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In Ally Juma Said & Another v Hassan Abubakar & Others, Land Case No. 29595/2025, High Court of Tanzania, Land Division, at Dar es Salaam, GWAE, J | 8 June 2026, the High Court (Land Division) reaffirmed the principle that parties who voluntarily agree to mediation, arbitration, or other dispute resolution mechanisms must comply with those procedures before resorting to court proceedings.
The decision serves as an important reminder that contractual dispute resolution clauses are not mere boilerplate provisions. Failure to comply with agreed pre-litigation procedures may result in a claim being struck out, regardless of its merits.
Background
The dispute arose from a Joint Venture Agreement relating to the development of land. Clause 25 of the agreement required the parties to first seek resolution of disputes through mediation before pursuing court proceedings.
The plaintiffs commenced proceedings without demonstrating compliance with the agreed dispute resolution process. The defendants challenged the suit on the basis that it was premature and had been filed in breach of the contractual dispute resolution mechanism.
What the Court Held
The Court held that parties are bound by the terms of agreements they freely and voluntarily enter into and that courts should not rewrite or interfere with those agreements absent recognised legal grounds for doing so.
In reaching its decision, the Court endorsed the principle that:
“Where parties have freely entered into binding agreements, neither courts nor parties to the agreement should interpolate anything or interfere with the terms and conditions therein, even where binding agreements were made by lay people.”
The Court further found that the demand notice issued by the plaintiffs did not amount to compliance with the contractual requirement to appoint arbitrator/mediators. A general demand or negotiation effort could not substitute the specific dispute resolution procedure agreed by the parties.
Accordingly, the Court upheld the preliminary objection and struck out the suit for failure to comply with Clause 25 of the Joint Venture Agreement.
A Noteworthy Development: Filing a Defence May Not Constitute Waiver
Of particular interest is the Court’s treatment of the argument that the defendants had waived their right to rely on the arbitration clause by filing Written Statements of Defence.
The Court declined to accept that the mere filing of a defence is often done to comply with mandatory procedural timelines and does not amount to a waiver of the parties’ contractual obligation to arbitrate. In doing so, the Court departed from reasoning adopted in certain earlier High Court decisions and held that filing a defence does not, by itself, extinguish a party’s right to insist upon compliance with an agreed dispute resolution mechanism.
This aspect of the ruling is likely to attract considerable interest from commercial parties and practitioners involved in arbitration and complex commercial disputes.
Key Takeaways for Businesses
i. Review dispute resolution clauses before commencing legal proceedings.
ii. Ensure that all contractual preconditions to litigation have been satisfied.
iii. Demand letters and ordinary negotiations may not amount to compliance where the contract specifically requires mediation or arbitration.
iv. Maintain documentary evidence demonstrating compliance with contractual dispute resolution procedures.
v. Parties should not assume that participation in preliminary court processes automatically waives contractual ADR rights.
vi. Failure to comply with mandatory dispute resolution clauses may result in proceedings being struck out with costs.
Should you have any questions regarding this publication, do not hesitate to contact Yassin Maka