Pulses and Agro Commodities (Tanzania) Ltd. vs Bank of Baroda (Tanzania) Limited (Civil Application No. 537/02 of 2024) [2024] TZCA 972 (17 October 2024)

IN THE COURT OF APPEAL OF TANZANIA AT PAR ES SALAAM CIVIL APPLICATION NO. 537/02 OF 2024 PULSES AND AGRO COMMODITIES (TANZANIA) L T D .............................................. ....................... APPLICANT VERSUS BANK OF BARODA (TANZANIA) LIMITED................................RESPONDENT (Application for stay of execution of the decree of the High Court of Tanzania (Commercial Division) at Arusha (Magoiga, J.) dated the 27th day of November, 2020 in Commercial Case No. 8 of 2020 RULING 18mSeptember & 17th October, 2024 MGONYA. J.A.: The applicant, Pulses and Agro Commodities (Tanzania) Limited, filed an application seeking to stay the execution of the decree of the High Court of Tanzania (Commercial Division) at Arusha, in Commercial Case No. 8 of 2020 dated 27th November, 2020. The application is predicated under rule 11(3) of the Tanzania Court of Appeal Rules, 2009 as amended (the Rules). The same is supported by an affidavit duly affirmed by Rakesh Yoginder Kumar Vohora, the Managing Director and shareholder of the applicant. On the respondent side, being served with the application, she

filed a notice of consent to the application pursuant to rule 50 (4) of the Rules. When the application came up for hearing before me, Ms. Agnes Dominick and Mr. Obeid Mwandambo learned advocates, represented the applicant and respondent respectively. Submitting in support of the application, Ms. Dominick stated that, the respondent is in possession of the applicant's property situated at Plot No. 95 Block 1, Kawenda Road, Arusha Municipality which was the security for the advanced facility. Seeking solace in the decision made in Africhick Hatchers Ltd v. CRDB, Civil Application No. 98 of 2020, Mr. Dominick implored the above mortgaged property to serve as security in this application as well. It was Ms. Dominick further submission that, the applicant is ready to furnish another security as may be directed by the Court, as expressed under paragraph 18 of the affidavit in support of the application. In reply, Mr. Mwandambo submitted that, the security offered by the applicant's counsel was not pleaded. He contended that, the applicant's submission contravened paragraph 18 of the affidavit. According to Mr. Mwandambo, a bank guarantee suffices to serve as security.

In her rejoinder, Ms. Dominick stated that, paragraph 3 of the Notice of Motion is dear that, the applicant undertakes to furnish additional security if need be although, she went on to insist her prayer that, the mortgaged property mentioned earlier be considered by the Court. Having considered the submissions made by the counsel from both parties, I find the simmering issue is: what type of security is sufficient in the circumstance of this application. It is settled that; the Court would grant a stay order if three conditions have been cumulatively met. The first condition is; when granting the application is necessary in order to prevent substantial loss; second is when the application was made within the prescribed time and; the third condition is, when the applicant undertake to furnish security for the due performance of the decree. See; Samwel Muhoja Lumala v. Maryline Aminiel Minja, Civil Application No. 471 /01 of 2023, Evalyne Mbuna v. Joseph Mshana (Administrator of the Estate of the Late Naginder Singh Matharu), Civil Application No. 277/17 of 2023 and Ecobank Tanzania Ltd v. AA Company Ltd & Three Others, Civil Application No. 178/16 of 2020 (all unreported).

In this application, if I properly heard the respondent's counsel, he did not object the application save for the security offered by the applicant's counsel. It was Mr. Mwandambo's concern that, the property offered by the applicant's counsel contravened what was deponed by the applicant's Managing Director under paragraph 18 of the affidavit. That the applicant offered to execute a Bank Guarantee as security, of which he also finds to be sufficient. On my part, having examined the Notice of Motion and its supporting affidavit, I concur with the respondent's counsel that, what applicant's counsel prayed to offer as security for the due performance, is not backed up by the affidavit. In paragraph 18 of the supporting affidavit, it is clearly deponed that: "18. That, further to what is stated above, the Applicant is ready to furnish security for due performance o f the decree o f High Court (Commercial Division) at Arusha in Commercial Case No. 8 o f 2020 as may be directed by the Court including executing a bank guarantee . " It is garnered from the excerpt above that, apart from what the Court may direct, the applicant is willing to deposit a bank guarantee as

security. With that fact, I find the applicant's counsel's submission that, the applicant is willing to furnish the property which the respondent is currently hold as a security for the facility advanced, is not backed up with the Notice of Motion and its Affidavit rather, are merely counsel's statements from the bar which I declined to consider. Therefore, since a bank guarantee is the form of security preferred by both parties, I find no reason to exercise my discretion to order another type of security contrary to the wishes of the parties. Having determined the type of security which was a boiling issue in this application and bearing the facts that, the application was not objected by the respondent vide a notice of consent lodged on 10th September, 2024,1find no reason on laboring much on fulfillment of other conditions as the same was not disputed by the parties. Consequently, I proceed to grant an application and order stay of execution of the decree of the High Court of Tanzania, Commercial Division, in Commercial Case No.8 of 2020. The stay order is conditional upon depositing a bank guarantee of the decretal amount by the applicant within 60 days, from the date of delivery of this ruling. In default, the

order of stay shall lapse automatically. Costs shall abide the outcome of the intended appeal. DATED at DAR ES SALAAM 27ththis day September, 2024. L. E. MGONYA JUSTICE OF APPEAL The Ruling delivered this 17th day of October, 2024 in the presence of Mr. Obedi Mwandambo, learned counsel for the applicant and holding brief for the Ms. Agness Dominick, learned counsel for the Respondent, is hereby certified as a true copy of the original. D. P. KINYWAFU DEPUTY REGISTRAR COURT OF APPEAL