The Respondent, a banking institution incorporated under the
Companies Act [Cap 212 R.E. 2002] was the plaintiff in the High Court of
Tanzania (Commercial Division) at Dar es Salaam. It instituted Commercial Case
No. 73 of 2013 against the 1st Appellant, also a company
incorporated under the Companies Act together with the 2nd and 3rd
Appellants respectively who were hitherto Directors of the 1st
Appellant.
The 1st Appellant and the Respondent had entered
into an agreement whereby the Respondent was to advance to the former an amount
of money to enable it purchase a truck from Scania Tanzania Limited (Scania
Tanzania) and a trailer from Superdoll Trailers Manufacturing Company (T) Ltd
(Superdoll). According to the agreement and the invoices submitted to the
Respondent by the 1st Appellant, the truck was to cost an amount of
GBP 33,759.80 while the trailer’s price was USD 56,640.00. Thus on 17/02/2011,
the Respondent advanced to the 1st Appellant an amount of TZS
128,000,000.00. The loan, which was secured by a deed of debenture, chattel
mortgage and personal guarantees and indemnity of the 1st
Appellant’s Directors, was to be repaid within 24 months of the date of advance
on monthly instalments of TZS 6,703,788.00 with interest. The truck and trailer
(the vehicles) were to be registered in the joint names of the Respondent and
the 1st Appellant.
From the loan which was
deposited in the 1st Appellant’s bank account maintained at the
Respondent’s bank, the Respondent paid to Superdoll USD 50,312,350.0 being 80%
of the purchase price of the trailer. It also paid TZS 50,312,350.00 to Scania
Tanzania as 80% of the purchase price of the truck which, as stated above, was
GBP 33,759.80.
There was no dispute that the purchase price of the trailer
was fully -paid. However, the Appellants contended that it was not the case as
regards the truck. This gave rise to the dispute between the 1st
Appellant and the Respondent as to who between them had defaulted to discharge
its obligation as regards the payment of the purchase price of the truck. In
the meantime, the 1st Appellant failed to abide by the schedule of
repayment of the loan. As a result, the Respondent instituted a suit against
the Appellants.
The Appellants disputed the claim contending that the 1st
Appellant was not advanced the amount by the Respondent as a term loan. They
also alleged that the Respondent breached the terms of the agreement because it
advanced to the 1st Appellant TZS. 128,000,000.00 which was not
equivalent to GBP 27,007.84 and USD 45,312.00 required to settle 80% of the
purchase prices of the vehicles. They thus prayed for the dismissal of the
suit. In addition, they raised a counterclaim.
Having considered the evidence of the witnesses and
documentary exhibits relied upon by the parties in support of their respective
claims, the trial court found that on its part, the Respondent discharged its
obligation under the loan agreement by paying not only the 80% of the purchase
price of the trailer but also the same percentage of the truck’s purchase price
as agreed. It therefore, granted the reliefs claimed by the Respondent. Having
so found, it dismissed the counterclaim raised by the Appellants as being baseless.
The Appellants were aggrieved hence this appeal.