CRDB Bank Limited v Lwambagaza (Commercial Case No. 10 of 2000) [2000] TZHC 673 (4 August 2000)

CRDB BANK LIMITED v. JOHN KAGIMBO LWAMBAGAZA 117 CRDB BANK LIMITED u JOHN KAGIMBO LWAMBAGAZA HIGH COURT OF TANZANIA (Commercial Division) AT DARES SALAAM (Nsekela, J.) COMMERCIAL CASE No. 10 OF 2000 Civil Practice and Procedure - Summary Procedure - defendant fails to file written statement of defence after having been granted leave to appear and defend - Order VIII (2)(b) or Order XXXV Rule 2(2). The plaintiff bank sued the defendant under Order XXXV: Summary Procedure of the Civil Procedure Code 1966 for recovery of money due on a loan. The defendant was granted leave of the court to appear and defend the suit unconditionally. He was ordered to file a written statement of defence on or before 27 June 2000. The defendant failed to comply with this Court order. Counsel for the plaintiff prayed for a hearing date in order to prove the suit ex parte under Order VIII, rule 1 4(2)(b) of the Civil Procedure Code as amended by GN Number 422 of 1994. The court considered whether the provision cited by counsel for the plaintiff was applicable in light of the purpose of Order XXXV of the Civil Procedure Code. Held: (i) The purpose of Order XXXV of the Civil Procedure Code on Summary Procedure is to enable a plaintiff to obtain judgment expeditiously where the defendant has in effect no substantial defence to the suit and to prevent such a defendant from employing delaying tactics to postpone the day of reckoning; (ii) Order XXXV is self-contained in so far as it relates to suits stipulated thereunder; (iii) Since the defendant defaulted in filing his Written Statement of Defence on or before the 27 June 2000, then Order XXXV, rule 2(2), and not Order VIII, rule 14(2)(Z>), came into play;

118 TANZANIA LAW REPORTS [2002]T.L.R. A (iv) In terms of Order XXXV, rule 2(2) the bank ’ s allegations in the plaint shall be adjudged to be admitted and the bank will be entitled to judgment. Judgment for the Bank B Statutory provisions referred to:

1. Civil Procedure Code, Order XXXV, Order VIII (2)(b), Order XXXV, rule 2(1) and 2(2), Order VIII, rule 14(2)(Z>) Mr Mwandambo, for the Plaintiff C Mr Swai, for the Defendant RULING D (Dated 4 August 2000) Nsekela, J.: The plaintiff CRDB Bank Limited, (the Bank) is a commercial bank incorporated under the Companies Ordinance Chapter E 212, and doing business in Tanzania. The defendant is one John Kagimbo Lwambagaza. At the request of the defendant, the bank on or about the 27 July 1998 agreed to grant to the defendant a term loan of TZS. 30 000 000. This loan facility was secured with a legal mortgage F covering Plot Numbers 48,49 and 50 Block “ C ” Kibangu, Ubungo area in Dar es Salaam under Certificate of Title Number 47381 in the name of the defendant. The loan facility attracted a rate of interest of 22% per annum as from 1 February 1999. Apparently, the defendant G defaulted in the repayment of the said loan facility and this prompted the bank to institute this suit under “ Order XXXV Summary Procedure ” under the Civil Procedure Code, 1966 (CPC). On the 6 April 2000, I directed that the defendant be served with a summons under Order jj XXXV, rule 2(1) of the Civil Procedure Code and on the 14 April 2000 the defendant filed a Chamber Summons seeking leave to appear and defend the suit. The application by the defendant was argued on the 6 June 2000 by Mr Swai, learned advocate representing the defendant j and Mr Mwandambo, learned advocate representing the Bank. On the 23 June 2000 1 granted leave to the defendant to appear and defend

CRDB BANK LIMITED v. JOHN KAG1MB0 LWAMBAGAZA 119 the suit unconditionally. It was ordered that the defendant should file the Written Statement of Defence on or before the 27 June 2000 and that the suit be mentioned on the 4 July 2000, but it was instead mentioned on the 11 July 2000. Mr Mwandambo entered appearance on this date holding brief as well for Mr Swai and it was ordered that the hearing of the suit would be on the 18 July 2000. On this date once again Mr Mwandambo was present but neither Mr Swai nor the defendant John Kagimbo Lwambagaza was present. The court record however showed that Mr Swai was served with notice of date of hearing on the 11 July 2000. In other words, the learned advocate for the defendant was well aware that the suit had been fixed for hearing on the 18 July 2000. It is against this factual background that Mr Mwandambo prayed for a hearing date in order to prove the suit ex parte under Order VIII, rule 1 4(2)(Z>) of the Civil Procedure Code as amended by GN Number 422 of 1994. The learned advocate submitted that the defendant had not filed the Written Statement of Defence and there had been no application to extend the time for filing the same. I should at this juncture reproduce Order VIII, rule 14(2)(Z>) and Order XXXV, rule 2 of the Civil Procedure Code . The latter provides as follows: 2( 1) Suits to which this Order applies shall be instituted by presenting a plaint in the usual form but endorsed “ Order XXXV: Summary Procedure ” and the summons shall inform the defendant that unless he obtains leave from the court to defend the suit, a decision may be given against him and shall also inform him of the manner in which application may be made anti for leave to defend. (2 ) In any case in which the plaint and summons are in such forms, respectively, the defendant shall not appear or defend the suit unless he obtains leave from the Judge or magistrate as hereinafter provided so to appear and defend; and in default of his obtaining such leave or of his appearance and defence in pursuance thereof, the allegations in the plaint shall be deemed to be admitted, and the plaintiff shall be entitled:

120 TANZANIA LAW REPORTS [2002]T.L.R. A (a) where the suit is a suit referred to in paragraph (a), (b) or (d) of rule I or a suit for the recovery of money under a mortgage and no other relief in respect of such mortgage is claimed to a decree for any sum not exceeding the sum mentioned in the B summons, together with interest at the rate specified (if any) and such sum for costs as may be prescribed, unless the plaintiff claims more than such fixed sum, in which case the costs shall be ascertained in the ordinary way and such decree may be C executed forthwith ” , [emphasis supplied] And Order VIII, rule 14(2)(b) of the Civil Procedure Code provides as follows: 14(2) In any case in which a defendant who is required under sub-rule (2) of rule I to present his Written Statement of Defence fails to do so within the period specified in the summons or, where such period has been extended in accordance with the proviso to that sub-rule, within the period of such extension, the court may: E (a) ... (b) in any other case, fix a day for ex parte proof and may pronounce judgment in favour of the plaintiff upon such proof of his claim. F In the present suit, the defendant was granted leave to appear and defend the suit unconditionally. In addition, the defendant was ordered to file the Written Statement of Defence on or before the 27 June 2000. The defendant failed to comply with this Court order! Under G the circumstances, is Order VIII, rule 14(2)(b) applicable? I have serious doubts. With all due respect to the learned advocate, it is my considered view that since the defendantde faulted in filing his written statement of defence on or before the 27 June 2000 then H Order XXXV, rule 2(2) came into play. Mr Swai learned advocate for the defendant was served with notice that the suit was scheduled for hearing on the 18 July 2000 but for reasons best known to himself, he opted to absent himself. Needless to say, the purpose of “ Order j XXXV: Summary Procedure ” is to enable a plaintiff to obtain Judgment expeditiously where the defendant has in effect no substantial defence

SURYAKANT D. RAMJI v. SAVINGS AND FINANCE ________________________ LIMITED and OTHERS ______________________ J2I to the suit and to prevent such a defendant from employing delaying tactics and in the process, postpone the day of reckoning. I am of the settled view that Order XXXV is self contained in so far as it relates to suits stipulated thereunder. If a defendant defaults in filing the defence after obtaining leave to appear and defend the suit, as was the case herein then in terms of Order XXXV, rules 2(2): ... The allegations in the plaint shall be deemed to be admitted and the plaintiff shall be entitled ... [emphasis supplied] According to Black ’ s Law Dictionary (6 ed ) the word “ deem ” means - ... to hold; consider; adjudge; believe; condemn; determine; treat as if; construe. This means that since the defendant defaulted in filing the defence, the bank ’ s allegations in the plaint shall be adjudged to be admitted and the bank will be entitled to Judgment. There will be no need for the Bank to prove the suit according to the standard required by law. Under the circumstances I do hereby enter judgment for the Bank as prayed with costs. It is accordingly ordered. SURYAKANT D. RAMJI v. SAVINGS AND FINANCE LIMITED AND OTHERS HIGH COURT OF TANZANIA {Commercial Division) AT DARES SALAAM (Kalegeya, J.) CIVIL CASE No. 30 OF 2000 Landlord and Tenant - Flat allocated by employer to applicant as employee - Employee contracts with employer to purchase the flat - Whether dispute arising from that contract is a commercial dispute.