Tanzania Daily News (Dar es Salaam)

Tanzania: Hotel Firm Wins Appeal in Sh1.76 Billion Claim Case

THE Court of Appeal has nullified proceedings of a case involving the government of Zanzibar and two companies operating a hotel business in the isles over allegations of a breach of a land lease agreement and payment of over 1.76bn/-.

Justices Mbarouk Mbarouk, Bernard Luanda and Ibrahim Juma allowed an appeal lodged by Hotels and Lodges (Tanzania) Limited and ordered the case in question to be determined on merit, observing that the decision of the High Court of Zanzibar to dismiss the matter on technicalities was not proper.

"We hereby allow this appeal, quash the ruling and set aside the drawn up order of the High Court dated February 15, 2013 and set the case for trial on merits before another judge," they ruled.

The justices found that since there were some disputed matters which were not pure law, such mixed-law fact matters could not have been decided without resorting to evidence of some sort.

In its ruling, the High Court had upheld an objection presented by Chapwani Hotel Limited, a co-defendant with the government of Zanzibar in the case, that the appellant (Hotels and Lodges) was non-existent under the company's decree of Zanzibar and could therefore not in law have been granted a lease by the government.

High Court Judge Abraham Mwampashi, therefore, had dismissed the case on the basis. In his appeal, the plaintiff had complained that the objection presented by Chapwani Hotel did not raise a pure point of law to warrant dismissal of the suit without hearing evidence from the parties.

Facts of the case show that on November 2, 2009, Hotels and Lodges Limited signed a land lease agreement with the Zanzibar government.

Under the agreement, the appellant rented a 0.13 hectare parcel of land in Forodhani area for the purpose of building a restaurant at quarterly payments of USD 3,000.

Two years into the agreement problems emerged and sometime in April 2011, the plaintiff was informed that the Zanzibar government had decided to cancel the lease agreement and intended to enter into a new contract with Chapwani Hotel Limited.

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