(CORAM: MUNUO, J.A., NSEKELA, J.A., And KAJI, J.A.)
PRESIDENTIAL PARASTATAL SECTOR
AZANIA BANCORP LIMITEDcccccccccccc RESPONDENT (Appeal from the decision of the High Court of Tanzania ? (Commercial Division) at Dar es Salaam)
This is an appeal against the judgment of Kalegeya, J., in Civil appeal No. 277 of 2002 in which he entered judgment jointly and severally against the first defendant, Building Hardware and Electrical Supplies Limited (BHESCO) and the second defendant, Presidential Parastatal Sector Reform Commission (now appellant) BHESCO did not prefer any appeal. The facts leading to this appeal may be briefly stated as follows. The plaintiff/respondent, Azania Bancorp Limited extended credit facilities to BHESCO a specified public corporation who purportedly accepted an offer from the respondent amounting to Shs. 250,000,000/= on the 6.2.2001. There was an additional credit facility dated the 8.3.2001 for Shs. 50,000,000/= thus making a total of Shs. 300,000,000/=. To secure this credit facility, BHESCO executed a Mortgage of a Right of Occupancy, Certificate of Title No. 186066/76 & 186066/70 Plot No. 70 & 76 Gerezani Industrial, Dar-es-Salaam. BHESCO defaulted in the repayment of the credit facility leaving an outstanding liability of Shs. 352,798,513/40 due and owing to the respondent. Consequently, the respondent filed a summary suit under Order XXXV of the Civil Procedure Code, 1966. The High Court, Commercial Division, (Dr. S.J. Bwana, J.) granted to both the defendants leave to appear and to defend the suit.
The decision of the High Court was challenged on three grounds, namely that ?
At the hearing of the appeal Mr. Fungamtama, learned advocate for the appellant, argued the three grounds of appeal generally rather than arguing one ground after another. The cornerstone of the appeal however seemed to revolve around section 40A (1) (g) and (m) of the Public Corporations Act, 1992 as amended (the Act). The learned advocate contended that under the Act, a specified public corporation is debarred from doing certain prescribed transactions without the approval of the appellant. He added that the learned judge did not specifically refer to section 40A (1) (g) of the Act in his judgment. The learned advocate was of the opinion that the use of the word gexpressh in this provision indicated that it was mandatory for BHESCO to seek and obtain such approval before entering into the prescribed transactions, which are the subject matter of this appeal. Furthermore, the learned advocate submitted that when the Letter of Offer and Acceptance; Mortgage of a Right of Occupancy were executed, Act No. 17 of 1999 had already been enacted and so the respondent was well aware of the requirements of the Act.
Mr. W. Chipeta, learned advocate for the respondent, strongly countered Mr. Fungamtamafs contentions. He was of the view that the learned judge correctly found that the appellant had impliedly consented to BHESCO entering into the disputed transactions. BHESCO did not ask for the necessary approvals but the agreement between BHESCO and the respondent remained intact. The anchor of Mr. W. Chipetafs submissions, was the decision of this Court in Misc. Civil Appeal No. 1 of 1999, Abualy Alibhai Aziz v. Bhatia Brothers Limited (unreported). In conclusion, the learned advocate submitted that the appellant as Official Receiver, was jointly and severally liable to settle the liability of BHESCO.
Before we proceed to consider and determine the merits or otherwise of the appeal, we think that it is desirable that we should first examine the sequence of the proceedings upon which the judgment of the High Court was founded.
On the 26.3.2003, an amicable settlement of the dispute was not achieved during the final pre-trial and scheduling conference. Then Order VIIIB rule 3 (4) came into play and the High Court framed and recorded issues according to the provisions of Order XIV of the Civil Procedure Code. The following four issues were framed and recorded, namely ?
4. To what reliefs are the parties entitled to.
• • • • •
By consent of the parties hearing of the case was scheduled to be held on the 13th ? 14th/5/2003. For various reasons, hearing of the case did not take place as scheduled until the 30.3.2004. We take the liberty to reproduce the proceedings on this date.
By consent, joint memorandum to be filed by 2.4.2004
Defendants to file their written submissions by 16.4.2004
Plaintiffs to file their written submissions by 30.4.2004
Rejoinder, if any, by 7.5.2004
Judgment on notice
The learned judge did not indicate in this Order upon what provision of the Civil Procedure Code he derived powers for the parties to file a joint memorandum of facts not in dispute, then skip the taking of evidence from witnesses. Instead, the parties were required to file their respective written submissions, on the basis of which judgment was pronounced by the learned judge. The learned advocates duly complied with the time frame as prescribed by the court. However, the first document to be filed, that is, the joint memorandum, was not filed. This meant that the purported agreed facts not in dispute were not before the court. Obviously, as night follows day, all the facts were then in dispute!
We have not been able to find on the record that any party to this suit, by notice in writing, did call on any party to admit for the purposes of this suit any fact or facts. In any event, Order XII Rule 3 above does not provide a procedure of jointly filing a memorandum of agreed facts by the parties. Even then, the learned advocates did not file any joint memorandum as per court order. This means that there were no agreed facts before the court.
We now come to Order XIV rule 2 of the Civil Procedure Code. It provides as under ?
The question is, what were the issues of law that the court wanted to dispose of first? It will be recalled that on the 30.3.2004 the learned advocates for the parties put forth an intriguing proposal to the court that the facts before the court were not in dispute and so based on the issues framed, the court should decide the issues of law. We however now know for a fact that there were no such issues of fact agreed upon. The issues of law were apparently the four issues framed and recorded by the Court on the 30.3.2004. Issues 1 and 2 are at the core of the dispute. The question of approval of the agreements in dispute is a very contentious issue in the pleadings. These issues cannot in our considered view, be decided as purely legal issues without recording the evidence. The court was enjoined to make findings of fact first and then apply the law to the facts as established by evidence. The issue of whether or not the appellant gave approval to BHESCO goes to the root of the case and this cannot be disposed of as an issue of law only under Order XIV rule 2 of the Civil Procedure Code. In the absence of evidence, disputed matters of mixed law and fact cannot be resolved by considering written submissions of learned advocates only (see: (CAT) Civil Appeal No. 4 of 1983, Board of Internal Trade v. M/S G.B.L. & Associates Limited (unreported)).