Lakhani and Others v. Berrill and Co. Ltd. E. A. C. A. Civ. App. 51-D-70; 22/3/7; Duffus P, Law and Mustafa JJ. A.

Lakhani and Others v. Berrill and Co. Ltd. E. A. C. A. Civ. App. 51-D-70; 22/3/7; Duffus P, Law and Mustafa JJ. A.

The respondent had, on 1^st July 1967, obtained judgment by consent against the appellants for sums due on bills of exchange drawn and payable in London and expressed in pounds sterling. The decretal amount was to be paid off by monthly instalments commencing from 21^st July 1967. In November 1967, the pound sterling was devalued. Subsequently, the Chief Justice Held (Berrill  and Co. Ltd. v. Lakhani and Others [1970] H. C. D. 264 that courts in Tanzania could only enter

Judgment in Tanzania shillings and judgment could only be satisfied by the payment of Tanzanian shillings. The appellants are appealing from that decision on the ground that: (a) the debt sued for was an English debt according to the intention of both parties and was in respect of sterling bills of exchange drawn and payable in London; in order to remit the money to London, permission was required under the Exchange Control Ordinance (Cap. 294 ss. 5, 6(1), 33 (1) and Fourth sch.) and since the respondents were under a duty to obtain Treasury permission to remit the decretal amount outside Tanzania, the appropriate dates of conversion would be the dates Treasury permission was obtained for such remittances; (b) the provisions of s. 33(1) of the Exchange Control Ordinance applied in spite of the fact that judgment for a sum certain in Tanzania shillings had been obtained and therefore the appellant had to pay only the sterling equivalent of the decretal sum in Tanzania currency.

            Held: (Mustafa J. a.) (1) The sections and the Fourth Schedule of the Tanzanian Exchange Control Ordinance referred to herein are for all practical purposes identical with the corresponding provisions of the English Exchange Control Act 1947. These provisions in the English act were duly considered in Cumming v. London Bullion Co. Ltd. (1952) 1 All E. R. 383, a Court of Appeal decision. In the Cummings case it was held that the plaintiff, and American, was entitled to be repaid the price of returned goods on the day when the money became payable, that is on the date on which liability to pay arose. Since under the Exchange Control Act 1947 the permission of the Treasury was required for the performance of the defendant’s promise to pay the dollars to the plaintiff and under section 33(1) of the act an implied condition was to be read into the contract, the dollars did not become payable until Treasury permission was obtained and accordingly the plaintiff was entitled to be paid at the rate of exchange prevailing on the date permission from the Treasury was obtained. The Cummings decision was followed and approved in Barbey and others v. Contract and Trading Co. (Southern) Ltd. (1959) 2 Q. B. D. 157 and must be taken to be the English rule as to the appropriate date of conversion. …………….As the learned Chief Justice has pointed out, the Cummings case can be easily distinguished from the present one. In the Cummings case judgment had not been entered before Treasury permission to remit had been obtained and devaluation in that case preceded the entry of judgment, whereas in the present case it came afterwards. Indeed in the Cummings case the three learned judges considered the conversion date in relation to the position of a party who had sued and obtained judgment before obtaining Treasury permission. They were of the vie that in the event of a writ being served or judgment obtained the date when the obligation could have been discharged by a payment into curt would have been the proper date of conversion. This situation arises from the combined effect of the provisions of section 33 and the Fourth Schedule. Unless a suit is filed a person liable cannot legally pay without Treasury permission. Once a suit is filed, however, a person liable can legally discharge his obligation by payment of whatever is the appropriate sum into court. This is the somewhat anomalous situation created by statue on the filing of an

action.” (2) “In my view once judgment has been obtained in Tanzanian shillings in Tanzania the decretal sum can only be satisfied by its payment in full in Tanzanian currency. After judgment was obtained in this case the bills of exchange became extinguished and merged in the judgment, and the matter as between the appellants and the respondents was finally fixed and concluded”. (3) “In terms of the Fourth Schedule a party may obtain a good discharge by paying the sum of money due into court. So if judgment has been obtained the amount due becomes crystallized and only payment of that sum constituted a good discharge.” (4) “The fact that the respondents here would have the further task of obtaining Treasury approval to remit such decretal sum to London has nothing to do with the appellants and any fluctuations in the rate of exchange, either up or down, would be the sole concern and responsibility of the respondents.” (5) Appeal dismissed (Duffus P. and Law J. A. concurred).