Sisal Kamba Spinning Company Ltd v. TPM Ltd Civ no 9 of 2004 (Loans Recovery)

IN THE COURT OF APPEAL OF TANZANIA

AT DAR ES SALAAM

(CORAM: MUNUO J.A, KAJI J.A AND KILEO J.A)

CIVIL APPEAL NO. 9 OF 2004

                 SISAL KAMBA SPINNING COMPANY LTD.

(Under Receivership) ……………………………………APPELLANT

VERSUS

TPM (1998) LIMITED…………………………………RESPONDENT

(Appeal from the Judgment and Decree of the LART Loans Recovery Tribunal from the High Court of Tanzania at

Dar es Salaam)

(Msoffe J., Chairman and Mr. Bakilana, Member)

 Dated the 7^th day of October, 2003

in

Tribunal Case No. 13 of 2002

-------------------------------------

JUDGMENT OF THE COURT

KILEO, J.A.:

The dispute, which culminated in this appeal, is centered on contract.  The appellant lost in a petition, which it filed in the LART Loans Recovery Tribunal in which it was claiming for the balance of purchase price, interest and costs under a contract of sale of land at Mnazi, Korogwe in Tanga Region.  The land that was sold under the contract comprised of a factory building, outdoor works together with furniture and other materials, plant and machinery, canteen, dispensary, staff quarters, laborers’ quarters and an open yard for brushing and drying sisal fiber.  The purchase price as per the sale agreement was seventy million shillings.  Before the dispute arose the respondent had paid a total of shs twenty million and the balance of shs fifty million remained to be paid. This amount was to be paid within a period of one month after the purchaser being notified of the availability of the title deed.  Following the payment of 20 million shs the appellant handed over the property specified in the sale agreement less the open yard for brushing and drying sisal fiber.  The yard was item no 7 on the list shown as civil works in annex 1 to the sale agreement.  The hand over was done on 01/04/2000. It is on record that item 7 “was not in the map and was not taken over.” By 31^st July 2002 a title deed in the name of M/S Sisal Kamba Spinning Company Ltd had been obtained and was ready for transfer to the respondent. The respondent was then called upon to pay the balance of shs 50,000,000/= but it declined to do so on account of the fact that the petitioner had not handed over all the assets of the petitioner as per sale agreement.  The LART Tribunal found that the petitioner had breached the contract by not tendering to the respondent for transfer all land intended to be sold. The petition was in the circumstances dismissed with costs. It is against that dismissal that this appeal has been preferred.

Mkoba & Company Advocates represented the appellant at the hearing of the appeal. It is also the firm, which represented them in the LART Tribunal. There are three grounds on the memorandum of appeal:

·        That the Tribunal erred in law and in fact in not determining properly the reliefs to which the appellant is entitled.

·        That the Tribunal erred in law and in fact in failing to order specific performance of the contract.

·        That the Tribunal erred in law and fact by holding that the appellant breached the terms of the contract in failing to deliver the open yard while the respondent bought the property on an “as is where basis”.

Mr. Mkoba argued the three grounds of appeal together. He contended that the Tribunal did not take into account the clear wording of the sale agreement. He pointed out that the vendors sold the property on “as is where” basis. He also argued that the fact that the open yard for brushing and drying sisal fiber was not in the map should not be taken to mean that there was breach because, according to him “the yard is there, only that it is not in the map.” He went further to suggest that if there were any breach it would have been taken up at the time of handing over which was done in 2000 while the certificate was ready in 2002. The learned counsel further submitted that the Tribunal ought to have ordered specific performance considering that the respondents have had the property since 2000. Mr. Mkoba stressed that in the circumstances the respondents have an obligation to pay for the property.

Mr. Ntonge, learned advocate represented the respondent at the hearing of the appeal. He argued that the appellant has so far failed to perform its obligations under the sale agreement in that the yard which is an important item listed in the sale agreement has not been handed over.  Mr. Ntonge further submitted that since item no 7 in the list of items that were to be handed over is yet to be handed over then the demand for the balance is premature.

Two issues for determination were framed at the Tribunal:

·     Whether the parties have discharged their respective obligations under the contract.

·     To what reliefs are the parties entitled.

We are of the considered opinion that the trial Tribunal correctly found that the appellant had not discharged its obligations under the contract because it did not tender to the respondent for transfer all land intended to be sold. The property that was to be handed over is as listed in paragraph “E” of the Sale agreement. The handed over list was incomplete, particularly with respect to the open yard.  Mr. Mkoba argued that the property was sold on “as is where is basis” but with due respect to the learned counsel, the property had to be there in the first place. It was not there. In the circumstances we agree with the learned counsel for the respondent that the appellant rushed to the Tribunal prematurely in view of the fact that it was yet to discharge one of its obligations under the contract.

Mr. Mkoba also challenged the decision of the Tribunal for not making an order for specific performance. Our response to this argument is simply that the Tribunal would not be justified to order specific performance in view of the fact that it had found, rightly so, that the appellant had not discharged one of its obligations under the contract.  An order for specific performance would have been in order if the appellant had discharged all its obligations under the contract. Very unfortunately it had not done that.

In the light of the above we find this appeal to be wanting in

merit and we accordingly dismiss it with costs

DATED at DAR ES SALAAM this 13^th day of October, 2006 

E. N. MUNUO

JUSTICE OF APPEAL

                                   

S. N. KAJI

JUSTICE OF APPEAL

E. A. KILEO

JUSTICE OF APPEAL

        I certify that this is a true copy of the original.

S. A. N. WAMBURA

SENIOR DEPUTY REGISTRAR

View other posts for your benefit...