Exim Bank of Tanzania Limited vs The M & Five B Hotel & Tours Limited (Civil Appeal No. 511 of 2023) [2025] TZCA 946 (9 September 2025)

IN THE COURT OF APPEAL OF TANZANIA AT PAR ES SALAAM ( CORAM: KOROSSO- J.A.. MAKUNGU, 3.A. And RUMANYIKA, 3.A.) CIVIL APPEAL NO. 511 OF 2023 EXIM BANK OF TANZANIA LIMITED .......... . ............................. APPELLANT VERSUS THE M & FIVE B HOTEL AND TOURS LIMITED ...................... RESPONDENT [Appeal from the Judgment and Decree of the High Court of Tanzania (Commercial Division) at Dar es Salaam] ( Mruma, J.) dated the 5th day of July, 2022 in Commercial Case No. 104 of 2017 RULING OF THE COURT 22n d July & 9th September, 2025 MAKUNGU, J.A: This is an appeal in which the appellant, Exim Bank (Tanzania) Limited, is appealing against the judgment and decree of the High Court dated 5th July, 2022 by Mruma J. in Commercial Case No. 104 of 2017 which was instituted by the M & Five B Hotel and Tours Limited, the respondent. Basically, the respondent's suit before the High Court (the trial court) was for the recovery of more than USD 1, 435, 757. 25 due to an alleged fraudulent and unlawfully withdrawal from her account; which was operated and maintained by the appellant. i

Before the trial court the respondent claimed for, among other reliefs: One; that forensic audit be conducted in the respondent's current and loan accounts held and operated at the appellant's bank in order to determine the actual amounts of fraudulent withdrawals made in the respondent's loan and current accounts and determine the appellant's role played in the fraudulent transaction; Two, payment of damages for conversion; Three, payment of entire sum of unauthorized withdrawals and the entire proceeds fraudulently and negligently withdrawn and drawn from the respondent's accounts or alternatively for payment of the entire sum of amounts of unauthorized withdrawals as money had and received by the appellant to the respondent's use; Four, payment by the appellant to the respondent of the sum of the USD. 12,000,000.00 being special damages suffered by the respondent caused by the appellants negligence, fraudulent conversion and breach of contract; and Five, payment of USD. 15,000,000.00 being general and punitive damages for negligence, fraudulent conversion and breach of contract caused by the appellant's negligent and fraudulent actions and omissions. Another noteworthy relevant fact is that, apart from the High Court Commercial Case No. 104 of 2017, at the instance of the respondent and based on the same allegations that the respondent's bank accounts had

been negligently and fraudulently managed by the appellant, one of the respondent's staff jointly with a number of the appellant’s staff were charged in Criminal Case No. 242 of 2016 in the Resident Magistrates' Court of Arusha. The appellant denied causing the loss as claimed, stating that the disbursements of the loan facility were adhered to the respondents instructions. She argued that the accusation of fraud and unauthorized withdrawals was made purposely to evade payment of debt by the respondent. After the full trial, the matter was determined in favour of the respondent. The trial court viewed that the appellant was negligent in managing the respondent's accounts maintained at her Arusha branch. It held the appellant liable as she breached the duty of care toward the respondent. Consequently, the respondent was awarded the following: USD 11,021,018.00 as special damages; interest on special damages at the rate of 10% per annum from the date of institution of the suit to the date of judgment; interest at the rate of 7% per annum from the date of judgment to the date of payment in full, USD 1,000,000 as punitive damages and costs of the case. 3

Aggrieved by the decision of the trial court the appellant has now appealed to this Court. She has marshalled a memorandum of appeal on thirty two grounds of appeal which, for a reason to become apparent shortly, we do not intend to reproduce them. When the appeal was called on for hearing before us, the appellant was represented by a team of three learned counsel namely; Messrs. Gasper Nyika, Dr. Onesmo Kyauke and Ribent Rwazo. On the other hand, the respondent had the services of Messrs. Mpaya Kamara, Deusdedith Duncan, Emmanuel Saghan and Leonard Joseph, all learned counsel. Before the hearing of appeal could proceed in earnest, the Court asked the parties to address it on whether the respondent’s witnesses testified before the trial court on oath or affirmation as required by law. For the appellant, it was Mr. Nyika, learned counsel, who took the floor to address the Court on that point. It was argued by Mr. Nyika, that, according to the record of appeal the witness statements by all five witnesses for the respondent, (who was the plaintiff at the trial court), were not made or taken under oath or affirmation contrary to rule 49(1) (a) of the High Court (Commercial Division) Procedure Rules, 2012 (the Rules). He submitted that, the evidence in chief of all witnesses for the 4

respondent were not made under oath or affirmation, unlike the evidence of three witnesses of the appellant, which were made under oath. He referred us to pages 408, 442, 452, 467 and 499 of the record of appeal. Mr. Nyika contended that, as a matter of fact and common knowledge, an oath or affirmation of a witness is ordinarily made at the beginning of the statements and precedes the facts to be stated in the witness statement so as to guarantee the truth made subsequent to it. Mr. Nyika submitted further that, the requirement for a witness statement to commence by an oath or affirmation is not a mere technical requirement nor is it a matter of form but one that goes to the substance of evidence hence justice itself. It was also his argument that the violation of rule 49 (1) (a) of the Rules is a serious irregularity which vitiated the proceedings. However, he could not cite any authority to support his argument. The Court was thus invited to invoke its revisional power under section 4(2) of the Appellate Jurisdiction Act, [Cap. 141 R.E 2019] (the AJA), to revise record of the trial court. Responding to Mr. Nyika's submission, Mr. Duncan submitted that, much as he understands the submission made by the appellant's counsel premised on an allegation that witness statements lack oath or

affirmation, the truth of the matter at hand is that the said rules have to be read together with the Third Schedule to the Rules which give a prescribed format regarding how a witness statement should look like. In his submission, Mr. Duncan was of the view that, the submission made by the appellant's learned counsel that oath or affirmation has to be stated at the start of the statement was good and logical but what he stated was not part of the Schedule. In Mr. Duncan view, rules 49 (1) and 50 (l)(a) of the Rules have to be read in line with the Third Schedule to the Rules. Mr. Duncan submitted that, the statements of five witnesses for the respondent, contained affirmation as prescribed by the Third Schedule to the Rules, and, for that matter, the cited case of Afrinex Limited and 2 Others v. Petra Larsson and Another (Civil Appeal No. 594 of 2022) [2025] TZCA 274 was distinguishable to the facts and circumstances of the case at hand. In his view, an oath will be said to have been taken when it was done before the Commissioner for Oaths and, that, its relevant part is in the jurat and the statement is in compliance with the Third Schedule to the Rules. He contended further that, the submission made by the learned 6

counsel for the appellant befits application to a normal affidavit where the practice thereto is normally to start by the deponent's express mention of his or her religion and proceed to make an oath or affirmation. He contended however, that, such a practice is not a requirement in a witness statement and it is not part of what the Third Schedule to the Rules prescribes. He argued that, a witness statement on oath is different from an affidavit evidence where it is a documentary evidence which the court can admit in the absence of any unchallenged evidence. On the contrary, he said, a witness statement is not evidence. It only becomes evidence after the witness is sworn in court and adopts the statement. At this stage at best it becomes evidence in chief. It is thereafter subjected to cross-examination after which it becomes evidence to be used by the court. To support his submission, he relied on the persuasive decisions of the Court of Appeal of Nigeria in Hon. Fabian Okpa v. Chief Alex Irek and Anor (2012) and Samuel Lambart and Another v. Chief A. S. B. C. Okujagu and 2 Others [2015] All FWLR and Nas Hauliers Ltd and 2 Others v. Equity Bank (T) Ltd and Another Commercial Case No. 105 of 2021 [2023] TZHCCOMD 110 (19th April, 2023). Mr. Kamara chipped in and submitted that while the respondent concedes to the defect in those statements but the omission is curable 7

under section 9 of the Oaths and Statutory Declaration Act, Cap 34. He pointed out that, all five witnesses of the respondent took oath before the trial court which has more value. He added that the statement is not a testimony until it is adopted in the court. If it was adopted without oath it would be a different case. Therefore the evidence of the respondent is valid. To conclude, the learned counsel relying on the overriding objective, asked the Court to consider that, the appellant was given a chance of cross-examining those witnesses before the trial court and no objection was raised by the appellant when the evidence was taken. He prayed the Court to consider section 9 of the Oaths and Statutory Declaration Act, Cap 34 and section 8 of the Notar/ Public and Commissioners for Oaths Act, Cap. 12 when determining this issue. In a brief rejoinder, it was the submission of Mr. Nyika that, while he is in agreement with the respondent's counsel that rules 49 (1) and 50 (1) (a) of the Rules must be considered together with the format of witness statement prescribed in the Third Schedule to the Rules, their departure is on what the phrase "read together with" means. 8

According to Mr. Nyika, the phrase "reading together with" refers to giving effect to the substantive provisions and the form. He contended that, the meaning does not signify that the court should ignore or overlook the substantive provision and consider the format only. In his view, the format cannot prevail over the substantive requirement. As regards the submission that the issue of affirmation or swearing is more applicable to the form of an affidavit unlike a witness statement, Mr. Nyika re-joined that, the submission is erroneous because a witness statement has to be a more serious document than a mere affidavit. According to Mr. Nyika, so long as an oath is made to guarantee the veracity of any statement made in the cause of judicial proceedings, its absence can neither be salvaged by the overriding objective provided under rules 3A and 3B of the Tanzania Court of Appeal Rules, 2009 nor by Article 107 of the Constitution of the United Republic of Tanzania, 1977. We have given due consideration to the rival submissions. In the first place, there is no doubt that a witness statement has a prescribed form under the Third Schedule to the Rules. 9

Secondly, there is no doubt that in the case of Afrinex Limited (supra) there was an outright concession on the part of the respondent's learned counsel that the witness statements he had filed contravened rules 49(1) and 50(l)(a) of the Rules. In that premise, it was right for the Court to strike out the witness statements and dismiss the suit. In the present case, however, the respondent's counsel has contested the submission and the same is premised on rules 49(1) and 50(l)(a) of the Rules and, in that regard, Mr. Duncan has distinguished it. In our view, therefore, we would also distinguish the two cases based on their differences and facts of each case. With that in mind, the more pertinent issue for us to address is whether the witness statements for the respondent in support of her claims was worth consideration by the trial court. In the context of our Commercial Court what follows when a witness statement is filed is its formal adoption in court by the witness and subsequent tendering of the documents listed on the witness statement and thereafter cross-examination follows. From the above understanding, whereas under the normal practice elsewhere oral examination-in -chief is a mandatory requirement as per 10

section 147(1) of the Evidence Act, Cap.6 R.E 2019, the practice in the trial Court is that such a scenario is satisfied by way of filing a witness statement in accordance with rules 49(1) and 50 (l)(a) and (2) read together with the Third Schedule to the Rules. According to rule 50(2) of the Rules, it is provided that: ” 50(2) - The witness statementshallbe substantially in the form prescribed in the Third Schedule to these Rules. According to Webster's Dictionary, the term substantial compliance refers to: "Compliance with the substantial or essentiaI requirements o f something (as a statute or contract) that satisfies its purpose even though its formal requirements are not complied ." We have looked at the impugned witness statements. What we find, in the first place is that, although they do not have or state the witness's religious belief or contain the words "take oath" or "affirm" in their opening statements, the same have substantially adopted the format prescribed under the Third Schedule. In particular, it contains a "statement of truth" signed by the witness in the exact wordings provided for under the Third Schedule and was made before a Notary i i

Public and Commissioner for Oaths, stating the date and place where the statement was made. Under the law and practice in United Kingdom, for instance, Civil Procedure (Practice Direction) which provides for the form of statement of truth which is to be included in a witness statement. In particular, the Practice Direction No.32 Part 20.2 requires the following statement to be included in a witness statement: "I believe that the facts stated in this witness statement are true. I understand thatproceedings for contempt o f court may be brought against anyone who makes, or causes to be made, a faise statement in a document verified by a statement o f truth without an honest beliefin its truth . " Indeed, looking at the above statement in comparison with what the Third Schedule to the Rules applicable in our case one will find that the witness statement filed in the trial court does indeed mirror the kind of a witness statement filed in the UK Commercial Court and, that, both serve the purposes of expediting conduct of commercial matters. From that comparative view, we further move now to address the collateral questions when an oath is said to have been made and in what form and for what purpose? Perhaps we shall start by its second limb 12

regarding the purpose of an oath. In doing so, we will refer to the persuasive decision of South African High Court (Western Cape Division) in Wayne Gavin Armstrong vs The State, Case No. A265/16: "The reason for evidence to be given under oath or affirmation or for a person to be admonished to speak the truth is to ensure that the evidence given is reiiabie....An oath is no more than a caiiing on God to punish you if you say what is not true; and, if it is to be ciothed with any efficacy\ it can matter iittie what words or ceremonies are used in imposing it, provided the witness regards his conscience as bound thereby. The purpose o f administering an oath - normaiiy before a witness testifies - is to ensure that he does not speak lightly and frivolously, but weighs his words; to impress on him the solemnity o f the occasion, and above all to provide a sanction against untruthfulness ...." As one may note from the above quoted case, the purpose of an oath, and as correctly stated by Mr. Nyika, is to guarantee the veracity of the statement made by a witness in the course of judicial proceedings. It helps to impress one on the solemnity of the respective occasion. 13

But the question which follows is when is it made? Is it when the one taking oath or affirming states in the witness statement that "I take oath" or "I affirm" or is it just sufficient when, as per the statement of truth contained in the prescribed form in the Third Schedule to the Rules? As it may be observed from the Wayne's case (supra) for an oath: to be "clothed with any efficacy, it can matter little what words or ceremonies are used in imposing it, provided the witness regards his conscience as bound thereby." All in all, the bottom line of the above discussion, having so said, is whether the witness statements of the respondent were properly and competent enough to be relied upon by the trial court in determination of the case. In their submissions, both learned counsel for the parties were in agreement that, rules 49(1) and 50(l)(a) and (2) of the Rules applicable to Commercial Court, are to be read together with the Third Schedule to the Rules which contains a prescribed form regarding how a witness statement is to look like. As we stated herein earlier, the impugned witness statements are couched in line with the Third Schedule to the Rules. 14

In our firm view, the Third Schedule has condensed what is required of by rule 50(1) of the Rules so as to ease things out and should not be complicated further. Given that the statement couched in line with the prescribed form under the Third Schedule, and since the same must be made before a Commissioner for Oaths, the absence of the words "I swear" or affirm" cannot make such a statement to be defective. By the way, a witness may still start his/her statement with such solemn words and proceed to tell lies and hearsays throughout. For that matter, the procedure remains that, even if the statement has been filed in court, still the witness will have to formally tender it in court for it to be tested as to its admissibility and conformity having affirmed or sworn. In our view, if one carefully takes into account what rule 48 (1) and (2) of the Rules and item 5.1 of the Third Schedule to the Rules provide, it will be clear that, the mere filing of the witness statement does not make it to amount to evidence in chief until when the witness appears in court to testify. Item 5.1 provides that " a witness statement is the equivalent o f the oral evidence which that witness would, if called, give in court" 15

Ordinarily, oral evidence is given in court when a witness is summoned and appeared in court, and is put under oath to testify what is true. In the same manner, a witness statement will be a testimony in chief after the witness is made to appear before the court to have his statement formally adopted by the court as his testimony in chief since he may even deny to have written it. And, his statement will as of necessity, always be subjected to scrutiny during its admission to be part of the proceedings as witness' examination in chief. In the light of the above discussion, we are of the finding that, the witness statements for the respondent are valid and proper ones because they were taken before the Commissioner for Oaths and all of the witnesses took oath before the trial court. Furthermore, even if such omission would still exist, it is curable under section 9 of the Oaths and Statutory Declaration Act, Cap 34 which provides: "Where in any judicial proceedings an oath or affirmation has been administered and taken , such oath or affirmation shaii be deemed to have been properly administered or taken , notwithstanding any irregularity in the administration or the taken thereof, or any substitution o f an oath for an 16

affirmation , or o f an affirmation for an oath, or o f one form o f affirmation for another" In the circumstances, we find no serious irregularity in the statements of witnesses and let the hearing of this appeal proceed on merit. The Registrar to fix the date of hearing of the appeal at the next convenient sessions. DATED at DODOMA this 4th day of September, 2025 W. B. KOROSSO JUSTICE OF APPEAL 0. 0. MAKUNGU JUSTICE OF APPEAL S. M. RUMANYIKA JUSTICE OF APPEAL Ruling delivered this 9th day of September, 2025 in the presence of Mr. Gaspar Nyika, learned Counsel for the Appellant, Mr. Mpaya Kamara, learned Counsel for the Respondent through Teleconferencing and Ms. Jasmin Kazi, Court Clerk is hereby certified as a true copy of the original. J. J. KAMALA DEPUTY REGISTRAR COURT OF APPEAL