Swedish Motor Corporation vs Suchak & Sons Co.Ltd (Commercial Case No. 40 of 2000) [2000] TZHC 301 (2 November 2000)

-, S.. S IN THE HIGH COURT OF TANZANIA (COMMERCIAL DIVISION) AT DAR ES SALAAM COMMERCIAL CASE NO.40 OF 2000 SWEDISH MOTOR CORPORATION ------------ PLAINTIFF VERSUS SUCHAK & SONS CO.LTD --------------------- DEFENDANT JUDGMENT NSEKELA, J. The plaintiff, Swedish Motor Corporation Limited, is a limited liability company incorporated in Tanzania, and so is the defendant, Suchak & Sons Co. Ltd. The plaintiff and the defendant entered into three (3) Instalment Sale Agreements dated 1.5.99; 1.6.99 and 1.12.99. In these agreements the plaintiff agreed to supply to the defendant, and the latter to buy three Volvo trucks on the terms and conditions therein contained. Apparently, the defendant has defaulted in effecting payments according to an agreed schedule and as a result of this default, the plaintiff instituted this suit on the 25.8.2000. On the 26.9.2000 when the suit came before me Mr. R.C. Kesaria, learned advocate, represented the defendant and Mr. Ishengoma, learned advocate, represented the plaintiff. Mr. Kesaria informed the court that a document headed " Notice of Admission under Order XII and Order XX Rule 11 (1) of the Civil Procedure Code, 1966" had been filed in court in which the defendant seek to settle the suit by paying monthly instalments of US$ 10,000.00 with effect from 1.11.2000 but without interest and with the usual default clause. Mr. Ishengoma on his part, noted , bjji ade by defendant but he submitted that the transaction 40 w7AOmmerial on should therefore attract payment of interest on the • icz *1 '/7

2 decretal amount. Consequent upon these submissions by the learned advocates, I made the following order — Judgment is hereby ordered on the principal sum claimed in the plaint under paragraph 12(1). The said amount to be paid in monthly instalments of L/S$ 10,000 with effect from 1st November, 2000 until full payment of the same. Costs are awarded to the plaintiff. ii. The parties to negotiate the question of pa,vment of interest on the princioal sum and report the outcome of such negotiations to the court. Mention on 11.10.2000." e The suit has since then come before me on the 11.10.2000 and 18.10.2000. On e ach occasion Mr. D. Kesaria was absent. On the 18.10.2000 Mr. Ishengoma undertook to get in touch with Mr. Kesaria in order to finalize the matter. On the 26.10.2000 the suit again came before me. This time it was Mr. Magai, learned advocate who appeared for the plaintiff Mr. Kesaria did not enter an appearance. Mr. Magai stated that his client has not acceded to the request to waive payment of interest on the decretal amount. The reasons advanced on the 26.9.2000 by Mr. R.C. Kesaria in seeking a waiver of payment of interest were first, the fact that the defendant was offering to pay substantial instalments subject to the usual default clause and secondly, the fact that the defendant had sought not to prolong litigation over the matter. As stated before, on the 26.9.2000 I entered judgment on admission in favour of the plaintiff under Order XII Rule 4 of the CPC as regards the principal amount stated in paragraph 12 (1) of the plaint to be paid over a period of time. The question of interest payment was deferred in the pious expectation that the parties would sort it out. Order XX Rule 11(1) of the CPC provides — Where1 and in so far as a decree is for the payment of money, the court may for any sufficient reason at the time of passing the decree order that payment of the amount cfèd-sha/l be postponed or shall be made by instalments :7 \ \ . /.

3 with or without interest notwithstanding anything contained in the contract under which the money is payable." (emphasis supplied) When the proposal was made, Mr. Ishengoma readily accepted the deal but insisted that payment of interest cannot be waived. The defendant proposed the quantum of the instalments and the plaintiff in an act of magnanimity duly accepted them without demur. Under the circumstances, the court duly exercised its discretion to stagger the payments in the manner proposed. But the defendant has gone further in seeking that the plaintiff Z should forego payment of interest. It has been stated that the mere fact that the debtor is hard pressed or is unable to pay in full at once is not sufficient reason for granting instalments and that ordinarily the debtor should be required to show his bona fides by arranging prompt payment of a fair proportion of the debt. (See: Sawatram Ramprasad v Imperial Bank of India AIR 1933 N a g p u r 330; Kwshavjiietliabhai& Bros. Limited vSa/eh Abdulla (1959) EA 260; A.Rajaball Alidina v Remtulla Aildina and Another [1961] EA 565;) In Alidina's case, this Court (Law, 3) adopted a passage in IT Woodroffe and Amir A/I'S Civil Procedure in British India (2n d edition at page 869) at to what matters should be considered by a court in deciding whether or not "sufficientreason"exists. These are: the circumstances under which the debt was contracted; the conduct of the debtor; his financial position; and his bona-fides in offering to pay a fair proportion of the debt at once. I have already mentioned the reasons that have been advanced by the defendant, namely an offer to pay substantial instalments and that there will be no protracted litigation in the matter. I do not wish to lose sight of the fact that the interests of the plaintiff as the creditor have to be protected as well. The court having agreed that the decretal amount be settled by payment of

instalments is I think sufficient indulgence. The plaintiff's rights should be seriously taken into account. Having considered all the circumstances in this case, I do hereby order the defendant to pay interest on the decretal amount. It is accordingly ordered. H.R. Nsekela, Judge 2.11.2000 Judgment read in the presence of Mr. Magai, learned advocated for the plaintiff, also holding brief for Mr. D.Kesaria, learned advocate for the defendants. H.R.Nsekela, Judge. 2.11.2000 * I Certify that this is a tr8c ani Coect tile 01 fl tdcfgeet Ruiling T strar C 0 , 1 1111eir cia. Co&srt EJar clSaaiiu ME rd