ee IN THE HIGH COURT OF T | (LAND DIVISION) AT DAR ES SALAAM. LAND CASE NO 46 OF 2004 SHAFFIQUE A. S. DHIYEBL...- ~~ DEFER ’ The defendanc in this case, the Presidential Parastatal Sector 2 Reform C fter to be referred to simply 2 ~ PS 4 under section 21 of the Public J under Corporations Act, 19 section 22 of chis Ag, cain an up co date list of al P + recommendations to che Minister 0! jorshould be declared £0 be specie mmission is empowered among othe Asa body corporal dispose Of to take, purchase, acquire, hold, char f restructSoph ome eporacions. It has powers and jin accordance with OF F rsuant © ppointed ublic Corporations cial receivet of these col ead of eceiver 3PF ights of are e Sect. 43 ip rdinance. (Se grance Conporation is On of the specified ¢ to such funct iy May and Aus e newspapers | us properties oO a es house at plo perties advertised for f ce é a ES 2 = Q °° fons and pow! ers as st 2002, through nvited the wred by The Wational has mentioned fone and th _ The suit property, tnd. 5 one of the Pro mitted 3 bid for che on 23 August 2002. initial Trshs. 122.5 The plaintiff, Shaffique AS. Dhiyebi, subt perchase of the dispuced fhouse ly he ered £0 purchase the house at million. te 2 sidered this bid price to be coo low and it wre 12002, exhibit aiff in which they price co purchss rich was exten) The PSRC cons! feucer dated 9/9! plain nis bid e property t invited him to raiss Trshs, 149 million. The offer, wh tioned lester conained several conditio by the mer eas follows; ps) coe se the incite ded to the Pt ns. The conditions wer d bid security sh urchase price? 3) The subaitte one of the Pt pat| : } { ' In the meantime the plaintiff had contacted some officer from National Insurance Corporation who handed over the premises to him, Following the defendants failure to transfer the property to the plaintiff, he came to court seeking for the following reliefs, among others: (a) An order of specific performance for; () Preparing and signing the Sale Agreement with dhe plainciff (ii) Initiating the transfer process in accordance with the provisions of the Land Act, 1999 (b) Refund of USD 108,000 rental loss due to delays in commencement of the iousing project. (O» Refund of sum of USD 5000 which is che gravelling costs incurred by she Plaintiff for the purposes of following up the transfer process; The defendant strongly resisted the plaintiff’s claim and insisted that the offer was terminaced because of failure on the part of the plaintiff to comply with one of the conditions of the offer- in that he was unable to show evidence of his being a Tanzanian national. Itis stated in the writcen statement of defence that the properties advertised for sale were only for residential purposes meant for Tanzanian citizens and not for investment purposes by foreigners and as such foreigners did not qualify to bid for the same. It was stated further that the law requires that foreigners who want land for investment purposes ger it through the Tanzania InvestmentEMER required t0 pay 25 b) You are 10) working da within cen ( notification. prescribed ime fram of the offer and forfeiture security: ) You are red! purchase price Failure (0 P° will lead £0 W! 25% advance d) Transfer of the tit payment of the purchase e) As per the Li subject to you! wired C0 PAY ci within 2 pe th ydrawal of paymenG the total of Tsh: Tne pist Iso. complied with all che conditi al oduce evidence of not pr aspired to PSRC that when it tra national they, by t fer they neir lecter da terminated the of cheque for shs 149,0! ad been paid by hi monies that had contacted the Tanzant tow with a certificate of incentives incorporated, 2 company Limited. By his lee pa) he asked the defe of the Company Failure (0 sectl 2 will Les in 759 within the prescribe ‘fe will 0. rnd Act of 1999, this r productio! jonality.” ad made 20,854.20 in his favour ter faxed to the ndant to transfer the fhe purchase price e date of this unc within the withdraws! bid os of © sys from eh fe the amo 43d to auton amount of the of the 75% of the (3) months. id cime frame d forfefture of the ne remaining riod of three the offer an ty BG effected upon full price; and offer fs also made 1 of acceptable evidence of 5 149 million tO the PSRC. He er save that he ns of the o| his Tanzanian nationality: subsequently, the plaintiff was not 3 Tanzanian 02), ced 16/3/2004 (Exh. intiff and wrote a 1 ‘o the pla aya refund of sm, Prior to this stage Me plaint ument Cenire Who issued him for a company which he had 1 Company nas Laguna Investment (Exh PSRC on 29/1/2004 property in the © knowr ameCentre. It was stated also that since there was no evidence that the plaintiff was a Tanzanian nacional then the whole transaction became illegal. Dr. Tenga learned advocate prosecuted the plaintiff’s case on his behalf. Mr. W. Chipeta represented the defendant. Ms Rehema Manzi and Mr.Juma Lipendele served as assessors. Each side called one witness in support of their case. There was only one main issue raised and agreed upon by both sides in this case and it is whether the claim for specific performance by the plaintiff is maintainable. The other issue, which is commion in most civil cases, is to what reliefs are the parties entitled to? Ac the end of the crial both counsel addressed the court generally : and | am very grateful for their indulgence. = Both assessors being called upon by the court to give the d the court that the claim for specific performance opinions adv by the plaintiff could not be maintainable. They were of the opinion that as long as the plaintiff was a foreigner the property could not be transferred to him,as per condition that was az contained in the lecter of offer. The gentleman and lady assessors were also of the opinion that the property could not betransferred to the company cither because the company was a Lipendele was particularly concerned foreign owned company. “4 chat the plaintiff had obta ned a certificate of incentives in respect of development of prope: ty, which had not yet been transferred to him. Mr. Lipendele als: noted that the claim for specific performance is for the cransfer of che property to the plaintiff who is A.S. Dhiyebi to whom the property cannot be transferred Under the law as he is foreigner. He though¢ that the company should have been the one Co file the suic against PSRC, but again even the Company itself did not show evidence of its Tanzanian nationality. Ms, Manzi was surprised that the plaintiff got + possession of the property even before the sale agreement was signed. Now, is the plaintiff’s claim for specific performance maintainable? Three questions were posed by counsel for the defendant, which he considered to be vital in arriviny at a decision on whether or not the claim for specific performy.nce is maintainable. These questions which I also consider ri be important are: (2) Whether there is sny existing contract between the Defendant and rhe Plaintiff to sell che suit property fo the Plaintiff. 4) If the answer to (3) is in the affirmati existing contract is binding and enforceable betwee the parties? (And, if the snswer in (b) is affirmative whecher the plaintité has come to equity with clean hands whechergthe y veral argumente on behalf of his client but pur tiny focddon foot couch on only chose that [thinkare necessary for the just determination of this case. The birth of this case was the invitation to tender for the purchase of certain properties that were under the management of the PSRC. The learned advocate and scholar for the plaintiff referred to several decisions of other Common law countries which state that depending on the intention of the parties an invitation to tender can give rise to contractuai obligations upon the submission ofa bid. All the cases that he cited were discussed in the case of M.J.B. Enterprises Ltd. versus Defence Construction G2} (1999) 1 S.C.R.619 a copy that the learned counsel had the courtesy to supply to court. He further suggested that these decisions should be followed in place of the old reasoning where the inviter would outline the Bidding procedure and then insert a disclaimer that exempts him from any commitment whatsoever. He cited the case of Blackpool and Fylde"Acro Club Ltd. versus Blackpool Borough Council (1990) 3 All E.R p.25 which in reviewing the old reasoning Bingam LJ stated as follows:- “A tendering procedure of this Kind is, In many respects, heavily weighted in favour of the inviter. He can invite tenders From as many or asfew parties as he chooses. He need not tell ‘ony of them who else, or how many others, he has invited. The invitee may often, although mot here, be put (0 considerable labour and expense in preparing a tender, ordinarily without recompense if he is unsuccessful. The invitation to tender may itself, in a complex case, although rain not here, involve time and expense to prepare, but the jnviter does not commit himself to proceed with the project, whatever it is; he need not accept the highest bidder, he nece mot accept any Cen he need not give reasons [0 juscity his 1 acceptance or rejection of any tender received.In. Lenga opined that the reasoning in the M J.B. Enterprises , case, which also discussed the Blackpool case, should be adopted in erm of section 180 of the Land Act, 1999. The relevant provision under this section of which of Dr. Tenga wished to be i f adopted states as follows: “Section 180 - (1) Subject to the provisions of the f Constitution and this Act, the law to be applied by the t «courts in implementing, interpreting i and decermining disputes about land atisir or any other written law shall be- and applying this Act ngunder this AC (a). (B) the substance of the common taw and the doctrines of equity as applied from time to time in any other countries of the Commonwealth which appear to the courts (0 be relevant to the circumstances of Tanzania.” Much as this provision is attractive, however the case before us is more than just the “intention of the parties, invitation to tender, cnmtractuat obligations and submission of a bid.” It is also about Snforceability of a contract. May be | could be persuaded under diferent circumstances to adopt the reasoning in the M.J-B Enterprises case but in so far as this case is concerned I do not find it to be too helpful the law did not alldw Dr. Tenga suggested further that cho ts of occupancy, the foreigners to own land under granted rig defendant could still facilitate the execution of the “contract” by applying co the Commissioner for Lands to transfer the land to the TIC for purposes of re-granting it co the company, M/S Laguna ight 1: Company Limited under a deriva LivestnenDr. Tenga furthermore argued that the condition of Tanzanian nationality was bad in law because, firstly, it was not disclosed at the contract “A” stage and, secondly, because it is discriminatory. Ihave considered the above arguments and | must say that | hardly find them convincing. In the first place, if the law provided that a foreigner could not own land in Tanzania save for investment purposes, then automatically even without mentioning it as a specific condition it was upon anyone bidding for the property advertised for sale to ensure himself or herself chae he/she was qualified to purchase the property in the first place. | do not consider that the defendants were under a legal obligation to disclose at contract ‘A’ stage that foreigners could not own land except for investment purposes. The plaintiff would have been expected to know. I must also say that I do not see how one can say that the condition is discriminatory. The condition merely emphasised what the law says. And, reserving ownership of land under granted rights of occupancy for citizens alone cannot by any natory-it is their land, stretch of imagination be ssid to be discrit given to them by God after all I must also say that I find the suggestion by Dr. Tenga that the Commissioner for Lands could have been requested to transfer the property to the Tanzania Investment Centre after the conclusion of the contract to be outrageous for the reason among others that ic would be asking the Commissioner to legalize an otherwise™ illegal transaction. It would be against public policy 50 to do. ar on the face of the record that the Though ic would app transaction got to the extent of drafting a sale agreement, however, whoever drafted it and gave it to the plaintiff to review and return it for signature had no business doing so as long as the evidence of Tanzanian nationality had not yet been submitted. | am saying that there could be no contract between the plaintiff and the defendant because the plaintiff was unable to show evidence of his being a Tanzanian national. The cqnduct of the plaintiff, as pointed out by Mr. Laizer, the defence witness, show that the plaintiff poised as a Tanzanian national probably to get the property, which he knew, was available only to Tanzanian nationals. If he had no intention of posing as a Tanzanian national one wonders why he did not simply say so and instead submited a copy of his mother’s passport and his birth certificate to the PSRC. When he paid the money he was in possession of the letter containing the nationality condition yet he went ahead and paid the money for purchase any way. According co the testimony of DWI the plaintiff went to the accounts section, paid the money on various dates even without the knowledge of the transaction officer. Could it be that he thought he could buy his way through? The way the plaintiff got into the suit premises where he has remained until today leaves one wondering as to how he could have approached someone with whom he had not been dealing with and convinced him to hand over the property even before the sale agreement was signed. [ am left with a question mark. It has been suggested that the acceptance by the defendant of the 10whole purchase price conduded the agreement. In the Circumstances of the presen case | do not think that payment of the whole purchase price conduded the agreement because there was yet another condition based on a legal requirement that had to be met. | agree with Mr-Chipeta that even if the offerree shall fulfil all other conditions of the offer, but fails to fulfil the fundamental condition, which make the offer a conditional offer/contract, and, | would add, particularly where that condition is based ona legal requirement, there shall be in law, no acceptance, and the offer, agreement or contract shall not mature into a legally enforceable contract and the relationship between the parties so far shall have no legal effect at all. Sections 31 and 32 of the Law of Contract Ordinance are relevant here. They provide as follows, “Section 51. A “contingent contract” is a contract to do or not to do something, if some event, collateral 10 such contract, does or does not happen. Section 32. A contingent contract to do or not to do anything if an uncertain future event happens cannot be onforced by faw untess and until hae event has happened; gad if the event becomes impossible, such cortract becomes void. The case of Melina de Ellis versus Stotzky 16 EACA 65, dted by counsel for the defendants illustrates the principles undertying the above provisions. In this case X paid a deposit for Y’s house and contained the phrase “ subject co execution of the receipt giver agreement of sale.” It was held that che phrase prevented thecartier agreement from being a valid contract, even though 3 deposit had been paid. The Court stated; « The words “subject to execution of agreement of sale” mean that even if the parties are ad idem as to che terms which are to go into the agreement of sale, neither party is ound until the agreement of sale has been executed by both of them; che receipt of December, 1947, was nothing more than an agreement to make a contract at some future tine and as such cannot be made the subject of a decree for specific performance.” na nutshell, there was no any existing contract to sell the the plaintiff as he failed to accept all the conditi ns of property to the offer, and it was actually impossible, fer. | can safely say that the payment of on the available evidence, for him to accept the o Tshs.149 million by the plaintiff to the defendant was nothi more than an agreement to make a contract at some future date depending on the occurrence of a certain event; the event being evidence of Tanzanian nationality. Once it became impossible for the plaintiff co accept the offer, he quickly, and, | have no misgivings in stating that, dubiously, £ incentives from the Investment Centre obtained the certific He formed 2 company and requested the PSRC to effect the transfer of the property to it. The question follows; can an offer made to one person be accepted by another person with the resu! that the acceptance creates a contract beoween the offeror and the other person who was not the original offerree? The answer 1 think, as pointed out by Mr. Chipeta must be no, save in most wvunusual circumstances. The case of Otis Elevator Co.Ltd v Bhajan sigh (1967) E.A 78 gives support to this contention. In this case X tendered to install a lift in a building being erected by Y and Co., X addressed their tender letter to the architects, M. The architects, M, passed the letter to Y and Co. who replied to X awarding them the contract. The court decided that X’s letter was a specific offer to the architects, therefore it could not be accepted by Y and Co., the reply sent by Y and Co. was therefore 2 (counter) offer, which X then accepted. The contents of Y and Co.’s letter were the basis of the contract. The President of the Court of Appeal, Sir Charles Newbold explained while referring to submission of counsel for respondents: “He submitted, as 2 matter of lay, that an offer nude to one person carnot be accepted by another person with the result chet the acceptance creates a contract. I accept that. 1 think that it is not possible, save in the most unusual circumstances, for the acceptance by Y of an offer made to X to create a contract between ¥ and the offeror. He referred to’ authority in support of that, in particular the words of the judges in Boulton V, Jones (1857) 2 H. and N. 5&4. ia his subsnission, however, he very property stated chat this letter could also be construed as 2 counter offer by the defendnts. I think that is the proper « in which it could be regarded and that is in face thé way in which the parties regarded it. It was a counter - offer by the defendants stating in effect this: with reference co the offer which you made to the architects to supply and install a life on the terms of that tender, we are prepared to enter into a contract with you on these terms for the installation of that lift. / would agree with counsel for the respondent that the letcer of May 9 is not an seconence; it is a counter- \3offer and that counter-offer was accepted by the performance of the contract. 1 think beyond question of.doubt that is what all the parties involved in-this matter understood to be the position and that is what in law | consider was the position. It was perfectly open for the eppellant by its conduct after receiving this letter co accept the counter ~ offer and proceed £0 install the lift {would also agree with Mr.Chipeta and the gentleman assessor that once the plaintiff passed over the defendant’s offer to the company and the defendant eT, the changes then the plaintiff would cease to have any cause of action against the defendant. The Company being 100% foreign owned also did not ‘qualify to purchase the property in dispute. t would say further that, to the extent that a draft sale agreement was drawn up without the conditions for the purchase having been fulfilled, with che expectation thar the PSRC would persuade the Conimissioner for Lands co grant the property to TIC, this ions of the law and it amounted to a circumvention of the prov icy and prudence to allow it to stand would be against public po ize here thet whoever is given authority to deal wit | must emp care and diligence considering its land he muse ¢ t role it plays in the development of sensitivity and the imparie the citizens. Strict adherence to the provisions of the law is vital not only in order to avoid problems that occurred in land administration in the past which resulted in the reform of our land th loop holes dar may give room co laws, but also to do away « uwcorruption which is an evil chat we must employ every weapon at our disposal to fight. Section 20 of the Land Act provides as follows: “20-(1) For avoidance of doubt, a non-citizen shall not be allocated or granted land unless it is for investment purposes under the Tanzania Jnvestment Act., 1997. ite (2) Land to be designated for investment - purposes under the subsection (1) of this section shall be identified, gazetted and allocated to the Tanzania Investment Centre which shall create derivative rights to investors.” (do not think that the above provision was enacted without the intention of having it strictly adhered to. Identification and iz it especially where that land may be gazetting of land for invesur allocated to foreigners is very important and in fact without such identification and gazetting the Fundamental Principles of the National Land Policy which is the objective of the Land Acts to a promote and to which all persons exercising powers are to have ‘ regard to, cannot be adequately met. Some of these principles as enunciated under section 3 of the Land Act and the Village Land Act are (a) to recognise that all land in Tanzania is public lands vested in the President as trustee on behalf of at citizens; (b) (0 ensure that existing rights in and recognised i long standing occupation or use of land are clarified and secured by the law; (d)to regulate the amount of land that any one person or corporate body may occupy or use; (s* (to provide for an efticiens, effective, economical dad transparent systent of land administration; Now, you cannot say thac you have provided for an efficient, effective economical and transparent system of land administration iF for example you approve, whether expressly or otherwise, the signing of an agreement of sale and transfer of land to a foreigner where that fand has neither been designated for investment Purposes nor allocated to the TIC or been gazetted, If the land in Tanzania belongs co the citizens with the President holding it as trustee on behalf of all citizens, then ic must be assumed that the citizens have a say in the way their land is administered. How can they have a say if Courts allow themselves to be persuaded to ignore such significant provision as that contained in section 20 (2) quoted above? | am not entitled to overlook these provisions as has been Suggested by the plaintiff. | for one am enjoined and happily bound to ensure that provisions of the Land Acts are observed to the letter, Let me sum up by saying that 1 am in complete agreement with the lady and gentleman assessors that the plaintiff has totally failed ieto prove that he is entitled to specific performance which he is seeking for from this court. At most he has impressed us as a dubious character who should not expect any equitable relief from this court. The first issue framed is accordingly answered to the effect that the claim for specific performance by the plaintiff against the defendant is not maintainable. Indeed as submitted in the defendant’s summetion, he has been dragged to court without any legal justification. The plaintiff’s suit is dismissed. Considering the fact that the plaintiff imposed himself in the suit premises without any sale agreement in his hands and without any right of occupancy whatsoever, then he must bear the consequences of his unlawful occupation. As early as April 2003 according to a letter written by his advocate Said El Maamry , he had been taken to the premises and was in the process of taking it over. | think that it is fair and just that he pays for mesne profits as prayed for in the written statement of defence. The amount claimed for is $4000. This amotint has not been challenged as being too high for premises. In the circumstances the an order for mesne profits at $4000 per defendant is give month from 1% April 2003 cill the dace of giving vacant possession. The plaintiff is ordered to give immediate vacapt possession of the premises Co the defendant. The defendant shall also have its costs Oi 0 A VAY f ER Kied J. fe15/10/2004 Coram: Before E. A. KILEO, J Vor Plaintiff; Yur: MK daa, For Defendar mv. Goro wiv Bs aS Assessors: 1, Ms Vedas menze? 2: Me Duma Lipanst CIC: Simo 4 eee Court: judgment is delivered this aay of 282004 in the presence of PT made for the defendant. Assessors thanked and disctierged. B.A. Kileo, J