CBA faces over 1.3bn/- suit for breach of contract

FAUSTINE KAPAMA

DAR ES SALAAM businessman Gabriel Machumu Munasa has filed a suit before the High Court against Commercial Bank of Africa (CBA) Limited and another, demanding 1.335bn/- damages for allegedly breach of contract over transaction involving repayment of loan facility.

The case is before Judge Wilfred Ndyasobera and has been set for first pre-trial conference on April 12, this year.

Suing as an Attorney of one Said Hamadi Lugumi, Mr Munasa, the plaintiff claims in the plaint of the suit that on December 8, 2006, the Bank and the second defendant, Abdiel Alphonce Mshana, entered into a contract for loan facility under which Mshana borrowed 150m/- which was to return 190m/-.

To secure the said loan, it is alleged that Mr Mshana mortgaged his right of occupancy under Title No. 55461, Plot No. 703 Block F, Msasani Village area situated in Kinondoni Municipality. The mortgage deed which secured the loan facility was registered on June 15, 2007 by the Registrar of Titles.

Mr Mshana became unable to pay the outstanding loan instalments which by September 2012 was amounting to 500m/-. He approached the plaintiff for assistance to settle the claim, of which the latter agreed.

The plaintiff informed the bank of such development and started repaying the loan facility. It was agreed that after settling the loan, the Bank would release the title deed in the name of Mr Mshana to the plaintiff.

Upon getting such assurance, on September 27, 2012, the plaintiff transferred 85m/- from the Stanbic Bank to a bank account in the name of Global Web Limited maintained by CBA.

On November 30, 2012, the plaintiff again transferred 250m/- via TISS from First National Bank to the same account in the name of Global Web Limited.

However, before completing the loan facility as was agreed, the plaintiff surprisingly and without notice to him, discovered that the mortgaged right of occupancy had been sold and transferred to one Batuli Nassoro Seif from receiver, Mr Abduel Gilead Kitururu, on April 15, 2013 through power of sale.

On July 22, 2014, the plaintiff instructed Sky Advocates to write a demand letter to the Bank, demanding refund of 335m/- that had been paid to settle the loan facility after breach of contract for failure to honour the terms of the contract that they had agreed with him.

It was followed by several other communications, but the CBA remained reluctant to refund the said amount.

Again the plaintiff instructed Law Associates for an official search at the Registrar of titles and it was discovered that the Right of Occupancy that was mortgaged as security is owned by Batuli Seif.

The plaintiff had no other alternative than to institute the commercial dispute before the court without any further delay. In its written statement of defence, the CBA stated that the plaintiff was not entitled to any of the prayers sought.

It is specifically denied that the Bank entered into any agreement with the plaintiff for a claim of breach and loss of business to stand.