Wanachi Marine Product (T) Ltd vs Owner of Motor Vessels (Civil Case 123 of 1996) [2000] TZHC 12 (1 November 2000)

c/V\ I \ .\ I This suit, has a som8what chequered background, having been filed on the 8th de,y of May 1996, the 18th day of July, 2000. saw it como for mediation, 'tIhen the defendants, though, served made no appearance. Procedurally the defendntts dvoate, failing to appear for the mediation, the Court may enter a default judgment, agoinst the defendants. However, in view of the facti that lcxge sums of money are prayed for, this Court, with ! the aoncurrence of the plaintiffts counsel tr. El Maamry stood • over such jUdq:ment, subject to oral proof of the claim In the dutiful attempt, by the plaintiffs to prove the claim, we have ornl evidence, by TUNG 14U KONG, a Mombasa based resident, there running Mananchi Marine Products Kenya Ltd., as Chairman and Shareholder, showing thnt in this Country, (Tanzania), equally established, is the Mwon3nchi Marine Products (T) Ltd., herein to be called the plaintiffs. It is patently clear, on the evidence, that the plaintiffs, struck a Chart l' Party, or Charter greement, with Tanzania Fisheries Corpor9tion, the tOvmers', and hence to be called the defendants, whereby such owners, were to charter and the plaintiffs to hire, their two vehicles Christioned, -1- I'1t.•. W TAPIOO, and -2- S:D/',NI, to the plaintiffs, at the rte of US D.250 per day, per vessel, for a period of twenty four months. hccordingly therefore in the absence of challenge, I hereby make a finding to that effect It is apparently defying chAllenge also, that the period of twenty four months were to, and did cowence from 6/1993, and ended on 35/l995, -(pdL-?~c!..)' _.o.:Lt. •. _;Iiemn.t :;.nn..eYl!!e .. B.'.KI1, and this attracting no controversy, there is no escape routed, from finding" the same as a fact, which I hereby do. It cannot be denied Git~eri

and the hgreement is unquivocal, in the direction, th2t the defendants contractuslly undertook to obtain, the fishing Licences, for the two above mentioned vessels, from the Licen.ing :i.uthori ties, for and on behalf of the plaintiffs. Thus, the said Cherter Party Agreement, would be subject to the defend2nts obtaining fishing licences, or be terminated in the event of the defendnts failing, or neglecting to obtain, or to renew licence, for the duration of the Agreement, in ,,!hich case, the defelld,c;nts would be liable to compensate the nlaintiffs, for loss of income, for period of the G • Charter t.greement to;c;ether, the licences ,.,rere unobtained, vdth a lump sum compensc.tion of USD 200,000 to cover all expense,s in current by the plaintiffs in servicing thc contract - ~~~~~~~.~~.2, 19.3 ~~5~~~~~eeme That appears as clear as day liGht, and too ohvious to be dispuued, and I conclude the some, as an undeni8ble fact. The p12intiff l G claim, thnt the defc:mdcmts refused, or neglected to renew, or obtnin fishing licences for period from -1- 1211995 to 31/5/1997, and hence their anxiety to invoke p3ros 19.1, 19.2 and 19.3 of the Agreement, demanding an order for ortensntion -1- USD 200,000, -2- Loss of income and profits,from 1st d3y of December, 1995 to 31st day of May; 1997 at • 20,000 per month ~ $ 20,000 x 18 months = USD 360,ooo -3- USD 540,000 beinz, expenditure, at the r:te of USD 30,000 per month x 18 months. -4- Interest etc. but they are now asunder, 2.&.::ording to their ple8.dings, and hence this exparte proof, upon the defendants f2ilure, to enter app2r2nce on a date fixed for mediotion. In our sense, proof is proof by evidence, which would induce a reason'J.ble man, reason'101y npplyin[; his sood sense, and prudence to come to the conclusion, that certain fact~ or circumstances of the case . . our Case ~ ~ 1 d eXlst; In prool 01 Drench of contr3ct after extention an hence pl"intiffs entitlement to the reliefs sought by the plaintiffs •• It does not hO cv 8vc?r meC!Dproof to matbmatical cert-dnty, nei!' should it be ~ed8ntic211y arithmetical. nd it is trite l09rning that the burden is that, whoever wonts the Court to give him judgment as of right, on ,the existence of the fact he asserts, he ust prove those focts. Th0rcfore, the f9ct that, this it is an exp3rte proof, i,sno rd8S0n why, the Court should accept anything uttered, or tendered, untested, ?s automatic, ospel truth, and therefore ipso fcto etitle the Dlaintiffs to judgment.

As I look at the reement signed by the parties, as juxtposed with the claims, I am without doubts, as to its interpretative snaGs, as to dur3tion of contract or extension thereof, renewal, or obh!ining fi.shing licences, nor do I think, th?t the parties, were in any doubts about it. Coming into the aron3-, it does seem, that the claim in prayer (B) of the Plaint (8/5/1996), covers period divisible into two parts, - the first one covering part of the first twenty months,

• suspposed to commence by 6/1996 and 31/5/1995, coverinG 1st Becember, 1994 to 31/5/1995 i.e. six months. It appears, to be an unchallenged position, th?t for this period of six months before thu end of the first to years term, the def2ndants never renewed the fishins licences. I have not the slihtest doubt, that such a position' hapP'Ding, during the chrter period of twenty four months, does obviously yi?)ld to the general invocation of the Agreement Faras 19.2 and 19.3, entitlinG th nlaintiffs to -I- US ~ 200,000, and -2- Loss of income for the &ur.Jtion of the tilrter period for our purposes here, the period being dix months. \Vh'lt then, l'!ould tho loss of incom be? [cccording to prnyer (B) in the p1r.int, the monthly income ,,,ould be US $ 20,000 th;Jt for our purposes, (1 period of ,sixmonths, would amount to US 120,000. Hr. TL1-TG l f IU KOnG te.sti!ied, 3S coming to such figure by compr\risons of previous yeer's rGturns. l;/hen 811 is considered in the desirDble pGrspecti ve, it doe,s seem persu.-:lBive to trent vo'geric>sof fishiw; industry, 2.S p'_'Tt.3ing fishing incomes, as steady JS like production, on formulae bssis. But as the fiE!ure st,-.nd, :;mdrCnl:Jin undisputed even though the v[l[;eries of "cnther would make fish yields fluctu8te from time to time, I am tempted_ to uphold and therefor'; Gr;-:i1t the same, .,.hich I hereby do, and consequently 2.110':1 and award US :it 320,000 to the plaintiffs. I shell no 1;1 Game, to th( sec:JDd period, thnt cover 1st June, 1995 to 31st May, 1997 whjch iima, should have been covered, by the extension clause s~here:) see Pars 22.1 which runs as follows: Ii The Cll'V'tcrers helve option of extending the period of hirinG, for 8 further hro (2) yC'1rs, which option the Chnrterers, mny exercise, by giving the O\omers, not less trr'nthree months, prior to the expir8tion of the hire-term, hereby created,written notice of its

intention to renew tho hire-term. The 01~~RS upon receipt of the spid notice, shall notify the C1rrters in writing, not less than thrity days, of its acceptence, to renew the hire period. il The above hgreement clause does, not in my view demGndextrQ interpretative energies t 2.11. In my humble view, r2asonbly looked at, it, stands unquestioned, and 8ctually defyinG chDlleng2, that the plintiffs vide the Agreement gave the plaintiffs option, for extention of hiring term, for a further two ycars, provided, -1- the plnintiffs gave v.riitten notice to th.:; clefend,'Jnts, three months prior the expi.:",stion of the first hiring tern -2- of intention to renew the hire-term, and -3- beine notified in vJriting by th(e defend':mb;, nat less than thirty d2ys, of accepting to renew proposed hirc; pc;riod. To me, it appears, tk1t in classic:)l terminology, th8 obove 8p8ar8 to need, that the parties for on extended period of dur3tion, would not be bound by Agreement, until they are in agreement, which requires an offer for {;xtention of time by the p10intiffs, and ncceptnnce by the defendnts, as per terms above, all in ',rriting Hithin specified period of time. lilld n port from showinG the m,etinc of the minds, on the subject matter of the contr2ct, the ruleG of offer and acceptijllcG are used as OJ mech::mism, for deb'rminin; /hen the contractusl obliGotions 1'10/ ,I purposefully 8;k, was th,Tl: such extension? I pose this question bec'luG? both T1r o :81 Ma8EJrY and Hr'; TUNG \NIT KONG gave me an obviou[3 impres:::,ion, that such extension of charter agreement th(:L'e L2d been. In the obvious orenD of this case, I Get an undoubt,;d impression from the pl::dntiffs, thnt t there "28, such contr':1chFl extenc-;iol1of thc: second bro years term. ''lac there such exercis(,? of 0Tytion, as per pO.r2 221 of the Chorter j.greement,. I 3sk? 1:1::1!3 th"re "1noffer on the one hand by pl'Jintiffs, 2nd 2cccpt s :nce on t h,: other hand, 'by the defendonts? Nowour positive retrent, has t'lrgct to se8, whether th8re over was, an extrmsion in t8rms of PF\ra 22.1, the breach of 'lhich would attach, contractual li2bility, of course as deductcble from the evidence,given )In behalf of pllintiffs? H:. KUNG, vms e th0re wnB such extension.. I would not, hrlVe cultive,ted the antiipDtion,. to doubt his credibility. The plnint p8ra 3 asse:Cts,. the plc1intiffs exercised the option of renewal, after expirr:tion

of period 1/6/1993 to May, 31st 1995 via :lBAKI~\ of Charter Party Agreement. The defendants, deny such renewal in their vlritten statement of Defence. But "lith respect, the so called BAKI is a Cherter Agreement dated 15/5/1993, and the extension would have started at about on 31st May, 1995 and end on 31st May, 1997. So that with respect, althouzh BM(I, provided for option for extension the nrocedural mechanism for the same ~ is provided by Para 22.1. We are, with respect, therefore searching, how ccmpliance there14i th, if at all, was done. HR. TUNG !lU KONG could, be said to have conveniently avoided touching the same, and yet it lS a nagging pain, in the case. The search therefore continues, it cannot be abandoned unsatisfied, because the proof is exparte. But, if the offer was made, by the plaintiffs, as it foes from the record appear was actually made~.the answer thereto, . The Mancging Director, Wananchi Marine Products (T) ljd, P.O. Box 63252, DAR ES SALAAH. .-*,.... ~ RE: EXTENSION OF THE CHARrER AGREEMEl\lT ... ----..- ~ ---._-----~- Reference is made to your letter dated 16/1/1995 and our letter Ref. TAF/3/5/9/260 dated 6th February, 1995 in respect of the above mentioned subject. The issue of extention of the Charter Agreement for a further term of two (2) years, had been submitted to the Board of Directors, 8t its meeting held on 25th May, 1995. The Board of Directors after a thorough consideration of the issue, had resolved as follows:- (a) That the request by vMP to extend the Char§er Agreement for a period of two (2) years be, ahd is hereby accepted, on condition that WMP shall adhere and abide to the terms, and conditions of the ChDrter Agreement, which will be in force, during the whole extended period.

(b) That the extended period, may be determined by either party, terminating the same under the procedure laid dOl;m by the Charter Agreement, or by Government police (Privatisation) • (c) That breaches to the terms and conditions of the Charter Agreement, which were 90mmitted by \iMP during the two years period expiring on 35/1995 such as:- (i) Failure to insure the Vessels (ii) Failure to pay Charter Fees when it is due, etc. A draft, of a proposed addendum to existin Charter Agreement, will be sent to you for your perusal. We hope you will cooperate with us, in the finalisation of this matter, for the interests of both parties, and for the extension of our good business relatin§. Yours faithfully, TANZANIA FISHERnS CORPORl\TION with respect, I am prepared to vouch, that the plaintiffs made the offer, and so, in good time. But the above letter from the defendants, does instil worries, whether there was unqualified acceptance of the offer. In my humble view, there is no way, we can start pholosophizing a new, about the rules of acceptance, in contract formation, - it is trite learning I think. that an acceptance, is an unqualified expression of assent to all the terms of an offer, and the same, must appear to hsve been communic2ted to the Offerr, in the manner presented, or contemplated by the offeror in offer, considering the correspondences, and negotiatinons, between the parties as a whole, and their cpnduct .:J in that regard - See Section 4 and 7 of the Contract Ordinance Cap. 433. --~ ••.-'"<.'--'..., •.••..••.•.. " •. -- , -. . .--..-.~~ But here we have an acceptance subject to conditions attached being fulfilled, and when they were fulfilled, if at all, is shouting for the answer, ,."hich is not easily at hand. With respect, MR. TUNG 1ATU KONG, did not disclose how his Principals Offer, was accepted by the defendants, in view of the above letter. What I see, with my naked eye, is a kin to a counter - offer, whose legal effects is well known,

nor is it suggested, that the acceptance of extension, was done orally. But, if human flailty was not failing us, if our memories unfortunately were not betraying us, we would also easily recall, a letter dated 1st April, 1996 Ref. No. TAF/3/5/9/Vol.II/112, to Mr. Saidi H. El Maamry, that is as follows: Saidi E. E1 MaaDry, Advocate, Pamba Road, P.O o Box 5201, REFERENCE is made to your letter Ref. No. SHE/95/15 vfl{P dated 21/3/1996. The extension of the Chi3rterPeriod for a further period of two years hi3d, been accepted on condition tTh"t all clauses to the Agreement, which is one way or another hinder the smooth execution of the Agreement, had to be amended, and replaced by better terms by way of an Addendum effective from 1st June, 1995. Thib position was put clear to your clients in our letter Ref. No. Th~3/5/9/VomiII/5l of 29/5/19951 On the above stated grounds efforts to negotiate, and amend the Charter Agreement, etarted since A~~ust, 1995, although your Cleints have all along been reluctant to nefotiate. The grounds, for the failure to obtain the fishinr; licence, are the unfavourable terms, and conditions of the Charter Agreement, as we discussed on the 8th of March, 1996, at your office, as well as the breach of fishing Rules, by your clients.

This letter opens our eyes wide, it is all telling, Qthout capacity for caprice, ncr conspiracy, chowinG;th.2 t the extoEsion of the Charter t,gree:7lent, even three weeks before the insitution of the suit, had never been agreed upon, by the parties. Then, when was it 3fter that? It W1S ne:fer at Cillo From the :J00V0, it is my confident vie,,!, that the claim bpsed on em all,,,gedly extension of Chnrter Asreement from 6/1995 to 311997, has not been ost201ished, and the claim, is therefore disallowed, and in thcsmne period by extension for the same reaSon disallowed, is prsyer (c) of the plaint i.e. $ 540,000. In summary therefore'l the pl,c1intiffs 8h,)11 bo entitled to -I- US $ 200,000 as per psra 19&3. -2- Loss of income ror periocl of six months US $ 120,000, and hence US $ 320.000, -3- Interest on decret21 amount from date of filins suit till judgment, and till \ . _ '.. ".c. \.:.., ':--"\