Camusat Tanzania Limited vs SB Merali Company Limited (Civil Application No. 324 of 2026) [2026] TZCA 265 (6 March 2026)

IN THE COURT OF APPEAL OF TANZANIA AT PAR ES SALAAM CIVIL APPLICATION NO. 324 OF 2026 CAMUSAT TANZANIA LIMITED................................................................ APPLICANT VERSUS SB MERALI COMPANY LIMITED............................................................ RESPONDENT (Application for an ex parte order for stay of execution of the default judgment and decree of the High Court of Tanzania (Commercial Division), at Dar es Salaam (Gonzi, J.) dated the 13th day of June, 2025 in Commercial Case No. 19039 of 2024 RULING 2n d & 6th March, 2026 MGONYA. 3.A.: This application arises from Commercial Case No. 19039 of 2024 instituted before the High Court of Tanzania, Commercial Division. In the said suit, the Honorable Gonzi, J., delivered a default judgment and decree on 13th June, 2025 in favor of the respondent. By that judgment, the court declared that the applicant had breached the contract entered into between the parties and consequently awarded the respondent relief amounting to TZS. 483,626,753.40. Being dissatisfied with the whole of the said default judgment and decree, the applicant, on 10th July, 2025, lodged a Notice of Appeal before this Honorable Court signifying its intention to challenge the entire decision.

On the same date, the applicant further addressed a formal request to the High Court seeking to be supplied with certified copies of the judgment, decree, proceedings, admitted exhibits, and other relevant documents for the purpose of preparing and prosecuting the intended appeal. It is deponed that on 16th February, 2026, the applicant's banker, Bank of Africa Tanzania Limited, served upon the applicant a copy of a Garnishee Order Nisi issued in respect of the payment of a decretal sum of TZS. 483,626,753.40 arising from Commercial Execution Application No. 22904 of 2026. The said Garnishee Order Nisi attached the Applicant's Bank Account No. 02055760012, maintained at Bank of Africa Tanzania Limited, NDC Branch. It is this Garnishee Order Nisi that prompted the filing of the present application, wherein the applicant seeks an order of this Honorable Court staying execution of the said decree pending the hearing and determination of Civil Appeal No. 35 of 2026 before this Court. The application has been instituted by way of a Notice of Motion, supported by an affidavit sworn by Ms. Lizian Mushi, the applicant's Head of Legal Department and Principal Officer. 2

At the hearing of the application, the applicant was represented by Dr. Jacktone Koyugi, learned counsel, while the respondent had the services of Mr. Sylvanus Mayenga, learned counsel. Submitting in support of the application, Dr. Koyugi, learned counsel for the applicant, argued that the applicant prays for an order of stay of execution of the Decree issued in Commercial Case No. 19039 of 2024, pending the hearing and determination of Civil Appeal No. 35 of 2026 before this Court. The said appeal intends to challenge the entire default judgment and decree, which are presently the subject of execution proceedings. Learned counsel further submitted that the applicant has satisfied all the necessary conditions stipulated under rule ll(3)-(7) of the Tanzania Court of Appeal Rules, 2009 (the Rules). He referred to the supporting affidavit and contended that the applicant has demonstrated that a Garnishee order Nisi has been issued against the applicant's bank account with the aim of recovering the decretal sum, which is substantial in nature. He maintained that the circumstances disclosed constitute good and sufficient cause for the grant of the order sought. In elaborating on the said good causes, counsel advanced several grounds. First, he argued that if the order for stay is not granted, Civil 3

Appeal No. 35 of 2026 pending in this Court will be rendered nugatory, since the decree holder may proceed to obtain a garnishee order absolute from the executing court, thereby recovering the decretal amount of TZS. 483,626,753.40. Second, he submitted that the applicant, as the judgment debtor, will suffer substantial loss should the decretal sum be recovered before the determination of the intended appeal. Third, counsel submitted that the applicant has made a firm undertaking to provide security for the due performance of the decree. In that regard, the applicant has expressed readiness to furnish security in the form of a bank guarantee, as stated in paragraph 12 of the supporting affidavit, to satisfy the decree should the intended appeal ultimately be determined in favor of the decree holder, who is the respondent herein. Finally, counsel argued that the present application has been made without undue delay, noting that it was filed on 20th February 2026, shortly after the applicant was served with the Garnishee Order Nisi on 16th February 2026. It was the submission of learned counsel for the applicant that the applicant has satisfied the conditions prescribed by law for the Court to grant the application. In the premises, he prayed that the Court consider 4

the instant application for stay of execution and grant the order sought, contending that the decree holder would not suffer any prejudice if an order for stay of execution is granted. In reply, Mr. Mayenga, learned counsel for the respondent, while adopting the contents of the applicant's affidavit, pointed out that it is not in dispute that there is pending before this Court Civil Appeal No. 35 of 2026, of which the respondent was duly served. However, he submitted that, as provided by law, the mere existence of a pending appeal does not operate as a bar to the execution of a decree. Submitting further, learned counsel contended that, under rule ll(5)(a) of the Rules, it is incumbent upon the applicant to demonstrate the substantial loss that he would suffer if the application for stay of execution is not granted. On this point, and with reference to the relevant paragraphs of the applicant's affidavit, learned counsel argued that the affidavit in support of the application is couched in very general terms and fails to state specifically how and to what extent the applicant would suffer such loss. To fortify his submission, learned counsel cited the case of Registered Trustees of Kanisa la Upendo wa Kristo Masihi (KIUMA) v. The Registered Trustees of Kituo cha Elimu na 5

Maendeleo Matemanga (Matemanga Educational and Development Centre (KIUMA) Trust Fund), Civil Application No. 1078 of 2024. Referring to the said decision, learned counsel submitted that, at the concluding part of the ruling, the learned Judge emphasized that the alleged loss must be particularized and clearly demonstrated. According to learned counsel, in the present application, particularly in the applicant's supporting affidavit, the only matter mentioned is the decretal sum, which has been presented as the alleged loss. However, no specific facts have been provided to demonstrate the actual or substantial loss that the applicant would suffer if the stay of execution is not granted. Counsel further submitted that nowhere in the entire affidavit has the applicant sufficiently demonstrated such loss as required by law. Submitting further by reference to rule ll(7)(d) of the Rules, Mr. Mayenga contended that the said legal requirement had not been satisfied by the applicant. He argued that the Notice of Intended Execution was not attached to the application and could not be traced anywhere in the entire record of the application. It was therefore his view that, in the circumstances and in accordance with the law, it was both prudent and obligatory for the applicant to annex the Notice of Execution to the present application. 6

On account of this legal shortcoming, the learned counsel maintained that the threshold required for the grant of the application had not been met. Regarding the issue of prejudice, learned counsel submitted that, the respondent would continue to suffer prejudice as he remains barred from enjoying the fruits of his decree. Furthermore, counsel averred that the applicant had made no effort to move the Court to set aside the default judgment so as to finally resolve the dispute between the parties. In light of the foregoing, learned counsel prayed that the Court dismiss the application and refuse the order sought. In rejoinder, Dr. Koyugi, for the applicant, maintained that the applicant had clearly particularized the financial loss it would suffer if the order for stay of execution is denied. He pointed out that the relevant figures were contained in paragraphs 8 and 9 of the supporting affidavit, which specify the decretal sum that is intended to be withdrawn through the garnishee proceedings should the order sought not be granted. Referring to the case of the Registered Trustees (supra), learned counsel submitted that the authority is distinguishable from the present matter because, in that case, the specific amount of loss had not been pleaded in the affidavit. In contrast, the applicant in the present application 7

had expressly pleaded the exact amount it stands to lose should the order for stay be denied, and that is the decretal sum. Counsel further submitted that, under rule ll(5)(a) of the Rules, the applicant is only required to demonstrate the likelihood of substantial loss, and not irreparable loss. According to counsel, the substantial loss contemplated under the said provision includes, but is not limited to, the decretal amount. Consequently, by pleading the decretal sum, the applicant had sufficiently demonstrated the substantial loss it stands to suffer. Dr. Koyugi also addressed the issue of compliance with rule ll(7)(d) of the Rules. He referred the Court to paragraph 5 of the supporting affidavit, which indicates that BANK OF AFRICA TANZANIA LTD, the applicant's banker, had been served with a Garnishee Order Nisi, annexed to the affidavit as Annexure C3. Counsel submitted that the said order was sufficient to constitute a Notice of Execution for purposes of compliance with rule ll(7)(d). Moreover, counsel explained that the applicant only became aware of the execution proceedings upon being served with the said Garnishee Order Nisi. In those circumstances, it was his submission that the Rules do not require an applicant to attach the application for execution to the 8

supporting affidavit, contrary to the submissions made by learned counsel for the respondent. Finally, on the issue of prejudice, the learned counsel reiterated his submissions made earlier. He argued that the decree holder would not suffer any prejudice if the applicant is granted an order for stay of execution under the prevailing circumstances. Consequently, learned counsel urged the Court to grant the order for stay of execution as prayed for. Having carefully considered the arguments advanced by both parties in support of and in opposition to the application, I have no hesitation in stating at the outset that the applicant has complied with the requisites of rule 11(4) of the Rules. From the record, it is evident that the application was filed within the prescribed time from the date the applicant became aware of the execution proceedings through the issuance of a Garnishee Order Nisi. Accordingly, the pertinent issue for determination is whether the applicant has cumulatively complied with the requirements stipulated under rule ll(5)(a) and (b) of the Rules. In a number of its decisions, this Court has consistently held that for an application for stay of execution to succeed, the two conditions set out 9

under rule ll(5)(a) and (b) of the Rules must be cumulatively satisfied. See, for instance, David Mahende v. Salum Nassor Mattar & Another, Civil Application No. 160/17 of 2017 [2018] TZCA 459 (6 June 2018); Mohamed Enterprises T. Ltd v. Mussa Shaban Chekechea, Civil Application No. 394 of 2019 [2019] TZCA 449 (24 October 2019); and Pristine Properties Limited & Others v. ECO Bank Tanzania Limited, Civil Application No. 580 of 2021 [2023] TZCA 17267 (22 May 2023). With regard to the issue of substantial loss, the applicant has clearly deponed in paragraphs 8, 9, and 10 of the supporting affidavit that substantial loss may result if the Court does not intervene by granting an order of stay. Further, the applicant contends that the execution proceedings will paralyze its operations and render the intended appeal nugatory. Considering the applicant's assertions as summarized above, I entertain no doubt that, given the nature of the mode of execution pursued by the respondent, the issuance of garnishee orders against the applicant's bank accounts, the applicant is likely to suffer substantial loss if an order for stay of execution is not granted. Accordingly, I find that the first condition for the grant of an order of stay of execution has been satisfied. 10

Regarding the issue of security, the applicant avers in paragraph 12 of the affidavit in support of the application that it is willing to provide sufficient security for the due performance of the decree as may ultimately become binding upon it, specifically in the form of a bank guarantee. On this point, I am guided by the decision of the Court in Mantrac Tanzania Limited v. Raymond Costa, Civil Application No. 11 of 2010 (unreported), where the Court stated as follows: "To us, a firm undertaking by the applicant to provide security might prove sufficient to move the Court, all things being equal, to grant a stay order, provided the Court sets a reasonable time limit within which the applicant should furnish the same." Upon considering the foregoing excerpt and the applicant's undertaking as deponed in the supporting affidavit, I am satisfied that the applicant's expressed willingness to furnish sufficient security constitutes compliance with the requirement set out under rule ll(5)(b) of the Rules. Premised on the above findings, it is evident that the applicant has cumulatively satisfied the conditions stipulated under rule ll(5)(a) and (b) of the Rules, thereby warranting the grant of an order for stay of execution. li

The remaining issue for determination at this juncture concerns the nature of the security to be furnished by the applicant in the circumstances of the case. It is evident from paragraph 4 of the supporting affidavit that the decree sought to be executed involves payment of TZS. 483,626,753.40. It is therefore undisputed that the impugned decree, which the applicant seeks to stay, is monetary in nature. In light of this, I am inclined to agree with the submissions of learned counsel for both parties that a bank guarantee would be an appropriate form of security for the purpose of complying with the condition prescribed under rule ll(5)(b) of the Rules. In the event, and for the foregoing reasons, I find the application meritorious and accordingly grant it. Consequently, an order for stay of execution of the decree issued in Commercial Case No. 19039 of 2024 before the High Court of Tanzania (Commercial Division) is hereby granted pending the hearing and determination of the intended Civil Appeal No. 35 of 2026 before this Court. However, this order is conditional upon the applicant furnishing a bank guarantee equivalent to the decretal sum within sixty (60) days from the date of delivery of this ruling. 12

I further order that costs shall abide the outcome of the intended appeal. DATED at DAR ES SALAAM this 5th day of March, 2026. L. E. MGONYA JUSTICE OF APPEAL Ruling delivered this 6th day of March, 2026 in the presence of Mr. Haron Koyugi, learned counsel for the Applicant, Mr. Sylivanus Mayenga, learned counsel for the Respondent, via teleconference and Ms. Nise Mwasalemb3/ Court Clerk; is hereby certified as a true copy of the original. 1 J. KAMALA DEPUTY REGISTRAR COURT OF APPEAL 13