Clearing agent ordered to pay back Sh94 million overpaid by Alaf

Dar es Salaam. The Commercial Division of the High Court has ordered a clearing and forwarding agent to refund steel roofing maker Alaf Limited Sh81.3 million and $5,981 that was mistakenly overpaid.

The court has also rejected a counter claim of Sh218.6 million that Minex Logistics Limited raised after being sued calling it an ‘exaggeration’.

Alaf and Minex enjoyed a long and well-established business relationship since 2012 when Alaf engaged the company to provide clearing and forwarding services for its various consignments imported into Tanzania from January 2012 to July 2015.

The roofing producer claimed between May 2, 2015 and May 14, 2015 it mistakenly overpaid the agent Sh81.9 million and $5,981 for clearing and forwarding services. Alaf sued Minex in 2017 after all efforts to claim the refund failed.

Following the suit, Minex filed a counterclaim in which it denied the liability and asked the court to order Alaf to pay them Sh218.6 in unpaid invoices. The company tendered in court invoices for the services it offered to Alaf and accused Alaf of refusing the pay.

Issues for determination

At the hearing of the case, the court framed four issues for determination to meet the end of justice.

The court had to decide on whether Alaf overpaid the clearing and forwarding agent and whether Alaf paid for all services that were provided by the company from November 2011 to July, 2015.

The court had also to determine whether there was breach of the terms of the contract by either side and to what relief the parties were entitled to.

Alaf presents its case

Alaf called its financial manager Prem Narayan Verm as its first witness. The witness told the court that he came to learn that Minex owed them Sh81.8 million and $5,981 during his routine reconciliation of ledger with service providers.

“In the reconciliation, we discovered that we had overpaid the defendant and we were entitled for reimbursement of the excess amount,” Mr Verm told the court.

It was his further testimony that after discovering the anomaly, they immediately informed Minex manager about the amount.

A bank statement from Standard Chartered Bank covering January 1, 2012 to July 23, 2015 that showed the excess amount was produced in court to support Alaf’s case.

The witness further alleged that Minex was not keeping their records properly and ‘they kept changing the entries and their statements.’

Giving example, Mr Verm referred to the 2014 statement that showed Minex closing balance of Sh85 million but the opening balance of 2015 was altered to Sh216 million as opening balance of 2014.

Minex files counterclaim

To support its counterclaim of Sh218.6, Minex lined up its managing director and CEO Silivian Hayuma Diyame who presented in court various invoices for services rendered to Alaf but claimed were not honoured.

It was his further testimony that Alaf failed to pay the amount despite series of demands and reminders regarding delay in affecting the claim and that the amount had not been settle by the time he was testifying.

“There is no truth that the plaintiff claims any money from us and the claim of the plaintiff are intended to avoid or delay our lawful accruing payment and the alleged reconciliation was fully explained to them,” said the witness.

He insisted that no amount was paid in excess of what was supposed to be paid, describing the claim by Alaf as baseless and unfounded.

Court decides

In his decision, Judge Stephen Magoiga said the defendant failed to escape liability of receiving overpayments from Alaf.

“Scanning through exhibit P3A (bank statement) shows a closing balance of $5,981 was specifically pleaded but was not seriously challenged by the defendant (Minex). So in my opinion, the evidence in exhibit P3A remains unchallenged.

“A mere calling the plaintiff (Alaf) into strict proof of the claim where specific amount of money is claimed in the plaint but one would have stated that he either never received the money or if received all was utilized and the balance in dispute was other than the overpayment claimed.

“I find and hold that the plaintiff has been able to prove that actually she overpaid the money in advance and the balance of $5,981 is proved and the plaintiff is entitled to be refunded,” said the judge.

Regarding the claim of Sh81.9 million, the judge also sided with Alaf, saying the claim was not ‘seriously’ disputed by the clearing and forwarding agent. He, however, reduced the mount to Sh81.3 after considering evidence.

He rejected the counterclaim of Sh218.6 raised by Minex on ground that even a statement of account prepared by Minex’s CEO showed all invoices between May 2, 2015 and May 14, 2015 were paid for. “I have carefully gone through the contents of exhibit D2 (statement of account prepared and signed by Minex CEO), which is the basis upon which the learned advocate for Minex submit to have proved the Sh218.6 claim.

“With due respect, my third reason when I was dealing with the first issue above in which I made a thorough comparison between exhibit P3b (Alaf’s bank statement) and exhibit D2 negates the claims as being exaggerated and have no truth of the matter,” said the judge.