Dangote industries win appeal against paying 350m/-

DAR EES SALAAM: DANGOTE Industries Limited Tanzania has won her appeal challenging court’s decision for payments of 350m/- in favour of Warnercom Tanzania Limited in a dispute involving transportation of goods from Songea to Mtwara and Mtwara to Dar es Salaam.

In a judgment delivered in Dar es Salaam recently, the Court of Appeal ruled that the Resident Magistrates’ Court of Kinondoni, which heard the dispute in the first instance, lacked jurisdiction of exercising such power.

“The suit before the trial court was a commercial case involving a sum of 200m/- beyond its pecuniary jurisdiction. “…the course open to the first appellate court (High Court) was to quash the trial court’s decision and the proceedings for being a nullity,” Justices Shaban Lila, Lugano Mwandambo and Lucy Kairo ruled.

The justices set aside the first appellate court’s decision; the trial court had no jurisdiction to try the suit with the net effect that, the trial and the resultant judgment and decree were all a nullity.

They declared the trial before to the trial Resident Magistrates’ Court at Kinondoni a nullity and quash the judgment and set aside the resultant decree.

During hearing of the appeal, the counsel for Dangote Company, the appellant, had submitted that the High Court judge erred in law in holding that the Resident Magistrates’ Court acted within its pecuniary jurisdiction by entertaining the suit which was commercial in nature.

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The counsel argued that the claim involving the matter, which is 200m/- exceeded the trial court’s pecuniary jurisdiction of 70m/-, contrary to section 40 (3) (b) of the Magistrates’ Court Act (MCA).

He also submitted that the High Court judge erred in law and in fact in holding that the contractual relationship between the appellant and Warnercom Tanzania, the respondent, did not meet the threshold of being a civil case with commercial significance. In their judgment, the justices endorsed the submission by the appellant’s counsel and held that, the first appellate court made an error in holding that the suit was an ordinary civil case not covered by section 2 and 40 (3)(b) of the MCA.

“On the contrary, we are satisfied that the suit had commercial significance involving an amount of more than 70M/- which was beyond the pecuniary limit of the trial Resident Magistrates’ Court in terms of section 40 (3) (b) of the MCA,” they said.

According to the plaint, the appellant engaged the respondent for transportation of its goods from Songea to Mtwara and Mtwara to Dar es Salaam sometime between October and December 2015. The plaint alleged further that, despite the respondent performing its obligations under the contracts, the appellants failed to pay for the contracted services which triggered in the suit founded on breach of contract.

The respondent prayed for assortment of reliefs, including a declaration that the appellant was in breach of the contract and a claim for 200m/- each in special and general damages plus interest and costs.

Instead of filing a written statement of defence, the appellant challenged the suit by way of a preliminary objection contending that the trial court had no pecuniary jurisdiction to entertain the suit on the strength of section 40 (3) (b) of the Magistrates’ Court Act.

Nevertheless, the trial court struck out the objection for being improperly raised. Consequently, in the absence of a written statement of defence, the trial court proceeded with ex-parte hearing under Order VIII rule 14 (1) of the Civil Procedure Code (CPC).

After the ex-parte hearing, the trial court found the suit proved on the required standard and entered judgment for the respondent and awarded him 200m/- and 150m/- in special and general damages, respectively upon finding the appellant breached the said agreement.