Q&A – 17 October 2016

Controversial default judgment at Commercial Court

I was overseas when a party sued me and told the Court that I was nowhere to be seen, despite knowing I was undergoing treatment overseas. The Court ordered a summons to be published in the newspapers which I obviously did not see. Thereafter, and shockingly, the Commercial Court proceeded to give a default judgment for an astronomical amount that is not only wrong but is twenty times the initial demand of the plaintiff and it is 30 times the contract amount. My question is two fold. First, how can the Commercial Court even proceed to give such a default judgment without asking for some proof that the plaintiff deserves such an amount. And second, what can I now do?
OP, Dar

The High Court Commercial Division was established amongst others to serve the interests of the business community for expeditious dispensation of justice. However expeditious dispensation of justice does not mean unfair delivery of justice.

Rule 22 of the Commercial Court states that (1) Where any party required to file written statement of defence fails to do so within the specified period or where such period has been extended in accordance with sub rule (2) of rule 19, within the period of such extension, the Court shall upon proof of service and on application by the plaintiff in Form No. 1 set out in the Schedule to these Rules enter judgment in favour of the plaintiff.

Unfortunately the rule does not talk about ex parte proof, which as you have correctly pointed out, can lead to a serious miscarriage of justice. The rule seems to give a ‘mechanical power’ to the court to copy paste whatever the plaintiff has asked for and enter judgment. It is indeed a rule that is challegeable but no challenge has been mounted yet. Unfortunately until this rule is changed, you cannot do anything about it, but we agree with your concerns.

On your second question, you do have a chance to file an application to set aside the default judgment. However such an application must be filed within 21 days of the date of judgment. You are very likely out of time to file this application and we advise you to first file an application for extension of time which needs to be granted before you file an application to set aside the default judgment.

On the basis of what you have stated, we believe you have good grounds to set this default judgment aside.

Sonara cheating in grammage

I have been buying gold ornaments for years from a particular goldsmith (‘sonara’) in Dar who has always been giving me great discounts. Three months ago, I went and bought two sets of earrings. After I left the sonara, I was unsure of the grammage of the earrings and I went back to get each of the earrings labelled with their actual weight. Fortunately or unfortunately I went into the neighbouring sonara shop believing it to be the one I had just come out of. Luckily the person there was very cooperative and agreed to measure the earrings for me. To my dismay the grammage was much less than what the sellers scale showed me meaning that his scale is deliberately calibrated to show more grammage and cheat customers. I think I have been cheated by this sonara for the past ten years. Is there no law that regulates the weighing scales that such sonaras use?
OP, Dar

There is a specific Act- the Weights and Measures Act that protects you. In fact such scales are to be regularly inspected and you have all the rights to report this to the Weights and Measures Agency (“WMA”) who will take appropriate action. The WMA can both fine and imprison such a sonara. You also have the right to report this to the police for investigation as this is a cause of concern for all purchasers of gold from such sonaras. Such a behavior amounts to a criminal offence which is imprisonable.

Agreement to fix prices

There is a certain manufacturing industry where it is clear that the three big players are fixing prices. Is this not illegal?
AL, Dsm

The Fair Competition Act, 2003 provides that, a person shall not make or give effect to an agreement if the object, effect or likely effect of the agreement is price fixing between competitors. Price fixing between competitors means to fix, restrict or control the prices, tariffs, surcharges or other charges for, or the terms or conditions upon which, a party to an agreement supplies or acquires, or offers to supply or acquire, goods or services, in competition with any other party to the agreement.

Any person who intentionally or negligently acts in contravention of the provisions of this section, commits an offence. The Act provides for massive fines for such behavior.

Choice of social security scheme

I am employed in a private company in Tanzania. My employer has an agreement with one of the social security schemes registered in Tanzania to register all its employees in that scheme. I don’t want to be a member of the scheme as I have a scheme of my own choice in another pension fund. Am I bound to accept the social security scheme that my boss has a contract with?
TK, Arusha

The Social Security (Regulatory Authority) Act, 2008 provides that, every employer in the formal sector shall be required to register his employees with any of the mandatory schemes, provided that it shall be the right of the employee to choose a mandatory scheme under which the employee shall be registered. Based on the foregoing provision, you are not bound by the contract that your employer has executed with the social security scheme.