Business Law Notes

A5 Business Law

Foreword

  • NBAA established under Act No. 33 of 1972 (CAP 286 R.E.2002).
  • NBAA prepares National Accountancy Examination Scheme.
  • Study Guides are in text book form with examples and questions.
  • Study Guides cover NBAA syllabi and knowledge base to pass exams.
  • Study Guides are prepared to match Competency Based Syllabi.
  • Features of Study Guides:
    • Focus on outcomes.
    • Greater workplace relevance.
    • Assessments as judgments of competence.
  • Study Guides are useful to trainers specifically those who are teaching in the review classes preparing learners to sit for the professional examinations.
  • NBAA believes that these standard Study Guides are about assisting candidates to acquire necessary skills and knowledge.

1. Introduction to Tanzanian Legal System

  • Legal system defines culture, history, and future.
  • Major legal systems: common law, civil law, and religious law.
  • Tanzania follows a common law legal system.
  • Students will be able to know the structure of the legal system in Tanzania Mainland and the way it operates.
  • Students will be able to understand the sources of law and differentiate legal obligations from moral obligations.
  • Learners will be able to know where and how to find the law as well as how a person can get remedy when his rights are infringed.
  • Study Guide lays a foundation for learners to understand concepts and principles covered in the next Study Guides.
a) Identify and Explain the Tanzanian Legal System
  • Legal system includes rules, institutions, and officials responsible for the administration and enforcement of the law.
  • Positive law can be enforced through a court of law and similar institutions.
  • 'Law' refers to rules with 'obligation' and 'force'.
  • Osborne's Concise Law Dictionary definitions of law:
    • Obligatory rule of conduct.
    • Commands of him or them that have coercive power (Hobes).
    • Rule of conduct imposed and enforced by the Sovereign (Austin).
    • Body of principles recognized and applied by the State in the administration of justice (Salmond).
    • Blackstone: Rule of law made on a pre-existing custom exists as positive law apart from the legislator or judge.
  • Three elements of law:
    • Obligation to obey.
    • Institutions to enforce (e.g., police).
    • Officials to administer justice (e.g., judges and magistrates).
  • Important aspect of law is punishment; violation attracts sanctions.
  • According to Article 107A (1) of the Constitution of the United Republic of Tanzania, 1977, Courts are the institutions entrusted with the role of interpreting the law and administration of justice in the country.
2. Court System of Tanzania
  • Two-fold: Tanzania Mainland and Zanzibar.
  • Tanzania Mainland: Court of Appeal (apex), High Court, Resident Magistrate Court & District Court, and Primary Court.
  • Other institutions: Special Constitutional Court and tribunals.
2.1. Special Constitutional Court of Tanzania
  • Established under Article 125 of the Constitution.
  • Ephemeral status, sits only when there is a dispute to resolve.
  • Article 126(1): Hears disputes between the Government of the United Republic of Tanzania and the Revolutionary Government of Zanzibar concerning the interpretation of the Constitution.
  • Article 126(3): Conciliatory decision is final and not appealable.
2.2. Court of Appeal
  • Established under Article 117(1) of the Constitution.
  • Highest court, consists of Chief Justice and Justices of Appeal appointed by the President.
  • Article 117(3): Jurisdiction to hear cases from the High Court or Magistrate with extended jurisdiction.
  • No original jurisdiction, only hears cases on appeal.
2.3. High Court
  • Established under Article 108(1) of the Constitution.
  • Unlimited original jurisdiction to entertain all types of cases.
  • Article 108(2): Unlimited jurisdiction unless expressly precluded.
  • Section 2(1) of the Judicature and Application of Laws Act Cap. 543: Unlimited civil and criminal jurisdiction, subject to Court of Appeal.
  • In Northern Tanzania Farmers’ Cooperative Society Ltd v W.H Shelukindo (1978) 2 LRT 36, the High Court held on its jurisdiction stating that: ''The High Court is a creature of the Constitution and exercises unlimited pecuniary and exercises unlimited pecuniary and territorial civil and criminal jurisdiction unless expressly restricted by the legislature” .
  • Exercises original jurisdiction on constitutional matters, including cases under the Bill of Rights and election petitions.
  • Structure:
    • High Court Main Registry (including sub-Registries).
    • Specialized divisions: Commercial, Labour, Land, and Corruption and Economic Crimes.
2.4. Resident Magistrates Courts and District Courts
  • Concurrent jurisdiction.
  • Established under the Magistrates Courts Act (MCA) of 1984 [Cap. 11 R.E. 2002].
  • Section 5(1) of the MCA, Resident Magistrate’s Courts are established by order of Chief Justices published in the Government Gazette.
  • Section 5(2) of MCA, the same Order of the Chief Justice designates the territorial jurisdiction of that court.
  • District Courts established in all districts (section 4(1) of the MCA).
  • District Courts receive appeals from Primary Courts.
  • Section 40 of the MCA, they exercise original jurisdiction in criminal and civil matters.
2.5. Primary Courts
  • Lowest courts in the hierarchy, established under section 3(1) of the MCA.
  • Established in every district.
  • Deal with criminal and civil cases (section 18(1) of the MCA).
  • Jurisdiction over civil matters where customary or Islamic law is applicable.
2.6. Tribunals
  • Quasi-judicial bodies mandated to adjudicate particular cases.
  • Established under specific Acts of Parliament.
  • Examples: District Land and Housing Tribunals, Ward Tribunals, Village Land Councils, Fair Competition Tribunal.
  • Administrative bodies with adjudicatory functions: Tax Tribunals, Commission for Mediation and Arbitration.
3. Court System of the Revolutionary Government of Zanzibar
  • Similar to Tanzania mainland, includes Kadhi's courts.
  • Kadhi's courts adjudicate family law cases with Islamic religion (divorces, child custody, inheritance.)
3.1. Court of Appeal of Tanzania
  • Handles appeals from the High Court of Zanzibar, except Islamic law matters.
  • Composition stated in the Constitution.
3.2. High Court of Zanzibar
  • Same structure as the High Court of Tanzania.
3.3. Magistrate's Court
  • Jurisdiction over cases not involving Islamic law.
3.4. Kadhi's Appeal Court
  • Hears appeals from Kadhi's courts.
3.5. Kadhi's Courts
  • Lowest courts, adjudicate on Islamic family matters (divorce, assets, custody, inheritance) when both parties profess Islam.
3.6. Primary Courts
  • Same rank as Kadhi's Courts.
  • Deal with criminal and civil cases of customary nature but do not involve Islamic law.

4. Historical Background of Sources of Law in Tanzania

  • Current legal system is a result of Colonialism, particularly the British.
  • Before colonialism: 'social behaviours was regulated by custom and traditions, or customary law‟.
    Colonialists implemented their laws, modifying them where necessary.
  • Tanganyika adopted these laws after independence, modified to circumstances of an independent country.

5. Sources of Business Law in Tanzania

5.1. Constitution of the United Republic of Tanzania
  • Basic law of the land.
  • Lays down the general and basic legal framework.
  • Establishes Legislature (law-making), Executive (law enforcement), and Judiciary (law interpretation).
  • Defines powers of organs of government, sets limits to those powers.
  • Defines rights and duties of citizens (right to life, privacy, work, property; duty to participate in work, abide by laws, safeguard public property).
  • Supreme law, other laws derive validity from it; no law valid if contravenes it.
5.2. Statutes
  • Legislation enacted by the Parliament (Acts of Parliament).
  • Contain substantive/procedural provisions.
  • Examples: The Law of Contract Act [Cap. 345 R.E. 2002], The Companies Act [Cap 212 R.E. 2002]
5.3. Delegated Legislation
  • Laws made where Parliament delegates power to make regulations (Article 97(5) of the Constitution).
  • Must cover only specific area/part mentioned in Principal legislation.
  • Regulation must be made by specified authority in Parent Act.
  • Failure to comply means acting ultra vires; subsidiary legislation is null and void.
5.4. Customary Law
  • Introduced during British colonialism through the Tanganyika Order in Council, 1920.
  • Governor required to respect existing native laws and customs if not inconsistent with justice or morality.
  • Local courts applied native laws in cases involving natives, subject to justice, morality, and consistency.
  • Retained as a source of law post-independence.
  • Maagwi Kimito v Gibeno Werema [1985] TLR 132: Customary laws have same status as law provided not inconsistent with Constitution and natural justice.
    Mtatiro Mwita v Mwita Marianya Georges: relevant customary law must be applied if applicable and is not repugnant to justice or morality or inconsistent with any written law
5.5. Received laws
  • Laws from England applicable in Tanzania (section 2(3) of the Judicature and Application of Laws Act (JALA) [ Cap. 358 R.E. 2002]).
  • Include common law, doctrines of equity, and statutes of general application in force in England by 22nd July 1920.
  • Statutes of general application: The Fire Prevention (Metropolis) Act 1774, Life Assurance Act 1774, Marine Insurance Act 1906.
5.6. Case Law
  • Judicial decisions that have a binding force to future cases (High Court of Court of Appeal).
  • Function of the judiciary is to interpret the law.
    Methods of statutory interpretation judges give meaning to statutory provisions and that meaning has legal force like any other law.
  • Doctrine of precedent (Stare Decisis): lower courts obliged to follow principles established in decisions of higher courts (High Court, Court of Appeal) when deciding similar cases.
  • Courts of record: High Court and the Court of Appeal.
  • Found in case reports (High Court Digest (HCD), the Law Reports of Tanzania (LRT), the Tanzania Law Reports (TLR)).
5.7. Writings of eminent legal scholars
  • Authoritative works by legal experts.
  • Interpret the law, put it in correct perspective.
  • Courts refer to them for interpretation.
  • Not binding sources of law, but have a persuasive role.

6. Classification of laws of Tanzania

6.1. Public law and Private law
(a) Public Law
  • Matters related to society, particularly activities of state bodies.
  • Regulates relations between the state/governmental agencies and citizens or between agencies.
  • Main branches: Constitutional law, Administrative law, Criminal law.
(b) Private law
  • Deals with rights and duties between individuals in their private capacities.
  • Regulates relations between private persons, organizations/associations.
  • Examples: law of contract, law of agency, property law, and land law.
  • Also the law of torts, determines when compensation is to be paid when someone infringed.
  • The state is neither the subject nor the object of duty, but the state's machinery settles disputes.
6.2. Civil Law and Criminal law
(a) Civil law
  • Regulates civil wrongs/actions.
  • Breach of private duty, arising from agreement between individuals or rule of law (law of torts).
(b) Criminal law
  • Deals with crimes/offences.
  • Parties: the state and the individuals.
  • Crimes are wrongs the state has an interest to prohibit.
  • Prosecuted by the State, victims are witnesses.
6.3. Substantive Law and procedural law
(a) Substantive Law
  • Provides rights and duties.
  • Found in statutes, case law, or other sources.
  • Violation leads to litigation.
    Contractual terms must be honored, leading to liability for breach amounting of terms amounts to a violation of rights and may lead to Litigation
(b) Procedural Law
  • Provides procedures for obtaining rights/enforcing duties in substantive law.
  • Example: Penal Code provides for punishment for murder, Criminal Procedure Act provides the procedure.
6.4. International law and domestic law
(a) International Law
  • Operates among or between nations.
  • Public: regulates affairs/relations of states (Treaties, Conventions, Agreements, Protocols).
  • Private: regulates affairs between individual persons involving more than one state.
(b) Domestic Law
  • Law obtaining and applicable in the individual sovereign state.
  • Sometimes referred to as Municipal Law.
  • As per the sources of law recognised and applicable in that individual state. Total Page Count: 204