HAJI ASSOCIATES COMPANY (T) LTD. AND ANOTHER v JOHN MLUNDWA 1986 TLR 107 (HC)

HAJI ASSOCIATES COMPANY (T) LTD. AND ANOTHER v JOHN MLUNDWA 1986 TLR 107 (HC)

Court High Court of Tanzania - Mwanza

Judge Mwalusanya J

E

6 July, 1987.

CIVIL CASE 13 OF 1985

Flynote

Tort- Damages - Assessment of - Quantum

-Headnote

F A defamatory letter by the defendant concerning the plaintiffs resulted in the latter losing

considerable business. In a suit for damages the plaintiffs claimed shs.1,500,000/= as general

damages.

G Held: (i) General damages are compensatory in nature as they are intended to take care of

the plaintiffs loss of reputation as well as to act as a solatium for mental pain and suffering;

(ii) a compensation of Shs.1,500,000/= is a reasonable one in the circumstances of this

case.

Case Information

H Judgment for the plaintiffs.

Cases referred to:

1. Haji Associates Co (T) Ltd. v Registrar of Companies (Mwanza, Misc. Civil Appl 9

of 1985). I

2. Bowman v Secular Society [1917] A.C. 406.

1986 TLR p108

MWALUSANYA J

A 3. Chimala Stores v Zambia-Tanzania Road Services Ltd. [1970] H.C.D. n.232.

4. Jonathan v Athumani Khalfan [1980] T.L.R. 175

5. Novati s/o Joseph v Sebastian Muzo [1978] L.R.T. n.14.

[zJDz]Judgment

B Mwalusanya, J.: This is a suit for damages for defamation concerning a libel. The two

plaintiffs namely Haji Associates Company (T) Ltd. (1st plaintiff) and Haji s/o Mugishagwe (2nd

plaintiff) are claiming general damages in the sum of Shs.1,500,000/=.

C The preliminary point raised by the defendants in their Written Statement of Defence is that

the incorporation of the 1st plaintiff is null and void because the Memorandum and Articles of

Association of the company were signed inter alia by two minors; and because the incorporation

was obtained by false pretenses and/or fraud.

D I don't agree that the incorporation is null and void. I stick to what I held in the case of Haji

Associates Co. (T) Ltd. v Registrar of Companies Mwanza Misc. Civil Application No. 9 of 1985

(unreported) that once a certificate has been granted no one can question the regularity of

incorporation. That is the import of s. 16 of the Companies Ordinance, E Cap. 212. I suggested

in that case following the decision of the House of Lords in Powman v Secular Society [1917]

A.C. 406 at p. 439 that the only way to challenge the incorporation of a company is by way of

prerogative orders, e.g., certiorari, mandamus and prohibition. Therefore the preliminary point

fails. F

Now what are the issues to be proved to establish the tort of defamation concerning libel? These

are:-

1. First there should be communication to third parties.

G 2. Does the publication or communication refer to the 1st plaintiff as well?

3. Whether the statement or publication is calculated to injure the reputation of

another by exposing him to hatred, contempt or ridicule.

H 4. If the communication was made while on qualified privilege then malice must be

proved.

5. Is the defence of justification available to the defendants?

6. Is the defence of fair comment available to the defendants?

I The first issue as regards communication to third parties I find it uncontroverted. The letter

which defendants wrote is Exh.

1986 TLR p109

MWALUSANYA J

A B2 in Court and clearly indicates that it was communicated to nine different people or

organizations. So I answer the first question in the affirmative.

Concerning the second issue I also answer it in the affirmative as the letter exh. B 2 is selfexplanatory.

The heading of that letter reads: "Re: M/S Haji Associates Company (T) Ltd." and

therefore it cannot be gainsaid that the 1st plaintiff B was not the subject matter of that letter.

On the third issue I also answer in favour of the plaintiffs. The publication reads:

C It appears that Haji Mugishagwe has presented himself as the only qualified Architect in

Mwanza and has a successful 'practice' in Mwanza which is illegal. He has even swindled clients

by charging them up to 1000% of legal fees. Haji's claim is for sh.588,060/40 which should also

come to sh.40,000/= has reached me by coincidence from my client who has disputed his D

claim.

I agree with plaintiffs' counsel Mr. Kahangwa that those words in their natural and ordinary

meaning import that the E plaintiffs are operating an illegal practice, they are swindlers and

overcharging their clients. And obviously that is a very bad reputation of the company and its

Managing Director. The publication obviously tended to lower the plaintiffs in the estimation of

right-thinking members of society generally. F

We go to the fourth issue. Was the publication made under qualified privilege? In my view

only the communication to the Registrar of Board of Architects, Quantity Surveyors & Building

Contractors was privileged because there was reciprocal interest. I agree that the defendant as

an architect and a registered member of the National Board of G Architects, Quantity

Surveyors and Building Contractors was duty bound and had an interest in informing the Board

or making it aware of any practices that may not appear acceptable practices and procedures of

the profession and in particular as in this matter where the issue of calculation of fees is

concerned. However that qualified privilege was H destroyed by malice as he was reckless in

his publication. By publication of a false statement like - that the plaintiffs were operating an

illegal practice obviously destroyed the qualified privilege - see Chimala Stores v Zambia -

Tanzania I Road services Ltd [1970] H.C.D. n. 232. The plaintiffs are in fact doing their

business legally. They

1986 TLR p110

MWALUSANYA J

A are registered and have their business licence alright. And again the qualified privilege is

destroyed because the communication was made to persons other than the Board. That

communication to unconcerned people like Town Director Bukoba or Municipal Director

Mwanza was not privileged at all - see the case of Jonathan v Athuman Khalfan [1980] T.L.R.

175 by Lugakingira J. That sufficiently answers issue number four. B

Now issue number five says, is the defence of justification available to the defendants? I don't

think so. As this Court stated in the case of Novati s/o Joseph v Sebastian Muzo [1978] L.R.T. n.

14 (Mfalila J.) for the defence to succeed C the defendant must prove that the allegations were

true, made in public interest and not motivated by malice. As I have mentioned above it is not

true that the plaintiffs are operating an illegal practices; they are operating legally. Therefore

the defence of justification equally fails.

D Finally is the defence of fair comment available to the defendants? For the defence of fair

comment to succeed it should have been made in good faith and without malice upon a matter

of public interest namely the professional conduct of the plaintiffs. As I have said above the

defendant in this case was motivated by malice because he was reckless in his E language. It

was not fair comment to state that the plaintiffs operate an illegal business a fact which is not

true. I accordingly reject that defence.

In the event, I find the defendants liable. Now to what relief are the plaintiffs entitled to? Libel

is actionable per se in that F you don't have to prove damages. And general damages are

compensatory in nature; they are intended to take care of the plaintiffs loss of reputation as well

as to act as a solatium for mental pain and suffering. The plaintiff's have stated that their

otherwise successful business was substantially affected by that defamation. Many potential

clients began to decline G to offer them business, e.g., Kauma as evidenced in their letter Exh.

E. And the interesting thing is that the defamatory letter was addressed mostly to the plaintiffs'

clients. The other effect of the letter was that Mwanza Municipal Council refused them a

business licence for two months (see Exh. C and Exh. D) until it was clarified that the plaintiffs

were in fact H operating legally. It is said the turnover per year of the 1st plaintiffs' company is

about sh. 60,000,000/=. The defendants themselves have conceded in their defamatory letter

that plaintiffs were conducting a 'successful practice' though an illegal one. For the reasons

given, I find that a compensation of sh.1,500,000/= is a I

1986 TLR p111

A reasonable one. I accordingly enter judgment for the plaintiffs as prayed plus costs of the

suit.

Order accordingly.

1986 TLR p111

B