Gerhard Hockmuth vs Intermarine Ltd & Another (Commercial Case No. 2 of 1999) [2000] TZHC 481 (12 October 2000)

COMMERCIAL CASE NO. 2 OF 1999 GERHARD HOCKMUTH ..................... PLAINTIFF VERSUS I I I

1. INTER,t.-\RINE LTD ........................ lsT DEFENDANT
2. UNZIO D'ESPOSITO ...................... 2 0 DEFED.-~T .J LI Dr. E ;\1 E ~ T KALEGEYA, .J: I !"he! Pbintiff claims from tht: Dr"ndanl:i. jl)intly anJ si;;,·,:rall:,. ti)i·:- , /J ; ~ ' . I- ; i . i. i<L'f)U)'l11L'J1/ of//11! Lott/I t/11/()///11 <!/ l 'SD 15?. o/J,i "?' p,t)'/llt!llf ,f 1/:.! t>l,-//dnl.:n.'.,! !i,', 11 1:/:/,· l':rni;J_'..:, l'c.'l!:illLJJ;( l'' i}1 c.'YC,,,·, of" r:.,·1) 51-,_.fi(JtJ ---.r ' · .. l111c••··,t 11n r/:L' ,i<'<Tl..'t,:I ,111111;/n1·/i·un1 rl:<' :i.ifL• ,,/j11.l'--:,'lli<'I!/ /111f1L' dt1.'<' 1:;, • 1 '.1 1 •• .. • !, ., .. '! .. ·,~,.:f .:t f · ..... 1 ! ! 1·,:t II' ' ' \ I . II'\ j1,,·1!::r ti/' ,,r!il ,. ! ,·!,,·},,I,::, ' :;.J!z 0 1111\r5::,1- l ,,:,.·t 111::_1 :i,·,·11; :it,:,-,! ;u,1 to gr"111

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• • - ', ,l·(} ', r •. • •'°':.,·•<+ A • •" ·ii;Advociits>it)he'piairitiff and Defendants respectively. Issues framed are as under:- l. \tbether there was a contract of guarantee and indemnity between the Plaintiff and 2 nd Defendant? ., Whether the l st Defendant paid to the Plaintiff US dollars 96.000 as part payment in respect of the loan·:

3. Whether the Plaintiff took O\er the administration of \·ehidc:s, the: subject m:-itter of the lo:.1n. for his O\'n benefit for u pcri,)d of one year'? discharging the Oet"enJmts frnrn liabilit ·. 1 The plaintiffs contention is that in or ah1n1t 25 th S1.!plember. 199~. he signed a l,1:rn tl ''-IS, term 0i"th..:: ,1sI.:.:111l..'.nt tlut ca..:ii ,1.·hil"I.: ,,11u\J ,lltr:1-.:t \ S dulL!r~ :::(i!JIJ j',:I 111011th 1x1yabk to Pbintiff: that in nrd..:r tu ::;1.-cur..: tho.:· lt,:111 th.'. 2"" ikkndint sisncJ ;t d1.:cd nf··guarantce and indemnity'" guarantct:i11g that hi.• \t)uld pay ,,lntc,·1.·r Pl.1i11riff \0t1ld bl.! t.:ntitkd to in the 1.·\·cnt 01" I ' 1 l)ci'l.'.th.lant"s (:1ilur..: t1) hl)tlllllr its 1)b\ig.:11i111h I l.c PL1111tiff t'ur\111.·r m1int;1i11s that up to th,: ti111-: 1)1· !ii ins tho: ,11.:tinn the sum :kh"tnc,:d :1., :1 !t)a11 \;JS >l.'l t, 1 be rt:paid ,rnd that <•lit 1)t'thc 11wnthl> p1>mc11h ,1t·1 ·s J11IL1rs S.!HH) tl--.; dollars ()()() p,:r ,·chick tink'S-! ,·1.·hick) supp,1:;cJ to lun: CPl11i11Ct1c1.·d in July I 1>9-l

oral testimony of the sole witness for the Defendants. The Defendants admit ha'ing signed the loan agreement - the 2 nd Defendant ha'ing signed on behalf of the l st Defendant Company in his capacity as the Managing Director. From here, they launch two pronged defences, one in the ,, .. ritten statement of Defence and another in the oral testimony, and bearing contradictory elements of each other. In the oral line of defence they argue that the lo;.111 agreement did not Dir..:ct1)r::i 111d that the same ,,·,1s r..:jeclt.:d by th..:ir linancing l>1111x111y, Dcntnuk. l"hL·: 111.ik..: r..::'crl'!1i.'· t,1 :1 k111.:r ,!. ·,J 2 () l)J l'r11il1 Dl'nlr:tdl' :111J .i,1-.!:-..:-;:-;..:d t1l 2"' 1 l)cknd:111t. ,1n.i :il\l)th..:r d:1t..:d 31),<)_.9:; \ritten h: 2'Li lk1·..:1kLrnt ;rnd :1Jdrc::;..:d 111 l'b:ntil"t' 1 l)..:1·..:n..::1,;• I .\h .. \ .:, 13 r..:::;pccti\d) ). l 111.;·y di::,putc the c,i-:tc111.:e l,r th..:: :dkgcd "gu:1r:111k'e :111.J Indemnity'' contract; they insist that the acquisition or the 4 trucks \vas as a result or nn arrangt'l1h.:nt between the Plaintiff and Dcntrnde tthc linancing Company), a transaction \Jp.()t) 1 l h:1:-; .ilr,:.1dy b..:..:11 p;1iJ [l)\,l!,I-; tli.: :-;;1ti:--.1·:1,.:ti,,11 ,ir th..: lu.1:1. 111 tll,.: :lltL'!ll.lli\ :. th ... ) insi:--t th.11 if th..:: agreement did exist it ,·as tal ,,ithuut consideration (raised during tinal submissions): (b) frustrated by th..: 1inllict in l{\:1nJ,1. \hid, ,ilfrct..:d Lh1,;· bu::;i111.;•s-; Rl'garding the 2 1111 line of dl'fc:nrt. :1 p1dllt: lh1.;'r1.;·1)t' 1;:111 1m1p..:rl- b1,;• hn 1 uglll ,,ut :·-\ ,JU•Hin::; 1:k, :ml p:1r:1,:!.ra11h~ l,1· th-.: 11k.1,!i11::1~. !'he il,inl ,, ritL·n st.ill.:111-:11: ,,1· lki·:11<..:e. 111 , er\ c...:nain terms. in para,:!.r:1ph 2 . .idmit:< ··rh:\I the ,kri:n,bnt ;h.lrnit thL· ..:,,11te111.-- ,,t'p.1r:1gr,1!'h~ ·+ ,:hi !ti uf th-.: 11l.1i11:·· Paragraph-lot' the Pbint runs as tmd...:r:- -:.., -:- I ·-....._,__ • - ' I .• ,I

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. . • , . ,A·'f ~ ;&. ~ ,.,. 1 ,: ,:"" ,;~ ;''- •_,~ ~ • J :;~~ '.f,, • .. - .... : 1 , _..-r.'.;. at on or about'Septembeql 993. tlie 1' Defe°itd1fif s1gne1t'a'loaii agreement with ,. ~~ ~ ... -,_"?·,.~~-: ~~~ ... ! .. •·, -':., • - ...... .,.. . ·. the Plaintiff for a total sum of United States Dollars one huridred and fifty thousand only (USD t 50,000); the loan Agreement is annexed hereto and marked as Annexture GH - I for which the plaintiff craves leave to refer to it as part of this Plaint ... Para.16 is not relevant here because it simply shO'VS that the sum claimed falls under the jurisdiction of this Court. Paragraphs 5-12 of the written statement of Defrnce, entitled "SET-OFF .. p:1int the corner-stone of the 2 nd line of defence. "5. fhat the First Dcl'cndant c11tcrcd into the said agrccrnL'lll and indc.-d purchase and registered ➔ units for the itsdf and initiated fo1·" anling of the goods. luan. 7. That further repayments \Vere inkrrupted in Rwanda. the main route for both parties, due to conflicts. which ensued there nnd then. 8. l'h:1t the c1111!lict r1..:sttlt,.:d int) 1h, chick;-; hcing. qr;rnded l\11' r, 11wnth:-. \ ii 111 1 ' ( b ll :-; i 111..· S,. •> I 1i1t th..:: l)ci',:nd,u1ts :-;ulfcr1..·d li,:,1,) l,bSCS ;i-; ;1 r1..··,ul1 1lt1..-r...:,1t' ,1, lik·1..: '-'.h \ar i11 R\;111da :1s there \':l::i TH) nwre rccn,·ered l'rn111 hills and 1·rustr;1ti,>11 of the business 11. !'hat tlic Uck11d,1n1..; 11:l\ e l}1ll h1..·,·11 ,tl'k t,1 run husi111..·::-s C, 1 111rn...:r..:1.:\I ;tihl the Scc,md Dclfai.111t i:- pl.11..·eJ u11d1..·r l1qui,l.1tiun :111d ,ill .h-.,.:t, h1.: b..:..:11

12. That the Defendants pray for full discharge of the contract due to frustration of the contract as a result of war in R"vanda and liquidation of the second Defendant." (emphasis mine) \hose effectiveness is being (OntesteJ. The same pro\ ides:- Lr,/ u/f' ()_ /3ax -J()f,- Dur"' St1lu,1111 tll:,/ \Ir Gl-rl;<1rd /fuclm1111/J 11//) 0. !3t1r J 195"7 ."oirohi. thi.? (iJ//011·i11g /oun ugrer.!111..:111: . ' '., / r I .t. .' ' .. .' • .: f :\IS /n1em1dri11t.' I.rt!. rlic.! ,11111 oj CS!) I 50. ()I)() (( }niJ. J-/11ndr..:tl ,,nd Ii/I_" / ~ ': l i j Ii~ ; J.: ': l.' I ' : ! .. ; / ,·, J : .'. // ....... ;t. :. : . • ...i I;· 111. k, , 1 J; .. ; : , :, 1 ;: :'; •• : ~ .. :,:, I , • : .' ': f I ,'.i: ••I : , , .t,; 't' .. ,' i': .- ; : •..: ~ I • ' i ,' ! ' • .,... ..... -·

n of their being into operations guaranteeing a minimum net earning of USD 2,000 per unit per month. • .\I'S lntermarine shall prurid<! a bri!ak doH'l1 swtemenl vn the acri1·ities uf the units including a separare sratemc?nl detailing the re1·enue and momh. • .! S lntamurine Ltd ulso ugr1:es ttJ gru111 to .\fr. l·fvL·k111111h c1 h11y hut'k clu11sl.! \I fia<!,tS ut !hi! t'lld ufi/11..' rint I] 1110111/is ,~f up<!rutio11s .\ fr th-: 0111011J1t ulr<!t"ltZI 1..'ur111..·d during 1/1i: .1,11J1..! pi.:riod ,,(oJJt.'rutiun., • JI S /11ten11uri11i: I.rd s/1ull ins111' u11d d.:hit th.: costs to .\Ir. /-fod.111111/i u!I ,,, t!i,...' I i/ 1 /, ,,, .,, ,.j ,;i'1..:.:.,1t4.l1',I ;;_:1,. /', f'/ 1 ,, 1: 1 , 1 /; j i, 'c :: I'll .. ',', .,,_t..:Jit'1 I I,,,,/,,-__:,,·, l, / ! /;. \ 1 ft I; .'gd .\Ir. < i 1/0Cf: \ff Tl!

out the date because the document contains 2 dates - 15 th at the top and 25 th at the bottom. However, I consider this discrepancy not to be fatal regard being had to the fact that p·arties are agreed that it \'as authored by 2 nd Defend ant who duly signed and on 16 th dispatched it to plaintiff who subsequently signed. In the circumstances, it could not h,l\e h~('n signed on the same Jate an,..i it \ill be ntHed thzit the autlrnrs. ::;ig1ut0ries :ire LJ 1 mi:n. \hich goes eYen to explain the \;intin:J \(1r,iing and phr:l5('vlogy us.:1.I. .-\mung the clear tt:'rms contained therein hO\c\·cr. are - that the plaintiff was to ad,rnce to the I · 1 Defend.mt Company US dollars 150.000: that sum ,,as to be used in buying ➔ traikr \C-hil.'.ks: the- said sum \as ti> re111..1in the- I ' 1 DefcndJnt·s liability until ,,l1L1lly rC"p:1iJ. Further h) the abo\·e, the !' 1 Dd"cn ... bnt \;1::; t,J r1y t,1 the pbintil'f l.:s doll:1r:-; -()()() per munth per Vehick-== US dl)llars SOUIJ per month l1r the ➔ ~hicks. It is als1.l li:Hmcd p:,rt Lll' the I ' 1 Del'cnd:111t · s lkct ,,t' tra11::;p11rtaliun industry. .-\gain, 1t is agrc,__-d th:11 .1 c1.·nain sum ( partic:-; di IYc1; l)il :1111, 1u111 J \ :1~ paid l) the- pl:1i111i if gi,·1.'11. the line of Lklcncc prnjcck,I in the 11r:tl l1..'sli11w11y and Jin;ll suh111i:>si('ih. I l1 1 und i1 impcra_ti,c_ that apart rrnrn the ➔ issu1..·s 1·ra111cd. :11H1thi:.'r issue ,ind~,. crucial l.lilc 1't1r tk,t I will start \1th this Liu,:r issuc. 1'11c I Jdcnd:rnts in:--ist th,11 \ itlwut t!i'-· I\P:ll'd 11i'l)irl.'.d11r·, autlhHit: thl.' :1:!1-..:,:1:1,•11i ..... ,, ,,,i,! 1,.,cki11; t,!' 1h1-; :1r:;1:rn,·11t :li,::- fr1111t I kk11cc F.\hthit .. ,-- ,lll,I --1r·. tli~· k·(i-_'!; 1!,·,1,i_. i·i'~•ff.•,I '" 1111..·\ :,, 1·:1Ulil i.li.:1 :l

"DE/'TRADE /NTERNATIONA S.A .\f's lntermarine limited P.O. Box i1067 Dur es Salaam Our Rt!f DTD IT.! TZ Loun- 2. 9. 93 .-l{(. Capt. Sun:io d'Esposi1n Dear Caprain. September 2rd. 199] RF. .\JR C ER fl. i R !)J' 1/0CI //{Tl/ S F.\PR ESSJU' r >r I\ 7FR C\f /\ I.\TESTl."G IS I.\TER.\I.-IRl.'I:. IJ\f!IEI) 11 ·l" ll'cJ11/c/ \1·ish l<J l'L'/L'i' In 1/1,: uho1'<: t111,I LIL k11011·l<!,lg,: rect:ij>I u/ \ u11r u,1.1_r,.:,,11:,·nt · ~ •: ~ . I ·,, : i • 1 ~ .' · 1 '· ·' • ·: · · • 1 • 1 • : • t . , . - /JJ1rclwsc! o(oddi1iu11ul ../ 1111i;1· n(/r111.:h. trufl,·n 1/1/d i/,1//i(:1 /11 m:gn1L·11t 111ur t!,·,, /'Oli.!llfiul lll'('()J"dinglr. IJ'L, /11J11 L'l't'/', 11011/d lik,•'/1J ('.///',',. /1,·rt-/1_1· u11r cit, ,·,•;;1 hu,,·d 011 !llL' /,,//,,.1 i11:.:, /!it:/.'. • )our c·ul/l;>Lnn ,:u, ·.:,,,, un ,,:.r,1<1u,i1 1 :-.:. l.1,,111 .1i1!, 1,,.1.11,i h,: 1,-;•,;·,i,,;,./ 1/iour./1 you hl•li<!','l' i/1,:r,· /.\going/ti he: LIii i!i(/'l'dh' iii iitL· husint:..I, \ L' /eur / hut (II) t.tddir innul t '()/Ji/II if //It.'/// I I 011/d di, ·er/ /'C!'011/'Cl' 1· cl 't! I! -/Jt'l'L' instcod o(c11/I/Jl!t:tin•~ 1!,l, Clll'f'c.:'/1{ !tildc•l'((lkil/,f.!.' ·' , , ()': ·..: ! J \ , ' ! I . ' ··.' I l:.. ' ,· , .' I ' : I I I • '. I I ! , : ; ' , \ .'; l , 1 ! ~ .'' . ~ • • : : I ," '\ I I I • ' I ; I ;, .. . '; ·,:..:; I ; ; .. :: I /: • I I ' ' : ', •• I j ' ~ '' • ' /'t..l'\4};f,.l/ l.-·(J1}.',i.1,'/ li'1.·••,r' {,,,,.,(, .o. ti,/ .!.'ii,t'tl· th,· co11rn11y we· hi:/ic:1·e tliut II d!f/i'r,:11! 11gret'IIIL'II/ 11·1ut!t! cn:111,· 11 1t·rio11, cu11jlict of i11tert:)I 11·/1ic/J ll't: 11/'t: totally agaimt. /11 '/;.'\I 11/ !iii.: uho1·L· ll 0 L' /.:111c//1 ,:,'.!,'.!,, ,r ·' ti/I {ti C<IIILcl \i /1.1/c'I LI' ,/ .. ~i','<'li,,'11/ \ [/1/ \fr ift1L·k1JJ11th und r,·ft•r /1i11; ic1 !,, 11 .';L·rc·. ,11/ 1 it·d ;,, ,1 1 1/.' l·11.-1,;,,\T<1:;,111, f,ei,1_-..: ;11t·I ,11...: ,.,·t11,.'tlt,ll'''';,1;,,ll1::· .';i, ,/ .. ·,;1·'-· 1,, 1 i'' ,1 . 1 1 ,,,. 1 • 1 • ... ,,,,,i·-1;·\ f J J' J l I~~,· i 111 t I,· ,i \ l l / \ t ,·xi,1:11•~ /,1,111 ,.,·t•'1 , . . : \ .\iJt 1,. J\ / \ r i1 l ( i· .. 1..··•\ ,: • l ,•:: ·l ; l • .'' • l \ : . ' . :' 1 ,;, , /: •~• l I ..: ,• , le Ji, l ': j , 0 • O, ! • I • , ,• i I 't O I, 1 • l j' !t \ • ; / J , •. • .1,t/, ,: • .• ,· .... • ··• 1 , • \ • 1•"':l.•·! cl 1 ',. l , I 11•,.• •1,1 - •:Jlil;;·tif,J/._•..c..,,'\1.. \1J '1,.,,'• . J;.'' ·,., 4 ,·I\ • I• l,: I.. •• : • : i '; I , /1,11, 1;:: ·,; . ! .'; , /, ' 'I. t ,·; : • : •• :. \ : . . : • ' , . .' : , ; • : . , . ;,- : : : . , • .. ; l'<J'1i1.. ,·In.\·•., ;;:..•;·_ir..fi7d.

() Yours Truly, S 0 d .:- Christian Hoechst CO.HJIERC!AL .\l4XAGER" (emphasis mine) Supporting the contention further, the Defendants front Def. E:d1. B. a ktter \ ritten by yJ Ddndant to Plaintiff upon receipt of E:xh. D-:-t"ena ··_-\ ... rhe cL1ntc:nts thc:r.:1)f J::i folk)\s:- f.\TER.\l.·IRIYE LTO \fr. Gahurdt HuCH/L,T!-1 lllh'l'IIUI io110/ / lo11,·t' \·uirohi I c 11do.1..: /i,:rl·11 ui1 u l<'ftvr r,. l c'/\ ,·,I h1 \ Ir \1,tlc'r 11/ Ill 11trt1,I,· Int I Iii r·rih,u,r· 11 IWSL' t·nnte//1 is se({explu11uror_, . . l!ihor,p,h lcini di . .,·T1ii.1_h:JJ-ec111n,,1 ti,rgn hn 71u.,r1..'mii111T1i1iL·11r u1:J/. ,11i\ 7 fr. cli11!1 1 t !•tl':..' ,:,l t ll!l /1) /'ti\ 1l;l'l'l / 1 ll.. .: ,:( 1/;l· 1:1, 1 ,'ilt'I!/ I i . ; l ' . I .'.' ; I ~ ' . : I ' / \ I . ' ,·; ~ ; ". ! I l ". · i , . . I i f / i ,· t..' ( I J ~ : : • \ (. / / , '\ ' \ • ! / 1 / } J : \ i I i; .. ; i , : \ ( •. \t r,',J .,,·;' 'Lt.\ /.;c. \j 1 1 1 l' c,•;:l .,·1.. \ i 1,l/•l.'1 .; 1 • t1·\ ftJ f:,,,,/ t/ /1, 1 /,tf,/l• l·1J,Jfjl/'l'''."·'.,' 1 /,•:·i ,'} it',!/"l}f.,i/1..'i\ \ti'f,'.,!it ,· ,'.'//'.tl'/.i,., /11 titc .1<111/t' tilllL' 1<111 .,Jiu!/ hL· uh/1· 1,, 1n,:.,· u 1/t'\1 ugrt'1'1J1t·11t 1111.l,·r /-.'1,rt1/'t'Uil I ,111 11 !11ch ,l:,,11/d ,t//(l_l' _1 our i•t11·, ,1i 1/;,: /,,, ,:/ 1 ,,1,n, o.' l.ll11 un,/ :,r:!!:-:. 1,,:,1 h,•f;::.:. .,:: ultug,·rh,·r lil'll ugn.'('11/t'II/ 11 /if,·/; ,h,!i :i11J 11:, 1,·/1 u/11 ,1_1·1 rc·,:,h 1,1 t·" ,1·•.-rt1f, f.:.:.,.', !1..llllt'(i!(J\ tJ/,;;J\ ll.·•·t.-",,,•111:l,'/ ,:n1..1.. /._;:,,,'. ,I,, I, t ,,. ,:,1,1,j,\ [d! u\ /1 1 1·11,-,•i't' und lllight rind ti:,· cl:,r;;,·l· /,I /:,t'c' d ci:r,·l/ '.,•i,/ ·,·. ;';.'; /; ,·!,//ti" ;, \i ·, . .'t I . '//(["\I •fl 11·\ . .. ~ .. , ... >'''"1J', ;•t ···I.-,·,;\ , .. ,:. .·. i ,: 1·,::l·1..··· :f ·.'· , ' 1 l -t, t , , , • 1 • ·1 ! I , 1, • , .. . , "1, ,. , • , , • I t , ~ 1 I.; ;,. It; 't /: ! . j ,. :,: ., ,1 ! \ 11;' r . . , .. 1J/· \ 11_';1' .' 1 , • .',i°,; [,.j•_'~/.r.J,''.!, t.,', 1 j',{ \f :·, ~ :t ,'•,' Ji,'l l \t if .. •I: I . ' ... ti 1 ' • • \ f '; / / ( I \I•.,: 1 l t ,' i .' , i :...:. 1 · l •,'!I:. i; ! \ \ 1 7; .. • i ; 'l.· . · l / \ 1 : t 1 ', 1 : f I '' t. · ;· . • . . . .. \ '- : ' \ \ l / ' ,': i: •:

Sgd Xunzio d'Esposiro" The long quotations above are by design: to bring out a picture of ,,·hat was transpiring between the parties. H:t,·ing carefully an;:ilysc:-J the arguments in rcbtion to the c,iden-.:e. I h,1,:: c1.mduJed that no sufficient evidence has so for been gi,·en by Defendants to show that ,, hate:, 1.:r :nJ Defendant did ,,·as ,,·ithout the requisite authoriry. FL1r that matta. I ,, ill rH .. 't CL'i1>idcr the Plaintiffs l)ther lint: c,f :1rgumc11t thH 2nd [),:kncLmt slwu!J be hd.J li;1hk t1r ..:onccalrnenr of tlut r1..:t fr1.1rn tht: nthcr p:in}. I h.: r,1111'" in;:; arc rn 1"1.:,1:,u1b. hi') .:ll,:;1..·d \Ci') al.'.l:-- ;111d c,)11...,1.:quc11<.:1.::; tli,:1:111·,11,11c :..·,•ij1.,,•ncc tlun :-.u..:h ;111 ;1:--:-.1..·rti, 1 ·1 i, rc,;uir.:J in 11rdcr t,, ult ti:.: l..,:d.m..:(· i11 Iii:; i'.1, ,,•ir l hi~ ..:,,uld l,.: in .1 ;·,,rn1 Pi' d)(Ul11C:ilt,lli1H1 !'rum his !3oirJ or Dir1.·ct11r:,; ur C\ ...:11 u1·dl C\ ickllt..:C: fr1)1ll any uf 1111 .. : Dir(·ct1,1rs or 1llhcr principd 1.11·1iccr ,;t· 1 • 1 I kl~'thl.1111. !kk11du1h lli.J11·1 b11tllcr t11 pH1.: purpus -:;iated. ! his ktt..:r simply sh,1\:,; 1h;1t Dcmradl..' l11tl..'1T1<1ti,111:d. ~ .. \ H,1nk \:1s 1111.r(·h 1 · 1 lkknd,mt·-. ti11;rnci1.T 1·1ic l'L1i11ti 1·1 lL::-.crih1.,,•d it ,i.-; · ·' -, .. -,l·:·:·.;;:,I t,11· .. '., .. ' I h.: .::·" I )...:k1llLlllt \ .i 1.·.11,:;, 'I le.ti , 1 11 \IL, •:· ,·. ,,::,:r I ),r,·l.·l, ,,·, 1:1 \ i;,'i'l.'. / \ '" tll/t' :>i ih(:i ( ·,,11!//J.'\ ' f );,·,, i',';1,.':' \1 .,,.l., ,,.rJ:l·r {H i !):'rl·~ !t , .. , ! •:. •. • I J • I .· I

11 Defence Exh. "A" shows that Dentrade did not accept the loan agreement and for that matter, in a strongly worded and financially threatening phraseology. It suggested contacts with Plaintiff for 'ariation of the tem1s. It posed threats that in the event the loan agreement went ahead as proposed I s1 Defendant had to pay the outstanding debt of U.S dollars 460,000 forthwith. Vv'e should pose here and ask ourselves, legally, how could this approach and threat by this third party affect an agreement already entered into between plaintiff and Defendants? The answer is ob,·ious - there is no ,,·ay the said Dentride could comractually e,en peep therein! [ndeeJ. the threat rnuld ha,e h,.:en real considering the extent of indebtness rnd l",nancial sustenance th::H is pJinted t,1 h,1, c c.\isted between the two but this could ,wt a!Tect the contrKtual relatit)l1S ,, irh 1Jthcr · 1 :-.1:·1i,.·, \ hatsl··c\ er. I c:innul ;11, i:::..:2-.: ,1 ,i1u.1ri1':1 '-' !..:re ,.:):1tr.1;.;t"" .:nt..:r-..-,J 111>, :, . k:.:_,;

• . ~ the Uihl...'l':il,t1l1.li11.::' b,.:l\CL'll lilL'lll. Suell d(i:i c:lil \ltil~ :,lr1i11 rcLtti1111:-;hir hct\CL'll tli1.· ( 1 'il1p.111:- :ind the Fin:inci,:r. ,!111..I ,ll ,,11r...;1_ hri.:::1ch ...:1,ntra..:1:; b1..'l'-1..'ct1 th,:111. dc;1-..·11-..li11 ,1 11 th,.'ir (C\Jmrach) nature. but c1111wr 1011...:h the 1Jlh1.·n, ise kg.illy hindi11.::' CPntr:1cts cntcr.: .. 1 intu by the Company :rnd nther panics h11,,·c, er dist:1stcful the: n11y be to the Fin:inL·i,:r I )cfcn...:e L:.,h. --,.\ .. is thcrdi1rL' itTclt:, :111t 1.. 1 11 thi-; p,)i11t. I Ill.' is:-;u..:- is thl.'1:·l'i.1rc Jt1-,,v(Tc,J Our 11L'.\t qt11.·stinn l1t1,tld h,:. did th...: Pbintil'i' c:ll'r nu! Iii p:tn p(thL· l'<'lllr:1'-·1' Un tile-:, idem·c a,·ailabk I a111 satislicd tlut Ile did ;rnd lktt thL: l)L·kndarns· denial is p.1::;1 ;1 tactic to run away from an:- li,tbility. ,I

J 6'h September 1993 Dear Gerhard, I am enc/using here1rith 1 copir!s ew.:h j(1r thr:! loun agreo!mt!lll und personal guarantee from myself to you. II yvu{tnd e\·aything 0. K. pli.:use sign 011d reium 111y c,Jpies hack tom<'. The h£111k oddn:ss is /3.-1:"QCE .".-1TIO.'.lf.E DE P.-IR/S.'..1 . I£ 5:CHEXCR. !BE.' .!n 1). i.)1:.1- - .':i°lt"ll/.OU..·I.DJ ,'1i,!:fj} 1/:111;,/,'t•'''' 1;;";1:•; I Ii-: I )1.:k111.l:illl.· sok \ itt1t.::-, :-ldlt.:,I 1h;1t 111.: ;;_'.,I..: tli:1t ,tt.:l'tlllill tu pl:1in1it( h1.·..:.m,;1.• th1.; i1l\ Pi...:1.:: t\H· thi: ➔ !chicks had ht.:1.·n issu(·d by Dc11tr:i-.k an,!·· t,1 C\pl..'dik tlii: 111;1th.:r '-... -·

1 'l the loan agreement in a manner proposed without even bothering to know what had taken place between the financier and Plaintiff? For sure, if that \vere the case (as alleged by Defendants) then they should ha'e told us in what capacity and on what terms ,·ere lhey running the four trucks. If the underst:i.nding was between Dentrade and Pbinti ff then they sh,)ti!J tell us for ,, hat remuneration were they running the tnh.:ks; how they earned from them and how the remillances were being made and to who. It is not of less signiticance that the 2 nd Dctcndant testified th:H sometime in \Lm.:h. 1996. they h:,d a meeting in :--:air1_)hi (attcn..:kJ by Capt. 'inacci;:i and Plaintiff),, hich aimed at soh ing Plai11tiffs· Ct)l11f)Llinb reg1rding non-remittances arising frnm the operatil)I1S of the -i units anJ that it ,, :is .1::!1..:1.l Lh,1t the.: ::;;.iiJ, ehicks ::,lhJukl be rn11 by lr:1g1>. a L gandan l"lH1lp:rny "h1ch \llllkl tl1..:-111.:,:t"111th pay the Pl:1i11tilf !"he Dcl~'11J:111ts 111Jilllai11 that in r..:l'usi11g th..: ltl:111 ',\ ith FLt1ntiff. 11 in1.!ccd :-;ucli 11cgllti:1tit1n:-; di,l :-;uh;1.:qt11.:nt!y t:1kc pl1cl..' :111cl th1.:I..' k.J 1,1 ;Ii rr\h.:ur..:rn..:nr )!° the.: four trucks i:; ,.::ir! i,:r pl.u111.:J h) Dc!cnd:111ts ..:,ntl,I the h.: hut oiT from the transaction and (ktails thcrt::llJ :1s alkg..:d and still be calkd upnn Lu ru11 th.: , ..:hicks' ll sh1.1u!d be r111t..:d 1h,1t the :2 11d l),:k11J:111t in his tstimtiny re, ..:ak1.I i11;1t !iirn ;111-I !"he: lkli.:11d,mts· s1<1ry i-; lt)(l ::'.,1,1.J 1,, h._: tru1.· I h..: ..:1. id..:111.·..: -.:.h,,,1.-. th.ii Pl.11111it"1· c:1rri...:1.l ,1ut \h;lt h..: \;: r...:quirl..'d ,,r1,y th.: ·:.'l,','111,'ill I k duh ..;ic'.111.·J th...: 1.•.ii1ir.kt .ii,•! ... ,,.: . ' .\ '<#· -" ·'.{- - . ~;( ·#;::-~ ·-/ '. -"' "•; ,I

1 l 1 am satisfied that the line of defence projected by the Defendants in the oral testimony (and v,:hich goes counter to what is in the \Titten statement of Defence) is a hatchment of second thoughts. The abo\·e takes us forward to the four issues as framed and reflected abo, e. \"e · st:.irt with the issue of the contract of ••indemnity and gu:1ran1ee.·· I ::;h0uld stan by sa)in:4 that a ··contract of Indemnity"' is different from a ··contract of Guarantee ... S. 78 of the ,ii' Law of Contract Ordinance defines a ··Contract of guarantee·· as follows .. - thi.! !iuhiliry, of u 1hird pi:rson in cu.H' ,fhis di:Jiw/1. Tlic parn11 11-/w gi,·es till' 11 rit1e11. • I I I I

-.-h.· . . t The Plaintiff testified that the 2 nd Defendant undertook to meet any liability (on the loan agreement) that the 1 st Defendant r.uy fa1I to discharge. The Oefon,.bnts vehemently deny there ha'ing been such thing in existence. Their denial however goes counter to Exh. PI, a conring letter to the Loan .-\greement, sent b 2 nd OefrnJant to Pbintiff :is already discussed. Exh. Pl is already quoted. It clearly sho\S that apart from 2 copies of a loan agreement included in the enclosures was" a personal guarantee from myself to you". In his testimony the 2nJ Detndant com.:edes being the autlwr of rlaintiff Exh.Pl. While denying. hein;:! 1\:1re (if ,rn:thing. in '.l lorn, ofan ·•inJ('111t1il: .mJ uu1ntec·' contract he Joes r1l.)t blHht:r to tdl us "hat it \as that he r...:lrred was ··a pers•.)nnl uarantee from rnysdf to you ... ,\ genuine and l10nest mind. totally u11a,ar...: ol· te:-tinhrny: the as:--...:ssment I mad..: ,)!'him 1'l.:g:udi11 crcdihilit~. :--uppPrtcd by pl:1i111it't' 1:\llP ! : I . .1111 Cllll\ inc1:J th.H th,:r~ c\i::ll.:d th..: .:iI Cl'l:irai..:t h: 1\ hi..:li ill..: 2'' 1 I ).·kn,L:i·.~ u1h.krtook ro s11l>U1Jcr th~ 1' 1 Dd11d111t':,; li;1bility that ma: aris...: under th~ 10:rn :1gr;,,•1.:111c:nr ~rnd dul:! ll) PL.1inti IT l :n..J,:r -.;. ~1) 0f th..: I .a11 nl' ( 'n11trac1 Ordin:u1l.'.<..: tl11.:

Having discredited the first line of projected defence as a hatchment of 2 nd reflection, and in view of Defendants' admissions, the third issue can only attract a negath·e answer. Para.5 of the joint written stJtement of defence shows that the \ ehicks were purchased and registered in the t s1 Defendant's name. In para.6-9 Defendants tell us that business was indeed carried out using the same vehicles although the conflict in R \and:i interrupted it for 6 months. Then .::0111-.'.'s a tlat assen ion in para. IO that Pbinti ff run it for 6 months. I slh)tdd reiterate that hi.! \ho alleges must pro\e. The Ddend::rnts shoulJ h.1\e kd c\iJl.!nce to sho,, how and ,,hen t!il.! saiJ (;'.hicks came to be under the Plaintiffs contn.il. The Defendants didn·t huth 1;.'.\Cn tu gi,e dHes Juring \hich these ,chicks \-.:'1: nul u11-.kr il11:ir c011lr)I but Pbintilf:; I lut 1p,1n. d1e-;e bL'll1:;! ,ehick;-; and ,,hich '-'L·1-...: pl:-inJ h1..·r.: und tl11..·re, 11;1tur:ili:-. h;1,J dri,crs anJ atte11Ja11h. l)lhins coulJ be :IS s1mpk ,1:; pr1,i.:ur1ng thce t() t,.:stify ,111 lhi lhL· f.kk;1cl.1,1h JiJ 11t1ihi11 l1l ilui clf1..·,_·1 L:t .il, 1 11-· c\l.'."11 ;-;,.1'::cstin th:1t C\Cll th,iL1h they ,,i:--.hed hi :-;o .tel the s:.1i,I pcrs1i11:tl ,,er,.: un;'1\h:;1rahk 1 lh-: !"r,111 c·()111p;1c: -;tilt:. \lii(h \1 l,1u111:hc,I u11<.kr th1..· 1 ·• lin~· ,,! ,!, .. :knc~:. ,, hich de knee h~1s hccll rl;.'.jcct1:d. c\ en i I" c,)1-rcct \ 1luld nut pr0, c that then lllL' ,__.hicks \re under the Pl:1intiffs control. Th1t ;:11Tan'.!1..'lllClll \OUld still be np1..·r,1tc,J .,,,-.""- . . - . ,.· ... ' .

• • ··-·~

n 1 "'7 If the Defendants challenge this by urging that U.S. dollars 64,000 more was paid (to make 1t 96,000) \·as it not up to them to show ho\v the alleged difference \vas paid? Apart from the first line of defence which was deplorably discredited Defendants diJ not offer even a spec of evidence on their assertion. In the premises, the figure of U.S dollars 32.000 remain unshaken. The 2 nd issue is also answered in the neg.:nive. We now tum to issue four -,vhether the conflict in Rwanda frustrated the contract. The Defendants argue that due to the conflicts in Rwanda ··the 'Chicks \hich are subject l1f the k)an agreement \ere stranJeJ for Jbout 6 ml'inths ...... Jnd <llhcrs rcmaincd idle t'l)r \Jilt of business .. and that this h:.1J disastrous effect on the general business 01· the: i ·• I kt"c11<.farH Company citing S. 56 ( 2 J or the l.:1\v of (\111tract Ordinance ( Cap ➔ 3:) :111d K.lli).11'\c l3ui1Jing Cuntract1)1· ' !he .-\lllH·ne) lic,11..·ral ,111cl an1)thcr ( 1085) l'.I..R l<)I 111 "hic!1 the decision in .-\libai Ciulam ' i'-. l\lh:1rned Yu:-;u!' / 1946) 13 1: . .-.C . .-\ 25 \;1:-; ·..:l·1:t·;·l,i/·,. tfii .,, \1 !1t·1·1...• r/,l. 1 , ·, '1 :·, ·_ I,::, '/'l.1 , ·:1 · ;.,,•::· .: ·, ·,r,;,·,· t,\ r. ,· . .::, l ,,;/i',/;_ / ,,;· li} ·l,)if,'l , 1 ;;i;/,1!.'t),;l ,,,' /ll,'i'{il.'' ;:~·· l ,,., .. ··. ',1:· 1 1 1. ;·,',1i'i:iti•i-. t' j l/ ~' ... ~ ·,, .·,,\ . .,

,. 18 " A contract to do an act which, after the contract is made, becomes impossible. or, by reason of some event i,·hich the promisor could nor prevent, unlauful. becomes mid H·hm the act becomes impossible vr 1111/awful." \'hat the Defendants front is that the R\and.:i conflict m:1de it impossible for them to perform the contract. I am not con\ irn.::ed .:it .:ill th.:it the contract was frustrated. \.'hv? Although the Defendants did not bother to tell us the exact dates co,·ered by the 6 n11Jnths· peril1d when the ,ehicks Here allegedly stranded in R,an1.b their rnmmitrnenl in the :-,ear 199-4 (the :-t.'ar they 1C,1uired the 'chicks) is c0ntrc1ry lu the pk:.1 of frustrati)11 . .-\spa an u11ch1lk11ged C\ idcnce l,f Plaintiff. the: c,1ntract could t1lH h.l\C :X'l.:n 1·ru=,1r,i1c:J then anJ yet he abk t,) pa> l. '.') JulL1rs 10.UUU in July ind 12.tJ(J\J 111 111.:ri.: i ,,:t :tll•'ihL·r t':11.·1 \lii,:h rni!it:tt,:, :t:.!:!111·-l . - the Dt.·k-ndant·s business operc1tit111s I h,:r1..:. l sh,)uld p,.1i11t 1)ut tk1t th(' Plai11ti ff a ISL) C\l!Kt.'dcs that the: conflict indeed r('duccd th ,,per1ti,11il rnc: o!' the busi11css) it is th-: I - - • 1 • ..:-,im,q~~ ,,( t!1 . .: '2·:., lkf-:11-.Lrnt th.it :h,: ;'-·L·, .1,11 \ ,:hi-.k ,-.·rs: tin.Ill:- :··tri,:\ .:,1 .,11.I .1~ lkli:ndants rc:cci\cd the h)~l!1. ,hich had w b(' 1·<.:p;1iJ t-1gi.:thcr ,,ith nwntltl> 1:111itt.111..:<.:, ,11' 8000 l 'S d,)llars f11r the tr:insp()rl:JtiLH1 ,-.-r, ic1..·, ,1!'i°t.'1:d by th(' 4 truck:- . \ccl..'j1ti11':c! ilh.· ...---- .. ~-----.

19 covered all the period envisaged under the agreement and even then, depending on the actual dates when the conflict raged, the defendants would not be absorbed from the tenns of the contract for the period prior to the said conflict (if that period fell within the terms of the agreement). I should also point out that it would seem that not all the \·ehicles were captured by the Rwanda conflict. Para.8 of the written statement of Defence shows that some of the vehicles were str:rnJed :lt ··General .!Jgazines of \lugerna·· \vhile others --remained idle for business ... The latter should be taken to h.:i,·e been outside Rwanda. For sure. the loan agreement \'as not pegged upon transpon::ition business\ ith R,anda alone ::md C1)11sequently reduce,J \ olume of business cannL)[ frill under the doctrine of frustratiL)ll. On the focts 1t hand. frustration as a detence is not 1, :1ilabk l1.> the Defendants. The fourth issue is :ds1) neg:1ti,·c:ly anS\ere,I. Last]:,, the assertiuns th.It th-: 1 · 1 D..:k11J,111t h.1s i1rec1d bel'n liquiJatcd. :ih1rnU not take much ot·my time because ,1s ,,as pointeJ nut b::, the Plaintit'fs C1t.1ns1?l. r,:prL':::. .... ·1ik,.I hy :1 Coun.-;l·l. ,,,H1kl 11,1t h:1,L· 1·.1ik,! t,i 11,1i11t 1H1l the c,1urt ,11\kr dL'ciit<·1 1,, ;/ut ,·ifi:1..l ii,1·.,..:~'l' .. th·..: 2··! 1)1..·fcnJ,uit ·.,.•.:; !.i11,! :i1,1u:;h i,11'1.•int , 1 ili tlut th:: i: 1 I 1...:,, th.: :-11111 a!r;,t-1: paiJ. !11th;: t"11ul suh111i-,:;i1111-; th,: Pl;1i11t1ll-.;t:1tcd ;1:,; un~!L'r. Fodu_i tht! ollfstu11di11g un101111r 11 ill \f,111d ut l 'SI) '\fJ()fJ .r MJ 1110111/Js t ·::-,·/) 56/J!Jf.JI) . . ldd this 10 rfil' /J/"llld/'(" ,11 1 11 the 1k1•', ,rc111tl1 f . .....-1 J ,. \ <---. -.- .-. /}. t,. ,, ;' . .·r .- .{;.;·~. ,· . . ,-........ _______ ~

~ 20 456,000). Add this sum to the loan amount: USD 470,000 + 150,000= USD 620,000. But for \vhat follo\vs immediately after I would haYe entered Judgement in favour of the plaintiff in the sum as computed. In his testimony. the Plaintiff conceded thus "I understand thar there was a reduced operation of the vehicles due to rhe conflict in Rwanda and rherefore a 'liluarion of rhe situarion is necessary to arri,·e ac a sum H·hich should he paid. " In \·iew of this, (the Defendants allege, uncontrowrtedly that the conflict covered a span of6 months). this court \VOti!d be acting judicially ifit honours the Plaintiffs \I, ishes intended to cushi011 the othern isi: e\tent L)f Defend:.111ts· liabilit). Plaintiff ga, e the court unlimited latitude in \'hich tu act. In c,rnsideration ot' this and als1) the u111.:halknged statement that some L)f the rctrie,t:d ,ehicles ,,ere det'ccti,I'.'. l m1...e the folh),,ing tindings: (a) lhc si:-- munths r..:rnitu1h:..:s: = l.iSI) -4S.UlJU\l.SD SUUU x bl (c11,..:ring th..; period ,,lh:n the alkc:d conllicl rag..:J) swnds Lkductcd from the: lntal ,k·dud l 1 <;; d1,lbrs 2-4/)flll. 'rc1Ji11= 1111 th..: :-,1111-: -,piril the pr:1;-cr-.; f1Jr 11n.,;1:-st -.in th,: L...:(11..·ul sum :;inc..; lhc: J\l<.: l,1· th-.: ,1((1'!d ,\1· tli..: (,\LIS( l,r ;1cti,,n :,Ull'1 dis:11,,\_;d i:-i ,:i-:,nclu:oion. judgc:m..;nt is hL-rch ..:nkrcd in 1:1\ ll11r 1\t Plaintiff in th..: l,1t,d :;um ,,ft·~ Jl)!brs 5-rn.oon: interC:S{ at 7,i Orate: ,)11th;.: .J..:.·rct~d urn fr1)!11 the: d:ll( n!' jL11..i..:111..:1ll till L.B. 1,.\1.ECCY.\ .II DLF .,; :.1 tru, .10 1..:o:~i,ner.:i:1: Cour· D;1r ~,; .-;.1L.i.1 \J I C orrect . .,