Serengeti Breweries loses Sh1 billion appeal against Break Point

Dar es Salaam. Serengeti Breweries Limited (SBL) has lost an appeal against a decision of the commercial court that had rejected her Sh1 billion claim from Break Point Outdoor Catering Limited allegedly for breach of a contract for supply of beer and spirits.

The Court of Appeal has upheld the decision of the commercial division of the High Court that the beer manufacturer has failed to adduce convincing evidence to prove the Sh1billion claim.

“Because of the appellant’s failure to bridge the yawning chasm between her claim and the evidence on record, we are unable to fault the learned trial judge,” held Justices of appeal Rehema Mkuye, Panterine Kente and Paul Khwelo in a recent decision.

SBL had filed an appeal in 2019 following a March 5, 2019 decision of the commercial court that dismissed a suit in which it had sued the sports and recreation company for non-payment of Sh1 billion, allegedly being the purchase price for beer and spirits supplied to the firm.

The root of the dispute can be traced way back in between 2012 and 2013 when SBL entered into a contract with Break Point to supply it with beer and spirits on “transactions on empty beer crates” basis.

However, the trade relationship could not last longer. After a series of smooth sale transactions, SBL expressed discontent over Break Point’s mode of implementing its contractual obligation.

Specifically, the beer maker claimed in a case against Break Point at the commercial court that after conducting reconciliation it discovered that the company was indebted over Sh1 billion in outstanding balance after supply of beer and spirits.

At the hearing of initial case at the commercial court, Break Point denied the allegation and raised a counter-claim of Sh439 million it claimed to have overpaid SBL.

After hearing the claim, the commercial court dismissed SBL’s claim for want of merit. Break Point’s counter-claim was likewise dismissed on similar ground.

Specifically, the trial judge held that there was no evidence to establish that the respondent (Break Point) was indebted to SBL or that Break Point had made any overpayment as to be entitled to any monetary refund from the appellant.

SBL was dissatisfied with the holding of the 2019 decision of the commercial court and took the matter to the highest court of the land. It was their contention that the trial court erred in fact and in law by failing to consider and properly analyzing evidence tendered by parties.

SBL was represented by counsels Elizabeth Mlemeta and Reuben Robert throughout the appeal while Break Point enjoyed the service of Mr Mafuru Mafuru.

Analysis and decision of the court of appeal

The justices were to establish whether the respondent was truly indebted to the appellant either to the tune of Sh1 billion as alleged.

It was clearly stated during trial that the appellant used to supply beer and spirits to the respondent by differed payments. The contract between the parties was a sales contract outlining the terms of the transaction between them.

According to analysis of the Justices of appeal, SBL’s document titled “General Conditions of Sale” was silent regarding the mode of payment.

SBL will have to blame herself for not setting clear the mode of payment in the general conditions of sale

It only stipulates specifically and respectively under clause3.1 and 3.2 that payment shall be bay way of such method as the appellant (seller) may specify from time to time and that time shall be the essence in respect of all payments due by the customer (respondent).

The gist of the contention by SBL was that the decision by the trial court was erroneous because it was contrary to the evidence showing that Break Point was indeed indebted to SBL to the tune of Sh1 billion.

In support of their claim, lawyer for SBL mainly relied mainly on the delivery notes, the sales invoices and load control sheet which she said were the basis of establishing her client’s claim.

The lawyer contended that if the allegedly ignored exhibits had been factored in during evaluation of the evidence by the trial judge, her client might have won the case.

On the other hand, lawyer for Break Point, Mafuru Mafuru supported the decision of the trial court, arguing that it was upon the appellant to prove that it was still in possession of some of postdated cheques issued to the respondent and that the appellant was saddled with a duty to tender the said cheques as exhibits.

In determining the appeal, the justices of appeal considered the fact that for every sale transaction between the appellant and respondent, payment was secured by Break Point’s issuance of a postdated cheque which remained under SBL’s custody and could only be returned to the respondent after payments.

“Having reviewed the evidence and in view of what we have already stated, we think on the whole that there is no merit in the appellant’s case and therefore we have no convincing reason to differ with the trial court.

“As we have shown, the appellant (SBL) had not even a single postdated cheque in her possession issued by the respondent as would have created the impression that indeed the respondent is still indebted to her.

“The documents she (SBL) used to prove her claim were, to say the least, questionable, in so far they were generated by her from her own computer systems long afte4r the sale transactions were accomplished and without involving the respondent (Break Point),” said the justices.