TULIP Tanzania Limited vs ALAB Contractors Company Limited (Civil Application No. 317/01 of 2022) [2023] TZCA 17756 (13 October 2023)

IN THE COURT OF APPEAL OF TANZANIA AT PAR ES SALAAM (CORAM: KOROSSO. J.A. RUMANYIKA, J.A And MGONYA. J.A^ CIVIL APPLICATION NO. 317/01 OF 2022 TULIP TANZANIA LIMITED...............................................................APPLICANT VERSUS ALAB CONTRACTORS COMPANY LIMITED................................1 st RESPONDENT MUZAMIL HUSSAIN...............................................................2 nd RESPONDENT (Application for an Order of Stay of Execution of the Decision of the High Court of Tanzania District Registry at Dar es Salaam) fMlvambina. JM dated the 2n d September, 2021 in Civil Case No. 211 of 2017 RULING OF THE COURT 2Sh September & 13th October, 2023 MGONYA. J.A.: Resulting from the decision of the High Court of Tanzania, Dar es Salaam District Registry in Civil Case No. 211 of 2017, (Mlyambina J.) dated 2n d September, 2021 the applicant herein, Tulip Tanzania Limited, by way of notice of motion filed under rule 11(3), 11(4), 11(5) (a)(b) & (c), 11(6), 11(7) (a), (b)(c) & (d) and rule 48(1) of the Tanzania Court of Appeal Rules, 2009 (the i

Rules) moved this Court to issue an order for stay of execution. It is based on the following grounds:

1. The 1s t Applicant will suffer irreparable loss because if the Respondent executes the said decree which will render the appeal process commenced by the 1 applicant nugatory;
2. The Judgment and Decree of the High Court of Tanzania District Registry at Dar es Salaam is extremely problematic and tainted with serious irregularities which prejudice the 1s t Applicant;
3. That the Decree Holder has sought an order for arrest and detention of Directors of judgment while there is no order for lifting the vail of incorporation;
4. In the event the 1s t Applicant's appeal fails the Applicant is able to honour the Judgment and decree without any difficulty;
5. The balance of convenience dictates that the execution be stayed; and
6. The 1s t Applicant is ready and willing to provide security for the due performance of the Judgment and decree. The notice of motion is supported by an affidavit duty sworn by Paschal Kamala, advocate duly authorized to represent the applicant in the application. 2

At the hearing of this application, Mr. Antipas Lakama, learned counsel appeared for the applicant while Ms. Neema Joram Mboto, learned counsel represented the respondent. Before commencement of the hearing, Ms. Mboto prayed to withdraw the point of preliminary objection earlier advanced against the application. On the other hand, the applicant's counsel pronounced to abandon the 2n d respondent from this application as he was dropped from the claims before the trial court. Hence, he proceeded to prosecute the application against the 1s t respondent only. When invited to submit in support of the application, Mr. Lakama informed the Court that, on 30th May, 2022 the applicant was served with notice of the execution, hence the instant application. Submitting further, Mr. Lakama learned counsel also prayed to adopt the applicant's affidavit and written submission before the Court. He went on to inform the Court that, the 1s t respondent instituted the application for execution against the applicant registered as Execution No. 33 of 2022; whereas in the same, he sought assistance of the Court to arrest and detain the directors of the applicant while in the main suit there was no order against the applicant's directors. Further, that the 1s t respondent has not applied for lifting the corporate veil of the applicant's directors to entitle the 1s t respondent to execute decree against 3

them in their personal capacities. In that regard, it is the learned counsel's averment that, in the event the execution proceeds, the applicant and its directors wili suffer hardships and irrecoverable economic loss for failure to operate their business hence rendering the applicant's company redundant and generate loss of Government's revenue. Submitting further, it was Mr. Lakama's submission that, if the execution of the impugned decree is not stayed, the applicant will suffer an irreparable loss. Finally, the learned counsel confirmed that the applicant is able to, and will timely honour the decree in the event the intended appeal fails. He also undertook to furnish any such security as the Court may deem fit to order for the due performance of the Decree. The Applicant's counsel thus prayed the application be granted as prayed. On the other hand, Ms. Mboto briefly but pertinently, prayed the Court to consider the 1s t respondent's written submission which essentially urged for the dismissal of the application with costs. Basically, the 1s t respondent averred that, the application before the Court; is frivolous and vexatious with the purpose of delaying the 1s t respondent from enjoying the fruits of the decree. The reason being, that from the applicant's submission, the application is based on mere narration by stating that, the amount in decree is colossal without showing the extent of loss which the applicant is going to suffer. Additionally, 4

it is the 1s t respondent's concern that, they have not been made aware of the properties of the company other than the property which was the subject matter of the conflict being the two-story building on plot No. 18 at Mbagala Rangi Tatu, and one of the Company's Director one Mr. Sheikh Shahid Majel. Hence why they opted for his arrest and detention of the Directors of the applicant as one among the modes of execution provided under the provisions of section 42 (c) of the Civil Procedure Code, Cap. 33 [R, E. 2019]. Our cursory glance of the application before the Court, parties' affidavits, their respective written and oral submissions before the Court, reveal that, the applicant filed a notice of appeal within the time prescribed by law on 29th September, 2019 after the High Court decision which was delivered on 2n d September, 2019. Furthermore, it has been observed by the Court that, the application for stay of execution has also been diligently and timely lodged within fourteen days of the service of notice of execution as provided for under rule 11(4) of the Rules. In adherence of rule 11 (5) of the Rules, on substantial loss to be suffered by the applicant if the order is withheld, the applicant deponed in paragraphs 4 to 7 of the supporting affidavit that she will suffer an irrecoverable loss and hardship for failure to operate the business thus rendering the employees redundant. 5

Finally, is the third condition that the applicant has to undertake to furnish security for the due performance of such decree or order as may ultimately be binding upon him. From our considered view, this condition has been met as the applicant in his paragraph eight (8) of the affidavit, undertook to furnish any such security as the Court may deem fit to order for the due performance of the judgment and decree. We respectfully find that in the circumstance, the applicant has shown his preparedness to furnish security for the due performance of the order to do so as it is upon the Court to impose condition on the intended security to be furnished, as stated in Shirika la Usafiri Dar es Salaam Limited v. Flamingo Auction Mart Company Limited, Civil Application No. 555/16 of 2018 (unreported). In this application, it is gathered from the record that, the amount of money involved in the intended execution is TZS. 837,195,574.00. It is the said amount which is intended to be challenged on appeal. In this regard, this Court is satisfied that the applicant met the conditions for the grant of the order for stay of execution of the High Court Order as prescribed under ruie 11 (5) (a) and (b) of the Rules. For the interest of justice, the application for stay of execution in respect of the judgment and decree in Civil Case No. 211 of 2017 has merits. We hereby grant it subject to the applicant giving security for the due performance 6

of the decree in a form of a bank guarantee of the sum of TZS. 837,195,574.00 within the period of sixty (60) days from the date of this ruling. The order is made, pending hearing and determination of the intended appeal. Costs be in due cause. We so order. DATED at DAR ES SALAAM this 11th day of October, 2023. W. B. KOROSSO JUSTICE OF APPEAL S. M. RUMANYIKA JUSTICE OF APPEAL L. E. MGONYA JUSTICE OF APPEAL The Ruling delivered this 13th day of October, 2023 in the presence of Ms. Ester Msangi, learned advocate for the applicant and Ms. Neema Joram Mboto, learned counsel for the 1s t respondent is hereby certified as a true copy of the original.