were not parties to the mortgage hence, unlawfully depriving the guarantors ( 2nd , 3rd , 4th and 5th ) defendants their fundamental right to be heard and or defend."
At the hearing of the appeal, the appellants were represented by Mr. Ruben Robert, learned advocate while Mr. Zacharia Daudi, also learned advocate, represented the respondent. The Applicant counsel submitted that the gist of the first ground of appeal is that the impugned judgment was wrongly entered against the parties who were not privy to the mortgage deed. He went on to state that the only parties to the mortgage deed were the first appellant and the respondent. He referred us to pages 84-85 of the record of appeal where it is clearly shown that only the said two parties executed the mortgage deed. In the circumstances, he argued, the summary suit was incompetent as it impleaded parties who were not privy to the mortgage deed and the summary judgment was erroneously entered against other appellants, that is, the second, third, fourth and fifth appellants. According to him the guarantors were condemned unheard contrary to Article 13 (6) (a) of the Constitution of the United Republic of Tanzania 1977. Mr. Daudi opposed the appeal arguing that, since a guarantee is similar to a promissory note, a summary suit can be instituted against the guarantor.
Appeal allowed
ISSUES
1. Whether parties who were not privy to the mortgage deed may be impleaded in a summary procedure and summary judgement entered against them
2. Whether the appellants was denied right to be heard
3. whether the trial court was proper to inter summary judgement
HELD
1. Therefore, the appellants were denied their fundamental right to be heard in what culminated into a summary judgment against them.
2. On the basis of what we have endeavored to discuss above, we find the appeal is merited. Consequently, we allow it and hereby set aside the summary judgment entered on 15th May, 2017. The High Court is directed to determine the suit as an ordinary suit according to the law.
STATUTORY PROVISION REFEERED TO:
1. Order XXV Rule 1 (c) (i) ,Order XXXV Rule 3(l)(b), Rule 3(2) and section 95 of the Civil Procedure Code, Cap 33 R.E. 2002
2. Article 13 (6) (a) of the Constitution of the United Republic of Tanzania 1977
3. Section 78 of the Law of Contract Act, Cap 345 R.E. 2019
4. Bills of Exchange Act, Cap 215 RE 200
CASE LAWS REFEERED TO:
1. R.S.A Limited v. Haspaul Automechs Limited and Govinderajan Senthil Kumal, Civil Appeal No. 179 of 2016 (unreported).
2. Jomo Kenyatta Traders Limited and 5 others v. National Bank of Commerce Limited, Civil Appeal No.48 of 2016 (unreported).
3. Prosper Paul Massawe and 2 Others v. Access Bank Tanzania Limited, Civil Appeal No.39 of 2014 (unreported).
4. The Republic v. Mwesige Geofrey Tito Bushahu, Criminal Appeal No.355 of 2014 (Unreported)
5. Geita Gold Mining Limited v. Commissioner General Tanzania Revenue Authority, Civil Appeal No. 132 of 2017 (unreported).
6. Mbeya Rukwa Autoparts and Transport Ltd v. Jestina George Mwakyoma [2003] T.LR. 253
7. Transport Equipment Limited v. Devramp Valambhia [1998] T.L.R. 89
8. Abbas Sherally and Another v. Abdul Sultan Haji Mohamed Fazal Boy, Civil Application No. 33 of 2002 (unreported).
9. Connect Cut Nat'l Bank v. Germain, 112 s.ct.1146, 1149 (1992
BOOKS REFEERED TO:
Anson's Law of Contract 25th Edition (Century Edition) by AG. Guest, M.A. at Page 461- 462."
Mr. Ruben Robert, learned advocate for Appelant
Mr. Zacharia Daudi learned advocate for the responden | en_US |
