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02-66-10/2015(K)

PERAYU USIMA SDN BHD (No. Syarikat : 206761-H) … APPELLANT RESPONDEN LEE HOR FONG (berniaga di bawah nama dan gaya PEMBINAAN LH FONG) … RESPONDEN T

Contract : Payment for work done - Interim certificate - Whether interim certificates may be considered as a final amount of the value of work done - Contract subject to re-measurement - Whether amount claimed based on said interim certificates would be subjected to re-measurement - Question posed to Federal Court not related to a matter in respect of which a determination has been made by the court below - Effect of

06/09/2017

YA DATO' BALIA YUSOF BIN HAJI WAHIKorumYAA TAN SRI DATO' SERI ZULKEFLI BIN AHMAD MAKINUDINYA TAN SRI DATUK SURIYADI BIN HALIM OMARYA TAN SRI HASAN BIN LAHYA TAN SRI DATUK RAMLY BIN HAJI ALIYA DATO' BALIA YUSOF BIN HAJI WAHI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=75f6a1c8-8a4e-4ffe-9ac8-ebb78d90185c&Inline=true

02-66-10/2015(K) 1 IN THE FEDERAL COURT OF MALAYSIA ( APPELLATE JURISDICTION ) CIVIL APPEAL NO: 02-66-10/2015(K) BETWEEN USIMA SDN BHD (No. Syarikat : 206761-H) … APPELLANT AND LEE HOR FONG (berniaga di bawah nama dan gaya PEMBINAAN LH FONG) … RESPONDENT [ In the Court of Appeal Malaysia ] (Appellate Jurisdiction) Civil Appeal No. K-02-2633-10/2011 ] Between Lee Hor Fong (berniaga di bawah nama dan gaya PEMBINAAN LH FONG) … Appellant And Usima Sdn Bhd (No. Syarikat : 206761-H) … Respondent CORAM Zulkefli Ahmad Makinudin, PCA Suriyadi Halim Omar, FCJ Hasan Lah, FCJ Ramly Ali, FCJ Balia Yusof Wahi, FCJ http://www.kehakiman.gov.my/node/68 02-66-10/2015(K) 2 JUDGMENT OF THE COURT Background Facts [1] The Appellant, Usima Sdn. Bhd. (hereinafter referred to as Usima) was appointed as the main contractor by Jabatan Kerja Raya (“JKR”) to construct a water tank and carry out pipe laying works (the main contract). The Respondent, Lee Hor Fong (hereinafter referred to as LHF) was the subcontractor appointed by Usima to carry out the works. [2] By a Letter of Award dated 5.11.2002 , Usima appointed LHF as its subcontractor to carry out and complete the contract works for a total sum of RM9,510,863.51 commencing on 30.9.2001. The completion date for the contract was 7.3.2003. In the said letter of award, it was stated that the terms and conditions of the main contract will be deemed to form and be construed as part of the subcontract. [3] Dispute arose between the parties and by a letter dated 13.1.2003 Usima terminated the subcontract alleging that LHF had breached the terms of the contract by abandoning the contract works. [4] LHF commenced action against Usima in the High Court claiming for a sum of RM3,159,540.15. This claim was premised on Usima’s 02-66-10/2015(K) 3 refusal to pay for work done as represented by interim certificates number 15, 16 and 17 and a further sum of RM143,472.62 from the retention sum. [5] Usima filed a counter-claim for a total sum of RM2,034,908.27, being the costs incurred as management fees, and the cost to engage new subcontractors to complete the project and carry out rectification works, agreed liquidated damages and interest on advance payment. [6] On 9.10.2011, the High Court dismissed LHF’s claims on the grounds that LHF had failed to complete the contract works within the stipulated time and had abandoned the construction site. The learned High Court judge also allowed the counter-claim by Usima. Decision of the High Court [7] In dismissing LHF’s claims, the learned High Court judge considered that the pertinent question before the court was, when was the contract between the parties terminated. Was it on 13.1.2003 or on 20.2.2003. 02-66-10/2015(K) 4 [8] The significance of these two dates may be gleaned from the judgment of the learned High Court judge found at page 16 of his judgment: “….although the letter of termination was dated on the 13th January 2003 and received by the Plaintiff on the 20th February 2003, there were ample evidence to show that the Plaintiff had abandoned the construction site as early as mid-December 2002. This is evident by the appointment of the third parties to complete the uncompleted contract works.” [9] The learned High Court judge found that LHF had abandoned the contract. At page 17 of the judgment, His Lordship opined: “…The Court was of the further view that if Clause 51(c)(i) and (ii) is relevant to be the guideline as to how the contract work should be terminated, from the evidence adduced, the Defendant had complied with it by sending out notices in the form of memo before terminating the contract (Agreement). In the circumstances, the Court was of the view that the Defendant was not in breach of the contract when it terminated it and therefore was entitled to appoint other contractors to finish the uncompleted contract works. The Court was also of the view that since the Defendant was at all material time the main contractor of the contract work and it suffices that the issuance of the memo to the Plaintiff were indicative that the Plaintiff had abandoned the construction site.” [10] Being over cautious perhaps, the learned High Court judge also stated that if he was wrong in finding that Usima was not in breach of the 02-66-10/2015(K) 5 contract, the amount claimed by LHF based on the interim certificates would be subjected to re-measurement. [11] Aggrieved by the decision of the High Court, LHF lodged an appeal to the Court of Appeal. By its decision on 2.12.2013, the Court of Appeal unanimously allowed the appeal and the decision of the High Court was set aside. The Court of Appeal also dismissed Usima’s counter-claim. Decision of the Court of Appeal [12] In allowing LHF’s appeal, it was the unanimous view of the court that the learned High Court judge had erred in finding that LHF had abandoned the construction site. At page 5 of its judgment, the Court of Appeal found: “…. abandonment never featured in the respondent's notices to the appellant which referred to delays by the appellant, not least the letter of termination dated 13.01.2003 which was totally devoid of any reference to abandonment. It is elementary that delay cannot be said to constitute abandonment especially where, as here, the completion date was months away and until then the appellant was entitled to programme its works as it pleased. Time was not of the essence because it was not specified to be so in the contract which also provided for liquidated agreed damages as indicated by the respondent's counterclaim therefor.” 02-66-10/2015(K) 6 [13] The Court of Appeal also held that clause 51 of the main contract was not complied with by Usima because the letter of award (P11) appointing LHF to execute and complete the contract expressly provided for the main contract to be part of the contract between them. The Court of Appeal found that the learned High Court judge had failed to consider whether the notices and the letter of termination dated 13.1.2003 complied with clause 51 of the main contract. In the said letter of termination dated 13.1.2003, LHF was only given 7 days to make good the breach whereas clause 51(a) gives a period of 14 days. [14] On the issue of re-measurement of the interim certificates, the decision of the learned trial judge was held to be erroneous on the ground that the interim certificates upon which LHF’s claim were based, had already been measured and certified by the employer's consultant. The evidence relied on by the learned High Court judge referred to joint measurement before the issue of the interim certificates. [15] On Usima’s counter-claim, the Court of Appeal found that the trial judge had erred in allowing the same without reference to and in the absence of any evidence to support such claims. 02-66-10/2015(K) 7 [16] Usima sought for leave to appeal against the decision of the Court of Appeal and this Court had, on 10.9.2015 granted leave to Usima to appeal on the following questions of law: i. Whether the termination clause (Clause 51) found in the main contract [JKR 203A (Revised 10/83)] which is to be operated by the SO, can apply to the subcontract? ii. Can interim certificates under a provisional subcontract based on bills of quantities issued by Superintending Officer (“SO”) to the Applicant (Main Contractor) be considered as final amount of the value of work done to entitle the Court of Appeal to enter judgment based on the value of these certificates? iii. Whether in a provisional contract based on bills of quantities, interim certificates which are subject to re-measurement and not issued to the Respondent (Subcontractor) can be relied on by the Respondent as evidence of the value of work which they had carried out? iv. Whether as a matter of law a party to a construction contract is entitled to programme its work as it pleases? v. Can direct payments paid by the Applicant (Main Contractor) directly to the sub-subcontractors be disregarded in the claim 02-66-10/2015(K) 8 made by the subcontractor (Respondent) against the Applicant (Main Contractor)? [17] At the hearing of the appeal, learned counsel for Usima had abandoned questions number (i) and (iv) and proceeded to deal with questions number (ii) and (iii) together and with question number (v) to be dealt separately on its own. Our decision : Questions (ii) and (iii) [18] Questions (ii) and (iii) both deal with interim certificates and what merits determination by this court is whether such certificates may be considered as a final amount of the value of work done and the issue of re-measurement. [19] We will start with the subject of interim certificates. [20] By its very nature, an interim certificate can never be considered as a final determination of the value of works done or programmed in the contract. We reproduce below what the learned author Chow Kok Fong states in his book titled Law and Practice of Construction Contracts 4th Edition Volume 1 at pages 441 and 442: 02-66-10/2015(K) 9 “8.12 Interim certificates are certifications of payments made in accordance with some timeline stipulated in a construction contract. In essence, a certificate is a statement by the certifier (typically the architect, engineer, contract administrator or Superintending Officer) that during the period covered by the certificate, the contractor has carried out the works and supplied materials up to the value shown in the certificate as well as the net amount which the contractor is entitled to be paid, after allowing for the adjustments permitted by the terms of the contract. These certifications are never intended to be a precise or final determination of the value of the works. Thus, Hobhouse J in Secretary of State for Transport v Brise-Farr Joint Venture (1993) noted: At the interim stage, it cannot always be a wholly exact exercise. It must include an element of assessment and judgment. Its purpose is not to produce a final determination of the remuneration to which the contractor is entitled but is to provide a fair system of monthly progress payments to be made to the contractor. 8.13 In the absence of any provision to the contrary, the sum certified in an interim certificate is thus taken to be an estimate of the value of the work done up to the date shown in the certificate. Thus, while the employer or owner is obliged to pay what is certified, the amount certified is not binding on the parties and may be adjusted upon the completion of the works.” [21] Speaking on the same subject matter, Keating on Construction Contracts by Stephen Furst 8th Edition London Sweet and Maxwell, 2006 at page 139 says: “Interim certificates are thus approximate estimates, made in some instances for the purpose of determining whether the employer is safe in making a payment in advance of the contract sum, in others whether he is under a duty to pay an instalment and, if so, how much he is to pay. A contractual 02-66-10/2015(K) 10 right to receive payments for the value of work done and materials supplied arises not upon the work being done but upon the issue of the interim certificate in respect of such work and materials. Such certificate are not normally binding upon the parties as to quality or amount and are subject to adjustment on completion. They have been described as having “provisional validity” or being “provisional estimates of the sum to which the contractor is entitled by way of instalment payments”. The sum certified is not the true final value of the work done and materials supplied but what in the opinion of the engineer is due on the basis of the monthly statements.” [22] In the House of Lords’ case of The Tharsis Sulphur And Copper Company V. M’Elroy & Sons and Others (1878) 3 App. Cas 1040 HL Lord Cairns, LC at page 1045 had referred to what the parties called as engineers certificate issued from time to time authorizing interim payments as: “The certificates I look upon as simply a statement of a matter of fact, namely, what was the weight and what was the contract price of the materials actually delivered from time to time upon the ground, and the payments made under those certificates were altogether provisional, and subject to adjustment or to re-adjustment at the end of the contract.” [23] The English Court of Appeal in Henry Boot Construction Ltd v. Alstom Combined Cycles Ltd (2005) 3 ALL ER 932 ruled that interim certificates were no more than provisional estimates of the sum to which the claimant was entitled by way of instalment payments. At the final stage, the claimant and the engineer had to perform a very different exercise and it would be an integral part of the final certificate that it 02-66-10/2015(K) 11 would contain the engineer’s statement of the contract price ascertained by him after considering the final account, as detailed supporting documentation and all information reasonably required by him for its certification. [24] The issues that arose in the said case were (i) whether the claimant’s right to receive payments for the value of work done and materials supplied arose upon the work being done and materials supplied, or only upon the issue of a certificate (ii) if it only arose upon the issue of a certificate, whether it arose once and for all as soon as the claimant was entitled to have the sum certified in an interim certificate, or whether the claimant had a continuing right to have the sum certificated in subsequent certificates, and in particular the final certificate. [25] On the issue of re-measurement, suffice it to state that a contract containing quotations in which the sum finally due to the contractor is to be ascertained by recalculating each stated quantity from the actual amount of work performed, is referred to as re-measurement contract (Chitty on Contracts Volume II Specific Contracts 30th Edition). 02-66-10/2015(K) 12 [26] At the outset, it is worth reminding that parties had agreed at the trial stage that the contract is subject to re-measurement. Reading exhibit P11, we are of the considered view that the application of the main contract agreement to the subcontract was made at the request or rather on the suggestion of Usima. LHF accepted and agreed to the same as evinced by the signature of Lee Hor Fong in his capacity as a Director of Pembinaan L.H. Fong. Exhibit P11 states that the condition of the main contract including addendums and appendices attached thereto, specification preambles and methods of measurement shall be deemed to form and be read and construed as part of the subcontract. Exhibit P11 is a letter of award to LHF dated 5.11.2002. [27] We find the Court of Appeal was right in concluding at page 6 of its judgment which states “the main contract was applicable because the letter of award dated 5.11.2002 appointing the appellant to execute and complete the contract expressly provided for the main contract to be part of the contract between the appellant and the respondent.” [28] A perusal of the relevant clauses of the main contract and the Preamble to Bill of Quantities fortifies Usima’s contention on the issue. Clause 25 of the main contract captioned ‘Ukuran dan Penilaian Kerja Termasuk Perubahan’ in sub clause (c) provides: 02-66-10/2015(K) 13 “Di mana kuantiti kerja atau sebahagian daripadanya dinyatakan sebagai “sementara” dalam Senarai Kuantiti, amaun yang akan dibayar kepada Kontraktor berkenaan dengan Kerja tersebut atau sebahagian daripadanya apabila Kontrak ini disiapkan hendaklah ditentukan dengan mengukur semula dan menilai ke atas Kerja termasuk apa-apa perubahan yang dibenarkan atau disahkan kemudiannya oleh P.P. secara bertulis di bawah Fasal 24 Syarat-syarat ini, sebagaimana ianya dilaksanakan sebenarnya. Penilaian pengukuran semula kerja tersebut termasuk apa-apa perubahan hendaklah mengikut kaedah-kaedah (i) dan (ii) subfasal (b) di atas.” (emphasis added) [29] Further, clause 26(c) on quantities states: “(c) Sekiranya kuantiti dinyatakan sebagai “sementara”, kuantiti tersebut adalah menjadi kuantiti anggaran kerja tersebut tetapi ianya tidak akan diambil kira sebagai kuantiti yang benar atau tepat bagi Kerja yang akan dilaksanakan oleh Kontrak ini.” (emphasis added) [30] Consistent with a re-measurement contract, clause 47 of the main contract deals with the issue of payment and interim certificate. Sparing the need to reproduce the entirety of the said clause, it is crucial to refer to sub clause (c) of the same which reads: “(c) Amaun yang dinyatakan sebagai kena dibayar dalam Perakuan Interim hendaklah, tertakluk kepada apa-apa persetujuan antara pihak-pihak itu mengenai pembayaran secara berperingkat-peringkat, merupakan anggaran jumlah nilai kerja yang dilaksanakan dengan sempurnanya dan tujuh puluh lima (75) peratus daripada nilai bahan dan barang-barang tak pasang yang diserah-hantar ke tempat 02-66-10/2015(K) 14 Kerja atau ke tempat yang bersampingan dengan Kerja yang dicadangkan untuk digunakan di tempat Kerja itu sehingga dan termasuk pada tarikh penilaian itu dibuat, ditolak apa-apa ansuran yang dibayar dahulunya di bawah Syarat ini. Dengan syarat bahawa perakuan itu hendaklah termasuk hanya nilai bahan dan barang-barang tak pasang tersebut seperti dan dari masa ianya diserah-hantar dengan munasabah dan dengan sempurnanya dan tidak terlalu awal, ke tempat Kerja atau ke tempat yang berdampingan dengan Kerja, dan hanya jika dilindungi dengan secukupnya terhadap cuaca, kerosakan dan kemerosotan.” (emphasis added) [31] The status of the interim certificate referred to in clause 47(c) above is never intended to be final and conclusive as envisaged by clause 49 of the main contract which states: “49. KESAN PERAKUAN P.P. Tiada perakuan P.P. di bawah mana-mana peruntukan Kontrak ini boleh disifatkan sebagai keterangan muktamad mengenai kesempurnaan apa-apa kerja, bahan atau barang-barang bagi maksud perakuan itu dan juga tiada perakuan boleh melepaskan Kontraktor daripada liabilitinya untuk meminda dan memperbaiki semua kecacatan, ketidaksempurnaan, kekecutan atau apa-apa jua kerosakan lain sebagaimana diperuntukkan dalam Kontrak ini. Bagaimanapun, perakuan P.P adalah tidak muktamad dan tidak mengikat dalam apa jua pertikaian antara Kerajaan dan Kontraktor jika pertikaian itu dibawa ke hadapan seorang penimbangtara atau ke Mahkamah.” (emphasis added) [32] These clauses, in our view are clear provisions in the contract document indicating and spelling out that the contract being a re-measurement contract. 02-66-10/2015(K) 15 [33] It is the court’s duty to give effect to the bargain of the parties according to their intention and when that bargain is in writing the intention is to be looked for in the words used unless they are such that one may suspect that they do not convey the intention correctly. If those words are clear, there is very little that the court has to do. The court must give effect to the plain meaning of the words however much it may dislike the result. (See: Mulpha Pacific Sdn Bhd. v. Paramount Corp Bhd [2003] 4 MLJ 357) [34] The next question that arises is whether there was or there was no re-measurement done. [35] The learned High Court judge found that the amount claimed by LHF is subject to re-measurement and concluded that on the evidence proffered, there was no re-measurement done. [36] In finding that the interim certificates were subject to re- measurement, the learned High Court judge had merely relied on a piece of SP1’s evidence (Ismail b. Md. Zain). At page 17 of His Lordship’s grounds of judgment, it was stated as follows: 02-66-10/2015(K) 16 “If the Court wrong on its finding that the Defendant was not in breach of its contract with the Plaintiff, then on the amount claim by the Plaintiff would be subjected to re-measurement. In the evidence of SP1 it was put to him: Put: Sebelum JKR keluarkan interim certificate untuk interim 17 apakah prosedurnya? Jawapan: Sebelum keluarkan interim certificate, kebiasaan nya pihak kontraktor dengan pihak JKR akan mengadakan joint measurement bersama untuk kenal pasti nilai. Akan tetapi kuantiti tidak tepat sebab ada setengah kerja tidak siap sepenuhnya.” [37] We note that the above quoted passage was in our view added by the learned High Court judge as a further qualification to his finding that Usima was not in breach of the contract with LHF. It was his additional finding that there was no re-measurement. At the risk of repetition, it must be reiterated that LHF’s claim against Usima failed because the learned High Court judge found LHF had abandoned the construction site. [38] The Court of Appeal however, found that as abandonment was never featured in Usima’s notices to LHF as such notices only referred to delays by LHF in carrying out its work, the learned High Court judge had erred in holding that LHF had abandoned the site. 02-66-10/2015(K) 17 [39] On re-measurement, the Court of Appeal held that the issue of re- measurement did not arise as the interim certificates upon which LHF based its claim had already been measured and certified by the employers’ consultant. At paragraph 7 of its judgment, the Court of Appeal stated: “Finally, the learned trial judge’s finding that the appellant’s claim was subject to re-measurement was plainly wrong because the interim certificates upon which the appellant’s claim were based had already been measured and certified by the employer’s consultant. The evidence relied on by the learned trial judge referred to joint measurement before the issue of the interim certificate. The question of re-measurement, therefore, did not arise. Hence the respondent was clearly in breach of the contract when it purported to terminate the contact by its letter dated 13.01.2003.” (emphasis added) [40] LHF’s claims against Usima is based on interim certificates number 15, 16 and 17. SP1, an engineer in charge and who was the Superintending Officer of the project, stated in his evidence that the certificates were issued by JKR. The certificates show among others, the percentage of work carried out by Usima and up to the issuance of interim certificate no. 17 it shows the value of work done by Usima in the sum of RM6,021,006.95 as at 22.2.2003. The witness further stated that “Kesemua peraturan disokong oleh tuntutan kuantiti atau Bill of Quantity” and “Perakuan ini dibuat bagi mengesyorkan bayaran interim kepada kontraktor.” 02-66-10/2015(K) 18 [41] SP3, a technician under the supervision of SP1 supervised the project. He was on site and prepared the Bill of Quantity. His evidence merely reiterated the evidence of SP1. The evidence of SP2, a senior technician who supervised directly the duties of SP3 in essence also echoed a similar tone with the evidence of SP1 on the preparation and issuance of certificates number 15, 16 and 17. [42] Lee Hor Fong’s (the plaintiff) evidence established that LHF has completed about 61% of the contract work and his claim among others is based on the interim certificates number 15, 16 and 17. [43] We have earlier noted that the learned High Court judge had in the course of the trial when SP1 was giving evidence recorded that the parties had agreed the contract is subject to re-measurement. Beside saying in cross examination that “sebelum keluarkan interim certificate pihak Jabatan Kerja Raya (JKR) akan mengadakan joint measurement bersama untuk kenal pasti nilai akan tetapi quantity tidak tepat sebab ada setengah kerja tidak siap sepenuhnya”, SP1 further stated during re examination that “Ya, sebelum interim certificate dikeluarkan pihak kontraktor akan bersama-sama dengan Jabatan Kerja Raya (JKR) mengadakan joint measurement untuk tentukan quantity dan nilai.” 02-66-10/2015(K) 19 [44] We agree with the conclusion drawn by the Court of Appeal that LHF’s claims were based on the interim certificates which had been jointly measured and certified by Usima and the JKR. In our view, that joint measurement or re-measurement as one may call it, is in respect of work done by LHF on behalf of Usima towards Usima’s obligations under the main contract with JKR. That was the basis and modus operandi of the contract between the parties. Usima has been paid by JKR prior to this by way of and on the basis of other earlier interim certificates. It is an undeniable fact that Usima had relied upon these interim certificates for its claim against JKR. Likewise, LHF had also been correspondingly paid by way of and on the same basis. As the evidence of the witnesses suggest, joint measurement had been done. [45] Learned counsel for Usima contended that only certain clauses of the main contract can have application to the subcontract or rather can be imported into the same. To this end, it was submitted that those clauses of the main contract such as those that relate to the tasks and roles of the superintending officer (which happens to be SP1) cannot be imported and read into the subcontract. We find this argument to be seriously flawed for the reason of the existence of exhibit P11 which we have adverted to earlier. We find not a shred of evidence to controvert exhibit P11. 02-66-10/2015(K) 20 [46] The learned High Court judge was clearly in error in failing to fully appreciate the evidence in concluding that there was no re-measurement done. The evidence presented clearly suggest that the tasks carried out by SP1, SP2 and SP3 in the issuance of the interim certificates involved the process of re-measurement of the subcontract price which had been agreed in the sum of RM9,510,863.51 as stated in exhibit P11. Re- measurement according to the learned author of GT Gajira’s Law Relating to Building and Engineering Contracts in India “more often than not only means re-calculation, and physical measurements or dimension taken on site only occur in relation to work not of its nature subject to calculations of drawings.” [47] An error of this nature on the part of the trial judge merits intervention by the Court of Appeal. No doubt an appellate court will be slow in interfering or disturbing a finding of fact recorded by a trial court but it does not end there. In State of Rajastan v. Hanuman AIR [2001] SC 282, Mohapatra J delivering the judgment of the Supreme Court of India said: “An appellate Court should assess the evidence on record with a view to satisfy itself that the appreciation of evidence by the trial Court is not vitiated on account of any erroneous approach or illegality and it is not palpably erroneous. The sustainability of the judgment depends on the soundness of the reasons given in support of the findings and the conclusion.” 02-66-10/2015(K) 21 [48] It is trite that appellate interference will take place in cases where there has been no or insufficient judicial appreciation of the evidence. (See: Lee Ing Chin & Ors v. Gan Yook Chin & Anor [2003] 2 CLJ 19, Watt or Thomas v. Thomas [1947] AC 484, Chow Yee Wah & Anor v. Choo Ah Pat [1978] 1 LNS 32) [49] On that note, we see no error on the part of the Court of Appeal to have reversed the finding of the learned High Court judge on the issue of re-measurement. [50] Further, in our view it is unconscionable on the part of Usima after having been paid by JKR (the employer) based on the interim certificates to now insist that there should be a “further” re-measurement in respect of the work performed by LHF on its behalf as its subcontractor. Usima is estopped from doing so. The interim certificates were jointly measured by Usima and the Superintending Officer (SP1) from JKR, the employer. Usima must have approved and agreed to the same before being paid by JKR on those certificates. It cannot now say otherwise. One cannot approbate and reprobate. [51] Again, looking back at the contract documents agreed between them and the factual scenario of the case, was it intended by the parties 02-66-10/2015(K) 22 that re-measurement referred to therein means that there will be re- measurement of the work between Usima as the main contractor and JKR and subsequently, there is also the need for another re- measurement of the same contract work between Usima and LHF, the subcontractor? We do not think that was envisaged by the terms of the contract between the parties. [52] For the aforesaid reasons and as explained earlier, interim certificates are merely estimates and are not final. However, on the peculiar facts and circumstances of this case which is a contract subject to re-measurement and based on the finding that measurement had been done before the issuance of the interim certificates as found by the Court of Appeal on its re-evaluation of the evidence, we agree with the submissions of learned counsel for LHF that the answer to questions (ii) and (iii) ought to be in the affirmative. Question (v) [53] Question number (v) arises from the issue of payments made by Usima directly to third parties. It was contended by Usima’s learned counsel that when the Court of Appeal allowed LHF’s appeal and entered judgment for the full amount in interim certificates no. 15, 16 & 17, it had failed to take into account such payments. During the course of the 02-66-10/2015(K) 23 works, payments were made by Usima directly to LHF’s subcontractors (the 3rd parties) and those payments were included in interim certificates number 15, 16 and 17. Those payments were not meant for work done by LHF but by the so called 3rd parties. LHF had thereby been unjustly enriched while Usima had been made to pay twice for the same works. Usima contended those payments must be deducted. [54] In support of its contention, Usima had invoked section 71 of the Contracts Act 1950 which reads: “Obligation of person enjoying benefit of non-gratuitous act 71. Where a person lawfully does anything for another person, or delivers anything to him, not intending to do so gratuitously, and such other person enjoys the benefit thereof, the latter is bound to make compensation to the former in respect of, or to restore, the thing so done or delivered.” [55] The scope on the application section 71 of the Contracts Act 1950 was explained by the Privy Council in the case of Siow Wong Fatt v. Susur Rotan Mining Ltd & Anor [1967] 2 MLJ 118 which laid down that four conditions must be satisfied to establish a claim under section 71 of the Contracts (Malay States) Ordinance 1950. [56] A summary of the facts of the case as may be gleaned from the report is reproduced herein verbatim: 02-66-10/2015(K) 24 “ The appellant made discoveries of a few hundred acres of land which gave promise of bearing iron ore. In November 1959 he obtained a prospectors licence and a mining lease was granted to him in 1961. He then formed a company called the Kota Mining Co. Ltd. (hereinafter called “Kota”) and transferred all the benefits and burdens vested in him to the company. By an agreement dated September 19, 1960 Kota transferred its right under the earlier agreements to the first respondent in consideration of $40,000 and a further $40,000.00 was to be paid at a later stage (which was never paid) with a tribute of $2 for every ton raised. Thus by a train of subcontracts the first respondent became entitled as a matter of substance to the benefit of the prospectors licence and a right to a mining sub-lease of the mineral land. The first respondent then as commercial owners of the mining rights constructed a road eight or nine miles long leading to the mineral land. But despite that the first respondent never started to mine the land as it appeared that Kota did not carry out their part of the contract. The first respondent then sued Kota for specific performance of the agreement dated September 19, 1960 and they joined the appellant as a defendant against whom they made a claim for specific performance of an alleged oral agreement. When the case came up before Azmi J., as he then was, counsel 02-66-10/2015(K) 25 for the first respondent announced that the action between his client and Kota had been settled so that the action proceeded between the first respondent and the appellant, and Azmi J. held that there was no oral agreement as alleged and dismissed the action. The first respondent then appealed to the Federal Court who found against the first respondent upon the alleged oral agreement but in its favour under section 71 of the Contracts (Malay States) Ordinance and directed an inquiry as to the sum to which the first respondent was thereby entitled ([1965] 2 MLJ 45). On appeal to the Privy Council, the sole question before their Lordships was whether the Federal Court were right in holding that the first respondent had a valid claim against the appellant under section 71 of the said Ordinance in respect of their expenditure upon the road.” [57] The Privy Council held that for the successful invocation of the said provision, four conditions must be satisfied. Lord Upjohn in delivering the judgment stated: “ It has been common ground before their Lordships that four conditions must be satisfied to establish a claim under section 71. The doing of the act or the delivery of the thing referred to in the section: (1) must be lawful (2) must be done for another person (3) must not be intended to be done gratuitously 02-66-10/2015(K) 26 (4) must be such that the other person enjoys the benefit of the act or the delivery. In their Lordships’ judgment these matters must be answered at the time that the act is done or the thing delivered and this, their Lordships think, is of fundamental importance. In this case the relevant time was therefore the building of the roadway in April to December, 1961.” [58] In laying down the four conditions stated, the Privy Council, relied on the observation made by Lord Simonds on section 70 of the Indian Contract Act in Governor-General of India v. Madura [1948] LR 75 IA 213 at page 221. Section 70 of the Indian Contract Act is in terms identical with section 71 of the Contracts (Malay States) Ordinance 1950, a predecessor to the present Contracts Act 1950. Their Lordships found that the Respondent had failed to satisfy the conditions except the first one that is, the act must be lawful. The Appellant’s appeal was allowed and the order of Azmi J was restored. [59] Before us, learned counsel submitted that Usima has satisfied all four conditions and therefore such payments must be deducted from the claims made by LHF. [60] On the facts and circumstances of the matter before us, we are unable to agree with that submission. While we may agree that the act 02-66-10/2015(K) 27 was lawful, it failed to satisfy the second test which the Law Lords of the Privy Council said: “ It is the second point which in their Lordships’ judgment is decisive of this case. As a matter of phraseology the section seems clear upon it. To bring the section into play the person when doing the act or delivering the thing must do the act “for another person” or deliver some thing “to him”. So that his then present intention must be to do the act or to deliver the thing for or to another.” [61] We may also agree with learned counsel on the third condition that it was not intended to be gratuitously done, but again, Usima failed to satisfy the fourth condition because it was in Usima’s interest and for its own benefit for the payment to be made in order to have the project completed. To achieve that, the third parties must be duly paid. The payment was for/towards the completion of the project awarded to Usima. Usima failed to satisfy the condition that the payment was made “for another person.” [62] In deciding on this second condition, the Privy Council found that when the road was built in 1961 by Susur Rotan and with the full knowledge of Mr. Siow, their Lordships held that it was built “for its own benefit for under the chain of contracts it was the body who was going to exploit the mineral lands. It was not done for another” (See: Siow Wong 02-66-10/2015(K) 28 Fatt v. Susur Rotan Mining Ltd & Anor (supra) per Lord Upjohn at page 121). [63] On the failure to satisfy all four conditions as envisaged under the section, Usima’s reliance on section 71 of the Contracts Acts 1950 is inconsequential. [64] We agree with the submissions of learned counsel for LHF that the answer to the question posed in the matter before us here turns very much on its own facts and circumstances. It is therefore not a question of general application. The answer to be given is only applicable to the peculiar facts and circumstances of the case alone. We shall refrain from answering question number (v). [65] Further, in our view, this issue of whether deduction should be made out of the sum in interim certificates number 15, 16 and 17 arises pursuant to the Court of Appeal’s decision in allowing the appeal and ordering LHF’s claim be allowed. Reading the judgment of the courts below, we are unable to find anything to indicate that this issue was ever dealt with except that there was a finding by the trial judge that Usima had appointed third parties to complete the contract works between 13.1.2003 and 20.2.2003. We are mindful of the fact that the question 02-66-10/2015(K) 29 posed to this Court must relate to a matter in respect of which a determination has been made by the court below. (See: Raphael Pura v. Insas Bhd & Anor [2003] 1 MLJ 513, The Minister for Human Resources v. Thong Chin Yoong [2001] 4 MLJ 225). [66] For the reasons stated, we unanimously dismiss the appeal with costs. The decision of the Court of Appeal is affirmed. t.t ( BALIA YUSOF BIN HJ. WAHI ) Federal Court Judge Dated: 6 September 2017 Counsel for Appellant: 1. B. Thangaraj 2. Sanjay Mohan Messrs Thangaraj & Associates Advocates and Solicitors Counsel for Respondent: 1. Gopal Sri Ram 2. Saw Lip Khai 3. YC Wong 4. CK Lim 5. Chuah Yih Chuan 6. David Yii Tetuan Chooi Saw & Lim

Tika 2.6.0

W-01(NCVC)(A)-463-12/2016

PERAYU MUHIBBAH ENGINEERING (M) BERHAD … APPELLANT RESPONDEN PEMUNGUT DUTI SETEM … RESPONDEN T

Revenue Law — Stamp duty — Exemptions — Facility agreement required plaintiff to provide negative pledge to bank that it would not create any encumbrance on its assets — Whether a negative pledge in a banking facility agreement is a “security” within the meaning of paragraph 2 of the Stamp Duty (Remission) (No.2) Order 2012 — Whether undertaking/guarantee by plaintiff that if bank recalled facility on demand repayment of monies owing would not be encumbered by third party interests could be termed as "pledge for security"

05/09/2017

YA DATO' ABDUL RAHMAN BIN SEBLIKorumYAA TUN TENGKU MAIMUN BINTI TUAN MATYA DATO' ABDUL RAHMAN BIN SEBLIYA PUAN SRI DATO' ZALEHA BINTI YUSOF

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=c96da8a0-0914-4f6b-80d8-610f26b546ae&Inline=true

1 IN THE COURT OF APPEAL OF MALAYSIA (APPELLATE CIVIL JURISDICITON) CIVIL APPEAL NO: W-01(NCVC)(A)-463-12/2016 BETWEEN MUHIBBAH ENGINEERING (M) BERHAD … APPELLANT AND PEMUNGUT DUTI SETEM … RESPONDENT [In the matter of Kuala Lumpur High Court Originating Summons No. WA-24NCVC-348-03/2016 Between Muhibbah Engineering (M) Berhad … Plaintiff And Pemungut Duti Setem … Defendant] CORAM TENGKU MAIMUN TUAN MAT, JCA ABDUL RAHMAN SEBLI, JCA ZALEHA YUSOF, JCA JUDGMENT OF THE COURT [1] The question for our determination was whether a negative pledge in a banking facility agreement is a “security” within the meaning of paragraph 2 of the Stamp Duty (Remission) (No.2) Order 2012 (“the Remission Order”) which is couched in the following language: “2. The amount of stamp duty that is chargeable under subsubitem 22(1)(b) of the First Schedule to the Act upon a loan agreement or loan instrument without security for any sum or sums of money repayable on demand or in single bullet repayment under that subsubitem which is in excess of zero point one per cent (0.1%) is remitted.” 2 (emphasis added) [2] Subsubitem 22(1)(b) of the First Schedule to the Stamp Act 1949 (“the Stamp Act”) referred to in the above Remission Order stipulates as follows: “22. BOND, COVENANT, LOAN, SERVICES, EQUIPMENT LEASE AGREEMENT OR INSTRUMENT of any kind whatsoever: (1)(b) for any sum or sums of money, not being interest for any principal sum secured by a duly stamped instrument, nor rent reserved by a lease or tack.” [3] Read together with this subsubitem, what paragraph 2 of the Remission Order means is that stamp duty that is chargeable on a loan agreement or loan instrument without security for any sum or sums of money repayable on demand or in single bullet repayment is remitted, meaning to say such loan agreement is exempted from payment of stamp duty. [4] The facts, as set out in the Case Stated, are as follows. Maybank Islamic Berhad (“Maybank”) provided banking facility to the appellant vide letter of offer dated 20.11.2013. Subsequent thereto, a facility agreement dated 2.6.2015 (“the facility agreement”) was executed between the appellant and Maybank for the transfer/refinancing of the appellant’s combined tradeline facilities from RM330 million to Islamic combined tradeline facilities amounting to RM595 million. [5] The appellant paid ad valorem stamp duty on the facility agreement amounting to RM1.98 million and Maybank issued the receipt for stamping dated 3.6.2015. 3 [6] On 20.8.2015, the respondent received the appellant’s letter dated 17.8.2015, appealing against the stamp duty and seeking application of the Remission Order to the facility agreement. By Notice of Assessment dated 15.9.2015, the respondent rejected the appellant’s appeal. [7] The appellant appealed against the Notice of Assessment by letter dated 9.10.2015, requesting the respondent to reconsider the assessment of stamp duty and to allow for remission under the Remission Order. The appellant further appealed against the Notice of Assessment by letter dated 28.12.2015, in which the appellant submitted the supplemental amendment and restatement agreement (“SARA”) dated 28.12.2015 to qualify for remission under the Remission Order. [8] On 12.2.2016, the respondent notified the appellant that the appeal was rejected and maintained its assessment of stamp duty amounting to RM1.98 million. [9] Aggrieved by the decision, the appellant appealed to the High Court against the assessment. The learned judge dismissed the appellant’s appeal, holding that the facility agreement was with security and therefore subject to payment of stamp duty. Hence the present appeal. [10] Having heard arguments by both parties, both oral and written, we unanimously allowed the appellant’s appeal and set aside the decision of the High Court. These are our grounds for allowing the appeal. [11] In the High Court, the reliefs sought by the appellant were as follows: 4 (1) An order that the facility agreement between the appellant and Maybank dated 2.6.2015 together with the SARA dated 28.12.2015 qualified for a remission pursuant to the Remission Order; (2) An order that should the facility agreement qualify for remission under the Remission Order, the excess stamp duty paid on the facility agreement amounting to RM495,000.00 be refunded to the appellant. [12] The issues for the High Court’s determination were the following: (1) whether the term “negative pledge” in the facility agreement carries the meaning of “security” (“jaminan” or “cagaran”); (2) whether the facility agreement, including the SARA are entitled to a remission of the stamp duty under the Remission Order. [13] In holding that the facility agreement was with security and therefore not entitled to remittance of stamp duty under the Remission Order, the learned judge relied on the following grounds: (1) The facility agreement considered the negative pledge as a security document under clause 1.1, clause 15 and clause 16; (2) The appellant had given a security in the form of a guarantee of the fulfilment of an undertaking or the payment of the loan. The appellant’s financier Maybank was assured by the appellant’s pledge that when it demanded the sums loaned under the facility agreement, the appellant was liable to pay back the loan or the 5 facility since the appellant was unencumbered by other claims. In that way Maybank was guaranteed that a recall of the loan on demand could be secured; (3) The security documents i.e. the facility agreement and the negative pledge constituted a security for the payment obligations and liabilities of the appellant; (4) The amendments made to the facility agreement through the SARA had removed all references to the security documents and was made retrospectively. Nonetheless, at the point in time when the appellant first stamped the facility agreement, stamp duty was already chargeable and therefore had to be paid by the appellant and therefore with security. [14] The “Negative Pledge” is given the following meaning by clause 1.1 of the facility agreement: “Negative Pledge means the negative pledge granted by the Customer in favour of the Bank undertaking inter alia that it will not create or permit to arise or subsist any encumbrance, mortgage, charge, pledge, lien, right of retention, right of set off or any other security interest on the whole or any part of our present or future assets other than:- (a) liens arising in the ordinary course of business or by operation of law; and (b) security interests existing at the date hereof provided the same has been disclosed to you prior to the date hereof and subject to the amount outstanding and secured thereby at all times and at any time hereafter not exceeding the amount so disclosed at the date hereof;”. 6 [15] The word “security” is not defined by the Remission Order but the same clause 1.1 of the facility agreement defines “security documents” as to mean: “‘Security Documents collectively this Agreement, the Negative Pledge, the Trade Finance Contract Note and all other security documents for the time being or from time to time constituting security for the payment obligations and liabilities (including but not limited to the payment of Indebtedness) of the Customer under and in connection with the Facility and references to the “Security Documents” shall include references to any one or more of them;’” [16] Under the facility agreement therefore, “security documents” includes the negative pledge given by the appellant, which was in the following terms: “NOW IN CONSIDERATION OF THE FOREGOING, WE HEREBY COVENANT AND UNDERTAKE that so long as any part of the facility, profit, dividend, income, yield and any other fees, commission, cost or other charges relating thereto and any monies secured herein shall remain outstanding, we shall NOT without your written consent:- (a) create or permit to arise or subsist any encumbrance, mortgage, charge, pledge, lien, right of retention, right of set off or any other security interest on the whole or any part of our present or future assets other than:- (i) liens arising in the ordinary course of business or by operation of law; and (ii) security interests existing at the date hereof provided the same has been disclosed to you prior to the date hereof and subject to the amount outstanding and secured thereby at all times and at any time hereafter not exceeding the amount so disclosed at the date hereof…” (emphasis added) 7 [17] In considering whether the facility agreement was with or without security, the learned judge took the following approach: “The crux of the matter before this Court is whether the “loan agreement” or “loan instrument”, i.e. the Facility Agreements in this case, are “without security” for the sums of money which are “repayable on demand”. In determining this, the Court would consider, inter alia, whether the term “negative pledge” can be construed as being akin to “security”. If it is found that the Facility Agreements are without security, then the Plaintiff is entitled to the remittance of stamp duty as provided in paragraph 2 of the Remission Order 2012.” (emphasis added) [18] The baseline of the reasoning is that having been armed with the negative pledge given by the appellant, which is “akin to a security”, Maybank would then be in a position to recover the loan sum on demand, and this takes the facility agreement outside the scope of the Remission Order, thus disentitling the appellant to a remission of the stamp duty. [19] The peg on which the reasoning is hung is that since the appellant had pledged not to create or permit to arise or subsist any encumbrance, mortgage, charge, pledge, lien, right of retention, right of set off or any other security interest on its present or future assets, Maybank had thereby been provided with a “security” for the loan, the security being the pledge not to do any of those acts. We reproduce below Her Ladyship’s reasoning on this point: “By the “obligation created by an instrument”, namely the Facility Agreement [following the meaning of the word “security” as explained by Wright J in Jones (supra)], the Bank is assured by the Plaintiff’s negative pledge that when the Bank demands the sum loaned under the Facility Agreement, the Plaintiff is able to pay back the loan or facility since the Plaintiff is not encumbered by other claims on the Plaintiff. In that way, the Bank is guaranteed that recall of the loan on demand can be secured.” 8 (emphasis added) [20] With the above reasoning as its base, it was inevitable that the learned judge would come to the following conclusion at paragraph 46 of her grounds of judgment: “46. Based on the foregoing considerations, it is clear that the Facility Agreement, together with the amendments and further provisions in SARA, are agreements which are with security. The Plaintiff is therefore not entitled to the remittance of stamp duty as provided in paragraph 2 of the Remittance Order 2012.” (emphasis added) [21] The question of law that arises is whether a negative pledge such as the one provided by the appellant to Maybank is a “security” within the meaning of the Remission Order. If it is, then a loan agreement with such pledge as security is chargeable with stamp duty and therefore not entitled to the benefit of a remission under the Remission Order. [22] In concluding that the facility agreement was with security, it is obvious that the learned judge considered “security” under the Remission Order as to include the facility agreement itself, which by definition (see clause 1.1) includes the agreement, being one of the “Security Documents”. [23] With due respect to the learned judge, we must say at the outset that the “security” that the court should be concerned with is not the loan instrument, i.e. the facility agreement itself, but the nature of the negative pledge. The words “without security” in the Remission Order come after the words “loan agreement or loan instrument”. This can only be 9 construed as to mean a security that is separate from and not part of the loan instrument itself. It refers to a separate security instrument. [24] The legislative intent clearly is for the security to be collateral or secondary to that of the loan agreement or loan instrument. To construe otherwise would be to render the Remission Order redundant and will not be applicable in any circumstance as the loan agreement or loan instrument would then, by itself, constitute “security” in any event and in every case. In our view, that construction will defeat the object of the Remission Order rather than to put its object into effect. [25] We agree with learned counsel for the appellant that the loan agreement is not the operative instrument for the purposes of the Remission Order because the loan agreement is already subject to stamp duty and is the main instrument falling under subsubitem 22(1)(b) of the First Schedule to the Stamp Act. What the Remission Order is concerned with is whether or not the loan agreement or loan instrument is supported by another instrument that creates an obligation “for any sum or sums of money repayable on demand or in single bullet repayment”. [26] The parties had cited English and Australian cases to support their respective arguments. Although relevant, these cases are not directly on point, simply because the equivalent provisions in those jurisdictions are not in pari materia with paragraph 2 of the Remission Order. Nevertheless we shall refer to them for the general principles involved. [27] In Independent Television Authority and Associated-Rediffusion Limited v Inland Revenue Commissioners [1961] AC 427, the facts as summarized in the headnote of the law report are as follows. Independent 10 Television Authority (“ITA”) and Associated Rediffusion Ltd (“ARL”) agreed to provide programmes for broadcasting by ITA pursuant to section 2 of the Television Act, 1954. [28] The agreement was to come into operation between August 15, 1955, and November 15, 1955, and to continue in force until July 29, 1964. ARL was to pay ITA a fee at the rate of £495,600 a year for 2 ½ years and at a rate of £536,900 thereafter. The agreement further provided for an increase or decrease of such payments in the event of an increase or decrease of 5 per cent or more in the half-yearly index figure (therein defined), compared with the basic index figure (defined as meaning the average of the index figures for all items in the Interim Index Retail Prices published by the Board of Trade). [29] The Inland Revenue Commissioners held that the agreement was liable to ad valorem stamp duty under the head of charge “Bond, Covenant, or Instrument of any kind whatsoever (1) being the only or principal or primary security for … any sum or sums of money at stated periods” within the meaning of the First Schedule to the Stamp Act, 1891, and so assessed the duty on the sums payable annually of £495,600 and £536,900 respectively. [30] From the facts of the case, it is clear that the agreement was the only principal or primary security for payment of the money at stated periods, which was crucial for the Inland Revenue Commissioners to determine whether the agreement was liable to ad valorem stamp duty. The House of Lords affirmed the finding of the Commissioners. The case concerns the following provision of the 1891 English Stamp Act: 11 “(1) Being the only or principal or primary security for any annuity (except upon the original creation thereof by way of sale or security, and except a superannuation annuity), or for any sum or sums of money at stated periods, not being interest for any principal sum secured by a duly stamped instrument, nor rent reserved by a lease or tack.” (emphasis added) [31] We reproduce below what Lord Cohen said in his judgment at page 447: “The commissioners held that the agreement was chargeable under the head “Bond, Covenant, or Instrument of any kind whatsoever,” and assessed the duty accordingly. On appeal, the Divisional Court gave judgment in favour of the Crown and the Court of Appeal affirmed that decision. Mr. Asquith argued that if the decision stood, any executory agreement providing for periodical payments such as an agreement for hire of a carriage and the services of a coachman from a livery-stable keeper in consideration of periodical payments, would be chargeable with ad valorem duty as a security, but A.L. Smith L.J. was not frightened by that analogy. After referring to the argument he continued: “The question, however, is, not what in ordinary parlance could be called a security, but what is the meaning of the word ‘security’ in this taxing Act; and it seems to me that, when the Act is fully considered, the meaning of the word as used therein is fairly defined by the Act itself.” Then, after setting out the relevant provisions of the head of charge, he continued: “I will take the word ‘bond’ and ‘covenant’ first of all. A bond given for the payment of a sum of money at stated periods, or a covenant given for such payment, is clearly a security within the meaning of the Act. Then I come to the subsequent words, upon which the question in the present case depends, ‘or instrument of any kind whatsoever being the only or principal or primary security … for any sum or sums of money at stated periods.’ Those words, in my opinion, cover a contract in writing, such as this, for the payment of a sum of money at stated periods. I cannot sever the word ‘instrument’ from the words ‘bond’ and ‘covenant’ which accompany it; and, as a bond or a covenant for the payment of a sum of money at stated periods is within the Act, I cannot see how I can hold that a contract in writing to the same effect is not within it. It was argued that a ‘security’ only means something auxiliary to an antecedent obligation, and therefore that a simple contract for the payment of £12 a year for the use of a telephone is not a security within the meaning of the Act. I think that the word ‘security,’ as used in the Act, clearly includes an instrument by which the obligation to pay is originally created.” 12 [32] In Underground Electric Railways Company of London Limited v Commissioners of Inland Revenue [1916] 1 KB 306 Swinfen Eady LJ said at page 313: “It was then contended that the deed was not a security for “any sum or sums of money at stated periods” as at its date there was no ascertained sum that might become payable, and it was urged that there was no decision upon the language of the schedule now under consideration, that the words extended to money only contingently payable, although there were decisions to that effect under other provisions of the Stamp Act. It has been determined that a deed is liable to be stamped as a security although the instrument itself creates the liability and contains merely a personal covenant or obligation and does not secure or reinforce any antecedent or collateral obligation: It is a security within the meaning of that provision: National Telephone Co. v. Inland Revenue Commissioners.” [33] At page 315 the learned judge went on to say: “In my opinion the deed comes within the language of the schedule to the Stamp Act. It is immaterial whether it is the only, or principal, or primary security; it was the security in respect of the guaranteed dividend – it was the only security for “any sum or sums of money at stated periods.” Then the duty is upon the sum periodically payable. Therefore with regard to the first point I am of opinion that the deed was both in fact and in law a deed being “a bond, covenant, or instrument,” coming within the language of this schedule, whereby certain sums were contingently made periodically payable. In these circumstances I am of opinion that the first point taken by the appellants fails and that the deed is liable to ad valorem duty.” [34] Banks J in his supporting judgment said: “I agree, and I do not desire to add anything to what the Lord Justice has said upon the first point which was relied upon by the appellants. On the second point I desire to say just a few words. At one time I felt some difficulty on this point, but the difficulty entirely disappeared upon a closer investigation of the exact language of the statute and the language of the deed. The schedule in the statute includes amongst the documents that 13 have to be stamped a “bond, covenant, or instrument of any kind whatsoever,” and then it goes on to define the class or nature of the bond, covenant or instrument coming within this particular provision. It defines it as being a document, a “bond, covenant, or instrument being the only or principal or primary security for any annuity or for any sum or sums of money at stated periods.” Now that must mean “for any sum or sums of money payable at stated periods,” and the first question for consideration is whether the instrument in question is the only or principal or primary security for an annuity or for any sum or sums of money payable at stated periods.” [35] In Inland Revenue Commissioners v Henry Ansbacher & Co [1963] 3 All E.R. 843 this is what Lord Morris said: “The words “being the only or principal or primary security (other than an equitable mortgage) for the payment or repayment of money” are, in my view words which must be shown to apply to an instrument which in the first place is within the heading, then the word “being” requires that to attract the particular specified stamp duty it must also be a security for the payment or repayment of money and must also be “the only principal or primary” such security. The guarantee is a security for the payment of money. It is not, however, the only such security unless for some reason the sale agreement is not to be regarded as a security for the payment of money. But in my view it clearly is.” “My Lords, I am satisfied that the word “security”, as used under the “Mortgage, bond etc”, heading, carries the same meaning as that word bears when used under the earlier heading. It seems to me to follow that, though the guarantee satisfied the test of coming within the “Mortgage, bond etc” heading, it did not satisfy the test of being the only or principal or primary security for the payment of money. The sale agreement was the principal or primary such security and, therefore the guarantee was not the only or principal or primary such security. It follows that the guarantee was not chargeable under sub-head (1), and accordingly was not liable to the amount of duty assessed by the commissioners.” [36] The meaning of “instrument of security” in the Second Schedule to the West Australian Stamp Act 1921 (“the WASA”) was discussed in the article titled Stamp Duty: The meaning of “Instrument of Security” in 14 Theory and Practice by I G Peek. After reviewing the decision of the Supreme Court of Western Australia in National Mutual Life Nominees Limited v Commissioner of State of Taxation (1991) 4 WAR 226, the learned writer wrote: “The second proposition is that, in order to be an instrument of security, the obligation secured must be one for the payment or repayment of money. An instrument will not satisfy this test if the obligation secured is not of a monetary nature. A common example of an instrument of security falling outside item 13 is a guarantee given by a holding company, guaranteeing the performance of a building contract by a subsidiary which is a construction company. The same point arises with “gold loans”, under which a quantity of gold is delivered by a “lender” to a “borrower” under a gold loan agreement, one of the conditions being that the “borrower” will deliver to the lender, at some time in the future, an equivalent quantity of gold of the same quality. A security given by the “borrower” securing its obligation to deliver gold will not be an instrument of security. In both these cases, the obligation secured is not of a monetary nature.” (emphasis added) [37] Item 13 of the Second Schedule to the WASA, which was applicable at the material time, stipulated as follows: “13. MORTGAGE (LEGAL OR EQUITABLE), BOND, DEBENTURE, COVENANT, BILL OF SALE, GUARANTEE, LIEN OR INSTRUMENT OF SECURITY OF ANY OTHER KIND WHATSOEVER: (1) An instrument referred to in the heading to this item, which instrument sets out the only or principal or primary security for any sum or sums of money at stated periods, being neither interest for any principal sum secured by a duly stamped instrument nor wages or salary or rent reserved by a lease (a) for a definite and certain period so that the total amount ultimately payable can be ascertained for every $100 and”. 15 [38] It is important to appreciate that stamp duty strikes at instruments rather than transactions. This is implicit in section 4(1) of the Stamp Act: “4(1) Subject to this Act and subject to the exemptions contained in this Act and in any written law for the time being in force, the several instruments specified in the First Schedule shall, from and after the commencement of this Act, be chargeable with several duties specified in such Schedule.” (emphasis added) [39] In Lim Teck Lee v The Commissioner of Stamps [1956] 22 MLJ 135, the Singapore Court of Appeal held: “The fundamental principle is this. The Stamp Act taxes instruments, not transactions. If there are two ways of carrying out a transaction and the parties are content with the simpler, they are entitled to carry it out in that way.” [40] In Galaxy Energy Technologies Sdn Bhd v Timbalan Pemungut Duti Setem, Malaysia & Anor [2011] 5 CLJ 829, this Court held a similar view when it said: “The cardinal principle of stamp duty is that stamp duty is chargeable on the instruments and not transactions. As Finley J in Prudential Assurance Co v Inland Revenue Commissioners [1935] 1 KB 101 said: The rule which must not be forgotten – namely, that under the Stamp Act one stamps, not transactions or anything of that sort, but one stamps instrument.” (emphasis added) [41] Reference may also be made to the case cited by the respondent, namely Jones v Commissioners of Inland Revenue [1895] 1 QB 484 where Wright J said: 16 “…the word “security” as used in these schedules does not mean as in popular language some obligation which is auxiliary to some obligation, but means any obligation created by any instrument.” [42] The decision was endorsed by the Court of Appeal in The National Telephone Company, Limited v Commissioners of Inland Revenue [1899] 1 QB 250 where A.L. Smith LJ said: “The question, however, is, not what in ordinary parlance could be called a security, but what is the meaning of the word “security” in this taxing Act; and “A bond given for the payment of a sum of money at stated periods, or a covenant given for such payment, is clearly a security within the meaning of the Act.” [43] The National Telephone Company, Limited (above) was affirmed by the House of Lords in The National Telephone Company, Limited v The Commissioners of Inland Revenue [1900] AC 1. [44] As to who bears the burden of proof in taxing laws, Harman J in Holmleigh (Holdings) Ltd v Commissioners of Inland Revenue 46 TC 435 held that it lies with the appellant. This is what he said: “The burden of bringing the several transactions which affect them within the relevant dispensing sections is of course on the Appellants. This is not a case of a taxing Act where the Crown must justify its charges: the boot is on the other foot.” [45] In similar vein, Raus Sharif J (now CJ) in Koperasi Serbaguna Kebangsaan Bhd v Pemungut Duti Setem Wilayah Persekutuan, Kuala Lumpur [2003] 8 CLJ 223 in dealing with the exemption of stamp duty sought by the co-operative society held as follows: 17 “To me, the above provision does not confer automatic exemption on all instruments executed by a co-operative society. It is the duty of the plaintiff when submitting the appropriate form to the defendant for the adjudication of the proper stamp duty under the Act, to seek for exemption by showing: (a) the instruments relating solely to the business of any society; (b) the society registered under any written law relating to co-operative societies; and (c) the instruments executed by the officer or member of such society.” [46] The decision was affirmed by this Court in Civil Appeal No. W-01-6- 04. [47] Lord Russell in the House of Lords case of Ben-Odeco Ltd v Powlson (Inspector of Taxes) [1978] STC 460 had this to say on the subject: “I start, my Lords, with the fact that this is a provision affording relief from tax. The taxpayer must persuade me that he is within it. If the reasons pro and con were in precise balance, the taxpayer on that basis would lose. But in upholding the view of the Special Commissioners and of Brightman J, as I do, I find the balance is in fact against the taxpayer company.” [48] The burden was therefore on the appellant to bring the facility agreement within the words of the Remission Order when it presented the agreement for stamping on 3.6.2015. [49] In urging this Court to dismiss the appeal, learned counsel for the respondent submitted that the Remission Order is only applicable to a loan agreement or loan instrument which - (a) has no security whatsoever and is repayable on demand; or 18 (b) has no security whatsoever and is repayable in a single bullet repayment. [50] It was submitted that the words used in the Remission Order are clear and as such must be applied, citing Maughan (Surveyor of Taxes) v Free Church of Scotland [1893] 3 TC 207 where it was stated: “But if you claim exemption you must fall clearly within the words of the Statute, or it cannot be allowed by ingenious arguments such as were presented to us by Mr Jameson.” [51] The argument presupposes of course that the negative pledge given by the appellant is a security within the meaning of the Remission Order. We were told that such type of loan agreement or instrument is loosely termed as a “clean loan”. What this means, conversely, is that a loan agreement or loan instrument with a negative pledge as security is not a clean loan and therefore not entitled to remission under the Remission Order, i.e. not exempted from payment of stamp duty. [52] In this regard, the following observations by Martin B in Limmer Asphalte Paving Co Ltd v Commissioners of Inland Revenue (1872) LR Exch 211 may perhaps provide some assistance: “In order to determine whether any, if any what, stamp duty is chargeable upon an instrument, the legal rule is that the real and true meaning of the instrument is to be ascertained; that the description of it given in the instrument itself by the parties is immaterial, even although, they may have believed that its effect and operation was to create a security mentioned in the Stamp Act, and they so declare. For instance, if a writing were headed by a recital that the parties had agreed to execute the promissory note thereafter written, yet if in truth the contract set forth was not a promissory note but an agreement of another character, the stamp duty would be not that of a promissory note but of the agreement. The question, therefore, stamp or no stamp, and if a stamp to what 19 amount, is to be determined upon the real and true character and meaning of the writing.” (emphasis added) [53] In Jones (supra), Wright J’s views were as follows: “I do not see how the Court could have arrived at the conclusion at which they did arrive unless that had been their view. It seems to me that we are bound by that decision; but even if we are not bound by it, it appears to me that it puts the proper construction on the schedule, and that the word “security” as used in these schedules does not mean as in popular language some obligation which is auxiliary to some other obligation, but means any obligation created by an instrument.” [54] However, Collins J in the same case gave a somewhat different view when he said: “Now, in “mortgage, bond, debenture, covenant”, it is clear that the statute is dealing with what we may call a primary security – with the instrument which creates the obligation as well as gives the right to recover the consideration; and therefore in that part of the Act it clearly does not appear to be used in any collateral or auxiliary sense.” [55] Lord Morris of Borth-y-Guest in Inland Revenue Commissioners v Henry Ansbacher & Co [1962] AC 191: “My Lords, it would be surprising if the word “security” bore different connotations in different parts of the Act, and I cannot think that it does. If the word denotes an instrument which creates an obligation, then it will be seen that though a “bond” or a “covenant” may be a security, a “security” will not necessarily be either. There may be a security (as for example the sale agreement in the present case) which is not a mortgage or bond or debenture covenant. I conclude therefore that, though the guarantee is caught by the words of the heading, it is not caught by the words which follow. To be chargeable the guarantee not only must be within the heading, but it must be a security which is a security for the payment or repayment of money and it must also be the only or principal or primary 20 such security. As it is not the only security, it is not liable to the amount of duty assessed by the commissioners.” (emphasis added) [56] Then there is the pronouncement by Lord Clyde in James Cormack and Others (James Cormack’s Trustees) v The Commissioners of Inland Revenue [1924] SC 819: “In determining whether a particular instrument falls within this, or that – or within any – of the categories enumerated in the schedule and defined in the Act, it has been often said that the substance and effect, rather than the precise terms, of the instrument should be regarded – Christie v. Commissioners of Inland Revenue, L.R., 2 Exch. 46; Limmer Asphalte Paving Co. v. The Commissioners, L.R., 7 Exch. 211; Belch v. The Commissioners, (1877) 4 R. 592; The Commissioners v. Glasgow and South-Western Railway Co., (1886) 13 R. 480, revd. (1887) 14 R. (H.L.) 33, 12 App. Cas. 315. No doubt this is so; but the question is nevertheless one both of form and substance. Among the infinite variety of transactions, there are some which are not necessarily and in themselves sales, but which may conveniently and effectually be carried out under the form of sale; and if the parties select that form as the vehicle of their transaction in preference to some other (which might be equally competent and effectual, but is considered less convenient, for the purpose of carrying out the objects in view), the substance of the transaction may be determined by the form selected. It is not that the legal form into which a transaction is thrown alters the substance. It is that the substance of a particular transaction may be equally consistent with the adoption of either legal form. It would be in vain to seek to avoid liability for the stamp-duty appropriate to the form selected merely because the substance of the transaction might have been carried into effect in another legal shape, the form of which would have attracted a stamp-duty of inferior denomination.” [57] Lord Ellenborough CJ in Warrington v Furbor 8 East 242: “I think that when the subject is to be charged with a duty, the cases in which it is to attach ought to be fairly marked out, and we should give a liberal construction to words of exception, confining the operation of the duty.” 21 [58] In Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (Northern Territory) [2009] HCA 41; (2009) 239 CLR 27 the High Court of Australia made the following observations with regard to the Australian revenue law: “Fixing upon the general legislative purpose of raising revenue carried with it the danger that the text did not receive the attention it deserves. This danger was adverted to by Gleeson CJ in Carr v Western Australia when he said: “[I]t may be said that the underlying purpose of an Income Tax Assessment Act is to raise revenue for government. No one would seriously suggest that s 15AA of the Acts Interpretation Act has the result that all federal income tax legislation is to be construed so as to advance that purpose. Interpretation of income tax legislation commonly raises questions as to how far the legislation goes in pursuit of the purpose of raising revenue. In some cases, there may be found in the text, or in relevant extrinsic materials, an indication of a more specific purpose which helps to answer the question. In other cases, there may be no available indication of a more specific purpose. Ultimately, it is the text, construed according to such principles of interpretation as provide rational assistance in the circumstances of the particular case, that is controlling.” …The general purpose of the Act to raise revenue is insufficient to support an intention to exclude a clearly expressed definition and to substitute a quite different meaning. Accordingly, the value attributable to an option to renew a lease should be excluded in making relevant calculations for stamp duty purposes under s 56N(2)(b) of the Act.” [59] As for the principles of statutory interpretation, we have within our shores the following pronouncement by Eusoffee Abdoolcader SCJ delivering the judgment of the then Supreme Court in Foo Yoke Ying & Anor v Television Broadcasts Ltd & Ors [1985] 2 MLJ 35: “The court however is not at liberty to treat words in a statute as mere tautology or surplusage unless they are wholly meaningless. On the presumption that Parliament does nothing in vain, the court must endeavor to give significance to every word of an enactment, and it is presumed that if a word or phrase appears in a statute, it was put there for a purpose and must not be disregarded. In Quebec Railway, Light, Heart and Power Co. Ltd. 22 v. Vandry, Lord Sumner in delivering the judgment of the Judicial Committee said (at page 676): “Secondly, there is no reason why the usual rule should not apply to this as to other statutes – namely, that effect must be given, if possible, to all the words used for the legislature is deemed not to waste its words or to say anything in vain.” … We should perhaps reiterate that the starting point in statutory interpretation is to consider the ordinary meaning of the word or phrase in question, that is its proper and most known signification. Some three months ago Lord Scarman in delivering the leading judgment of the House of Lords in South West Water Authority v Rumble’s [1985] 2 WLR 405 said (at p. 411): “…the language of the two paragraphs consists of ordinary English words which possess by their very impression the flexibility which is the hallmark of the English language, and which is one of the reasons for the survival of English as a living and worldwide tongue. I have no doubt that it would be contrary to the legislative purpose of the enactment to restrict or refine their breadth and flexibility in the context of this legislation, which has to cover a wide range of circumstances and situations present and future. A restrictive interpretation of the legislature’s language would defeat the broad purpose of this innovative and reforming statute.”” [60] Coming back to the word “security”, Lexis Nexis publication of Words, Phrases and Maxims – Legally and Judicially Defined (Volume 13) defines it to mean as follows: “A security is an encumbrance, vested in a creditor, over the property of his debtor, for the purpose of securing the repayment of a debt. It is a right in the property of another, which enables a person, who is entitled to receive a definite value from that another in default of so receiving it, to realise it from that property. The purpose of a security is to ensure, of [sic] facilitate, the fulfilment, or enjoyment, of some other right vested in its owner. Securities may be classified into: (i) mortgages; (ii) pawns; (iii) floating charges; (iv) lien. This word has a variety of meaning: 23 (i) the general name for all mortgages, charges, debentures, etc, whereby repayment of money is assured or secured; (ii) any document by which any claim may be enforced.”. (emphasis added) [61] Going by this definition, the negative pledge by the appellant is certainly not a security as it is not an encumbrance vested in Maybank over the properties of the appellant, nor does it vest in Maybank a right over the properties which enables Maybank to realise the loan amount from the properties in the event of default by the appellant. Being a mere pledge not to encumber properties and nothing more, there is no property for the respondent to realise in the event of default. [62] The true legal effect of the negative pledge given by the appellant is that it merely created an obligation not to encumber. It does not provide an obligation to repay any sum or sums of money in any way whatsoever. This is to be contrasted with that of a charge, mortgage or guarantee. In these instruments, upon the occurrence of an event of default, the sums of money become due and payable and failure to pay will expose the assets encumbered to foreclosure proceedings to redeem the loan sums. [63] We agree with learned counsel for the appellant that in the event of default by the appellant, Maybank will be considered as an unsecured creditor and will be equal in right of payment i.e. pari passu vis-a-vis the other creditors. It is therefore incorrect for the learned judge to hold the view that the negative pledge by the appellant assured or guaranteed Maybank of payment in the event of default. [64] It is an undisputed fact that the appellant did not pledge any tangible asset or property as security that can be disposed of, sold or converted to 24 cash to pay for the facility. The learned judge however did not consider this as negativing the element of “security” in the facility agreement when she held: “However, it must be noted that according to Clause 1.1. of the Facility Agreement, the negative pledge by the Plaintiff to the bank is an “undertaking” that the Plaintiff “will not create or permit to arise or subsist any encumbrance, mortgage, charge, pledge, lien, right of retention, right of set off or any other security interest on the whole or any part of the Plaintiff’s present or future assets” other than those provided therein. Therefore, it can be construed that whilst the Plaintiff did not pledge any tangible asset as a security, the Plaintiff has given an undertaking not to create any security interest in the Plaintiff’s assets. This means that, if construed within the meaning of the word “security” as stated in the Concise Oxford Dictionary (supra), the Plaintiff has given to the Bank a “security” in the form of “a guarantee of the fulfilment of an undertaking or the payment of a loan”. By the “obligation created by an instrument”, namely the Facility Agreement [following the meaning of the word “security” as explained by Wright J in Jones (supra)], the Bank is assured by the Plaintiff’s negative pledge that when the Bank demands the sum loaned under the Facility Agreement, the Plaintiff is able to pay back the loan or facility since the Plaintiff is not encumbered by other claims on the Plaintiff. In that way, the Bank is guaranteed that recall of the loan on demand can be secured. In view of the express provisions in the Facility Agreement that the “Security Documents” i.e. the Facility Agreement and the Negative Pledge constitute “security for the payment obligations and liabilities of the Customer” i.e. the Plaintiff, I agree with the submissions of the Defendant that the Plaintiff’s Facility Agreement is a loan agreement or loan instrument with security. It is not one “without security” as envisaged in paragraph 2 of the Remission Order 2012 to entitle the Plaintiff to remittance of stamp duty as provided therein.” [65] The Concise Oxford Dictionary (Ninth Edition) which the learned judge referred to in the first paragraph of the above passages gives 5 different meanings to the word “security”, as follows: “1 a secure condition or feeling. 2 a thing that guards or guarantees. 3a the safety of a state, company etc., against espionage, theft, or other danger. b an organization for 25 ensuring this. 4 a thing deposited or pledged as a guarantee of the fulfilment of an undertaking or the payment of a loan, to be forfeited in case of default. 5 (often in pl) a certificate attesting credit or ownership of stock, bonds, etc.” (emphasis added) [66] Of the 5 meanings, only meanings 2 and 4 are relevant, but even then they speak of “a thing” that guards or guarantees, or deposited or pledged as a guarantee of the fulfilment of an undertaking or the payment of a loan, to be forfeited in case of default. [67] With due respect to the learned judge, her reliance on the above dictionary meaning is misconceived. Surely a negative pledge in terms of clause 1.1 of the facility agreement cannot by any stretch of the imagination refer to “a thing that guards or guarantees”, nor is it “a thing deposited or pledged as a guarantee of the fulfilment of an undertaking or the payment of a loan, to be forfeited in case of default.” There was nothing deposited and there is nothing to forfeit. This fact alone dispels any notion that the negative pledge is a security within the meaning of the Remission Order. [68] A “thing” must necessarily refer to some tangible asset and not merely a pledge not to do a certain act. To give the construction that the learned judge had given will be to stretch the meaning of the word “security” beyond what is contemplated by Parliament in the Remission Order. [69] Since the negative pledge relates to an “encumbrance”, it is perhaps necessary to find out what the word means. The Oxford Dictionary of Law (Seventh Edition) defines it to mean: 26 “A right or interest in land owned by someone other than the owner of the land itself; examples include easements, leases, mortgages, and restrictive covenants.” [70] So, going by this definition, in order to create or to permit to arise or subsist any “encumbrance”, it must relate to land, over which Maybank is vested with a right or interest. Obviously, the definition does not cover the negative pledge given by the appellant as the pledge is not limited to land but to “the whole or any part of our present or future assets”. [71] We agree with the point taken by learned counsel for the appellant that there is no other instrument independent of the facility agreement which secures an obligation to secure a sum or sums of money on demand. As the negative pledge only creates an obligation not to encumber or charge assets as stipulated in the pledge, the facility agreement clearly falls under subsubitem 22(1)(b) of the First Schedule to the Stamp Act. [72] The matter of concern for the Remission Order is not the loan agreement or loan instrument itself but whether there is in existence another instrument that creates an obligation to pay a sum or sums of money on demand or in a single bullet payment. It is only where such instrument exists that entitlement to a remission of stamp duty is excluded by the Remission Order. [73] It bears repeating that a negative pledge by its very nature does not represent any guarantee that the sum or sums of money can be demanded from the appellant. It is merely a pledge to abstain from creating any form of charge, encumbrance or security. It is clearly not a 27 “security for any sum or sums of money repayable on demand”, unlike a guarantee or a charge. [74] We further agree with learned counsel for the appellant that the negative pledge will not help Maybank in any way towards recovery of the debt. The negative pledge does not create such obligation because it is merely a contractual obligation not to charge or encumber any asset and not an obligation to repay any sum or sums of money on demand. [75] In the event of default, nothing arises from the terms of the negative pledge and it does not make the sum or sums of money repayable on demand. This is of course another way of saying that there is no “security” in the form of “a guarantee of the fulfilment of an undertaking or the payment of the loan”. [76] The learned judge was therefore erroneous in holding that the negative pledge given by the appellant constitutes security for the facility agreement. To reiterate, there does not exist in the facility agreement any security for any sum or sums of money repayable on demand or in single bullet repayment. The facility agreement is therefore a loan agreement without security and is entitled to remission under the Remission Order. 28 [77] It was for all the reasons aforesaid that we allowed the appeal with costs of RM10,000.00, subject to payment of the allocator fee. ABDUL RAHMAN SEBLI Judge Court of Appeal Malaysia Dated: 5 September 2017. For the Appellant: Dato’ Mohd Arief Emran Arifin, Jason Liang Dinghui and Kellie Allison Yap of Messrs Wong & Partners. For the Respondent: Shafini Abdul Samad and Irfan Muashik bin Jantan of the Inland Revenue Board.

Tika 2.6.0

W-05(M)-168-05/2016

PERAYU ABOU SYLLA RESPONDEN PUBLIC PROSECUTOR … RESPONDEN T

Dangerous drugs — Trafficking in dangerous drugs — Accused excreted a total of 78 capsules — Trial court found the accused’s defence in respect of the 2nd charge were mere denial — Accused acquitted and discharged of 1st charge — Whether the omission on the part of the learned trial judge to state whether it was a case of direct trafficking or presumed trafficking was erroneous and fatal — Whether it was a case of direct trafficking or presumed trafficking— Dangerous Drugs Act 1952 [Act 234],section 12(2), 39A(2),s 39B(1)(a)

30/08/2017

YA DATUK KAMARDIN BIN HASHIMKorumYA DATUK SERI HAJI MOHD ZAWAWI BIN SALLEHYA DATO' AHMADI BIN HAJI ASNAWIYA DATUK KAMARDIN BIN HASHIM

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=722cf79c-1ce6-4a3c-9331-d6e8443fab7d&Inline=true

MRJ NO: W-05(M)-168-05/2016 IN THE COURT OF APPEAL, MALAYSIA AT PUTRAJAYA [APPELLATE JURISDICTION] CRIMINAL APPEAL NO: W-05(M)-168-05/2016 BETWEEN ABOU SYLLA …APPELLANT AND PUBLIC PROSECUTOR …RESPONDENT HEARD TOGETHER WITH CRIMINAL APPEAL NO: W-05(LB)-180-05/2016 BETWEEN PUBLIC PROSECUTOR …APPELLANT AND ABOU SYLLA …RESPONDENT (In The Matter of High Court of Malaya at Shah Alam Criminal Trial No: 45A-(36-37)-06/2014 Between Public Prosecutor And Abou Sylla) CORAM: MOHD ZAWAWI SALLEH, JCA AHMADI HAJI ASNAWI, JCA KAMARDIN HASHIM, JCA JUDGMENT OF THE COURT [1] This is a cross-appeal. The accused, a Republique De Guinee national, was charged with two offences of trafficking in dangerous drugs under section 39B(1)(a) of the Dangerous Drugs Act 1952 (‘the Act’) and punishable under section 39B(2) of the same. [2] Particulars of the charges were as follows: 1st Charge (case No: 45A-37-06/2014) “Bahawa kamu pada 8.1.2014 jam lebih kurang 5.30 petang di bilik 01, Hotel Liintel Inn, No. 210 Jalan Tun HS Lee, di dalam daerah Dang Wangi, di dalam Wilayah Persekutuan Kuala Lumpur telah didapati mengedar dadah berbahaya jenis methamphetamine berat bersih 228.6 gram. Oleh itu kamu telah melakukan kesalahan di bawah seksyen 39B(1)(a) Akta Dadah Berbahaya 1952 yang boleh dihukum di bawah seksyen 39B(2) Akta yang sama.” 2nd Charge (case No: 45A-36-06/2014) Bahawa kemu pada 8.1.2014 jam lebih kurang 9.05 pagi sehingga 11.1.2014 jam lebih kurang 11.15 pagi di Wan Zon Kritikal, Hospital Kuala Lumpur, di dalam daerah Dang Wangi, di dalam Wilayah Persekutuan Kuala Lumpur telah didapati mengedar dadah berbahaya methamphetamine berat bersih 768.6 gram. Oleh itu kamu telah melakukan kesalahan di bawah seksyen 39B(1)(a) Akta Dadah Berbahaya 1952 yang boleh dihukum di bawah seksyen 39B(2) Akta yang sama.” [3] At the end of the trial, the learned High Court Judge (‘the trial Judge’) convicted the accused and sentenced him to suffer the mandatory death penalty of the 2nd charge and acquitted him of the 1st charge. Aggrieved by the conviction and sentence, the accused appealed to this court. The Public Prosecutor aggrieved by the acquittal of the accused of the 1st charge, likewise appealed to this court. Both appeals were heard together. [4] We heard both the appeals on 24.7.2017. After hearing the parties and after perusing the Appeal Records, we allowed the accused’s appeal in part. We set aside the conviction under section 39B(1)(a) of the Act and substituted it with a conviction under section 12(2) and punishable under section 39A(2) of the Act. After hearing parties on the sentence, we imposed a sentence of 25 years imprisonment and 10 strokes of whipping on the accused. [5] We dismissed the appeal by the Public Prosecutor against the accused’s acquittal of the 1st charge. We affirmed the order of an acquittal of the accused of the 1st charged. [6] We now give our grounds of our decision. The Prosecution’s Case [7] The prosecution’s case may be summarized as follows. On 8.1.2014 at about 5.00 am, the accused came to Kuala Lumpur General Hospital and met Dr. Kamadev a/l Sonamuthu (PW3). The accused complained that he had stomach ache and feel like vomiting. [8] An x-ray was immediately done and the image showed that there were about 30 small packages inside the accused’s stomach. The accused was thus detained in the critical zone ward of the hospital and a police report was lodged. [9] The accused was detained at the said ward from 8.1.2014 until 15.1.2014. During that period of detention, the accused excreted a total of 78 capsules suspected to contained dangerous drugs. [10] The 78 capsules were sent to the chemist, Dr. Vanitha Kunalan (PW5) who confirmed that the 78 capsules contained Methamphetamine with a total weight of 768.6 grams, subject matter of the 2nd charge. PW5 also confirmed that Methamphetamine is listed under the First Schedule of the Act. [11] On 8.1.2014, while the accused was still under detention in the ward, ASP Mohd Farid bin Mokhtar (PW12) had recovered a hotel key from the accused’s trousers pocket. The accused informed PW12 that the key was the key to his room at No. 01, Hotel Liintel Inn, along Jalan Tun H.S. Lee. PW12 and his team went to the said room and recovered 23 capsules suspected to contained dangerous drugs. [12] The 23 capsules were sent to PW5 for analysis and confirmed to contained Methamphetamine with a total weight of 228.6 grams, subject matter for the 1st charge. [13] At the close of the prosecution’s case, the learned trial judge acquitted and discharged the accused on both the charges, holding that the prosecution had failed to establish a prima facie case on both the charges. [14] A subsequent appeal by the prosecution to the Court of Appeal was allowed and the accused was ordered to enter upon his defence on both the charges. The Defence [15] The accused elected to give evidence under oath. He denied having any knowledge of the drugs. He admitted swallowing and excreting the capsules he believed to contained gold dust. He swallowed the capsules while he was in Quanzang, China. The capsules were given to him by one Matthew in Quanzang. The accused said that he was paid USD2,000 by John to swallow the capsules containing the gold dust and to bring them into Malaysia. He alleged that some of the capsules were introduced into his body by Matthew through his anus. [16] The accused also stated that he was supposed to deliver the capsules to a person named Jackson at the hotel he stayed i.e Hotel Liintel Inn, Jalan Tun H.S. Lee. Jackson and a few other persons did come to his hotel room the next day. Jackson gave him fruits to eat in order to excrete the capsules. He excreted a few capsules which were taken by Jackson but some of the capsules were stuck in his stomach. Thus, he was sent by Jackson to the hospital. [17] The accused denied knowing that the capsules contained dangerous drugs otherwise he would not have swallowed the capsules. The accused testified that he did not inform the police about Matthew and Jackson as the police did not asked him. [18] Having evaluated the evidence of the accused, the learned trial judge found that the accused had failed to raise a reasonable doubt on the prosecution’s case in respect of the 2nd charge (drugs excreted by the accused). His Lordship held that the accused’s defence in respect of the 2nd charge were mere denial. Learned trial Judge also blamed the accused for his failure to disclose the existence of John, Matthew and Jackson to the police during the investigation. His Lordship opined that the prosecution had proved its case beyond a reasonable doubt in respect of the 2nd charge. The accused was thus convicted and sentenced to death on the 2nd charge. [19] In respect of the 1st charge for the drugs recovered from the hotel room, His Lordship held that the accused had succeeded in raising a reasonable doubt on the prosecution’s case. The prosecution had failed to cross-examined the accused in respect of the drugs found in the hotel room. Thus, the accused was acquitted and discharged of the 2nd charge. [20] We shall now deal with the accused’s appeal. The Grounds of Appeal by the Accused [21] Before us, learned counsel for the accused canvassed only one main ground of appeal, namely, that the accused had been prejudiced in that he does not know the basis of his conviction, whether it was a case of direct trafficking or presumed trafficking. This issue was raised as a point of law. [22] The learned counsel’s complaint was that there was no indication in the judgment of the learned trial judge whether the accused was convicted based on actual trafficking or presumed trafficking. The learned counsel argued that the omission on the part of the learned trial judge to state whether it was a case of direct trafficking or presumed trafficking was erroneous and fatal. The learned counsel asked for an outright acquittal or in the alternative, a conviction of possession simpliciter under section 12(2) punishable under section 39A(2) of the Act. [23] Learned counsel relied on three cases decided by this Court, namely Daniel Akachukwu Agbanusi v. PP [2017] 4 CLJ 200; Saeid Reza Mohammadi Mohammad v. PP [2016] 1 LNS 303; and Seyedalireza Seyedhedayatollah Ehteshamiardestani v. PP [2014] 4 CLJ 406. [24] In reply, the learned Deputy Public Prosecutor (‘the learned Deputy’) submitted the case of Tang Kheng Teong v. PP [2003] 2 CLJ 701 and urged upon us to invoke the provisio under section 60(1) of the Court of Judicature Act, 1964 (Act 91) to find the accused guilty of trafficking. Learned Deputy further cited the case of Tunde Apatira & Ors v. PP [2001] 1 CLJ 381, which decided that based on strong and overwhelming evidence such as in the present case where the drugs were found in the accused’s abdomen, the conviction should be maintained despite a misdirection by the trial judge. Our Decision [25] We have perused through the judgment of the learned trial judge and we agree that there is no indication in the judgment whether the accused was convicted based on actual trafficking or presumed trafficking. There was no mention at all by the learned trial judge whether the accused had committed an act of actual trafficking under section 2 or presumed trafficking under section 37 (da) of the Act in convicting the accused for an offence of trafficking in the impugned drugs under section 39B(1)(a) of the Act. In fact, the learned trial judge did not consider trafficking in the impugned drugs as one of the element of the charge against the accused person as can be seen from His Lordship’s judgment at page 21 AR vol.1: “E. Intipati-Intipati Pertuduhan 1. Sama ada barang yang disyaki itu dadah berbahaya? 2. Sama ada Tertuduh ada jagaan, kawalan, milikan dan ada pengetahuan mengenai dadah berbahaya tersebut? 3. Sama ada rantaian keterangan pendakwaan teratur?” [26] We are of the view that there was a misdirection by the learned trial judge for his failure to state whether the conviction of the accused was based on actual or presumed trafficking. The issue before us now is whether the failure of the learned trial judge had occasioned a failure of justice and fair trial and if that is so, whether it can be cured under section 422 of the Criminal Procedure Code. Under normal circumstances, a misdirection in law occured where the appellant is able to demonstrate that there has been a miscarriage of justice or there has been withheld from him a rule of law operating in his favour, the appellate court will normally interfere by setting aside the conviction (see: Chiu Nang Hong v. PP [1965] 1 MLJ 40). [27] The learned Deputy urged upon us to invoke the proviso under section 60(1) of Act 91, and to affirm the conviction on the strength of the prosecution’s case against the accused. The proviso to section 60(1) of Act 91 reads a follows: “Provided that the Court of Appeal may, notwithstanding that it is of opinion that the point raised in the appeal might be decided in favour of the appellant, dismiss the appeal if it considers that no substantial miscarriage of justice has occurred.” [28] The learned Deputy further argued that no substantial miscarriage of justice had occured in the present appeal before us on the ground that the learned trial judge had infact considered all the evidence before him and had applied the correct burden before convicting the accused of the trafficking charge. In this regard, His Lordship stated in his grounds of judgment, at pages 23 – 24 AR vol.1, as follows: “Selepas meneliti pembelaannya, Mahkamah berpendapat pembelaan Tertuduh langsung tak menimbulkan sebarang keraguan yang munasabah ke atas kes pendakwaan…… Mahkamah berpuashati pendakwaan telah membuktikan kesnya melampaui keraguan yang munasabah ke atas Tertuduh…..” [29] We agreed with the learned counsel. We are of the considered view that the failure of the learned trial judge to state whether it was direct or presumed trafficking was a serious misdirection in law. To our mind the misdirection in law had occasioned a miscarriage of justice to the accused person. [30] What amount to a miscarriage of justice or a failure of justice had been addressed by Gopal Sri Ram, JCA (as he then was) in Tunde Apatira & Ors, supra, where His Lordship had with approval cited three authorities decided in other jurisdiction, as follows: “The way in which the proviso is to be applied has been considered in several cases. Three of these deserve mention. In Marz v. The Queen [1955] 93 CLR 493, 514, Fullagar J, when addressing a similar provision in the New South Wales Criminal Appeal Act 1912 said: It is very well established that the proviso to s. 6(1) does not mean that a convicted person, on an appeal under the Act, must show that he ought not to have been convicted of anything. It ought to be read, and it has in fact always been read, in the light of the long tradition of the English criminal law that every accused person is entitled to a trial in which the relevant law is correctly explained to the jury and the rules of procedures and evidence are strictly followed. If there is any failure in any of these respects, and the appellant may thereby have lost a chance which was fairly open to him of being acquitted, there is, in the eye of the law, a miscarriage of justice. Justice has miscarried in such cases, because the appellant has not had what the law says that he shall have, and justice is justice according to law. It is for the Crown to make it clear that there is no real possibility that justice has miscarried. In Krishna Murthy v. Abdul Subban [1965] 1 Cr LJ 565, 576, Hegde J when dealing with the Indian equipollent of s. 422 of our Criminal Procedure Code said: The expression ‘a failure of justice has in fact occasioned thereby’ found in s. 535(1), Cr PC does not connote that the court should be of the opinion that an innocent person has been convicted or the case against the accused person is not made out beyond reasonable doubt. An accused person is entitled to be acquitted whether there was a fair trial or not if no case is made out against him. For the purpose the Legislature need not have introduced the conception of ‘failure of justice’ in ss. 535 and 537, Cr PC. The ‘failure of justice’ mentioned therein is that occasioned by the contravention of the provisions in Chapter XIX, Cr PC. In law the expression ‘justice’ comprehends not merely a just decision but also a fair trial. Sections 535 and 537, Cr PC have primarily in view a fair trial. For the purpose of those sections a denial of fair trial is denial of justice. One of the contents of natural justice, which is so much valued, is the guarantee of a fair trial to an accused person. A fair trial is as important as a just decision. Neither the one nor the other can be sacrificed. Sacrificed of the one, in the generality of cases, is bound to lead to the sacrifice of other. The two are closely interlinked. In Ratten v. R [1974] 131 CLR 510 at p. 516, however, Barwick CJ, explained the way in which the proviso is to be applied to particular circumstances. He said: Miscarriage is not defined in the legislation but its significance is fairly worked out in the decided cases. There is a miscarriage if on the material before the Court of Criminal Appeal, which where no new evidence is produced will consist of the evidence given at the trial, the appellant is shown to be innocent, or if the court is of the opinion that there exists such a doubt as to his guilt that the verdict of guilty should not be allowed to stand. It is the reasonable doubt in the mind of the court which is the operative factor. It is of no practical consequence whether this is expressed as a doubt entertained by the court itself, or as a doubt which the court decides that any reasonable jury ought to entertain. If the court has a doubt, a reasonable jury should be of a like mind. But I see no need for any circumlocution; as I have said it is the doubt in the court’s mind upon its review and assessment of the evidence which is the operative consideration. So it comes to this. As a general rule this court will, in the normal course of events, quash a conviction where there has been a misdirection. Exceptionally, a conviction will be upheld despite a misdirection where this court is satisfied that a reasonable tribunal would have convicted the accused on the available evidence on a proper direction. The decision of this court in Alcontara a/l Ambross Anthony v. Public Prosecutor [1996] 1 CLJ 705 exemplifies the general rule, while that in Khoo Hi Chiang v. Public Prosecutor [1994] 2 CLJ 151 illustrates the exception.” [31] In PP v. Ishak Hj Shaari & Other Appeals [2003] 3 CLJ 843, the Court further explained the meaning and extent of the application of the term “failure of justice” in section 422 of the CPC when an accused was denied a fair trial as follows: “In our view, having regard to the aforesaid object of the CPC, the issue whether or not the misdirection has occasioned a failure of justice can be resolved by seeking answer to certain corollary questions, namely, did the accused have a fair trial, did he know what he was being tried for and whether the allegations and facts were explained to him fairly and clearly and whether he was given a full and fair chance to defend himself? If the answers are in the affirmative, the only conclusion is that there has been no prejudice and failure of justice. If the answers are in the negative, the trial must necessarily be treated as vitiated. If there exists a reasonable doubt regarding the answers, the benefit of doubt must be given to the accused.” [32] In Tang Kheng Teong, supra, cited to us by the learned Deputy, the so call misdirection by learned trial judge as argued by the appellant was for the failure to make a finding of fact as to who was the actual trafficker, whether the appellant or a person by the name of Choong. It was held that the argument was bereft of any merit. In the present case before us, the learned counsel’s complaint relates to uncertainty on the part of the accused as to the evidential burden to be discharge by him at the end of the trial. If the learned trial judge had invoked the presumption under section 37(da) for the element of trafficking, the accused bears a higher burden to rebut the presumption on a balance of probabilities as decided in PP v. Yuvaraj [1969] 2 MLJ 89, Pc. If it is on direct trafficking, than the burden is only to raise a reasonable doubt. But, in the present case, the learned trial judge had used a lower burden of raising a reasonable doubt in holding that the prosecution’s case had been proved beyond reasonable doubt. [33] Another aspect of the learned trial judge’s judgment which had been criticised by the appellant was the uncertainty as to what act under section 2 had been committed by the accused for the trafficking charge assuming that the learned trial judge had applied section 2 of the Act to prove trafficking. If the learned trial judge had invoked presumed trafficking because of the weight of the drugs involved, then the learned trial judge had, however, failed to make a finding whether the presumption had been rebutted or not. [34] Learned counsel for the appellant had raised Articles 5 and 8 of the Federal Constitution in objecting the use of the proviso under section 60(1) of Act 91 and urged upon us to follow this court earlier decision in Daniel Akachukwu Agbanusi v. PP [2017] 4 CLJ 200, which is on all fours with the present appeal before us where it was decided: “(39) The principles enunciated in the above cases are equally applicable to this case where the trial judge did not make known whether the appellant’s case was premised on actual trafficking under s. 2 of the Act or presumed trafficking under s. 37(da) of the same Act. And whether the appellant had rebutted the presumption. (40) In conclusion, the appellant may consider himself fortunate for the lapses of the trial judge in writing his ground of judgment. Based on the evidence before the court, we were of the view that his conviction was not safe. We therefore minded to reduce the charge to a lesser offence of possession of drugs under s. 12(2) of the Act, punishable under s. 39A(2) of the same Act.” [35] We are of the view that this is not a fit and proper case for us to invoke the proviso. The court below committed misdirections in both law and fact. But, nevertheles, in our view, there was overwhelming evidence against the appellant in regard to the commission of the offence charged. The proven facts lead to only one reasonable conclusion that the appellant was indeed engage in the trafficking in dangerous drugs. He is not entitled to an outright acquittal. The material fact that the impugned drugs were found inside the appellant’s body was not disputed. [36] Based on the foregoings, we allowed the accused/appellant’s appeal in part. We set aside the conviction and death sentence imposed by the High Court, and substituted it with a conviction under section 12(2) punishable under section 39A(2) of the Act. After hearing the parties on sentence, we imposed an imprisonment term of 25 years commencing from the date of arrest and ten strokes of whipping on the accused/appellant. The prosecution’s appeal [37] We shall now deal with the prosecution’s appeal against the acquittal of the accused of the 1st charge in respect of the impugned drugs found in the hotel room. [38] The learned Deputy raised only one main central issue, namely, that the learned trial judge had failed to consider the evidence in totality before deciding that the prosecution had failed to proved its case beyond a reasonable doubt at the end of the trial. Learned Deputy argued that there are strong facts to proved custody and control of Room 01, Hotel Liintel Inn against the accused. The undisputed facts were such as: (a) the key to the room was recovered from the accused trousers’ pocket; (b) 23 capsules of drugs were found in the said room; (c) some personal belongings of the accused were also recovered from the same room which includes International Passport, boarding pass, flight tickets and hotel receipt, all under the accused name; (d) the hotel room was registered under the accused’s name; (e) the type of drugs recovered were similar with the drugs excreted by the accused in the HBKL ward; and (f) clothings bearing the accused DNA were also recovered in the said room. [39] Learned Deputy relied on Siew Yoke Keong v. PP [2013] 4 CLJ 149 where it was held that the accused had custody and control of the impugned drugs recovered in the room. For the element of knowledge, learned Deputy argued that the trial judge should have invoked the presumption under section 37(d) and direct trafficking under section 2 of the Act for keeping the drugs in the room. [40] On the issue of similar type of drugs, the learned Deputy argued that the drugs recovered from the room were similar in type and appearance with the drugs excreted by the accused. All were in capsules. The learned Deputy argued that the accused had knowledge of the drugs and relied on the Supreme Court’s decision in Wong Yew Ming v. PP [1991] 1 MLJ 31 to show evidence of system which is relevant and admissible under section 15 of the Evidence Act 1950. Our Decision [41] In acquitting the accused of the 1st charge, the learned trial judge reasoned as follows at page 24 AR vol.1: “Untuk pertuduhan pertama, pendakwaan langsung tak menyoal balas Tertuduh. Kegagalan berbuat demikian adalah satu penerimaan seperti yang diputuskan oleh kes Tan Kim Lue v. PP [1971] 1 MLJ 174. Oleh itu, pembelaan berjaya menimbulkan keraguan yang munasabah ke atas kes pendakwaan untuk pertuduhan pertama………………………………………….. Untuk pertuduhan pertama, pembelaan berjaya menimbulkan keraguan yang munasabah. …………………………………… Untuk pertuduhan pertama, Tertuduh dilepas dan dibebaskan.” [42] After perusing the Appeal Records, we unanimously agree with the decision of the learned trial judge. The learned trial judge had accepted the evidence of the accused in respect of the recovery of the drugs in the hotel room. As rightly pointed by the learned trial judge, not a single question from the prosecution’s cross-examination challenging the accused evidence and explanation. We find no error on the part of the learned trial judge in his finding. [43] The material part of the accused evidence in-chief in respect of the drugs found in the hotel room were as follows: (a) The capsules were given to him by Matthew in Guangzang, China and he was asked to swallowed them believing they contains gold dust; (b) He was supposed to deliver the capsules to Jackson when he arrived in Malaysia; (c) Some of the capsules he had excreted at the hotel room were taken by Jackson; (d) Later, he had excreted all the capsules at the hospital; (e) The police took his hotel room key from his trousers pocket; (f) The police did not take him to the hotel room and he did not know about the drugs allegedly recovered by the police from the hotel room; and (g) The police did not tell him anything about the recovery of the drugs from the hotel room. [44] The testimonies of the accused was not challenged by the prosecution. The learned trial judge was right in relying on the decision of Sharma J in Tan Kim Lue, supra, in accepting the accused’s unchallenged evidence and in acquitting the accused of the 1st charge. At page 175 of that case, Sharma J opined: “Another sad aspect of this case is that the learned magistrate having once decided to call upon the defence and the defence having given an explanation which could very reasonably be true still convicted him. One of the defence witnesses deposed that the six jacks were bought from the shop of Hock Tong Hin by the appellant and brought by him in the witness’s car. This witness was never cross-examined by the prosecution at all. In spite of this the learned magistrate has convicted the appellant. This, I think, was entirely wrong. When the prosecution chooses not to cross-examine a witness the natural inference is that it accepts the evidence of that witness in its totality.” [45] There was no challenged by the prosecution that the 23 capsules allegedly recovered by SP12 from the hotel room on 8.1.2014 were kept by the accused or were there with the full knowledge of the accused. In his evidence, the accused said that he had swallowed all the capsules given by Matthew while he was in China and the same had been excreted by him at the hotel room and at the hospital. His further evidence was that Jackson did came to his hotel room and took all the capsules he had excreted at the hotel room after consuming fruits brought by Jackson. A few inferences can be drawn as to how the 23 capsules were recovered from the hotel room. It is trite that the one most favorable to the accused should be adopted by the trial judge. The capsules could be brought by Jackson or excreted by the accused and kept in the room by Jackson without the accused’s knowledge. [46] We are of the considered opinion that there were many gaps in the prosecution’s case in respect of the 1st charge. There were many unsatisfactory fixtures in the investigation and in the alleged recovery of the 23 capsules in the hotel room. We would also say that there were many infirmities in the prosecution’s case. The hotel staff was not call to testify regarding spare keys and possibility of access by others to the room. There were DNA profiling of three other persons from the inner-ware recovered from the room which were unexplained. [47] In the upshot, we find no merits in the appeal by the prosecution against the acquittal of the accused on the 1st charge. There is no appealable error committed by the learned trial judge warranting an appellate intervention. We, therefore, unanimously affirmed the acquittal of the accused on the 1st charge by the High Court. Conclusion [48] We unanimously allowed the accused’s appeal in part in respect of the 2nd charge. We set aside the conviction and the death penalty imposed by the High Court. We substituted it with a conviction under section 12(2) punishable under section 39A(2) of the Act. We imposed 25 years imprisonment and 10 strokes of whipping in lieu thereof. [49] We unanimously dismissed the prosecution appeal in respect of the 1st charge. The acquittal of the accused of the 1st charge by the High Court is affirmed. Dated: 30th August, 2017 Signed (KAMARDIN BIN HASHIM) Judge Court of Appeal Malaysia Counsel/Solicitors: For the Appellant: Teh Poh Teik Messrs. Teh Poh Teik & Co Suite 11.08, Level 11 Menara TJB No. 9, Jalan Syed Mohd Mufti 80000 JOHOR BAHRU For the Respondent: Adam Bin Mohamed Deputy Public Prosecutor Attorney General’s Chambers Putrajaya 1

Tika 2.6.0

W-05(M)-168-05/2016

PERAYU ABOU SYLLA RESPONDEN PUBLIC PROSECUTOR … RESPONDEN T

Dangerous drugs — Trafficking in dangerous drugs — Accused excreted a total of 78 capsules — Trial court found the accused’s defence in respect of the 2nd charge were mere denial — Accused acquitted and discharged of 1st charge — Whether the omission on the part of the learned trial judge to state whether it was a case of direct trafficking or presumed trafficking was erroneous and fatal — Whether it was a case of direct trafficking or presumed trafficking— Dangerous Drugs Act 1952 [Act 234],section 12(2), 39A(2),s 39B(1)(a)

30/08/2017

YA DATUK KAMARDIN BIN HASHIMKorumYA DATUK SERI HAJI MOHD ZAWAWI BIN SALLEHYA DATO' AHMADI BIN HAJI ASNAWIYA DATUK KAMARDIN BIN HASHIM

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=722cf79c-1ce6-4a3c-9331-d6e8443fab7d&Inline=true

MRJ NO: W-05(M)-168-05/2016 IN THE COURT OF APPEAL, MALAYSIA AT PUTRAJAYA [APPELLATE JURISDICTION] CRIMINAL APPEAL NO: W-05(M)-168-05/2016 BETWEEN ABOU SYLLA …APPELLANT AND PUBLIC PROSECUTOR …RESPONDENT HEARD TOGETHER WITH CRIMINAL APPEAL NO: W-05(LB)-180-05/2016 BETWEEN PUBLIC PROSECUTOR …APPELLANT AND ABOU SYLLA …RESPONDENT (In The Matter of High Court of Malaya at Shah Alam Criminal Trial No: 45A-(36-37)-06/2014 Between Public Prosecutor And Abou Sylla) CORAM: MOHD ZAWAWI SALLEH, JCA AHMADI HAJI ASNAWI, JCA KAMARDIN HASHIM, JCA JUDGMENT OF THE COURT [1] This is a cross-appeal. The accused, a Republique De Guinee national, was charged with two offences of trafficking in dangerous drugs under section 39B(1)(a) of the Dangerous Drugs Act 1952 (‘the Act’) and punishable under section 39B(2) of the same. [2] Particulars of the charges were as follows: 1st Charge (case No: 45A-37-06/2014) “Bahawa kamu pada 8.1.2014 jam lebih kurang 5.30 petang di bilik 01, Hotel Liintel Inn, No. 210 Jalan Tun HS Lee, di dalam daerah Dang Wangi, di dalam Wilayah Persekutuan Kuala Lumpur telah didapati mengedar dadah berbahaya jenis methamphetamine berat bersih 228.6 gram. Oleh itu kamu telah melakukan kesalahan di bawah seksyen 39B(1)(a) Akta Dadah Berbahaya 1952 yang boleh dihukum di bawah seksyen 39B(2) Akta yang sama.” 2nd Charge (case No: 45A-36-06/2014) Bahawa kemu pada 8.1.2014 jam lebih kurang 9.05 pagi sehingga 11.1.2014 jam lebih kurang 11.15 pagi di Wan Zon Kritikal, Hospital Kuala Lumpur, di dalam daerah Dang Wangi, di dalam Wilayah Persekutuan Kuala Lumpur telah didapati mengedar dadah berbahaya methamphetamine berat bersih 768.6 gram. Oleh itu kamu telah melakukan kesalahan di bawah seksyen 39B(1)(a) Akta Dadah Berbahaya 1952 yang boleh dihukum di bawah seksyen 39B(2) Akta yang sama.” [3] At the end of the trial, the learned High Court Judge (‘the trial Judge’) convicted the accused and sentenced him to suffer the mandatory death penalty of the 2nd charge and acquitted him of the 1st charge. Aggrieved by the conviction and sentence, the accused appealed to this court. The Public Prosecutor aggrieved by the acquittal of the accused of the 1st charge, likewise appealed to this court. Both appeals were heard together. [4] We heard both the appeals on 24.7.2017. After hearing the parties and after perusing the Appeal Records, we allowed the accused’s appeal in part. We set aside the conviction under section 39B(1)(a) of the Act and substituted it with a conviction under section 12(2) and punishable under section 39A(2) of the Act. After hearing parties on the sentence, we imposed a sentence of 25 years imprisonment and 10 strokes of whipping on the accused. [5] We dismissed the appeal by the Public Prosecutor against the accused’s acquittal of the 1st charge. We affirmed the order of an acquittal of the accused of the 1st charged. [6] We now give our grounds of our decision. The Prosecution’s Case [7] The prosecution’s case may be summarized as follows. On 8.1.2014 at about 5.00 am, the accused came to Kuala Lumpur General Hospital and met Dr. Kamadev a/l Sonamuthu (PW3). The accused complained that he had stomach ache and feel like vomiting. [8] An x-ray was immediately done and the image showed that there were about 30 small packages inside the accused’s stomach. The accused was thus detained in the critical zone ward of the hospital and a police report was lodged. [9] The accused was detained at the said ward from 8.1.2014 until 15.1.2014. During that period of detention, the accused excreted a total of 78 capsules suspected to contained dangerous drugs. [10] The 78 capsules were sent to the chemist, Dr. Vanitha Kunalan (PW5) who confirmed that the 78 capsules contained Methamphetamine with a total weight of 768.6 grams, subject matter of the 2nd charge. PW5 also confirmed that Methamphetamine is listed under the First Schedule of the Act. [11] On 8.1.2014, while the accused was still under detention in the ward, ASP Mohd Farid bin Mokhtar (PW12) had recovered a hotel key from the accused’s trousers pocket. The accused informed PW12 that the key was the key to his room at No. 01, Hotel Liintel Inn, along Jalan Tun H.S. Lee. PW12 and his team went to the said room and recovered 23 capsules suspected to contained dangerous drugs. [12] The 23 capsules were sent to PW5 for analysis and confirmed to contained Methamphetamine with a total weight of 228.6 grams, subject matter for the 1st charge. [13] At the close of the prosecution’s case, the learned trial judge acquitted and discharged the accused on both the charges, holding that the prosecution had failed to establish a prima facie case on both the charges. [14] A subsequent appeal by the prosecution to the Court of Appeal was allowed and the accused was ordered to enter upon his defence on both the charges. The Defence [15] The accused elected to give evidence under oath. He denied having any knowledge of the drugs. He admitted swallowing and excreting the capsules he believed to contained gold dust. He swallowed the capsules while he was in Quanzang, China. The capsules were given to him by one Matthew in Quanzang. The accused said that he was paid USD2,000 by John to swallow the capsules containing the gold dust and to bring them into Malaysia. He alleged that some of the capsules were introduced into his body by Matthew through his anus. [16] The accused also stated that he was supposed to deliver the capsules to a person named Jackson at the hotel he stayed i.e Hotel Liintel Inn, Jalan Tun H.S. Lee. Jackson and a few other persons did come to his hotel room the next day. Jackson gave him fruits to eat in order to excrete the capsules. He excreted a few capsules which were taken by Jackson but some of the capsules were stuck in his stomach. Thus, he was sent by Jackson to the hospital. [17] The accused denied knowing that the capsules contained dangerous drugs otherwise he would not have swallowed the capsules. The accused testified that he did not inform the police about Matthew and Jackson as the police did not asked him. [18] Having evaluated the evidence of the accused, the learned trial judge found that the accused had failed to raise a reasonable doubt on the prosecution’s case in respect of the 2nd charge (drugs excreted by the accused). His Lordship held that the accused’s defence in respect of the 2nd charge were mere denial. Learned trial Judge also blamed the accused for his failure to disclose the existence of John, Matthew and Jackson to the police during the investigation. His Lordship opined that the prosecution had proved its case beyond a reasonable doubt in respect of the 2nd charge. The accused was thus convicted and sentenced to death on the 2nd charge. [19] In respect of the 1st charge for the drugs recovered from the hotel room, His Lordship held that the accused had succeeded in raising a reasonable doubt on the prosecution’s case. The prosecution had failed to cross-examined the accused in respect of the drugs found in the hotel room. Thus, the accused was acquitted and discharged of the 2nd charge. [20] We shall now deal with the accused’s appeal. The Grounds of Appeal by the Accused [21] Before us, learned counsel for the accused canvassed only one main ground of appeal, namely, that the accused had been prejudiced in that he does not know the basis of his conviction, whether it was a case of direct trafficking or presumed trafficking. This issue was raised as a point of law. [22] The learned counsel’s complaint was that there was no indication in the judgment of the learned trial judge whether the accused was convicted based on actual trafficking or presumed trafficking. The learned counsel argued that the omission on the part of the learned trial judge to state whether it was a case of direct trafficking or presumed trafficking was erroneous and fatal. The learned counsel asked for an outright acquittal or in the alternative, a conviction of possession simpliciter under section 12(2) punishable under section 39A(2) of the Act. [23] Learned counsel relied on three cases decided by this Court, namely Daniel Akachukwu Agbanusi v. PP [2017] 4 CLJ 200; Saeid Reza Mohammadi Mohammad v. PP [2016] 1 LNS 303; and Seyedalireza Seyedhedayatollah Ehteshamiardestani v. PP [2014] 4 CLJ 406. [24] In reply, the learned Deputy Public Prosecutor (‘the learned Deputy’) submitted the case of Tang Kheng Teong v. PP [2003] 2 CLJ 701 and urged upon us to invoke the provisio under section 60(1) of the Court of Judicature Act, 1964 (Act 91) to find the accused guilty of trafficking. Learned Deputy further cited the case of Tunde Apatira & Ors v. PP [2001] 1 CLJ 381, which decided that based on strong and overwhelming evidence such as in the present case where the drugs were found in the accused’s abdomen, the conviction should be maintained despite a misdirection by the trial judge. Our Decision [25] We have perused through the judgment of the learned trial judge and we agree that there is no indication in the judgment whether the accused was convicted based on actual trafficking or presumed trafficking. There was no mention at all by the learned trial judge whether the accused had committed an act of actual trafficking under section 2 or presumed trafficking under section 37 (da) of the Act in convicting the accused for an offence of trafficking in the impugned drugs under section 39B(1)(a) of the Act. In fact, the learned trial judge did not consider trafficking in the impugned drugs as one of the element of the charge against the accused person as can be seen from His Lordship’s judgment at page 21 AR vol.1: “E. Intipati-Intipati Pertuduhan 1. Sama ada barang yang disyaki itu dadah berbahaya? 2. Sama ada Tertuduh ada jagaan, kawalan, milikan dan ada pengetahuan mengenai dadah berbahaya tersebut? 3. Sama ada rantaian keterangan pendakwaan teratur?” [26] We are of the view that there was a misdirection by the learned trial judge for his failure to state whether the conviction of the accused was based on actual or presumed trafficking. The issue before us now is whether the failure of the learned trial judge had occasioned a failure of justice and fair trial and if that is so, whether it can be cured under section 422 of the Criminal Procedure Code. Under normal circumstances, a misdirection in law occured where the appellant is able to demonstrate that there has been a miscarriage of justice or there has been withheld from him a rule of law operating in his favour, the appellate court will normally interfere by setting aside the conviction (see: Chiu Nang Hong v. PP [1965] 1 MLJ 40). [27] The learned Deputy urged upon us to invoke the proviso under section 60(1) of Act 91, and to affirm the conviction on the strength of the prosecution’s case against the accused. The proviso to section 60(1) of Act 91 reads a follows: “Provided that the Court of Appeal may, notwithstanding that it is of opinion that the point raised in the appeal might be decided in favour of the appellant, dismiss the appeal if it considers that no substantial miscarriage of justice has occurred.” [28] The learned Deputy further argued that no substantial miscarriage of justice had occured in the present appeal before us on the ground that the learned trial judge had infact considered all the evidence before him and had applied the correct burden before convicting the accused of the trafficking charge. In this regard, His Lordship stated in his grounds of judgment, at pages 23 – 24 AR vol.1, as follows: “Selepas meneliti pembelaannya, Mahkamah berpendapat pembelaan Tertuduh langsung tak menimbulkan sebarang keraguan yang munasabah ke atas kes pendakwaan…… Mahkamah berpuashati pendakwaan telah membuktikan kesnya melampaui keraguan yang munasabah ke atas Tertuduh…..” [29] We agreed with the learned counsel. We are of the considered view that the failure of the learned trial judge to state whether it was direct or presumed trafficking was a serious misdirection in law. To our mind the misdirection in law had occasioned a miscarriage of justice to the accused person. [30] What amount to a miscarriage of justice or a failure of justice had been addressed by Gopal Sri Ram, JCA (as he then was) in Tunde Apatira & Ors, supra, where His Lordship had with approval cited three authorities decided in other jurisdiction, as follows: “The way in which the proviso is to be applied has been considered in several cases. Three of these deserve mention. In Marz v. The Queen [1955] 93 CLR 493, 514, Fullagar J, when addressing a similar provision in the New South Wales Criminal Appeal Act 1912 said: It is very well established that the proviso to s. 6(1) does not mean that a convicted person, on an appeal under the Act, must show that he ought not to have been convicted of anything. It ought to be read, and it has in fact always been read, in the light of the long tradition of the English criminal law that every accused person is entitled to a trial in which the relevant law is correctly explained to the jury and the rules of procedures and evidence are strictly followed. If there is any failure in any of these respects, and the appellant may thereby have lost a chance which was fairly open to him of being acquitted, there is, in the eye of the law, a miscarriage of justice. Justice has miscarried in such cases, because the appellant has not had what the law says that he shall have, and justice is justice according to law. It is for the Crown to make it clear that there is no real possibility that justice has miscarried. In Krishna Murthy v. Abdul Subban [1965] 1 Cr LJ 565, 576, Hegde J when dealing with the Indian equipollent of s. 422 of our Criminal Procedure Code said: The expression ‘a failure of justice has in fact occasioned thereby’ found in s. 535(1), Cr PC does not connote that the court should be of the opinion that an innocent person has been convicted or the case against the accused person is not made out beyond reasonable doubt. An accused person is entitled to be acquitted whether there was a fair trial or not if no case is made out against him. For the purpose the Legislature need not have introduced the conception of ‘failure of justice’ in ss. 535 and 537, Cr PC. The ‘failure of justice’ mentioned therein is that occasioned by the contravention of the provisions in Chapter XIX, Cr PC. In law the expression ‘justice’ comprehends not merely a just decision but also a fair trial. Sections 535 and 537, Cr PC have primarily in view a fair trial. For the purpose of those sections a denial of fair trial is denial of justice. One of the contents of natural justice, which is so much valued, is the guarantee of a fair trial to an accused person. A fair trial is as important as a just decision. Neither the one nor the other can be sacrificed. Sacrificed of the one, in the generality of cases, is bound to lead to the sacrifice of other. The two are closely interlinked. In Ratten v. R [1974] 131 CLR 510 at p. 516, however, Barwick CJ, explained the way in which the proviso is to be applied to particular circumstances. He said: Miscarriage is not defined in the legislation but its significance is fairly worked out in the decided cases. There is a miscarriage if on the material before the Court of Criminal Appeal, which where no new evidence is produced will consist of the evidence given at the trial, the appellant is shown to be innocent, or if the court is of the opinion that there exists such a doubt as to his guilt that the verdict of guilty should not be allowed to stand. It is the reasonable doubt in the mind of the court which is the operative factor. It is of no practical consequence whether this is expressed as a doubt entertained by the court itself, or as a doubt which the court decides that any reasonable jury ought to entertain. If the court has a doubt, a reasonable jury should be of a like mind. But I see no need for any circumlocution; as I have said it is the doubt in the court’s mind upon its review and assessment of the evidence which is the operative consideration. So it comes to this. As a general rule this court will, in the normal course of events, quash a conviction where there has been a misdirection. Exceptionally, a conviction will be upheld despite a misdirection where this court is satisfied that a reasonable tribunal would have convicted the accused on the available evidence on a proper direction. The decision of this court in Alcontara a/l Ambross Anthony v. Public Prosecutor [1996] 1 CLJ 705 exemplifies the general rule, while that in Khoo Hi Chiang v. Public Prosecutor [1994] 2 CLJ 151 illustrates the exception.” [31] In PP v. Ishak Hj Shaari & Other Appeals [2003] 3 CLJ 843, the Court further explained the meaning and extent of the application of the term “failure of justice” in section 422 of the CPC when an accused was denied a fair trial as follows: “In our view, having regard to the aforesaid object of the CPC, the issue whether or not the misdirection has occasioned a failure of justice can be resolved by seeking answer to certain corollary questions, namely, did the accused have a fair trial, did he know what he was being tried for and whether the allegations and facts were explained to him fairly and clearly and whether he was given a full and fair chance to defend himself? If the answers are in the affirmative, the only conclusion is that there has been no prejudice and failure of justice. If the answers are in the negative, the trial must necessarily be treated as vitiated. If there exists a reasonable doubt regarding the answers, the benefit of doubt must be given to the accused.” [32] In Tang Kheng Teong, supra, cited to us by the learned Deputy, the so call misdirection by learned trial judge as argued by the appellant was for the failure to make a finding of fact as to who was the actual trafficker, whether the appellant or a person by the name of Choong. It was held that the argument was bereft of any merit. In the present case before us, the learned counsel’s complaint relates to uncertainty on the part of the accused as to the evidential burden to be discharge by him at the end of the trial. If the learned trial judge had invoked the presumption under section 37(da) for the element of trafficking, the accused bears a higher burden to rebut the presumption on a balance of probabilities as decided in PP v. Yuvaraj [1969] 2 MLJ 89, Pc. If it is on direct trafficking, than the burden is only to raise a reasonable doubt. But, in the present case, the learned trial judge had used a lower burden of raising a reasonable doubt in holding that the prosecution’s case had been proved beyond reasonable doubt. [33] Another aspect of the learned trial judge’s judgment which had been criticised by the appellant was the uncertainty as to what act under section 2 had been committed by the accused for the trafficking charge assuming that the learned trial judge had applied section 2 of the Act to prove trafficking. If the learned trial judge had invoked presumed trafficking because of the weight of the drugs involved, then the learned trial judge had, however, failed to make a finding whether the presumption had been rebutted or not. [34] Learned counsel for the appellant had raised Articles 5 and 8 of the Federal Constitution in objecting the use of the proviso under section 60(1) of Act 91 and urged upon us to follow this court earlier decision in Daniel Akachukwu Agbanusi v. PP [2017] 4 CLJ 200, which is on all fours with the present appeal before us where it was decided: “(39) The principles enunciated in the above cases are equally applicable to this case where the trial judge did not make known whether the appellant’s case was premised on actual trafficking under s. 2 of the Act or presumed trafficking under s. 37(da) of the same Act. And whether the appellant had rebutted the presumption. (40) In conclusion, the appellant may consider himself fortunate for the lapses of the trial judge in writing his ground of judgment. Based on the evidence before the court, we were of the view that his conviction was not safe. We therefore minded to reduce the charge to a lesser offence of possession of drugs under s. 12(2) of the Act, punishable under s. 39A(2) of the same Act.” [35] We are of the view that this is not a fit and proper case for us to invoke the proviso. The court below committed misdirections in both law and fact. But, nevertheles, in our view, there was overwhelming evidence against the appellant in regard to the commission of the offence charged. The proven facts lead to only one reasonable conclusion that the appellant was indeed engage in the trafficking in dangerous drugs. He is not entitled to an outright acquittal. The material fact that the impugned drugs were found inside the appellant’s body was not disputed. [36] Based on the foregoings, we allowed the accused/appellant’s appeal in part. We set aside the conviction and death sentence imposed by the High Court, and substituted it with a conviction under section 12(2) punishable under section 39A(2) of the Act. After hearing the parties on sentence, we imposed an imprisonment term of 25 years commencing from the date of arrest and ten strokes of whipping on the accused/appellant. The prosecution’s appeal [37] We shall now deal with the prosecution’s appeal against the acquittal of the accused of the 1st charge in respect of the impugned drugs found in the hotel room. [38] The learned Deputy raised only one main central issue, namely, that the learned trial judge had failed to consider the evidence in totality before deciding that the prosecution had failed to proved its case beyond a reasonable doubt at the end of the trial. Learned Deputy argued that there are strong facts to proved custody and control of Room 01, Hotel Liintel Inn against the accused. The undisputed facts were such as: (a) the key to the room was recovered from the accused trousers’ pocket; (b) 23 capsules of drugs were found in the said room; (c) some personal belongings of the accused were also recovered from the same room which includes International Passport, boarding pass, flight tickets and hotel receipt, all under the accused name; (d) the hotel room was registered under the accused’s name; (e) the type of drugs recovered were similar with the drugs excreted by the accused in the HBKL ward; and (f) clothings bearing the accused DNA were also recovered in the said room. [39] Learned Deputy relied on Siew Yoke Keong v. PP [2013] 4 CLJ 149 where it was held that the accused had custody and control of the impugned drugs recovered in the room. For the element of knowledge, learned Deputy argued that the trial judge should have invoked the presumption under section 37(d) and direct trafficking under section 2 of the Act for keeping the drugs in the room. [40] On the issue of similar type of drugs, the learned Deputy argued that the drugs recovered from the room were similar in type and appearance with the drugs excreted by the accused. All were in capsules. The learned Deputy argued that the accused had knowledge of the drugs and relied on the Supreme Court’s decision in Wong Yew Ming v. PP [1991] 1 MLJ 31 to show evidence of system which is relevant and admissible under section 15 of the Evidence Act 1950. Our Decision [41] In acquitting the accused of the 1st charge, the learned trial judge reasoned as follows at page 24 AR vol.1: “Untuk pertuduhan pertama, pendakwaan langsung tak menyoal balas Tertuduh. Kegagalan berbuat demikian adalah satu penerimaan seperti yang diputuskan oleh kes Tan Kim Lue v. PP [1971] 1 MLJ 174. Oleh itu, pembelaan berjaya menimbulkan keraguan yang munasabah ke atas kes pendakwaan untuk pertuduhan pertama………………………………………….. Untuk pertuduhan pertama, pembelaan berjaya menimbulkan keraguan yang munasabah. …………………………………… Untuk pertuduhan pertama, Tertuduh dilepas dan dibebaskan.” [42] After perusing the Appeal Records, we unanimously agree with the decision of the learned trial judge. The learned trial judge had accepted the evidence of the accused in respect of the recovery of the drugs in the hotel room. As rightly pointed by the learned trial judge, not a single question from the prosecution’s cross-examination challenging the accused evidence and explanation. We find no error on the part of the learned trial judge in his finding. [43] The material part of the accused evidence in-chief in respect of the drugs found in the hotel room were as follows: (a) The capsules were given to him by Matthew in Guangzang, China and he was asked to swallowed them believing they contains gold dust; (b) He was supposed to deliver the capsules to Jackson when he arrived in Malaysia; (c) Some of the capsules he had excreted at the hotel room were taken by Jackson; (d) Later, he had excreted all the capsules at the hospital; (e) The police took his hotel room key from his trousers pocket; (f) The police did not take him to the hotel room and he did not know about the drugs allegedly recovered by the police from the hotel room; and (g) The police did not tell him anything about the recovery of the drugs from the hotel room. [44] The testimonies of the accused was not challenged by the prosecution. The learned trial judge was right in relying on the decision of Sharma J in Tan Kim Lue, supra, in accepting the accused’s unchallenged evidence and in acquitting the accused of the 1st charge. At page 175 of that case, Sharma J opined: “Another sad aspect of this case is that the learned magistrate having once decided to call upon the defence and the defence having given an explanation which could very reasonably be true still convicted him. One of the defence witnesses deposed that the six jacks were bought from the shop of Hock Tong Hin by the appellant and brought by him in the witness’s car. This witness was never cross-examined by the prosecution at all. In spite of this the learned magistrate has convicted the appellant. This, I think, was entirely wrong. When the prosecution chooses not to cross-examine a witness the natural inference is that it accepts the evidence of that witness in its totality.” [45] There was no challenged by the prosecution that the 23 capsules allegedly recovered by SP12 from the hotel room on 8.1.2014 were kept by the accused or were there with the full knowledge of the accused. In his evidence, the accused said that he had swallowed all the capsules given by Matthew while he was in China and the same had been excreted by him at the hotel room and at the hospital. His further evidence was that Jackson did came to his hotel room and took all the capsules he had excreted at the hotel room after consuming fruits brought by Jackson. A few inferences can be drawn as to how the 23 capsules were recovered from the hotel room. It is trite that the one most favorable to the accused should be adopted by the trial judge. The capsules could be brought by Jackson or excreted by the accused and kept in the room by Jackson without the accused’s knowledge. [46] We are of the considered opinion that there were many gaps in the prosecution’s case in respect of the 1st charge. There were many unsatisfactory fixtures in the investigation and in the alleged recovery of the 23 capsules in the hotel room. We would also say that there were many infirmities in the prosecution’s case. The hotel staff was not call to testify regarding spare keys and possibility of access by others to the room. There were DNA profiling of three other persons from the inner-ware recovered from the room which were unexplained. [47] In the upshot, we find no merits in the appeal by the prosecution against the acquittal of the accused on the 1st charge. There is no appealable error committed by the learned trial judge warranting an appellate intervention. We, therefore, unanimously affirmed the acquittal of the accused on the 1st charge by the High Court. Conclusion [48] We unanimously allowed the accused’s appeal in part in respect of the 2nd charge. We set aside the conviction and the death penalty imposed by the High Court. We substituted it with a conviction under section 12(2) punishable under section 39A(2) of the Act. We imposed 25 years imprisonment and 10 strokes of whipping in lieu thereof. [49] We unanimously dismissed the prosecution appeal in respect of the 1st charge. The acquittal of the accused of the 1st charge by the High Court is affirmed. Dated: 30th August, 2017 Signed (KAMARDIN BIN HASHIM) Judge Court of Appeal Malaysia Counsel/Solicitors: For the Appellant: Teh Poh Teik Messrs. Teh Poh Teik & Co Suite 11.08, Level 11 Menara TJB No. 9, Jalan Syed Mohd Mufti 80000 JOHOR BAHRU For the Respondent: Adam Bin Mohamed Deputy Public Prosecutor Attorney General’s Chambers Putrajaya 1

Tika 2.6.0

21NCVC-115-05/2012

PLAINTIF 1. EE CHONG WAH (NRIC No.: 350316-10-5475) 2. EE SOON KEE (NRIC No.: 630515-10-7621) 3. GOODLAND REALTY SDN. BHD. (Company No.: 14959-D) DEFENDAN 1. SUPREME TRIBUTE SDN. BHD. (Company No.: 970975-D) 2. CHONG WING FAT (NRIC No.: 600404-06-5177) 3. LIM YOKE SIM (NRIC No.: 640313-10-5766) 4. LOW BENG HONG (NRIC No.: 730726-08-6005) 5. SURUHANJAYA SYARIKAT MALAYSIA 6. DATO' HAJI MOHD AMIN BIN AHMAD YAHYA (Sued as the Land Administrator of Hulu Langat Selangor) 7. KERAJAAN NEGERI SELANGOR 8. MOHD AZHAR BIN MOHD DAUD (Sued as the Assistant District Officer, Registration Unit of the Land Office of Ulu Langat Selangor) 9. PENGARAH TANAH DAN GALIAN Negeri Selangor

29/08/2017

YA DATUK SU GEOK YIAM

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=f54d08e3-94c8-439b-85a9-2a667e4bd6ba&Inline=true

DALAM MAHKAMAH TINGGU MALAYA DI KUALA LUMPUR 1 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF KUALA LUMPUR, MALAYSIA (CIVIL DIVISION) CIVIL SUIT NO: 21NCVC-115-05/2012 5 BETWEEN 1. EE CHONG WAH (NRIC No.: 350316-10-5475) 10 2. EE SOON KEE (NRIC No.: 630515-10-7621) 3. GOODLAND REALTY SDN. BHD. (Company No.: 14959-D) ... PLAINTIFFS 15 AND 1. SUPREME TRIBUTE SDN. BHD. (Company No.: 970975-D) 20 2. CHONG WING FAT (NRIC No.: 600404-06-5177) 3. LIM YOKE SIM 25 (NRIC No.: 640313-10-5766) 4. LOW BENG HONG (NRIC No.: 730726-08-6005) 30 5. SURUHANJAYA SYARIKAT MALAYSIA 6. DATO' HAJI MOHD AMIN BIN AHMAD YAHYA (Sued as the Land Administrator of Hulu Langat Selangor) 35 7. KERAJAAN NEGERI SELANGOR 2 8. MOHD AZHAR BIN MOHD DAUD (Sued as the Assistant District Officer, Registration Unit of the Land Office of Ulu Langat Selangor) 9. PENGARAH TANAH DAN GALIAN 5 Negeri Selangor ... DEFENDANTS (By Way of Main Action) 10 BETWEEN 1. SUPREME TRIBUTE SDN. BHD. (Company No.: 970975-D) …PLAINTIFF 15 AND 1. GOODLAND REALTY SDN. BHD. (Company No.: 14959-D) 20 2. EE CHONG WAH (NRIC No.: 350316-10-5475) 3. EE SOON KEE 25 (NRIC No.: 630515-10-7621) 4. SURUHANJAYA SYARIKAT MALAYSIA 5. DATO' HAJI MOHD AMIN BIN AHMAD YAHYA 30 (Sued as the Land Administrator of Hulu Langat Selangor) 6. KERAJAAN NEGERI SELANGOR 3 7. MOHD AZHAR BIN MOHD DAUD (Sued as the Assistant District Officer, Registration Unit of the Land Office of Ulu Langat Selangor) 8. PENGARAH TANAH DAN GALIAN 5 Negeri Selangor ... DEFENDANTS (BY WAY OF COUNTERCLAIM) 10 GROUNDS OF JUDGMENT Background facts of main action 1. On 01.12.2014, this case was transferred to this Court from NCVC 2, upon the directions of the Managing Judge of the Civil Division of the 15 Kuala Lumpur High Court. 2. The background facts, which led the 3 (three) plaintiffs to file the main action in this case against the 9 (nine) defendants, are as follows: (1) At all material times, Ee Chong Wah and Ee Soon Kee, the 1st and 2nd plaintiffs, respectively, are the only 2 (two) shareholders 20 and directors of Goodland Realty Sdn. Bhd. (“Goodland”), the 3rd plaintiff; (2) Ee Chong Wah, the 1st plaintiff, was appointed as director of Goodland since 28.06.1973. He is holding 482,500 shares in Goodland; 25 (3) Ee Soon Kee, the 2nd plaintiff, was appointed as director of Goodland since 04.09.1991. He is holding 17,500 shares in Goodland; 4 (4) Goodland is a private limited company incorporated on 28.06.1973 under the Companies Act 1965 (Revised 1973) (Act 125); (5) Goodland has an authorized capital of RM 3,000,000.00 and a total issued and paid up capital of RM 500,000.00; 5 (6) At all material times, Goodland’s registered address is at Tingkat 1, Wisma Cheng Hin, No. 116 Jalan Pudu, 55100 Kuala Lumpur (“the Pudu address”); (7) Goodland is the registered proprietor of a piece of land held under EMR 2824, Lot No. 1011, Mukim Cheras, Selangor (“the 10 land”); (8) At all material times, Goodland is in possession of the EMR handwritten issue document of title of the land; (9) Unknown to the 1st to the 3rd plaintiffs, on 14.05.2002, the 6th defendant had converted the EMR handwritten register 15 document of title of the land, viz EMR 2824, Lot No. 1011, Mukim Cheras, Selangor (“the EMR title”) to a GM computer printed register document of title, viz Hakmilik Geran Mukim No.: 872, Lot 1011, Mukim Cheras, Daerah Hulu Langat, Negeri Selangor (“the GM title”) under paragraph 8(1) of the 20 Fourteenth Schedule of the National Land Code 1965 (“the NLC 1965”); (10) Goodland did not make any application under paragraph 8(4) of the Fourteenth Schedule of the NLC 1965 to the 6th, 8th and/or 9th defendants to convert the EMR handwritten issue document 25 of title of the land to a Geran Mukim computer printed issue document of title of the land; 5 (11) Goodland was also never asked by the 6th defendant to surrender the EMR handwritten issue document of title of the land to the 6th and/or 8th defendants to be cancelled and destroyed and to collect a Geran Mukim computer printed issue document of title of the land to replace the EMR handwritten 5 issue document of title of the land; (12) Goodland is still in possession of the EMR handwritten issue document of title of the land; (13) On Thursday, 01.03.2012 (which was about 10 (ten) years after the conversion of the EMR title to the GM title of which the 3 10 (three) plaintiffs were unaware), Goodland was orally informed by one Dato' Lee Siew Neng (“Dato' Lee”), through Ee Soon Kee, the 2nd plaintiff, at a meeting, that based on a search conducted at the Suruhanjaya Syarikat Malaysia (“the SSM”), the 2nd, 3rd and 4th defendants have replaced the 1st and 2nd 15 plaintiffs as the directors of Goodland; (14) At this meeting, Dato' Lee also produced and showed to Ee Soon Kee, the 2nd plaintiff, a photocopy of the search at the SSM dated 28.02.2012, which states as follows: (a) Both Ee Chong Wah, the 1st plaintiff and Ee Soon Kee, 20 the 2nd plaintiff, have been removed/replaced as the 2 (two) original directors of Goodland; and (b) The names of the new directors, who replaced them, at various dates, are Chong Wing Fat, the 2nd defendant; Lim Yoke Sim, the 3rd defendant; and/or Low Beng Hong, 25 the 4th defendant (“the new Directors of Goodland”); 6 (15) At this meeting, Goodland was also orally informed by Dato' Lee, through Ee Soon Kee, the 2nd plaintiff, that based on a search conducted at the Hulu Langat Land Office, the EMR title had been converted to the GM title and the land had been transferred by Goodland to Supreme Tribute Sdn. Bhd. 5 (“Supreme Tribute”), the 1st defendant; (16) At this meeting, Dato' Lee also produced and showed to Ee Soon Kee, the 2nd plaintiff, a photocopy of the search at the Hulu Langat Land Office dated 20.02.2012, which states as follows: 10 (a) The EMR title had been converted to the GM title; and (b) The land had been transferred to and registered in the name of Supreme Tribute on 01.02.2012. (17) The 1st and 2nd plaintiffs then made a search at the Hulu Langat 15 Land Office and discovered as follows: (a) that, without the knowledge and consent of the 1st to the 3rd plaintiffs, the land had been, purportedly, sold by Goodland to Supreme Tribute for a sum of RM 2 million; (b) that on 01.02.2012, the land had been, purportedly, 20 transferred by Goodland to Supreme Tribute upon the registration of a Memorandum of Transfer (“the MOT”), which was presented by Messrs. Peter Pui & Partners, the solicitors of Supreme Tribute; and (c) that Supreme Tribute had become the new registered 25 proprietor of the land on 01.02.2012; 7 (d) According to the 1st and 2nd plaintiffs, the, purported, sale and transfer of the land by Goodland to Supreme Tribute was done through fraud, forgery and/or by means of an insufficient and/or void instrument because at no point in time did either of them enter into any sale and purchase 5 agreement with Supreme Tribute, on behalf of Goodland, to sell the land to Supreme Tribute for a sum of RM 2 million or any other sum and/or execute the MOT on behalf of Goodland to transfer the land to Supreme Tribute in consideration of a sum of RM 2 million or any 10 other sum; (e) The 1st and 2nd plaintiffs discovered that the photocopies of the NRIC, purportedly, belonging to both of them, which were used in the, purported, transfer of the land by Goodland to Supreme Tribute, were false as they had 15 been forged by using photographs of unknown persons; (f) The 1st and 2nd plaintiffs also made a search at the SSM and discovered as follows: (a) that as a result of what they suspect to be the fraudulent acts of the 2nd defendant and/or the 3rd 20 defendant and/or the 4th defendant, who had, without their knowledge and consent, appointed themselves as the new Directors of Goodland (“the 3 (three) new Directors of Goodland”); (b) and who had, acting individually or together, then 25 forged and fabricated documents, including 2 (two) Form 49 dated 04.09.2011 and 30.12.2011, 8 respectively, and 1 (one) Form 44 dated 04.11.2011, all under the Companies Act 1965, which they had then sent to the SSM, for the purposes of registration in the records of the SSM; (c) that without their knowledge and consent and the 5 knowledge and consent of Law Ah Kuan, Goodland’s Company Secretary (“Law Ah Kuan”), the registered address of Goodland had been changed from the Pudu address to a fictitious address at No. 5, Jalan Cuepacs 4F, Taman 10 Koperasi Cuepacs, 43000 Kajang Selangor (“the Kajang address”) by the 3 (three) new Directors of Goodland, either acting individually or together, by forging the signature of Law Ah Kuan in the Companies Act 1965 Form 44 dated 04.11.2011, 15 which was intended to inform the SSM of the purported change of Goodland’s registered address; and (d) that the records of the SSM show as follows: (i) that the 1st and 2nd plaintiffs were removed as 20 directors of Goodland on 04.09.2011; and (ii) that the 3 (three) new Directors of Goodland have replaced them, at different times, as the new directors of Goodland, viz, Chong Wing Fat, the 2nd defendant on 30.12.2011, Lim 25 Yoke Sim (F), the 3rd defendant, on 04.09.2011, Low Beng Hong, the 4th 9 defendant, on 04.09.2011, and that Low Beng Hong, the 4th defendant, later resigned on 30.12.2011, viz the same day on which Lim Yoke Sim (F), the 2nd defendant, was appointed as director of Goodland; 5 (18) At all material times, the 3 (three) new Directors of Goodland are not known to the 1st and 2nd plaintiffs; (19) On Friday, 02.03.2012, at about 5.30 p.m., Ee Soon Kee, the 2nd plaintiff, was informed by one Mr. Gan (“Mr. Gan”) that the 10 2nd and 3rd defendants were with him and he was asked by Mr. Gan to go to the Bandar Kinrara Police Station, which is in the district of Serdang in the State of Selangor (“the Bandar Kinrara Police Station”) to meet him (Mr. Gan); (20) Ee Soon Kee, the 2nd plaintiff, proceeded to the Bandar Kinrara 15 Police Station and he arrived there at 7.30 p.m. He met up with Mr. Gan, who informed him that the 2nd and 3rd defendants were in his car. He was also introduced by Mr. Gan to one Mr. Tan, who Ee Soon Kee, the 2nd plaintiff, believed represented the 1s t defendant; 20 (21) Ee Soon Kee, the 2nd plaintiff, then lodged, on behalf of himself and on behalf of his father, Ee Chong Wah, the 1st plaintiff and also Goodland, the 3rd plaintiff, a police report, viz Report No.: BT9 Cheras/002854/12, at the Bandar Kinrara Police Station, at 9.48 p.m., to state that any signatures, purported to be his or his 25 father’s, which were executed as directors of Goodland for the purpose of selling the land are forgeries and also to state that a fraud has been committed against Goodland and/or the 10 directors of Goodland, namely, Ee Chong Wah and Ee Soon Kee, in the sale and transfer of the land from Goodland to Supreme Tribute (“Ee Soon Kee’s police report”); (22) On that day, for the first time, whilst Ee Soon Kee, the 2nd plaintiff, was at the Bandar Kinrara Police Station, he saw the 5 2nd and 3rd defendants when they were brought inside the Bandar Kinrara Police Station by the associates of Mr. Gan. He also saw the 2nd and 3rd defendants being taken away by some police officers; (23) On 08.03.2012, one Law Ah Kuan, Goodland’s Company 10 Secretary, lodged a police report at the Petaling Police Station, which is in the district of Brickfields, Kuala Lumpur, viz Report No: THSL/008680/12 stating, inter alia, that his signature in Form 44 dated 04.11.2011 has been forged; that there were no board of directors’ and shareholders’ meetings or resolutions 15 passed to replace the 1st and 2nd plaintiffs as directors of Goodland or to sell the land to the 1st defendant and/or any 3rd party or to authorize the 2nd and/or 3rd defendants to deal with the land in any manner or to execute any document pertaining to the transfer of the land to any 3rd party. He also stated that 20 Goodland’s registered Pudu address has not been changed to the Kajang address; that he does not know the 2nd or 3rd defendants; and that a fraud has been committed against Goodland and/or against its directors, Ee Chong Wah and Ee Soon Kee; 25 (24) On 09.03.2012, Ee Soon Kee, the 2nd plaintiff, also requisitioned for a private caveat to be entered on the GM title of the land 11 vide No. Perserahan: 1674/2012, on the ground that the land had been, fraudulently, transferred by Goodland to Supreme Tribute, and a private caveat was registered by the Hulu Langat Land Office (“the private caveat”); (25) On 02.04.2012, a Registrar’s caveat was entered on the GM 5 title of the land upon the application of the police, viz the Head of the Commercial Crime Division vide a letter dated 28.03.2012 (“the Registrar’s caveat”); (26) The application was based on a police report No. IPD Serdang 3863/2012 concerning a case of cheating under s. 420 of the 10 Penal Code involving the land (“the cheating case”); and (27) The Registrar’s caveat was entered for the purpose of restricting any individual or party from dealing with the land pending the order of the High Court in respect of the cheating case. 15 Main action 3. Hence, on 25.05.2012, the 3 (three) plaintiffs filed the main action in the Kuala Lumpur High Court vide a writ of summons dated 25.05.2012, enclosure (1) (“the writ”), and a statement of claim dated 20 25.05.2012, enclosure (2) (“the statement of claim”), through their solicitors, namely, Messrs. Lim & Hoh (“the plaintiffs’ solicitors”) against the 1st to the 6th defendants but without naming the 6 th defendant, to seek, inter alia, a declaration that Goodland is the legitimate and rightful owner of the land; and orders for the recovery 25 of the land by Goodland from Supreme Tribute; for the rectification of the Register of the SSM in regard to the particulars of Goodland, its 12 directorships and registered business address; for damages together with interest; and for costs. 4. Subsequently, the plaintiffs amended and re-amended the writ and statement of claim with the leave of the Kuala Lumpur High Court and the leave of the Court of Appeal, respectively. 5 5. As a result of the amendment and re-amendment, the plaintiffs named Dato' Haji Mohd Amin Bin Ahmad Yahya, as the 6th defendant. He is sued in his capacity as the Land Administrator of Hulu Langat, Selangor. The plaintiffs also added 3 (three) new defendants, viz the Selangor State Government, as the 7th defendant; 10 Mohd Azhar Bin Mohd Daud, who is sued as the Assistant District Officer of the Registration Unit of the Hulu Langat Land Office, Selangor, as the 8th defendant; and the Director Of Lands And Mines, Selangor, as the 9th defendant. 6. The plaintiffs’ 3 (three) causes of action against the 1st defendant and 15 the 3 (three) new Directors of Goodland are for indefeasibility of title under s. 340 of the NLC 1965 by virtue of fraud, forgery and deception/deceit in the forging and misuse of the statutory documents and the company documents of Goodland, including the, purported, resolutions of Goodland and the Companies Act 1965 Form 49, Form 20 48A and Form 44, which were sent by the 3 (three) new Directors of Goodland to the SSM for purposes of registration in the Register of the SSM; and also by virtue of fraud, forgery and deception/deceit and the use of a void/insufficient instrument in the transfer of the land from Goodland to Supreme Tribute. 25 7. The plaintiffs’ 2 (two) causes of action against the 5th defendant are for negligence in the maintenance of the Register of the SSM and in 13 providing to the 3 (three) new Directors of Goodland certified true copies of the forged Companies Act 1965 Form 49, Form 48A and Form 44, and breach of statutory duty under s. 11 of the Companies Act 1965 by failing in its duty to protect the interests of the 1st and/or the 2nd plaintiffs as the only true and genuine directors of the 3 rd 5 plaintiff. 8. The plaintiffs’ 3 (three) causes of action against the 6th to the 9th defendants are for indefeasibility of title under s. 340 of the NLC 1965; negligence in the issuance of the GM title and in the registration of the transfer of the land from Goodland to Supreme 10 Tribute; and breach of statutory duty in the issuance of the GM title, which is a nullity and, hence, void, as it was done in contravention of the provisions of the NLC 1965 and the Fourteenth Schedule of the NLC 1965. 9. The reliefs, which the plaintiffs seek from the 9 (nine) defendants in 15 the main action are set out in paragraph 12(1)(i) to (xii); 12(2)(i) to (ii); 12(3)(i) to (iii); 12(4)(i) to (iii); 12(4A); 12(5); 12(6); 12(7); 12(8); and 12(9); of the plaintiffs’ re-amended statement of claim, which was not re-dated. These reliefs are reproduced later in this Judgment. 20 Parties in main action 10. The 3 (three) plaintiffs in the main action are as follows: (1) Ee Chong Wah is the 1st plaintiff. He is one of the 2 (two) shareholders of the 3rd plaintiff. He was a director of the 3rd plaintiff until his name and position, as a director of the 3rd 25 plaintiff, were, fraudulently, removed from the records of the SSM; 14 (2) Ee Soon Kee is the 2nd plaintiff. He is the other shareholder of the 3rd plaintiff. He was also a director of the 3rd plaintiff until his name and position, as a director of the 3rd plaintiff, were, fraudulently, removed from the records of the SSM; and (3) Goodland Realty Sdn. Bhd. is the 3rd plaintiff. It is the original 5 registered proprietor of the land. The 3rd plaintiff’s original registered address, viz the Pudu address, was, subsequently, fraudulently, changed on 04.09.2011 to the fictitious Kajang address in the records of the SSM. 10 11. The 9 (nine) defendants in the main action are as follows: (1) Supreme Tribute Sdn. Bhd. is the 1st defendant. It is a private limited company incorporated under the Companies Act 1965 (Revised 1973) (Act 125). It has a registered address at Wisma Mega, No. 31-2-A, Jalan Miri, 41400 Klang, Selangor. It is the 15 new registered proprietor of the land as at 01.02.2012. (2) Chong Wing Fat is the 2nd defendant. He is a Malaysian male (NRIC No.: 600404-06-5177) with the following addresses as stated in paragraph 3.2 (i) of the plaintiffs’ statement of claim dated 25.05.2012: 20 (i) No. A-15-10, Seri Cedekia Condo, Jalan 4/124, Taman Connaught Cheras, 56000 Kuala Lumpur; and (ii) No. 36, Jalan Telawi 6, Bangsar, 55100 Kuala Lumpur (as stated in the 3rd plaintiff’s, purported, Form 49 dated 30.12.2011 based on the records of the 5th defendant). 25 15 (3) Lim Yoke Sim (F) is the 3rd defendant. She is a Malaysian female (NRIC No.: 640313-10-5766) with the following addresses as stated in paragraph 3.2 (i) of the plaintiffs’ statement of claim dated 25.05.2012: (i) B-15, Jalan Pasar Lama, Serdang Lama, 43300 Seri 5 Kembangan, Selangor; and (ii) No. 2, Jalan 9/5, 46000 Petaling Jaya, Selangor (as stated in the 3rd plaintiff’s, purported, Form 49 dated 30.12.2011 based on the records of the 5th defendant). 10 (4) Low Beng Hong is the 4th defendant. He is a Malaysian citizen (NRIC No.: 730726-08-6005) with the following addresses as stated in paragraph 3.2 (i) of the plaintiffs’ statement of claim dated 25.05.2012: (i) No. 31, Jalan Mawar 1D, Taman Puchong Perdana, 15 47150 Puchong, Selangor; and (ii) No. 29, Jalan Setia Bakti 6, Bukit Damansara, 55100 Kuala Lumpur (as stated in the 3rd plaintiff’s, purported, Form 49 dated 30.12.2011 based on the records of the 5th defendant). 20 (5) Suruhanjaya Syarikat Malaysia in Malay or “the Companies Commission of Malaysia” in English is the 5th defendant. It has its address at No. 7, Jalan Stesen Sentral 5, Kuala Lumpur Sentral, 50470 Kuala Lumpur; 25 (6) Dato’ Haji Mohd Amin Bin Ahmad Yahya, who is sued, pursuant to the requirements of the Government Proceedings Act 1956, 16 in his capacity as the No. 1 Land Administrator of the Pejabat Daerah/Tanah Hulu Langat, Selangor (in which the land is situated and under his purview), at the material time, is the 6th defendant (“the Land Administrator”). The Land Administrator’s address is at Bangunan Sultan Hisamuddin Alam Shah, 5 Kompleks Pentadbiran Daerah, Persiaran Pusat Bandar, Seksyen 9, 43650 Bandar Baru Bangi, Selangor Darul Ehsan; (7) Kerajaan Negeri Selangor in Malay or “the State Government of Selangor” in English is the 7th defendant. The 7th defendant has been sued on the basis that it is vicariously liable for the acts 10 and omissions of the 6th and 8th defendants in this matter (see para 6A of the re-amended Statement of Claim); (8) Mohd Azhar Bin Mohd Daud, who is sued, pursuant to the requirements of the Government Proceedings Act 1956, in his capacity as the Penolong Pegawai Daerah Unit Pendaftaran 15 Pejabat Tanah Hulu Langat, Selangor in Malay or the Assistant District Officer, Registration Unit of the Land Office of Ulu Langat, Selangor, at the material time, is the 8th defendant (“the A.D.O. of the Ulu Langat Land Office, Selangor”); and (9) Pengarah Tanah Dan Galian, Negeri Selangor in Malay or “ the 20 Director of Lands and Mines, State of Selangor” in English is the 9th defendant. The 9th defendant is sued on the basis that he is, vicariously, liable and responsible for the acts and omissions of the 6th and/or 8th defendants (see para 6B of the re-amended statement of claim). 25 17 3 (three) plaintiffs’ claim in main action 12. In their statement of claim dated 25.05.2012, which was, initially, amended by the Order of the High Court dated 23.08.2013 and, subsequently, re-amended pursuant to the Order of the Court of Appeal dated 26.02.2014, but not re-dated, the plaintiffs plead, inter 5 alia, as follows: “7. On 1.3.2012 a meeting was called by one Dato' Lee Siew Neng (“Dato' Lee”) which was attended by Mr. Ee Soon Kee representing the 3rd Plaintiff, and by Dato' Lee together with 2 individuals named Ms. Tee and Mr. Mervin Ang. 10 7.1 During the said 1.3.2012 meeting, the 2nd Plaintiff was orally informed by Dato' Lee by production of an SSM search dated 28.2.2012 and a photocopy of a Land Search dated 20.2.2012 on the Land which was shown to the 2nd Plaintiff for the first time, stating that:- 15 (i) Both Mr. Ee Chong Wah and Mr. Ee Soon Kee (the 1st Plaintiff and 2nd Plaintiff) have been removed/replaced as the 2 original directors of the 3rd Plaintiff; and (ii) The names of the alleged 2 new directors (hereinafter collectively referred to as the Bogus Directors) that 20 replaced the 1st Plaintiff and 2nd Plaintiff are in fact that of the 2nd Defendant and 3rd Defendant and/or the 4th Defendant; (iii) The EMR Title had been converted to a Geran Mukim Title (in the format of computer printed document of title 25 dated 14.5.2002) with the description as Hakmilik Geran Mukim No. 872, Lot 1011, Mukim Cheras, Daerah Hulu Langat, Negeri Selangor (“GM Title”). (iv) The Land had been purportedly transferred and registered in the name of the 1st Defendant since 30 1.2.2012; 18 8. The purported appointment dates of the Bogus Directors are as follows: (i) 2nd Defendant (30.12.2011) (ii) 3rd Defendant (4.9.2011); and (iii) 4th Defendant (4.9.2011) who later resigned on 5 30.12.2011, the same day the 2nd Defendant was appointed. 9. The 3rd Defendant and 4th Defendant were allegedly appointed as directors of the 3rd Plaintiff on 4.9.2011 and the 10 2nd Defendant was allegedly appointed as director of the 3rd Plaintiff on 30.12.2011, which appointments were done fraudulently and without the knowledge of the 1st Plaintiff and/or 2nd Plaintiff and/or 3rd Plaintiff. 10.1 The 1st Plaintiff and/or 2nd Plaintiff unknown to them, had 15 been fraudulently removed and replaced from their positions as directors and at no material time did either of them have knowledge nor consented, as either directors or as shareholders in any board or shareholders meetings to resign and/or be replaced as directors of the 3rd Plaintiff by 20 interalia the 2nd Defendant, 3rd Defendant and/or 4th Defendant. 10.2 At no time did the 1st Plaintiff and/or 2nd Plaintiff agree: (i) To approve and/or sell the Land either by themselves or through the 2nd Defendant, 3rd Defendant and/or 4th 25 Defendant or by any other 3rd Party, to the 1st Defendant or any other party, for the sum of RM 2,000,000.00 or any other sum; (ii) To allow the 2nd Defendant, 3rd Defendant and/or 4th Defendant and/or any other person(s) to be a director of 30 the 3rd Plaintiff and/or to execute any documents on behalf of the 3rd Plaintiff of whatsoever nature of any 19 instruments to transfer the Land to the 1st Defendant or any other party. 11. On 1.2.2012, the Land had been fraudulently transferred and registered in the name of the 1st Defendant by 5 forgery and/or by means of an insufficient and/or void instrument(s). PARTICULARS OF FRAUD 11.1 Signatures of the 1st and 2nd Plaintiffs being forged 10 (i) The signatures of the 1st Plaintiff and/or 2nd Plaintiff as either directors and/or shareholders had been forged on interalia the Company Act forms to interalia purportedly allow the 2nd Defendant, 3rd Defendant and/or 4th Defendant to be directors of the 3rd Plaintiff; and/or 15 (ii) The signatures of both the 1st Plaintiff and/or 2nd Plaintiff had been forged on interalia the purported 3rd Plaintiff’s resolutions which purportedly empowered the 2nd Defendant and/or 3rd Defendant to find purchasers for and/or to sell the Land; and/or 20 (iii) The signatures of the 1st Plaintiff and/or 2nd Plaintiff as either directors and/or shareholders had been forged on any documents, resolutions and/or Company Act forms leading to their purported resignation of 1st Plaintiff and/or 2nd Plaintiff as directors of the 3rd Plaintiff. 25 11.2 The 1st, 2nd, and 3rd Plaintiffs contend that at this juncture, the signatures of 1st and 2nd Plaintiffs discovered to be forged on interalia the documents described in paragraph 11.1(i), 11.1(ii), and 11.1(iii) above are particularized below 30 and the 1st, 2nd and 3rd Plaintiffs reserved their rights to particularize any such further documents that may arise in this suit:- 20 a. Purported extract from the purported Minutes of the 3rd Plaintiff’s Directors’ Circular Resolution dated 4.9.2011; b. Purported certified true copy of 3rd Plaintiff’s purported Shareholders’ Circular Resolution dated 30.12.2011; c. Purported certified true copy of 3rd Plaintiff’s purported 5 Shareholders’ Circular Resolution dated 3.1.2012; d. Purported certified true copy of 3rd Plaintiff’s purported Shareholders’ Circular Resolution dated 2.2.2012; e. Purported certified true copy of a purported Memorandum and Articles of Association of the 3rd 10 Plaintiff dated 28.6.1973; and f. Purported Sale and Purchase Agreement for the Land between the 3rd Plaintiff as purchaser and one Rajammal a/p Doraju as vendor. 15 11.3 Signature of 3rd Plaintiff’s Company Secretary being forged (i) The signature of the 3rd Plaintiff’s Company Secretary was forged interalia on the 2 Company Act forms 49 dated 4.9.2011 and dated 31.12.2011 respectively and Form 44 dated 4.11.2011 which changed the 3rd 20 Plaintiff’s Company Secretary’s address from Tingkat 1, Wisma Cheong Hin, No. 116, Jalan Pudu, 55100 Kuala Lumpur (Pudu Address) to the fictitious address of No. 5, Jalan Cuepacs 4F, Taman Koperasi Cuepacs, 43000 Kajang, Selangor (Kajang Address). 25 11.4 The 1st, 2nd, and 3rd Plaintiffs further contend that at this juncture, the signature of the 3rd Plaintiff’s Company Secretary discovered to be forged on interalia the documents described in paragraph 11.3(i), 3rd Plaintiff’s 30 Company Resolutions, Company Act forms, and any other documents are further particularized below and the 1st, 2nd, 21 and 3rd Plaintiffs reserve their rights to particularize any such further documents that may arise in this suit:- a. Purported Company Act form 49 dated 4.9.2011; b. Purported Company Act form 49 dated 30.12.2011; c. Purported Company Act form 49 dated 4.11.2011; 5 d. 3rd Plaintiff’s purported Extract of Minute of Directors’ Circular resolutions passed on 30.12.2011; and e. The 3rd Plaintiff’s purported Form 24 dated 19.12.2002; 11.5 The 1st, 2nd, and 3rd Plaintiffs further contend that the 3rd 10 Plaintiff’s Company Secretary’s signature had been forged, purportedly certifying the documents particularized below and the 1st, 2nd and 3rd Plaintiffs reserve their rights to particularize any such further documents that may arise in this suit: 15 a. Purported photocopied NRIC identity cards for both the 1st and 2nd Plaintiffs; b. Purported Company Act form 49 dated 4.9.2011; c. 3rd Plaintiff’s purported Shareholders’ Circular Resolution dated 30.12.2011; 20 d. 3rd Plaintiff’s purported Shareholder’s Circular Resolution dated 3.1.2012; e. 3rd Plaintiff’s purported Shareholder’s Circular Resolution dated 2.2.2012; f. Purported Memorandum and Articles of Association of 25 the 3rd Plaintiff dated 28.6.1973; g. 3rd Plaintiff’s purported Extract of Minute of Directors’ Circular resolutions passed on 30.12.2011; h. The 3rd Plaintiff’s purported Form 24 dated 19.12.2002; i. Purported Form 48A dated 30.12.2011; 30 j. 3rd Plaintiff’s purported Directors’ Circular Resolution dated 3.1.2012; and 22 k. 3rd Plaintiff’s purported Directors’ Circular Resolution dated 30.12.2011; 11.6 The 1st, 2nd, and 3rd Plaintiffs further contend that:- (i) The photocopied copies of the purported NRIC identity 5 cards of both the 1st Plaintiff and/or 2nd Plaintiff used for the fraudulent transfer of the Land had been forged which amongst others, include photographs of unknown persons and not the 1st and 2nd Plaintiffs; and/or (ii) The registered office of the 3rd Plaintiff have been 10 fraudulently changed from the Pudu address to the Kajang address; and/or (iii) The GM Title of the Land had been obtained fraudulently without the knowledge of any of the Plaintiffs. 15 (iv) The GM Title of the Land was issued in contravention of the provisions of the National Land Code 1965 and the 14th Schedule thereof and as such is a nullity and void. 11.7 The 1st, 2nd, and 3rd Plaintiffs will further contend that the GM Title issued by the 6th Defendants is ultra vires, null and/or 20 void ab initio and hence the purported transfer of the Land from the 3rd Plaintiff to the 1st Defendant is also null and void ab initio. 12A And/or in the alternative, the Plaintiffs will further contend that the 5th Defendant was negligent and/or grossly negligent 25 and/or in breach of its statutory duties under S. 11 of the Companies Act 1965 by failing in its duties to protect the interests of the 1st and/or 2nd Plaintiffs as the only true and genuine directors and shareholders of the 3rd Plaintiffs. 30 Particulars of Negligence and/or Particulars of breach of statutory duties 23 (i) The 5th Defendant failed to exercise a reasonable duty of care under S. 11 of the Companies Act 1965 to prevent the 1st and 2nd Plaintiffs from being removed and/or replaced by the Bogus Directors, interalia by failing to verify whether the purported Kajang address of the 3rd Plaintiff’s Company 5 Secretary as shown in the 3rd Plaintiff’s purported Form 49 dated 4.9.2011 was a genuine valid address or otherwise; and/or (ii) The 5th Defendant failed to exercise a reasonable duty of care under s. 11 of the Companies Act 1965 to stop the 2nd, 10 3rd, and/or 4th Defendants from being appointed as the Bogus Directors of the 3rd Plaintiff which culminated in the transfer of the ownership of the Land from the 3rd Plaintiff to the 1st Defendant through fraudulent means and/or forgery and/or by means of insufficient or void instrument; and/or 15 (iii) The 5th Defendant failed to exercise a reasonable duty of care under s. 11 of the Companies Act 1965 to prevent the fraudulent change of the 3rd Plaintiff’s registered address from the Pudu Address to the purported Kajang Address in the purported Form 44 dated 4.11.2011, interalia by failing to 20 verify whether Kajang Address was a genuine valid address or otherwise. 12B As a result of the 5th Defendant’s negligence/breach of its statutory duties, the 1st, 2nd, and/or 3rd Plaintiffs have 25 suffered loss and damage and the 3rd Plaintiff is deprived of its legal ownership of the Land. Particulars of Loss and Damage Loss of the value of the said Land To be assessed 30 12C And/or in the alternative, the Plaintiffs also contend that the 6th and/or 8th Defendants were negligent and/or grossly 24 negligent and/or in breach of their statutory duties under s. 5A of the National Land Code 1965 by failing in their duties to protect the interests of the 3rd plaintiff as the true and genuine registered owner of the Land. 5 Particulars of Negligence and/or Particulars of breach of statutory duties (i) The 6th and/or 8th Defendants failed to exercise a reasonable duty of care owing to the 1st, 2nd, and/or 3rd Plaintiffs by issuing the GM Title of the Land in contravention of the 10 provisions of S. 5A of the National Land Code 1965; and/or (ii) The 6th and/or 8th Defendants failed to exercise due care and competency within their department to prevent the transfer of the ownership of the Land from the 3rd Plaintiff through fraudulent menas and/or forgery and/or by means of 15 insufficient or void instrument; and/or (iii) The 6th and/or 8th Defendants failed to protect the interests of the 3rd Plaintiff as the true and genuine registered owner of the Land. 20 12D As a result of the 6th and/or 8th Defendants’ negligence, the 1st, 2nd, and/or 3rd Plaintiffs have suffered loss and damage and the 3rd Plaintiff is deprived legal ownership of the Land.” (Emphasis added). 25 13. Hence, in paragraph 12(1)(i) to (xii); 12(2)(i) to (ii); 12(3)(i) to (iii); 12(4)(i) to (iii); 12(4A); 12(5); 12(6); 12(7); 12(8); and 12(9); of their re-amended statement of claim, the plaintiffs pray for the following reliefs against the 9 (nine) defendants in the main action: (1) Declaratory orders to state as follows: 30 25 (i) The 3rd plaintiff is the legitimate and rightful owner of the land; (ii) The land was, fraudulently, transferred from the 3rd plaintiff to the 1st defendant; (iii) The 2nd defendant, 3rd defendant and/or 4th defendant 5 (Chong Wing Fatt and/or Lim Yoke Sim and/or Low Beng Hong) were never, legitimately, appointed directors of the 3rd plaintiff at any material time; (iv) Both the 1st plaintiff’s (Ee Chong Wah’s) and the 2nd plaintiff’s (Ee Soon Kee’s) signatures on the Company 10 documents including those lodged with the 5th defendant (the SSM) in relation to allowing the 2nd defendant, 3rd defendant and/or 4th defendant to be directors of 3rd plaintiff, are forgeries; (v) The signatures of both Ee Chong Wah and Ee Soon Kee 15 in the 3rd plaintiff’s resolution, purportedly, to empower the 2nd defendant, 3rd defendant and/or 4th defendant to sell the land, are forgeries; (vi) The removal of both Ee Chong Wah and Ee Soon Kee as directors of the 3rd plaintiff is fraudulent and/or illegal and 20 that both Ee Chong Wah and Ee Soon Kee be reinstated as directors of the 3rd plaintiff as at 04.09.2011; (vii) The documents and/or all instruments lodged in the SSM (including the Form 49 dated 04.09.2011) to remove both Ee Chong Wah and Ee Soon Kee as directors of the 3rd 25 plaintiff were obtained by forgery and are illegal and/or void ab initio; 26 (viii) The documents and/or instruments lodged in the SSM to add the 2nd defendant, 3rd defendant and/or 4th defendant (Chong Wing Fatt and/or Lim Yoke Sim and/or Low Beng Hong) as purported directors of the 3rd plaintiff were obtained by forgery and are illegal and/or void ab initio; 5 (ix) All the resolutions of the 3rd plaintiff signed by the 2nd defendant, 3rd defendant and/or 4th defendant (Chong Wing Fatt and/or Lim Yoke Sim and/or Low Beng Hong) as purported directors of the 3rd plaintiff concerning, inter alia, the sale of the land and/or the execution by Chong 10 Wing Fatt and/or Lim Yoke Sim and/or Low Beng Hong as purported directors, of the instrument of transfer, to the 1st defendant are void ab initio; (x) Both the names of the 2nd defendant (Chong Wing Fatt) and the 3rd defendant (Lim Yoke Sim) be removed as 15 directors of the 3rd plaintiff from the records of the SSM. (2) Orders that the 1st defendant, immediately, do the following: (i) Surrender back the original Geran Mukim title of the land to the 3rd plaintiff; and 20 (ii) Execute a duly registrable instrument of transfer (National Land Code Form 14A) to retransfer the land back to the 3rd plaintiff within 7 days from the date of this Order being pronounced, failing which the Senior Assistant Registrar (“the SAR”) of the High Court of Malaya do thereafter 25 execute the MOT on behalf of the 1st defendant; 27 (3) Orders that the 5th defendant, immediately, do the following to its records: (i) Strike out and/or take out and/or retroactively remove the names of the 2nd defendant, 3rd defendant and/or 4th defendant (Chong Wing Fatt and Lim Yok Sim and/or Low 5 Beng Hong) as directors of the 3rd plaintiff as at 04.09.2011; (ii) Reinstate retroactively the names of the 1st plaintiff and 2nd plaintiff (Ee Chong Wah and Ee Soon Kee) as directors of the 3rd plaintiff as at 04.09.2011; 10 (iii) Strike out the Kajang address and reinstate retroactively the 3rd plaintiff’s registered office address at Tingkat 1, Wisma Cheng Hin, No. 116 Jalan Pudu, 55100 Kuala Lumpur (Pudu Address) as at 04.09.2011. 15 (4) Orders that the 6th, 8th, and/or 9th defendants, immediately, do the following: (i) If the title of the land is with the 6th, 8th, and/or 9th defendants, to return the same to the 3rd plaintiff; (ii) To retransfer and register the land back in the 3rd 20 plaintiff’s name as the rightful registered owner of the land with no payment of adjudication fees and/or stamp duty for this retransfer conveyance and/or any fee whatsoever to the 6th defendant for the same; and (iii) Rectify and reflect the 3rd plaintiff as the registered 25 proprietor of the land in all lawful documents and records of the 6th defendant and/or to do all things necessary. 28 (4A) A declaration from the Court that the 7th and/or 9th defendants are vicariously liable for the acts and/or omissions of the 6th and/or 8th defendants; (5) An injunction to, immediately, restrain the 1st defendant whether by itself, its agents, servants, directors, contractors, nominees, 5 successors-in-title and/or all related parties to the 1st defendant, assignees or otherwise howsoever from selling, transferring, mortgaging, charging, leasing, letting, giving licenses or any type of occupational rights, easements and/or from encumbering the land or any part thereof in any way, legal or 10 otherwise; (6) Costs; (7) An Order for damages against the 5th, 6th, 7th, 8th, and/or 9th defendants for being negligent and/or grossly negligent and/or in breach of their statutory duties with damages to be assessed; 15 (8) Aggravated and/or Exemplary Damages against the 1st, 2nd, 3rd, 4th, 5th, 6th, 7th, 8th, and/or 9th defendants; and (9) Such further and/or other reliefs as the Court deems fit. 1st defendant’s appearance 20 14. On 13.06.2012, the 1st defendant entered its appearance to the writ and statement of claim by filing its memorandum of appearance dated 11.06.2012, enclosure (5), through its solicitors, namely, Messrs. Gerard Samuel & Associates (“the 1st defendant’s solicitors”). 25 29 2nd, 3rd and 4th defendants’ appearance 15. The 2nd, 3rd and 4th defendants did not enter appearance to the writ and statement of claim. 5th defendant’s appearance 5 16. On 08.06.2012, the 5th defendant entered its appearance to the writ and statement of claim by filing its memorandum of appearance dated 07.06.2012, enclosure (3), through the Legal Officer of the Litigation Section of its Legal Service Department. 10 6th defendant’s appearance 17. On 28.05.2012, the writ and statement of claim were served on the 6th defendant by the plaintiff’s solicitors. On 11.06.2012, the 6th defendant entered its appearance to the writ and statement of claim by filing its memorandum of appearance dated 07.06.2012, enclosure 15 (4), through the State Legal Adviser of Selangor. 7th defendant’s appearance 18. On 30.09.2013, the 7th defendant entered its appearance to the writ and statement of claim by filing its memorandum of appearance 20 dated 30.09.2013, enclosure (103), through the State Legal Adviser of Selangor. 6th, 7th, 8th and 9th defendants’ appearance 19. On 26.03.2014, the 6th and 7th defendants, again, entered their 25 appearance to the writ and statement of claim together with the 8th and 9th defendants by filing their joint memorandum of appearance 30 dated 26.03.2014, enclosure (118), through the State Legal Adviser of Selangor. 1st defendant’s defence and counterclaim 20. On 25.06.2012, the 1st defendant filed, through the 1st defendant’s 5 solicitors, its statement of defence and counterclaim (“defence and counterclaim”), dated 25.06.2012, enclosure (13), to the writ and statement of claim. 21. I noted that in its defence and counterclaim, dated 25.06.2012, enclosure (13), the 1st defendant relies on 7 (seven) causes of action 10 against the 1st to the 3rd plaintiffs and the 5th to the 9th defendants in the main action. These are as follows: (1) Indefeasibility of the 1st defendant’s title of the land as provided in s. 340 of the NLC 1965; (2) Trespass by the 1st to the 3rd plaintiffs on the land and/or 15 unlawful interference by the 1st to the 3rd plaintiffs with the proprietary rights of the 1st defendant over the land; (3) Negligence of the 3 (three) plaintiffs and the 5th to the 9th defendants; (4) Breach of statutory duty by the 5th, 6th, 8th and 9th defendants; 20 (5) Conspiracy by the 3 (three) plaintiffs and the 2nd to the 4th defendants by unlawful or lawful means to cause loss and damage to the 1st defendant; (6) Deception/deceit by the 3 (three) plaintiffs; and (7) Collateral abuse of process in the filing of the main action by 25 the 3 (three) plaintiffs. 31 22. Hence, in paragraph 50 (a) to (j) of its counterclaim dated 25.06.2012, enclosure (13), the 1st defendant prays for the following reliefs, jointly and severally, against the 3 (three) plaintiffs; the 5th defendant; and the 6th to the 9th defendants for only 6 (six) out of its 7 (seven) pleaded causes of action, as it did not seek any relief for the 5 alleged trespass and/or unlawful interference with its proprietary rights over the land by the 3 (three) plaintiffs: (a) A Declaratory order that it is the lawful registered proprietor of the land; (b) A Declaratory order that it is a bona fide purchaser of the land 10 for valuable consideration without notice of the fraud, forgery or deception/deceit as claimed by the 2 original Directors of Goodland and Goodland; (c) General damages in the sum of RM 2 million for negligence; (d) General damages in the sum of RM 2 million for breach of 15 statutory duty; (e) Further and/or in the alternative general damages in the sum of RM 2 million for conspiracy; (f) Further and/or in the alternative general damages in the sum of RM 2 million for deception/deceit; 20 (g) Further and/or in the alternative general damages in the sum of RM 2 million for collateral abuse of process; (h) Interest at the rate of 4% per annum on the damages as stated in prayers (c) to (g) above commencing from the date of the filing of the counterclaim until the date of full settlement; 25 (i) Costs on an indemnity basis; and 32 (j) Other reliefs, orders, directions, accounts and enquiries which this Court deems fit and appropriate to be given. 1st defendant’s re-amended defence and counterclaim 23. Subsequently, the 1st defendant amended its defence and 5 counterclaim vide the Order of the Kuala Lumpur High Court dated 23.08.2013. The 1st defendant also re-amended its defence and counterclaim vide the Order of the Court of Appeal dated 26.02.2014 pursuant to O. 15, rr. 2 and 3 of the Rules of the High Court 1980. 24. In its re-amended defence and counterclaim, the 1st defendant has 10 deleted its 3 (three) causes of action for conspiracy, deception/deceit and collateral abuse of process and the particulars thereof against the 3 (three) plaintiffs and the 5th to the 9th defendants, together with the corresponding reliefs claimed, thereby reducing its original 7 (seven) causes of action to only 4 (four) causes of action, viz 15 indefeasibility of title as provided in s. 340 of the NLC 1965; trespass and/or unlawful interference; negligence; and/or breach of statutory duty. 25. In its re-amended defence and counterclaim, the 1st defendant denies that there was any fraud or forgery in the transfer of the land from the 20 3rd plaintiff, to the 1st defendant. 26. In its re-amended defence and counterclaim, the 1st defendant also denies the plaintiffs’ allegations that it has acted, fraudulently, in regard to the land, and that as a result of its fraudulent acts in regard to the land, the land was transferred to it. 25 27. In its re-amended defence and counterclaim, the 1st defendant also pleads, inter alia, as follows: 33 (1) At all material times based on the records of the 5th defendant, which are public documents, and the Form 24 dated 19.12.2002 and the 2 (two) Form 49 dated 04.09.2011 and 30.12.2011, respectively, which are also public documents, and also copies of the Forms, which were certified as true by the 5th 5 defendant and/or Law Ah Kuan, which were produced to the 1st defendant, the 1st and 2nd plaintiffs, were only shareholders in the 3rd plaintiff but not directors as they had resigned as directors of the 3rd plaintiff on 04.09.2011; (2) Based on the same records of the 5th defendant mentioned 10 above; the 2 (two) Form 49 dated 04.09.2011 and 30.12.2011, respectively, which are public documents, which were produced to the 1st defendant; and the copies of the Forms mentioned above, which were certified as true by the 5th defendant on 03.01.2012 and/or Law Ah Kuan, at present, the directors of the 15 3rd plaintiff are the 2nd and 3rd defendants, who were appointed on 30.112.2011 and 04.09.2011, respectively, and that the 4th defendant was appointed as director of the 3rd plaintiff on 04.09.2011 and that he had resigned on 30.12.2011; (3) The Companies Act 1965 Form 49, which was filed with the 5th 20 defendant by the 3rd plaintiff on 30.12.2011, is legally valid and effective; (4) The 1st defendant will rely on s. 141 of the Companies Act 1965 and also on the doctrine of constructive notice pertaining to the public documents of the 3rd plaintiff mentioned above; 25 (5) At all material times, according to the records of the 5th defendant, until todate, and the Form 44 filed by the 3rd plaintiff 34 with the 5th defendant, the 3rd plaintiff’s registered address is the Kajang address, viz No. 5, Jalan Cuepacs 4F, Taman Koperasi Cuepacs, 43000 Kajang, Selangor Darul Ehsan, and the 3rd plaintiff’s business address is at No. 29, Jalan Riong, 59100 Kuala Lumpur; 5 (6) Based on the records of the 6th defendant, the 3rd plaintiff is the former registered owner of the land known as Mukim Grant Title No. 872, Lot No. 1011, Mukim of Cheras, District of Hulu Langat, State of Selangor and that the Mukim Grant Title of the land was registered on 14.06.2002; 10 (7) The 1st defendant was also shown the original copy of the Title Deed of the land by the 2nd and 3rd defendants, who represented the 3rd plaintiff in the sale of the land to the 1st defendant for a sum of RM 2 million, which is a sufficient consideration; 15 (8) As at 01.02.2012, the 3rd plaintiff is the lawful registered owner of the land; (9) The 1st defendant was given a certified true copy of the 2nd defendant’s identity card, which confirms his address is the same as that stated in paragraph 3.2(i) of the statement of 20 claim; (10) The 1st defendant was also given a certified true copy of the 3 rd defendant’s identity card, which confirms that her address is the same as that stated in paragraph 3.2(i) of the statement of claim; and 25 (11) The 4th defendant had resigned as director of the 3rd plaintif f on 30.12.2011 as stated in the Form 49 dated 30.12.2011. 35 28. In paragraphs 15 to 39 of the 1st defendant’s re-amended defence and counterclaim, the 1st defendant also pleads as follows: “15. The 1st Defendant has no knowledge of paragraph 7 of the Statement of Claim and does not admit it. 16. Pertaining to particulars (i) to (iv) in paragraph 7.1 of the 5 Statement of Claim, it is factually true and correct according to the records of the 5th Defendant (including the public documents of the 3rd Plaintiff) and of the 6th Defendant except that the 1st Plaintiff and 2nd Plaintiff had resigned as directors of the 3rd Plaintiff and were not removed or 10 replaced as alleged by the Plaintiffs in paragraph 7.1(i) therein. The 1st Defendant denies that there were “false directors” for the 3rd Plaintiff as alleged by the Plaintiffs in paragraph 7.1(ii) of the Statement of Claim. The 1st Defendant has no knowledge of paragraph 7.1(iii) of the 15 Statement of Claim regarding the conversion of the nature of title of the Property from an EMR Ttitle to a Grant Mukim Title that was done by the 6th Defendant except that the said Grant Mukim Title existed in the records of the 6th Defendant at all material times. 20 17. Pertaining to paragraph 8(i) to (ii)(iii) of the Statement of Claim it is true based on the records of the 5th Defendant and the public documents of the 3rd Plaintiff except for the use of the word “false directors” therein by the Plaintiffs. 18. The 1st Defendant denies paragraphs 9 and 10.1 of the 25 Statement of Claim and states that according to the records of the 5th Defendant and the public documents of the 3rd Plaintiff the appointment of the 2nd, 3rd and 4th Defendants as directors of the 3rd Plaintiff is legally valid and effective. 19. The 1st Defendant has no knowledge and was not a party 30 to the fraud as alleged by the Plaintiffs therein. 36 20. The 1st Defendant will also rely on section 141 of the Companies Act, 1965 and on the doctrine of constructive notice pertaining to the public documents of the 3rd Plaintiff. 21. The 1st Defendant will further rely on the indoor management rule and states that they had no knowledge of or were privy 5 to issues pertaining to the internal management of the 3rd Plaintiff and the 1st Defendant could only rely upon the public documents of the 3rd Plaintiff kept with the 5th Defendant and 6th Defendant. 22. The 1st Defendant denies paragraph 10.2(i) and (ii) of the 10 Statement of Claim and states that the Plaintiffs through resolutions of the board of directors and shareholders of the 3rd Plaintiff dated 30.12.2011, 3.1.2012 and 2.2.2012 and all certified by the 3rd Plaintiff’s Company Secretary (“the said resolutions”), had approved the 15 sale and transfer of the Property to the 1st Defendant for the consideration of RM 2,000,000.00. 23. Pursuant to the said resolutions, the 2nd and 3rd Defendants were authorised as directors of the 3rd Plaintiff to execute the Sale and Purchase Agreement dated 5.1.2012 between the 20 3rd Plaintiff and the 1st Defendant and also to sign the Form 14A under the National Land Code, 1965 to transfer the Property from the 3rd Plaintiff to the 1st Defendant. 24. Apart from that, the said resolutions also authorised the 3rd Defendant to receive the deposit of 10% of the purchase 25 price for the Property on behalf of the 3rd Plaintiff. 25. The 1st Defendant denies paragraph 11 of the Statement of Claim and states that the sale and transfer of the Property from the 3rd Plaintiff to the 1st Defendant on 1.2.2012 was bona fide and for valuable consideration. 30 The 1st Defendant has no knowledge of and was not privy to the fraud and/or forgery as alleged by the Plaintiffs. 37 26. The 1st Defendant denies that there was any forgery and/or use of an insufficient and/or void instrument pertaining to the transfer of the Property from the 3rd Plaintiff to the 1st Defendant premised on the public documents of the 3rd Plaintiff kept with the 5th Defendant 5 and the said resolutions. 27. The 1st Defendant will rely upon section 340 of the National Land Code, 1965 and states that they are a bona fide purchaser of the Property for valuable consideration without any knowledge of a privy to the 10 fraud or forgery or use of an insufficient and/or void instrument as alleged in the transfer of the Property from the 3rd Plaintiff to the 1st Defendant. 28. The 1st Defendant denies the particulars of fraud and/or forgery as stated in paragraph 11.1(i) to (viii)(iii) of the 15 Statement of Claim as Amended and paragraphs 11.2(a) to (f), 11.3(1), 11.4(a) to (e), 11.5(a) to (k) in the 2nd Amended Statement of Claim and repeats paragraphs 1 to 27 above. 29. The 1st Defendant emphasizes that they have no knowledge of and were not involved with the fraud 20 and/or forgery as alleged by the Plaintiffs which involved the 2nd and 3rd Defendants and/or 4th Defendant. 30. The 1st Defendant also states that the identity cards of the 1st Plaintiff, 2nd Plaintiff, 2nd Defendant and 3rd 25 Defendant, the Forms 24 and 49, and the Memorandum and Articles of Association of the 3rd Plaintiff, all certified as true copies by the 3rd Plaintiff’s Company Secretary, were given to the 1st Defendant and were in accordance with the 3rd Plaintiff’s records with the 5th 30 Defendant. There was no reason for the 1st Defendant to suspect the documents. 38 31. The 1st Defendant will rely on sections 127 and 35(5) of the Companies Act, 1965. 32. The 1st Defendant also made searches on the 3rd Plaintiff with the 5th Defendant and CTOS Sdn. Bhd. on 29.12.2011 and found that the records were true and accurate. There 5 were no impediments or obstacles and/or doubts for the 1st Defendant not to proceed with the purchase of the Property. 33. The 1st Defendant also did a search on the Property on 28.12.2011 with the 6th Defendant and found their records to be true and accurate on the status of the 10 ownership of the Property by the 3rd Plaintiff. 33A. Premised on the reasons as stated in paragraphs 1 to 33 above, the 1st Defendant denies paragraphs 11.6(i) to (iv) and 11.7 of the 2nd Amended Statement of Claim. 33B. Paragraphs 12A, 12A(i) to (iii) and paragraph 12B of the 15 Amended Statement of Claim are not admitted by the 1st Defendant. 33C. Paragraphs 12C, 12C(i) to (iii), 12D and 12E of the Statement of Claim are not admitted by the 1st Defendant. 34. The 1st Defendant has no knowledge of and does not admit 20 paragraph 12 of the Statement of Claim. The 1st Defendant denies that there was any fraud or forgery in the transfer of the Property from the 3rd Plaintiff to the 1st Defendant. 35. The 1st Defendant also disputes the locus standi of the 1st Plaintiff and 2nd Plaintiff to bring this action against the 25 Defendants. 36. Further, the 1st Defendant disputes the authority of the 3rd Plaintiff to bring this action against the Defendants. 37. The 1st Defendant does not admit the reliefs prayed for by the Plaintiffs in prayers 1(i) to (xii), 2(i) to (ii), 3(i) to (iii), 4(i) 30 to (iii), 4A, 5, 6, 7, 8 and 9 hingga 7 of the Statement of Claim. 39 38. Save as to where it is expressly admitted, the 1st Defendant repeats each and every allegation contained in the Statement of Claim herein and traverses the same seriatim. 39. The 1st Defendant prays that the Plaintiff’s claim be dismissed with costs on an indemnity basis.” 5 29. In paragraph 40 of the 1st defendant’s re-amended counterclaim, the 1st defendant also pleads as follows: “40. The 1st Defendant repeats paragraphs 1 to 39 above. 41. The 1st Defendant states that the Plaintiffs and the 5th 10 and 6th Defendants including the 8th Defendant and the 9th Defendant were negligent in discharging their duty and responsibility towards the 1st Defendant by allowing or causing documents of the 3rd Plaintiff to be filed with the 5th Defendant and 6th Defendant and/or the 9th 15 Defendant including the issuance of the original Title Deed for the Property that was fabricated and misused. PARTICULARS OF NEGLIGENCE (a) The Plaintiffs did not carry out their internal 20 management of the 3rd Plaintiff with care, appropriately and in accordance with the procedures as laid down in the Companies Act, 1965; (b) The Plaintiffs were not careful when filing their public documents with the 5th Defendant; 25 (c) The Plaintiffs including the Company Secretary of the 3rd Plaintiff did not discharge their duty and responsibility to ensure that the public documents of the 3rd plaintiff that were filed with the 5th Defendant were not misused; 30 (d) The Plaintiffs including the Company Secretary of the 3rd Plaintiff failed to deal with the 5th Defendant 40 appropriately to confirm and verify the status of the 3rd Plaintiff’s public documents; (e) The Plaintiffs including the Company Secretary of the 3rd Plaintiff failed to update the public documents of the 3rd Plaintiff that were filed with the 5th Defendant; 5 (f) The Plaintiffs did not deal appropriately with the 6th Defendant and/or the 9th Defendant to confirm the status of the issuance of the grant mukim Title Deed for the Property since the year 2002; (g) The Plaintiffs did not update the records and 10 documents of the 3rd Plaintiff with the 6th Defendant and/or the 9th Defendant pertaining to the Property; (h) The 1st and 2nd Plaintiffs were negligent in safekeeping their private documents from being misused; 15 (i) The 5th Defendant did not discharge their responsibility to confirm the validity of the 3rd Plaintiff’s public documents that were filed with them; (j) The 5th Defendant failed to deal with the Plaintiffs including the 3rd Plaintiff’s Company Secretary to 20 verify the status of the public documents of the 3rd plaintiff that were filed with the 5th Defendant; (k) The 5th Defendant failed to scrutinize carefully the contents of the resolutions, forms and supporting documents filed by the 3rd Plaintiff with them; 25 (l) The 5th Defendant failed to discharge their duty with care and with responsibility before updating the records of the 3rd Plaintiff with them; (m) The 5th Defendant allowed or caused the falsification of the 3rd Plaintiff’s public documents and/or the 30 misuse of the 3rd Plaintiff’s public documents; (n) The 5th Defendant negligently confirmed the authenticity of the 3rd Plaintiff’s public documents; 41 (o) The 6th Defendant and/or the 8th Defendant and/or the 9th Defendant did not discharge their duty and responsibility by permitting the issuance of the original Title Deed of the Property although the 3rd Plaintiff was in possession of another old Title Deed for the 5 same Property; (p) The 6th Defendant and/or the 8th Defendant and/or the 9th Defendant failed to deal with the Plaintiffs including the Plaintiffs’ Company Secretary to inform them about the issuance of the grant mukim Title Deed for 10 the Property in the year 2002; (q) The 6th Defendant and/or the 8th Defendant and/or the 9th Defendant did not discharge their duty correctly and appropriately when issuing the new original Title Deed for the Property; 15 (r) The 6th Defendant and/or the 8th Defendant and/or the 9th Defendant allowed parties other then the Plaintiffs to deal with them regarding the issuance of the new original Title Deed for the Property; and (s) The 6th Defendant and/or the 8th Defendant and/or the 20 9th Defendant issued and delivered the new original Title Deed for the Property to third parties and not to the Plaintiffs. 42. As a result of the negligence of the Plaintiffs and the 5th and 25 6th Defendants and/or the 8th Defendant and/or the 9th Defendant, the 1st Defendant has and continues to suffer damage and loss. The 7th Defendant is vicariously liable for the negligence of the 6th Defendant, the 8th Defendant and the 9th Defendant. 30 43. The 1st Defendant further states that the 5th and 6th Defendants and/or the 9th Defendant have breached their 42 statutory duty owed to the 1st Defendant under the Companies Act 1965 and the National Land Code, 1965. PARTICULARS OF THE BREACH OF STATUTORY DUTY (a) The 5th Defendant failed to exercise their 5 responsibility to verify the authenticity of the public documents of the 3rd Plaintiff that were filed with them; (b) The 5th Defendant failed to deal with the Plaintiffs including the 3rd Plaintiff’s Company Secretary to verity the status of the public documents of the 3rd 10 Plaintiff that were filed with the 5th Defendant; (c) The 5th Defendant failed to scrutinise carefully the contents of the resolutions, forms and supporting documents of the 3rd Plaintiff that were filed with them; (d) The 5th Defendant failed to discharge their duty and 15 responsibility before updating the 3rd Plaintiff’s records with them; (e) The 5th Defendant allowed or caused the falsification of the 3rd plaintiff’s public documents and/or the misuse of the 3rd Plaintiff’s public documents; 20 (f) The 5th Defendant was negligent in confirming the authenticity of the 3rd Plaintiff’s public documents; (g) The 6th Defendant and/or the 9th Defendant failed to discharge their duty and responsibility by allowing the original Title Deed to be issued for the Property 25 although the 3rd Plaintiff was in possession of another old Title Deed for the same Property; (h) The 6th Defendant and/or the 9th Defendant failed to deal with the Plaintiffs including the 3rd Plaintiff’s Company Secretary to inform them about the 30 issuance of the grant mukim original Title Deed for the Property in the year 2002; 43 (i) The 6th Defendant and/or the 9th Defendant failed to discharge their duty correctly and appropriately when they issued the new original Title Deed for the Property; (j) The 6th Defendant and/or the 9th Defendant allowed 5 persons other than the Plaintiffs to deal with them pertaining to the issuance of the new original Title Deed for the Property; and (k) The 6th Defendant and/or the 9th Defendant had issued and delivered the new original Title Deed for 10 the Property to third parties and not to the Plaintiffs. 44. As a result of the breach of statutory duty by the 5th and 6th Defendants and/or the 9th Defendant, the 1st Defendant has and continues to suffer damage and loss. The 7th Defendant 15 is vicariously liable for the breach of statutory duty by the 6th Defendant and/or the 9th Defendant. 45. The Plaintiffs have also committed trespass and/or have unlawfully interfered with the proprietary rights of the 1st Defendant as the registered owner of the Property on or 20 after 1.2.2012, the date that the 1st Defendant was registered as the owner of the Property and specifically between the months of February and August 2012, when the Plaintiffs jointly and/or severally instructed and/or allowed and/or unlawfully and illegally authorised their servants and agents 25 known as YL Design Consultancy Services, Soon Yeen Hardware & Trading and Gagasan Tegun Sdn. Bhd. to carry out works that were allegedly for soil investigation, slope trimming and stabilization on the Property. 46. The 1st Defendant had on 22.11.2012 issued letters of 30 demand through their solicitors Messrs. Gerard Samuel & Associates to the Plaintiffs’ solicitors Messrs. Lim & Hoh and also the YL Design Consultancy Services, Soon Yeen 44 Hardware & Trading and Gagasan Teguh Sdn. Bhd. and to date the said letters of demand have not been replied by the relevant parties. 47. The 1st Defendant has also discovered that the 2nd Plaintiff had on 9.3.2012 entered a private caveat via Presentation 5 No. 1674/2012 on the Property purportedly as the “beneficial owner” of the Property on the grounds that the 2nd Plaintiff is a shareholder in the 3rd Plaintiff. 48. The 1st Defendant denies that the 2nd Plaintiff and/or the 3rd Plaintiff have any interest that is caveatable in the Property 10 following the transfer of the Property from the 3rd Plaintiff to the 1st Defendant on 1.2.2012 whereby the 1st Defendant is a bona fide purchaser of the Property for valuable consideration without knowledge of any fraud and/or forgery and/or deception as alleged by the Plaintiffs. 15 49. The 1st Defendant also discovered that on 2.4.2012 a registrar’s caveat had been entered on the Property at the request of the police that was made on 5.3.2012 and 28.3.2012 to the Land Administrator Hulu Langat District following a police report made by the 2nd Plaintiff on 20 2.3.2012.” (Emphasis added). Reliefs claimed by 1st defendant in its re-amended counterclaim 30. Therefore, in paragraph 44 of the 1st defendant’s re-amended 25 counterclaim, the 1st defendant counterclaims against the 3 (three) plaintiffs and the 5th, 6th and 7th defendants and/or the 8th and 9th defendants in the main action, jointly and severally, for the following reliefs: “(a) A declaration that the 1st Defendant is the lawful registered 30 owner of all that Property known as Grant Mukim Title No: 45 872, Mukim of Cheras, District of Hulu Langat, State of Selangor (“the Property”); (b) A declaration that the 1st Defendant is the bona fide purchaser of the Property for valuable consideration without any notice of fraud, forgery or deception as alleged by the 5 Plaintiffs; (c) General damages in the sum of RM 2,000,000.00 for negligence or any other sum to be assessed by this Honourable Court; (d) General damages for breach of statutory duty in the sum of 10 RM 2,000,000.00 or any other sum to be assessed by this Honourable Court: (e) An Order that the private caveat bearing Presentation no. 1674/2012 that was entered on 9.3.2012 by the 2nd Plaintiff on the Property be cancelled forthwith and the Plaintiffs are 15 required to pay damages to be assessed by this Honourable Court to the 1st Defendant; (f) An Order that the registrar’s caveat entered 2.4.2012 by the 6th Defendant on the Property be cancelled forthwith; (g) Interest at the rate of 4% per annum on the damages as 20 stated in prayers (c) hingga (g) (c) to (e) above from the date of the filing of this Counterclaim to the date of full settlement; (h) Costs on an indemnity basis; and (i) Such other relief, orders, directions, accounts and inquiries that this Honourable Court deems fit and proper to grant.” 25 Background of 1st defendant’s re-amended counterclaim 31. According to the 1st defendant, the background, which caused it to file the re-amended counterclaim against the 1st to the 3rd plaintiffs and the 5th to the 9th defendants in the main action based on the 4 (four) 30 causes of action of indefeasibility of title as provided in s. 340 of the NLC 1965, trespass and/or unlawful interference with its lawful 46 property rights, negligence and breach of statutory duty, to claim for, inter alia, a declaratory order that it is the lawful registered owner of the land; a declaratory order that it is the bona fide purchaser of the land for valuable consideration without any notice of fraud, forgery or deception/deceit as alleged by the plaintiffs; general damages for 5 negligence and/or breach of statutory duty together with interest; and costs on an indemnity basis, is as follows: (1) The 1st defendant was shown by Chong Wing Fat and Lim Yoke Sim (F), the 2nd and 3rd defendants, respectively, in the main action, who acted for the 3rd plaintiff, certified true copies of the 10 Companies Act 1965 Form 24 dated 19.12.2002 and the 2 (two) Companies Act 1965 Form 49 dated 04.09.2011 and 30.12.2011, respectively (“the Forms”), which were filed with the 5th defendant, which show that both the 1st plaintiff and the 2nd plaintiff, the 2 (two) original Directors, had resigned as 15 directors of the 3rd plaintiff on 04.09.2011; (2) The copies of the Forms, which are public documents, were certified as true by the 5th defendant and/or the 3rd plaintiff’s Company Secretary; (3) The copies of the Forms also show that at present the directors 20 of the 3rd plaintiff, are Chong Wing Fat and Lim Yoke Sim (F), who were appointed on 30.12.2011 and 04.09.2011, respectively, and that Low Beng Hong, the 4 th defendant in the main action, was appointed as director of the 3 rd plaintiff on 04.09.2011 and that he resigned on 30.12.2011; 25 (4) According to the Companies Act 1965 Form 44 filed by the 3rd plaintiff with the 5th defendant and the records of the 5th 47 defendant, until todate, the registered address of the 3rd plaintif f is the Kajang address, viz No. 5, Jalan Cuepacs 4F, Taman Koperasi Cuepacs, 43000 Kajang, Selangor Darul Ehsan, and the business address of the 3rd plaintiff is at No. 29, Jalan Riong, 59100 Kuala Lumpur; 5 (5) The 1st defendant was also shown the original copy of the Title Deed of the land by Chong Wing Fat and Lim Yoke Sim (F), who represented the 3rd plaintiff; (6) According to the records of the Land Administrator of Ulu Langat, Selangor, the 3rd plaintiff was the former registered 10 owner of the land known as Mukim Grant Title No. 872, Lot No. 1011, Mukim of Cheras, District of Hulu Langat, State of Selangor and that the Mukim Grant Title of the land was registered on 14.05.2002; (7) The 1st defendant was given a certified true copy of Chong 15 Wing Fat’s identity card, which confirms that his address is the same as that stated in paragraph 3.2(i) of the statement of claim; (8) The 1st defendant was given a certified true copy of Lim Yoke Sim’s identity card, which confirms that her address is the same 20 as that stated in paragraph 3.2(i) of the statement of claim; (9) The 7th defendant is vicariously liable to the 1st defendant in the event that the 6th, 8th and 9th defendants, in the main action, are found to be negligent in permitting the issuance of the GM title of the land to third parties without first notifying the 3 rd plaintiff, 25 in the main action, which was still in possession of the EMR handwritten issue document of title of the land, and their 48 negligence has resulted in the misuse of the GM title of the land by the 2nd , 3rd and /or 4th defendants, in the main action, which has caused the 1st defendant to be sued by the 3rd plaintiff and the 2 (two) original Directors of the 3rd plaintiff for the recovery of the land, aggravated and/or exemplary damages, interest 5 and costs; (10) The 1st defendant was informed by Chong Wing Fat and Lim Yoke Sim (F) that the 3rd plaintiff’s board of directors and shareholders have approved the sale and transfer of the land to the 1st defendant for the consideration of RM 2 million vide 10 resolutions of its board of directors and shareholders dated 30.12.2011, 03.01.2012 and 02.02.2012, respectively, which were all certified by the 3rd plaintiff’s Company Secretary (“the said resolutions”); (11) The 1st defendant has no knowledge and was not a party to the 15 fraud, forgery and deception/deceit in the falsification of the documents, including the Forms and the said resolutions of the 3rd plaintiff’s board of directors and shareholders, which resulted in the registration of the alleged false particulars of the 3rd plaintiff and the 2 (two) original directors in the records of the 20 5th defendant or in the alleged fraudulent execution of the MOT by Chong Wing Fat and Lim Yoke Sim (F), purportedly, on behalf of the 3rd plaintiff for the transfer of the land by the 3rd plaintiff to the 1st defendant, as alleged by the plaintiffs in the statement of claim in the main action; 25 (12) The said resolutions authorised Chong Wing Fat and Lim Yoke Sim (F), the new directors of the 3rd plaintiff, to execute the Sale 49 and Purchase Agreement dated 05.01.2012 between the 3rd plaintiff and the 1st defendant and also to sign the MOT in Form 14A of the NLC to transfer the land from the 3rd plaintiff to the 1st defendant; (13) Furthermore, the said resolutions also authorised Lim Yoke Sim 5 (F) to receive the deposit of 10% of the purchase price for the land on behalf of the 3rd plaintiff; (14) Since the 1st defendant had no knowledge of and was not privy to the issues pertaining to the internal management of the 3rd plaintiff regarding the alleged fraud, forgery and deceit of the 3 10 (three) new directors of the 3rd plaintiff in the preparation, execution and filing of the documents mentioned above, including the said resolutions, the 1st defendant had relied on the indoor management rule as it could only rely upon the public documents of the 3rd plaintiff kept with the 5th defendant 15 and also the GM title, which was kept and/or issued by the Land Administrator of Ulu Langat, Selangor; (15) Hence, the sale and transfer of the land from the 3rd plaintiff to the 1st defendant on 01.02.2012 were bona fide and were done for valuable consideration; 20 (16) Based on on the public documents of the 3rd plaintiff kept with the 5th defendant and the said resolutions, there was no forgery and/or use of an insufficient and/or void instrument pertaining to the transfer of the land from the 3rd plaintiff to the 1st defendant; (17) Therefore, pursuant to s. 340 of the NLC 1965, the 1st 25 defendant is a bona fide purchaser of the land for valuable consideration without any knowledge of or being privy to the 50 fraud or forgery or use of an insufficient and/or void instrument, as alleged by the 3rd plaintiff, the 1st plaintiff and the 2nd plaintif f , in the transfer of the land from the 3rd plaintiff to the 1st defendant; (18) On 29.12.2011, the 1st defendant had made searches on the 3 rd 5 plaintiff and the directorships of the 3 (three) new Directors of Goodland, in the 3rd plaintiff with the 5th defendant and CTOS Sdn. Bhd. (“CTOS”) and the 1st defendant found that based on the 5th defendant’s and CTOS’s records, the information, which was given to the 1st defendant by the 2nd and 3rd defendants, on 10 their directorships in the 3rd plaintiff, were true and accurate; (19) Hence, the 1st defendant found that there were no obstacles or restrictions and/or suspicions for it to proceed with the purchase of the land from the 2nd and 3rd defendants (“the 2 (two) new Directors of Goodland”), who represented the 3rd plaintiff; 15 (20) The 1st defendant had also made a search on the land with the 6th defendant on 28.12.2011 and it found that the records of the latter were true and accurate regarding the ownership status of the land, viz that the registered proprietor of the land is the 3rd plaintiff; and 20 (21) Therefore, the 1st defendant is the lawful registered proprietor of the land pursuant to s. 340 of the NLC 1965. 2nd, 3rd and 4th defendants’ statement of defence 32. The 2nd, 3rd and 4th defendants, although served with a sealed copy of 25 the writ and statement of claim, did not file their statement of defence, either individually or jointly, to the writ and statement of claim. 51 33. As the 1st defendant did not include any of them in its counterclaim, they did not have to file their statement of defence, either individually or jointly, to the 1st defendant’s counterclaim. 5th defendant’s statement of defence 5 34. On 10.07.2012, the 5th defendant filed its statement of defence dated 09.07.2012 to the writ and statement of claim and to the 1st defendant’s counterclaim, through the Legal Officer of the Litigation Section of its Legal Service Department, enclosure (17). Subsequently, the 5th defendant amended and re-amended its 10 statement of defence to the 1st defendant’s amended and re- amended counterclaim. 35. In summary, the 5th defendant’s defence to the plaintiffs’ claim in the main action and the 1st defendant’s counterclaim is as follows: (1) Since the 5th defendant is a statutory body established under 15 the Companies Commission of Malaysia Act 2001 (Act 614), its members or employees or any other person acting under the direction of the 5th defendant are protected from personal liability for anything done in good faith; (2) Based on the 5th defendant’s record, the 1st and 2nd plaintiffs 20 have resigned from the 3rd plaintiff and they were replaced by the 2nd to the 4th defendants. The registered address of the 3rd plaintiff, the 3rd plaintiff, was also changed from the Pudu address to the Kajang address. The 5th defendant has no knowledge that the changes of the 3rd plaintiff’s directorships 25 and registered address were, fraudulently, done; (3) The 3rd plaintiff’s corporate information was amended by the 5 th defendant pursuant to the registration of the Companies Act 52 1965 Form 49, Form 48A and Form 44, which were submitted by the 3rd plaintiff and the amendment to the 5th defendant’s record upon the registration of the Forms were done by the 5th defendant in good faith without any element of malice and/or bad intention on its part; 5 (4) The 5th defendant has no knowledge that the 2nd to the 4th defendants are bogus directors and that the signatures of the 1st and 2nd plaintiffs and the 3rd plaintiff’s Company Secretary in the Companies Act 1965 Form 49, Form 48A and Form 44, which were submitted to the 5th defendant, purportedly by the 10 3rd plaintiff have been forged as pleaded by the 1st to the 3rd plaintiffs in the statement of claim; (5) The 5th defendant denies that it was negligent and/or in breach of its statutory duty. Although the 1st defendant has alleged that the 5th defendant failed to comply with the statutory duty under 15 s. 11 of the Companies Act 1965, the 1st defendant has failed to specify the details of the statutory duty under that section, which was not complied with by the 5th defendant; (6) On its part, in accepting and registering the statutory documents of the 3rd plaintiff, the 5th defendant has complied 20 with the requirements as prescribed under the Companies Act 1965 and the Companies Regulations 1966. This is because all the Forms, which were submitted to the 5th defendant for registration, purportedly, by the 3rd plaintiff, were found by the 5th defendant to be fit for registration and the 3rd plaintiff is, 25 solely, responsible for the accuracy of its company information as contained in the Forms; 53 (7) The 5th defendant has no knowledge of the internal management of the 3rd plaintiff as the 5th defendant operates on the basis of disclosure by companies. Hence, statutory forms, which are found to be in accordance with the Companies Act 1965 and the Companies Regulations 1966 will be accepted for 5 registration and the 5th defendant is not able to verify the authenticity or validity of the signatures in and the contents of the statutory forms of companies, which it receives for purposes of registration in its record; (8) The 5th defendant will take enforcement action in accordance 10 with s. 364(2) of the Companies Act 1965 if any corporate information contained in the statutory forms is alleged to be false or misleading but in this case there was no complaint made by the 1st and 2nd plaintiffs and the 3rd plaintiff’s Company Secretary to the 5th defendant concerning the alleged fraudulent 15 acts of the 2nd to the 4th defendants in forging the signatures of the 1st and 2nd plaintiffs and the contents of the statutory forms of the 3rd plaintiff, which were, subsequently and allegedly, submitted by the 2nd to the 4th defendants to the 5th defendant; (9) Hence, the 5th defendant denies that it has acted negligently as 20 it had followed the procedures prescribed under the Companies Act 1965 and Companies Regulations 1966 in accepting the statutory documents of the 3rd plaintiff for registration, viz the Companies Act 1965 Form 44, the Form 49 and the Form 48A; (10) The 5th defendant also did not at any time breach its statutory 25 duty and it has performed its duties in good faith and in accordance with the law; 54 (11) The 5th defendant has no personal interest in this case and no mala fide intention towards the 1st defendant; (12) The 5th defendant has no knowledge of the purchase of the land by the 1st defendant; and (13) The 1st defendant should claim for damages from the 2nd, 3rd 5 and 4th defendants for the losses, which it has, allegedly, suffered due to the claim of the 3 (three) plaintiffs against the 1st defendant in the main action. 36. Hence, in its re-amended statement of defence to the 1st defendant’s 10 re-amended counterclaim, the 5th defendant pleads, inter alia, as follows: “SECOND AMENDED STATEMENT OF DEFENCE OF THE 5TH DEFENDANT AGAINST THE AMENDED COUNTERCLAIM WHICH HAS BEEN AMENDED BY THE FIRST DEFENDANT 15 1. The 5th Defendant refers to the following cause papers: (a) Second Amended Writ of Summons and the Second Amended Statement of Claim dated 25.05.2012 (hereinafter referred as Plaintiffs’ Second Amended 20 Statement of Claim); (b) Second Amended Statement of Defence of the 5th Defendant dated 26.06.2012 (hereinafter referred as Second Amended Statement of defence of the 5th Defendant); and 25 (c) Second Amended of Statement Defence Of The 5th Defendant Against The Amended Counterclaim Which Has Been Amended 1st Defendant By The First Defendant dated 25.06.2012 (hereinafter referred as Second Amended Statement of Defence and Amended 30 55 Counterclaim Which Has been Amended of the First Defendant) which has been filed here. 2. The 5th Defendant filed the Second Amended Statement of Defence Of The 5th Defendant Against The Amended Counterclaim 5 Which Has Been Amended by The First Defendant dated 25.06.2012 without prejudice to any rights of the 5th Defendant to file any application against the said Amended Counterclaim Which Has Been Amended by The First Defendant. 3. The 5th Defendant now refers to the Second Amended 10 Statement of Defence Of The 5th Defendant and reiterates the said statements. The claim that the 5th Defendant is negligent and in breach of statutory duty 15 4. The 5th Defendant strongly denies the 1st Defendant’s allegations in Paragraph 41 of the Amended Counterclaim Which Has Been Amended by The First Defendant which states that the 5th Defendant has been negligent in performing their the 5th Defendant’s duties and responsibilities against the 1st Defendant 20 that had been falsified and misused. The burden of proof is placed on the Plaintiffs. 5. The 5th Defendant strongly denies the particulars of negligence stated by the 1st Defendant in Paragraphs 41(i), (j), (k), (l), (m) and (n) of the Amended Counterclaim Which Has Been 25 Amended by The First Defendant. The burden of proof is placed on the 1st Defendant to prove it. Further, the 5th Defendant states in the following paragraphs. 6. As the corporate regulator in Malaysia, the 5th Defendant consistently follows the procedures prescribed under Companies 30 Act 1965 and Companies Regulations 1966 in accepting statutory documents for registration. The prescribed procedures are as follows: 56 (a) The form shall be completed in accordance with the instructions set out in the prescribed form; STATUTORY FORM DETAILS REQUIRED Form 44 Must state: i) Company name; ii) Company registration number; iii) Date of the form; iv) Date of the change; v) Details of the change, at the office hour or registered office; vi) Director’s signature or signature of company secretary (local companies); vii) Signature of company’s agent (foreign companies). Form 49 Must state: i) Company name; ii) Company registration number; iii) Date of the form; iv) Date of the change; v) Details of the change such as;  Appointment and resignation of the directors;  Changes of the address;  Changes of the directorship or management; vi) Name, nationality, race, date of birth, position in other companies, identity card number/ passport number of the directors, company secretary and company manager. vii) Signature of the director or company secretary. A company should have at least 2 directors; A company should have one or more company secretary; For the appointment of the new 57 director, Form 49 must be attached with Form 48A, and Statutory Declaration by the individual before he/she be appointed as company director. Form 48A Must state: i) Company name; ii) Company registration number; iii) Full name, identity card number/ passport and address of the director; iv) Signature of the director; v) Stampt and signature of the commissioner of oaths. Date of affirmation shall be the date of appointment or before appointment. (b) A document to be lodged shall be on paper of medium weight and good quality and of international sheet size A4 only; (c) The document shall be clearly printed and shall be in 5 type of a size not less than the type known as eight point times; (d) Except with the consent of Registrar, the document shall not be a carbon copy; (e) The document shall have margins of not less than 10 twenty-five milimetres on the left-hand side and not less than fifteen millimeters on the right-hand side; (f) Where the document comprises two or more sheets, the sheets shall be bound together securely and each sheet shall have a margin of not less than twenty-five 15 millimeters on the side on which it is bound in addition to any space required for binding; (g) Where the document comprises more than twenty sheets, it shall be bound securely inside a durable and flexible cover; 20 58 (h) The document shall be punched with two holes of six millimeters in diameter and measuring eighty millimeters apart on the left-hand margin; (i) The document shall be endorsed with the name, address and telephone number of any person by or on 5 whose behalf the document is lodged at the end of each document; (j) The document shall be endorsed on the upper left-hand corner of every page with the company number allotted to which the document relates. 10 7. The 5th Defendant now refers to Forms 44, 49 and 48A as well as all the resolutions which were lodged for the 3rd Plaintiff (refer to Paragraph 4.12 and 5.13 of the Second Amendment Statement of defence Of The 5th Defendant). All the said statutory 15 forms are complete and fulfills all the procedures needed. After verifying that the form is complete and late lodgement fee is paid, the 5th Defendant had registered the statutory forms and amended the 3rd Plaintiff’s corporate information accordingly. 8. If the statutory forms are incomplete or irregular for 20 registration, the 5th Defendant will take action pursuant to section 11(8) or 11(9) of CA 1965 by issuing letter of query to the company. In the present case, as all the statutory forms are complete and fulfills all requirements, the said letter of query was not issued by the 5th Defendant to the 3rd Plaintiff or its company secretary. 25 9. The 5th Defendant has no knowledge of the internal management of the 3rd Plaintiff as well as the validity of the contents in the statutory forms which were lodged and registered with the 5th Defendant. The 5th Defendant operates on the basis of disclosure regime. Regular statutory forms for registration will be 30 accepted. 10. Statutory forms and company information of the 3rd Plaintiff supplied by the 5th Defendant to any third party is an extract from or 59 copy of the statutory forms lodged and registered with the 5th Defendant by the 3rd Plaintiff. Therefore, the 3rd Plaintiff is solely responsible for the accuracy of information on the companies and statutory forms supplied by the 5th Defendant to any third party. 11. Therefore, the 5th Defendant strongly denies the allegation of 5 the 1st Defendant in Paragraphs 43, 43(a) until (f) of the Amended Counterclaim Which Has Been Amended by The First Defendant in which it is alleged that the 5th Defendant has breached its statutory duty towards the 1st Defendant. The burden of proof is placed on the 1st Defendant. 10 12. The 5th Defendant strongly denies the statement in Paragraphs 42 and 44 of the Amended Counterclaim Which Has Been Amended by The First Defendant whereby the alleged loss experienced by the 1st Defendant is caused by the negligence and breach of statutory duty by the 5th Defendant. The burden of proof 15 is placed on the 1st Defendant. 13. 5th Defendant strongly denies the 1st Defendant allegations in Paragraph 45, particulars of consipiracy in Paragraph 45(a) until (f) and Paragraph 46 of the Counterclaim of the 1st Defendant. 5th Defendant never conspires legally or illegally with any parties to 20 cause any loss to 1st Defendant. The burden of proof is placed on the Plaintiffs. Next, The 5th Defendant further states that: (a) The 5th Defendant has no knowledge with regards to the property known as Geran Mukim No. Hakmilik 872, Lot No. 1011, Mukim Cheras, Daerah Hulu Langat, 25 Negeri Selangor (the said property) and the purchase of the said property by the 1st Defendant; (b) The 5th Defendant had no personal interest in this case and has no any mala fide intention against the 1st Defendant or any other parties. 30 (c) At all material times, the 5th Defendant and/or the employees of the 5th Defendant has never been negligent or breached its/their statutory duty and has 60 peformed their duties in good faith and in accordance to the provisions of law. (d) 1st Defendant has unfairly taken advantage of the 5th Defendant as regulatory body corporate by correlating 5th Defendant with the issue of the purchase of the 5 property by fraud, falsification of public documents and the 3rd Plaintiff’s resolutions and forgery of the Original Title of the said property. 14. The 1st Defendant should claim damages and/or take actions 10 against the 2nd, 3rd, and 4th Defendants for the alleged deception done against the 1st Defendant and also losses allegedly suffered by the 1st Defendant. The 1st Defendant’s inaction in not filing a counterclaim against the 2nd, 3rd, and 4th Defendants has raised doubts on the transparency of the Amended Counterclaim Which 15 Has Been Amended by The First Defendant. 15. The 5th Defendant has no information with regards to the 1st Defendant’s statement in Paragraphs 45 until 49 of the Amended Counterclaim Which Has Been Amended by The First Defendant. 16. Based on the above, the 5th Defendant was not negligent 20 and had acted in good faith in performing its duties, and therefore prays to this Honourable Court to dismiss the Amended Counterclaim Which Has Been Amended by The First Defendant against the 5th Defendant with costs. 17. Except and unless expressly admitted here, the 5th 25 Defendant denies all and every statement in the Amended Counterclaim Which Has Been Amended by The First Defendant as if the statements are denied by seriatim. Dated 9th July 2012” 30 61 6th defendant’s statement of defence and 6th and 7th defendants’ joint statement of defence 37. On 25.06.2012, the 6th defendant filed his statement of defence. 38. On 12.03.2014, the writ and the statement of claim dated 07.03.2014 were served on the 6th and 7th defendants. 5 39. On 14.04.2014, the 6th and 7th defendants filed their joint statement of defence. 40. In the 6th and 7th defendants’ joint statement of defence, the 6th and 7th defendants plead, inter alia, as follows: (1) The 3 (three) plaintiffs failed to fulfill the requirements of ss. 5 10 and 6 of the Government Proceedings Act 1956, which require them to identify the individual tortfeasor, who had, allegedly, negligently, registered the transfer of the land and/or who had committed the alleged statutory breach of the NLC 1965, in the registration of the land, by naming him in the writ and statement 15 of claim; (2) The 6th and 7th defendants are 2 (two) different entities. As such, it is misconceived for the 3 (three) plaintiffs to describe the 7th defendant as the “State Authority” for the land in Selangor; 20 (3) The 3 (three) plaintiffs are put to strict proof in regard to their allegation that the 7th defendant is vicariously liable to them as a result of the actions and omissions of the 6th, 8th and 9th defendants; (4) The 9th defendant does not supervise or handle the dealings 25 involving lands and, hence, it is wrong to name him in this suit; 62 (5) The 6th and the 8th defendants had complied with the procedures as laid down in the NLC 1965, in particular, ss. 215, 217, 218, 297 and 340, in the registration of the transfer of the land from the 3rd plaintiff to the 1st defendant as it was done based on the documents for the transfer of the land, which were 5 presented to the office of the 6th defendant; (6) It is for the 3 (three) plaintiffs to prove that there are elements of fraud in the transfer of the land from the 3rd plaintiff to the 1st defendant; (7) The 6th and 8th defendants have no knowledge that the 10 signatures of the 1st and 2nd plaintiffs and the 3rd plaintiff’s Company Secretary in the MOT, which was presented for registration by the 1st defendant, through its solicitors, Messrs. Peter Pui & Partners, had been forged by the 2nd to the 4th defendants; and 15 (8) In any event, the Registrar at the office of the 6th defendant is entitled to the protection under s. 22 of the NLC 1965 as he had acted bona fide in the registration of the transfer of the land from the 3rd plaintiff to the 1st defendant. 20 8th and 9th defendants’ joint statement of defence 41. On 14.04.2014, the 8th and 9th defendants filed their joint statement of defence to the writ and statement of claim. 42. In their joint statement of defence, they plead, inter alia, as follows: (1) The 9th defendant did not register the transfer of the land from 25 the 3rd plaintiff to the 1st defendant; 63 (2) The 8th and 9th defendants have no jurisdiction to check the status concerning the safe keeping of the original EMR handwritten issue document of title of the land by the 1st plaintiff; (3) The 1st to the 3rd plaintiffs failed to fulfill the requirements of ss. 5 5 and 6 of the Government Proceedings Act 1956, which require them to identify the individual tortfeasor, who had, allegedly, negligently registered the transfer of the land and/or who had committed the alleged statutory breach of the NLC 1965, in the registration of the transfer of the land, by naming 10 him in the writ and statement of claim; (4) The 1st to the 3rd plaintiffs, are put to strict proof in regard to their allegation that the 7th defendant is vicariously liable to them as a result of the acts and omissions of the 6th, 8th and 9th defendants; 15 (5) Based on the documents, which were presented to the office of the 6th defendant, the latter had, properly, registered the transfer of the land from the 3rd plaintiff to the 1st defendant as the documents presented for the transfer of the land complied with the procedures as laid down in the NLC 1965, in particular, 20 ss. 215, 217, 218, 297 and 340; and (6) It is for the 3 (three) plaintiffs to prove that there are elements of fraud in the transfer of the land from the 3rd plaintiff to the 1st defendant. 25 6th to 9th defendants’ joint statement of defence to 1st defendant’s counterclaim 64 43. On 12.05.2014, the 6th to the 9th defendants filed their joint statement of defence to the 1st defendant’s counterclaim. 44. In their joint statement of defence to the 1st defendant’s counterclaim, the 6th to the 9th defendants, plead, inter alia, as follows: (1) They deny that they were negligent in executing their duty to 5 the 1st defendant; (2) The EMR (handwritten) title of the land was changed to the GM computer printed title of the land pursuant to the implementation and execution of the computerized land registration system (“the said system”). Pursuant to the said 10 system, the EMR title was cancelled by the office of the 6th defendant and replaced with the GM title; (3) The 6th, 8th and 9th defendants were, wrongly, named in the counterclaim as they are not the tortfeasors as alleged by the 1st defendant. This is because the 1st defendant has failed to 15 identify the persons in the, respectively, offices of the 6th, 8th and 9th defendants in connection with the alleged negligence, pursuant to ss. 5 and 6 of the Government Proceedings Act 1956; (4) The 7th defendant will only be held, vicariously, liable in the 20 event the 1st defendant succeeds in proving its allegations of negligence, by acts or omissions, and/or breach of statutory duty by the 6th, 8th and 9th defendants; (5) The 6th defendant; the 7th defendant; the 8th defendant; and the 9th defendant deny that they have breached their statutory duty 25 under the NLC 1965 to the 1st defendant; 65 (6) The Registrar at the office of the 6th defendant had performed his duty, properly, without any mala fide intention and in compliance with the procedures in the NLC 1965 for the registration of the transfer, in particular, in ss. 215, 217, 218, 322, 323 and 324 as the documents for the registration of the 5 transfer, which were presented to the Registration Unit, had complied with s. 297 of the NLC 1965 and were found to be fit for registration; (7) There was confusion and digression of facts when the 1st defendant did not include the 2nd to the 4th defendants as 10 defendants in its counterclaim even though the 2nd to the 4th defendants are the key players in the main action. This is because they were, directly, involved in the transfer of the land from the 3rd plaintiff, to the 1st defendant, which is the subject matter of the main action, unlike the 6th defendant, which is only 15 a government agency and whose function to register the transfer, the private caveat and the Registrar’s caveat, is merely administrative in nature; (8) The 1st defendant has a mala fide intention in filing its counterclaim against the 6th to the 9th defendants; 20 (9) This is because it is not impossible that the 1st defendant had conspired with the 2nd to the 4th defendants in manipulating the functions of the 6th and 8th defendants; which had resulted in the registration of the transfer of the land from the 3rd plaintiff to the 1st defendant; 25 (10) The 1st defendant has also acted, unfairly, in suing the 6th, 8th, and 9th defendants for negligence, breach of statutory duty, fraud, forgery, deception/deceit, conspiracy and collateral 66 abuse of power without any proof and/or reasonable justification that they have personally committed the negligence, breach of statutory duty, fraud, forgery, deception/deceit, conspiracy and collateral abuse of power; (11) The 1st defendant and/or its solicitors, viz Messrs. Peter Pui & 5 Partners, were negligent as they failed to ensure that the documents, which were presented for the registration of the transfer of the land from the 3rd plaintiff to the 1st defendant, were in order and in accordance with the relevant law and the standard operating procedure (“SOP”) for the transfer of the 10 land; and (12) In any event, the 6th, 8th, and 9th defendants are protected under s. 22 of the NLC 1965 as they had acted bona fide in the registration of the transfer of the land, the private caveat and the Registrar’s caveat, upon being satisfied that the documents 15 presented were fit for registration. 6th to 9th defendants’ re-amended statement of defence to re-amended counterclaim of 1st defendant 45. Subsequently, the 6th to the 9th defendants re-amended their 20 statement of defence to the re-amended counterclaim of the 1st defendant dated 12.05.2014 (“re-amended defence”), enclosure (129), through the State Legal Adviser of Selangor. 46. In their re-amended defence, which was re-dated 12.05.2014, to the 1st defendant’s re-amended counterclaim, they plead as follows: 25 “RE AMENDED STATEMENT OF DEFENCE FOR THE 6TH AND THE 7TH UNTIL THE 9TH DEFENDANTS TO RE-AMENDED COUNTERCLAIM BY THE 1ST DEFENDANT 67 1. The 6th and the 7th until the 9th Defendants refer to the cause papers as follows: a) Writ of Summons and Amended Statement of Claim dated 25.5.2012 (hereinafter referred as “Plaintiffs’ Amended Statement of Claim”); 5 b) Statement of defence for the 6th Defendant dated 25.6.2012 (hereinafter referred as “the 6th Defendant’s Defence”); and c) Amended Statement of Defence for the 6th Defendant dated 11.10.2013 (hereinafter referred as “the 6th 10 Defendant’s Defence”); and d) Amended Statement of Defence for the 6th and the 7th Defendants (“hereinafter referred to as “the 6th and 7th Defendants’ Amended Defence”); and e) Statement of Defence and Re-Re-Amended 15 Counterclaim for the 1st Defendant dated 25.06,2012 (hereinafter referred as “the Re-Re-Amended Counterclaim by the 1st Defendant”) which all herein been filed; and; f) Statement of Defence for the 6th Defendant against 20 the counterclaim by the 1st Defendant dated 24.7.2012 (hereinafter referred as “Amended Defence to the Counterclaim by the 1st Defendant”); and g) Amended Statement of Defence and Amended Counterclaim by the 1st Defendant dated 2.4.2013 25 (“hereinafter refered as “Amended Counterclaim”) which all been filed herein, and; h) Amended Statement of Defence for the 6thand the 7th Defendants against Re-Amended Counterclaim by the 1st Defendant dated 25.10.2012 (hereinafter referred 30 as “Re-Amended Counterclaim”) which all been filed herein. 68 i) Re-Amended Statement of Defence for the 6th and the 7th Defendants dated 14.4.2014 (hereinafter referred as “Re-Amended Statement of Defence for the 6th and the 7th Defendants”); and j) Statement of Defence for the 8th and the 9th 5 Defendants dated 14.4.2014 (“hereinafter refered as “the 8th and the 9th Defendants’ Defence”); and k) Re-Re-Amended Statement of Defence and Counterclaim for the 1st Defendant dated 24.4.2014 (hereinafter referred as “Re-Re-Amended 10 Counterclaim”). 2. The 6th and the 7th Defendants have filed the Re-Amended Statement of Defence and the Statement of Defence for the 8th and the 9th Defendants against the Re-Amended 15 Counterclaim by the 1st Defendant dated 25.6.2012 2.4.2013 22.10.2013 24.4.2014 without prejudice to the rights of the 6th and the 7th until the 9th Defendants to file relevant application with regard the said Re-Re-Amended Counterclaim. 20 Allegation that the 6th inclusive the 8th and the 9th Defendant was negligent whilst executed duty 3. The 6th and the 7th until the 9th Defendants strictly denied allegations by the 1st Defendant in para 41 of the Re-Re-25 Amended Counterclaim by the 1st Defendant that the 6th Inclusive the 8th and the 9th Defendants had negligent when executed their duty towards the 1st Defendant by allowing or causing the documents of the 3rd Plaintiff that been presented to the 6th Defendant including the issuance of 30 original title for the said land that been forged and been misused. 4. The 6th and the 7th until the 9th Defendants strictly denied allegations by the 1st Defendant in para 41(o)(p)(q)(r)(s) of the Re-Re-Amended Counterclaim in particular that the 6th 35 69 Defendant inclusive the 8th and the 9th Defendants did not execute their duty and responsibility by allowing the Original Title issued for the said land whereas the 3rd Plaintiff has another old original title for the same said land. Thus burden of proofs are put to the 1st Defendant to prove the 5 authenticity of his words. 5. The original title for the said land was Title of EMR 2824, Lot 1011 which later been changed to computerized issuance of title. 6. The original title for the said land which later been 10 changed to computerized issuance of title pursuant to the implementation and execution of Computerized Land Registration System (SPTB). The issuance of document of Title had been registered by the 6th Defendant’s office on 14.35.2002 under document of Title Geran Mukim 15 No. 872, Lot 1011, Mukim Cheras, Daerah Hulu Langat. 7. Whereas, the issue regarding the Old document of title for the said land which purportedly claimed been in possession of the 3rd Plaintiff, such fact must come from the 3rd Plaintiff himself but not from the 1st Defendant. Whatever it was, the 20 fact as claimed that the old document of title is in the 3rd Plaintiff possession, pursuant to the implementation and execution of computerized land registration system, the said old document of title had been cancelled before the 6th Defendant’s office issued the computerized issuance of title. 25 7A. The 6th, the 8th and the 9th Defendants have been wrongly named in the Counterclaim suit by the 1st Defendants on basis of committed negligent which had caused the 1st Defendant to suffer loss and lost and continuing. Any allegation of negligent by the 6th, the 8th and the 9th 30 Defendants are strictly denied because the 6th, the 8th and the 9th Defendants are not the tortfeasor as been alleged by the 1st Defendant in para 41(o), (p), (q), (r) and (s) of the Re- 70 Re-Amended Counterclaim hereinafter referred as “the said negligence”). In a claim based on negligence, the 1st Defendant had failed to relate and identified to tortfeasor and the 1st Defendant failed to personally connecting the 6th, the 8th and the 9th Defendants with the said negligence. 5 8. Furthermore, refer to para 42 of the Re-Re-Amended Counterclaim, the 6th and the 7th until the 9th Defendants strictly denied the allegation by the 1st Defendant thus the strict burden of proof are put on the 1st Defendant to justify it claim. The 7th Defendant shall only be vicariously held liable 10 only in the event the Plaintiffs manage to prove beyond reasonable doubt such allegations of negligence, omission and breach of statutory duty against the 6th, the 8th and the 9th Defendants. 15 Allegation that the 6th Defendant inclusive the 8th and the 9th Defendants had breached the statutory duty. 9. The 6th and the 7th until the 9th Defendants are strictly denied the details of breach of statutory duty which purportedly from the 6th Defendant inclusive the 8th and the 9th Defendants as 20 been alleged in para 43, 43(g), (h), (i), (j) and (k) of the Re Re Amended Counterclaim. Thus, strict burden of proof are put on the 1st Defendant to justify its statements and claims. The 6th and the 7th until the 9th Defendants repeat para 5, 6 and 7 and paragraph 7A above. 25 10. Refer to para 44 and 45 of the Re-Re-Amended Counterclaim by the 1st Defendant are strictly denied. Thus, strict burden of proof are put on the 1st Defendant to justify its statements and claims. The 7th Defendant shall only be vicariously held liable only in the event the Plaintiffs 30 manage to prove beyond reasonable doubt such allegations of negligence, omission and breach of statutory duty against 71 the 6th, the 8th and the 9th Defendants. The 7th Defendant repeats para 7A above. Allegation that the 6th Defendant had conspired. 11. Furthermore, the 6th Defendant strictly denied the details of 5 of conspiracy involved the 6th Defendant as been alleged by the 1st Defendant in para 45(a), (b), (c), (d), (e), (f) and para 46 of the 1st Defendant Counterclaim because it was more to bare accusation and presumption only, thus strict burden of proof are put on the 1st Defendant to justify it statement and 10 claims with comprehensive documentary evidence. 11. In furtherance, the registrar at the 6th Defendant’s office had performed his duty in compliance with procedures with regard the transfer in particular sections 215, 217 and 218 National Land Code without any mala fide against all parties. 15 The Instruments of transfer that been presented to the Registration Unit at the 6th Defendant’s office for the said land are fit for registration as under section 297 of the National Land Code, thus the duty of the Registrar at Registration Unit at the 6th Defendant’s office at that material 20 time to register the instrument of transfer with reference to section 301 of the National Land Code. 12. Refer to para 45 and 46 of the Re-Re-Amended Counterclaim by the 1st Defendant, such facts had been raised between Plaintiffs and the 1st Defendant. The 6th 25 Defendant until the 9th Defendants do not have such knowledge except a fact that the 1st Defendant has been registered as the registered owner of the said land on 1.2.2012. 13. Refer to para 47 of the Re-Re-Amended CCA by the 1st 30 Defendant, the Registrar at the 6th Defendant’s office had administratively performed duty under sections 322, 323 and 324 of National Land Code and not denied had registered a 72 private caveat through presentation no. 1674/2012 on 9.3.2012. 14. Refer to para 48 of the Re-Re-Amended Counterclaim by the 1st Defendant, the fact that the 1st Defendant has been registered on 1.2.2012 as the registered owner for the said 5 land is admitted. Other facts in para 48 are not within the knowledge of the 6th until the 9th Defendants. 15. Refer to para 49 of Re-Re-Amended Counterclaim, the registrar at the 6th Defendant’s office, pursuant to the administrative functions under sections seksyen 319 and 10 321 of National Land Code, 1965, did not deny to have registered the Registrar Caveat on 2.4.2012 against the said land. Amended Counterclaim against the Plaintiffs and the 5th 15 Defendant and the 6th and the 7th until the 9th Defendants severally and separately. 16. Refer to para 50(a) 49(a) and (b) Re-Re-Amended Counterclaim, the issue of a declaration as claimed by the 1st Defendant is beyond the jurisdiction of the 6th Defendant 20 except based on Court Order. Hence, the 6th until the 9th Defendants will let the Honourable Court to hear the 1st Defendant’s claims after hearing all the evidence from all parties. 17. The 6th and the 7th until the 9th Defendants plead that there 25 were confusion and misappropriation of facts when the 2nd, the 3rd and the 4th Defendants are exempted by the 1st Defendant from the Counterclaim by the 1st Defendant as been pleaded in para 50 (a) (b) (c) (d) (e) (f) (g) (h) (i) and (j) Counterclaim by the 1st Defendant 49 (a) (b) (c) (d) (e) 30 (f) (g) (h) and (i) of the Re-Re-Amended Counterclaim by the 1st Defendant, whereby the 2nd, 3rd and the 4th Defendants are the main parties that involved in this suit 73 compared with the 6th Defendant who is only a government body which function is to administratively register the instrument of transfer, the private caveat and the register caveat of which is fit for registration. The 7th Defendant shall only be vicariously held liable only in the event the Plaintiffs 5 manage to prove beyond reasonable doubt such allegations of negligence, omission and breach of statutory duty against the 6th, the 8th and the 9th Defendants. 18. It is obvious that the 1st Defendant has an intention of mala fide against the 6th and the 7th until the 9th Defendants and it 10 is possible that the 1st Defendant conspired with the 2nd, the 3rd and the 4th in manipulating the functions of the 6th and the 7th Defendants. The 1st Defendant has unfairly connected the 6th Defendant inclusive the 8th and the 9th Defendants whom functions as Registrar with the issues of negligence, breach 15 of statutory duty, cheating, forgery, conspiracy and others with no proofs and/or reasonable justification that the 6th, the 8th and the 9th Defendants had personally committed the negligence and the breach of statutory duty. The 7th Defendant shall only be vicariously held liable only in the 20 event the Plaintiffs manage to prove beyond reasonable doubt such allegations of negligence, omission and breach of statutory duty against the 6th, the 8th and the 9th Defendants. 19. The 6th and the 7th until the 9th Defendants did not have any 25 personal interest against the said land, apart from that the Registrar of the 6th Defendant’s office had executed their task as registrar in accordance with the requirements under National Land Code 1965. 20. The 6th and the 7th until the 9th Defendants plead the 30 protection that given to the 6th Defendant inclusive the 8th and the 9th Defendants as been stated in section 22 of National Land Code. The Registrar at Registration Unit at 74 the 6th Defendant’s office at all material times has been acted bona fide when performed their duty and thus no action or claim can be brought agains them. 20A. The 6th and the 7th until the 9th Defendants plead that mandatory requirements for an identification of tortfeasor by 5 the 1st Defendant has failed to identify the tortfeasor as been stated in sections 5 & 6 of the Government Proceeding Act. 21. Save as have been specifically admitted before, the 6th and the 7th until the 9th Defendants denied each and every facts in the Re-Re-Amended Counterclaim as if it is made in 10 seriatim and specifically been denied. 22. Therefore, the 6th and the 7th until the 9th Defendants humbly request to the Honorable Court to dismiss the Re-Re- Amended Counterclaim by the 1st Defendant with cost. 15 Dated on 24th July 2012 Tt ……………………. Kamar Penasihat Undang-Undang Negeri Selangor 20 Dated on 22nd April 2013 Tt ……………………. Kamar Penasihat Undang-Undang 25 Negeri Selangor for the 6th Defendant Dated on 25th October 2013 Tt ……………………. 30 Kamar Penasihat Undang-Undang Negeri Selangor bagi pihak Defendan Ke6 dan Ke7 Dated on 12th May 2014 Tt 35 ……………………. Kamar Penasihat Undang-Undang Negeri Selangor the 6th until the 9th Defendants” 75 3 (three) plaintiffs’ reply to 1st defendant’s defence and the ir defence to 1st defendant’s counterclaim 47. In their reply to the 1st defendant’s defence and their defence to the 1st defendant’s counterclaim, the 3 (three) plaintiffs deny, inter alia, the following averments of the 1st defendant: 5 (1) That they were negligent in the management of the 3rd plaintiff or negligent in the filing of the public documents of the 3rd plaintiff with the 5th defendant as they did not file the same; (2) That they were negligent in not verifying the status of the alleged issuance of the computerized title of the land with the 10 6th defendant as they were not notified of the same; and (3) That they have allowed their workers or agents to commit trespass on the land or to interfere unlawfully with the proprietary rights of the 1st defendant over the land. This is because the 3rd plaintiff is the lawful registered owner of the 15 land and its workers or agents were carrying out the slope trimming and stabilization works on the land as per the Majlis Perbandaran Kajang’s direction and consent. 48. The 3 (three) plaintiffs also plead, inter alia, as follows: 20 (1) The private caveat was lodged by the 2nd plaintiff, as the director and shareholder of the 3rd plaintiff to protect the interests of the 1st and 2nd plaintiffs in the land; and (2) They have caveatable interests in the land as there are serious questions to be tried and the private caveat must be maintained 25 as the balance of convenience lies in their favour. 76 15 (fifteen) issues for determination of Court between 3 (three) plaintiffs and 1st defendant in main action 49. There are 15 (fifteen) issues for the determination of the Court between the 3 (three) plaintiffs and the 1st defendant in the main action, which are as follows: 5 (1) Whether the 1st plaintiff and/or 2nd plaintiff had knowledge or consented, as either directors or as shareholders in any board of directors’ and shareholders’ meetings to res ign and/or be replaced as directors of the 3rd plaintiff by, inter alia, the 2nd defendant, 3rd defendant and/or 4th defendant? 10 (2) Whether the land had been fraudulently transferred and registered in the name of the 1st defendant by forgery and/or by means of an insufficient and/or void instrument(s)? (3) Whether the registered office of the 3rd plaintiff as 1st Floor, Wisma Cheong Hin, No. 116, Jalan Pudu, 55100 (Pudu 15 address) was changed to No. 5, Jalan Cuepacs, 4F Taman Koperasi Cuepacs, 43000 Kajang, Selangor (Kajang address), unknown to the 1st plaintiff and 2nd plaintiff and/or Company Secretary of the 3rd plaintiff? (4) Whether the plaintiffs and/or the 5th, 6th and 8th defendants were 20 negligent in allowing or causing the 3rd plaintiff’s documents that were filed with the 5th and 6th defendants including the issuance of the Original Title Deed for the Property, to be falsified and misused? (5) Whether the 5th, 6th and 8th defendants had breached their 25 statutory duty under the Companies Act, 1965 and the the NLC 1965? 77 (6) Whether the GM Title [Grant] of the land had been obtained fraudulently without the knowledge of any of the plaintiffs? (7) Whether the GM Title [Grant] of the land was issued in contravention of the provisions of the NLC 1965 and the Fourteenth Schedule thereof and as such is a nullity and void? 5 (8) Whether the GM Title [Grant] issued for the land is void ab initio and hence the purported transfer of the land from the 3rd plaintiff to the 1st defendant is also null and void ab initio? (9) Whether the plaintiffs and/or the plaintiffs’ agents have committed a trespass? 10 (10) Whether the plaintiffs have any caveatable interests in the land? (11) Whether the 1st defendant is a bona fide purchaser for value of the property without any notice of fraud, forgery or deception? (12) Whether the 1st defendant is a lawful registered owner of the 15 property? (13) Whether the plaintiffs have been negligent in any way? (14) Whether the plaintiffs’ negligence (if any) had caused or contributed to the plaintiffs’ property being transferred to and registered in the name of the 1st defendant? 20 (15) Is the title defeasible as against the 1st defendant by virtue of the fact that the instrument is void because of fraud, forgery or deception? 6 (six) issues for determination of Court between 3 (three) plaintiffs 25 and 5th defendant in main action 78 50. The 3 (three) plaintiffs and the 5th defendant in the main action have framed the following 6 (six) issues between them for the determination of the Court: (1) Whether the 1st plaintiff and/or 2nd plaintiff had knowledge or consented, as either directors or as shareholders in any board 5 of directors’ or shareholders’ meetings to resign and/or be replaced as directors of the 3rd plaintiff by, inter alia, the 2nd defendant, 3rd defendant and/or 4th defendant? (2) Whether the land had been fraudulently transferred and registered in the name of the 1st defendant by forgery and/or by 10 means of an insufficient and/or void instrument(s)? (3) Whether the registered office of the 3rd plaintiff at 1st Floor, Wisma Cheong Hin, No. 116, Jalan Pudu, 55100 (Pudu address) was changed to No. 5, Jalan Cuepacs, 4F Taman Koperasi Cuepacs, 43000 Kajang, Selangor (Kajang address), 15 unknown to the 1st plaintiff and 2nd plaintiff and/or Company Secretary of the 3rd plaintiff? (4) Whether the 5th defendant was negligent and/or grossly negligent and/or in breach of its statutory duties under inter al ia s. 11 of the Companies Act 1965 by failing in its duties to 20 protect the interests of the 1st and/or 2nd plaintiffs as the only true and genuine directors and shareholders of the 3rd plaintiff? (5) Whether as a result of the 5th defendant’s negligence/breach of its statutory duties, the 1st, 2nd and/or 3rd plaintiffs have suffered loss and damage and the 3rd plaintiff is deprived of its legal 25 ownership of the land? 79 (6) Whether the registration of the change of the 3rd plaintiff’s company information through the lodgement of these documents had been made by the 5th defendant in accordance with the procedures set out by the Companies Act 1965 and the Companies Regulations 1966: 5 (a) Form 49, Form 48A and Resolution of all the Directors dated 04.09.2011 and registered on 15.11.2011? (b) Form 44 dated 04.11.2011 registered on 15.11.2011? and (c) Form 49, Form 48A and Directors Resolution dated 30.12.2011, all of which were registered on 03.01.2012? 10 11 (eleven) issues for determination of Court between 3 (three) plaintiffs and 6th to 9th defendants in main action 51. The 3 (three) plaintiffs and the 6th, 7th, 8th, and 9th defendants in the main action have framed the following 11 (eleven) issues between 15 them for the determination of the Court: (1) Whether the 1st plaintiff and/or 2nd plaintiff had knowledge or consented, as either directors or as shareholders, in any board of directors’ or shareholders’ meetings, to resign and/or be replaced as directors of the 3rd plaintiff by, inter alia, the 2nd 20 defendant, 3rd defendant and/or 4th defendant? (2) Whether the land had been fraudulently transferred and registered in the name of the 1st defendant by forgery and/or by means of an insufficient and/or void instrument(s)? (3) Whether the registered office of the 3rd plaintiff at the 1st Floor, 25 Wisma Cheong Hin, No. 116, Jalan Pudu, 55100, viz the Pudu 80 address, was changed to No. 5, Jalan Cuepacs, 4F Taman Koperasi Cuepacs, 43000 Kajang, Selangor, viz the Kajang address, without the knowledge of the 1st plaintiff and 2nd plaintiff and/or the Company Secretary of the 3rd plaintiff? (4) Whether the GM Title [Grant] of the land was issued in 5 contravention of the provisions of the NLC 1965 including s. 5A and the Fourteenth Schedule thereof and as such is a nullity and void. (5) Whether the GM Title [Grant] of the land issued by the 6th defendant is ultra vires, null and/or void ab initio and hence the 10 purported transfer of the land from the 3rd plaintiff to the 1st defendant is also null and void ab initio? (6) Whether the 6th and/or 8th defendants were negligent and/or grossly negligent and/or in breach of its statutory duties under, inter alia, s. 5A of the the NLC 1965 by failing in their duties to 15 protect the interests of the 3rd plaintiff as the true and genuine registered owner of the land? (7) Whether as a result of the 6th and/or 8th defendants’ negligence, the 1st, 2nd, and/or 3rd plaintiffs have suffered loss and damage and the 3rd plaintiff is deprived of the legal ownership of the 20 land? (8) Whether the 7th and/or 9th defendants are vicariously liable for the 6th defendant’s, 8th defendant’s and/or 9th defendant’s negligence and the 1st, 2nd and/or 3rd plaintiffs have suffered loss and damage and the 3rd plaintiff is deprived of the legal 25 ownership of the land? 81 (9) Whether the 6th defendant, 8th defendant and 9th defendant have been, wrongly, named in the suit by the 3 (three) plaintiffs? (10) Whether the plaintiffs have complied with the requirements in ss. 5 and 6 of the Government Proceedings Act 1956 (Act 359) 5 in filing the main action against the 6th to the 9th defendants? (11) Whether the issuance of the GM Title [Grant] and registration of the transfer of the land was done in good faith and in compliance with the National Land Code Rules so as to entitle the 6th defendant and/or his representatives to the protection in 10 s. 22 of the NLC 1965? Pre-trial Case Management (“PTCM”) on 26.03.2015 52. On 26.03.2015, the parties appeared before me for the last and final PTCM for the main action by the 3 (three) plaintiffs against the 1st 15 defendant and the 5th to the 9th defendants; and the counterclaim by the 1st defendant against the 3 (three) plaintiffs and the 5th to the 9th defendants. 53. On that date, Puan Rudaini, the learned counsel for the 5th defendant, which is the 5th defendant in the main action, informed the Court that 20 it has complied with all the PTCM directions given by the Court. 54. The learned counsel for the 6th to the 9th defendants in the main action, who are the 5th to the 8th defendants in the counterclaim, informed the Court that they have complied with all the PTCM directions given by the Court except that only 1 of their 4 (four) 25 witnesses’ witness statements has been efiled and that the witness statements of their 3 (three) other witnesses have not been efiled. 82 55. Mr. David Hoh, the 3 (three) plaintiffs’ learned counsel, then informed the Court that the plaintiffs have filed the plaintiffs' Summary of Case and the plaintiffs' Opening Statement. The Court interpreter informed the Court that she was given the hard copies of both the documents that morning and this was confirmed by Mr. David Hoh. 5 56. I then gave the following PTCM directions to the parties: (1) I directed the 1st defendant to file and serve the 1st defendant's Opening Statement on or before Monday, 30.03.2015; (2) I directed the 6th to the 9th defendants to efile the witness statements of their 3 other witnesses and serve them on the 10 other parties on or before Monday, 30.03.2015; (3) I also directed the plaintiffs’ learned counsel to file an amended Opening Statement to state which witness will be giving evidence on which issue; (4) I also directed the plaintiffs’ learned counsel to file a Statement 15 of Additional Issues to be tried, on or before Monday, 30.03.2015, based on the following matters raised that day by the Court: (a) whether the 1st defendant is a bona fide purchaser for value of the property without any notice of fraud, forgery 20 or deception/deceit? (b) whether the 1st defendant is the lawful registered owner of the property? (c) whether the plaintiffs have been negligent in anyway? (d) whether the plaintiffs’ negligence, if any, has caused or 25 contributed to the 3rd plaintiff’s land being transferred to and registered in the name of the 1st defendant? 83 (5) I also directed the 5th defendant to file a revised Opening Statement to state which witness will be giving evidence on which issue of fact and/or law in the Statement of Issues to be tried on or before Monday, 30.03.2015; and (6) I also directed the 6th to the 9th defendants to do the same on or 5 before Monday, 30.03.2015. Documents filed for use in the full trial of main action and counterclaim 57. Below are the documents filed by the parties, pursuant to PTCM 10 directions given by the Court, as on 26.03.2015, for use in the full trial of the main action and the counterclaim. Bundle of Pleadings (1) Enclosure (199) – Bundle of Pleadings. 15 Common Bundle of Documents (1) Enclosure (21) – Ikatan Dokumen Bersama Antara Plaintif Pertama, Kedua dan Ketiga dengan Defendan Pertama (No. 1); (2) Enclosure (28) – Ikatan Dokumen Bersama Antara Plaintif 20 Pertama, Kedua dan Ketiga dengan Defendan Pertama (No. 2); (3) Enclosure (43) – Ikatan Dokumen Bersama Antara Plaintif Pertama, Kedua dan Ketiga dengan Defendan Pertama (No. 3); (4) Enclosure (69) - i – Ikatan Dokumen Bersama Antara Plaintif Pertama, Kedua dan Ketiga dengan Defendan Pertama 25 (Revised) (volume 1 of 2); 84 (5) Enclosure (69) - ii – Ikatan Dokumen Bersama Antara Plaintif Pertama, Kedua dan Ketiga dengan Defendan Pertama (Revised) (volume 2 of 2); (6) Enclosure (23) – Ikatan Dokumen Bersama Antara Plaintif Pertama, Kedua dan Ketiga dengan Defendan Kelima; 5 (7) Enclosure (39) – Ikatan Dokumen Bersama Antara Plaintif Pertama, Kedua dan Ketiga dengan Defendan Kelima (No. 2); (8) Enclosure (44) – Ikatan Dokumen Bersama Antara Plaintif Pertama, Kedua dan Ketiga dengan Defendan Kelima (No. 3); (9) Enclosure (63) – Ikatan Dokumen Bersama Antara Plaintif 10 Pertama, Kedua dan Ketiga dengan Defendan Kelima (Revised); (10) Enclosure (24) – Ikatan Dokumen Bersama Antara Plaintif Pertama, Kedua dan Ketiga dengan Defendan Keenam; (11) Enclosure (37) – Ikatan Dokumen Bersama Antara Plaintif 15 Pertama, Kedua dan Ketiga dengan Defendan Keenam (No. 2); (12) Enclosure (47) – Ikatan Dokumen Bersama Antara Plaintif Pertama, Kedua dan Ketiga dengan Defendan Keenam (No. 3); (13) Enclosure (73) – Ikatan Dokumen Bersama Antara Plaintif Pertama, Kedua dan Ketiga dengan Defendan Keenam 20 (Revised); and (14) Enclosure (147) – Additional Common Bundle of Documents between the plaintiffs and the 1st, 5th to the 9th defendants. Statement of Agreed Facts and Issues to be tried 25 (1) Enclosure (188) – Statement of Agreed Facts between the plaintiffs and the 1st defendant; 85 (2) Enclosure (189) –Issues to be tried between the plaintiffs and the 1st defendant; (3) Enclosure (190) – Statement of Agreed Facts between the plaintiffs and the 5th defendant; (4) Enclosure (191) –Issues to be tried between the plaintiffs and 5 the 5th defendant; (5) Enclosure (192) – Statement of Agreed Facts between the plaintiffs and the 6th to the 9th defendants; and (6) Enclosure (193) – Issues to be tried between the plaintiffs and the 6th to the 9th defendants. 10 Summary of Case (1) Enclosure (223) – 1st defendant’s Summary of Case; (2) Enclosure (241) – 5th defendant’s Summary of Case; and (3) Enclosure (219) – 6th to the 9th defendants’ Summary of Case. 15 Opening Statement (1) Enclosure (242) – 5th defendant’s Opening Statement; and (2) Enclosure (221) – 6th to the 9th defendants’ Opening Statement. 20 List of Witnesses, Witness Statements and List of Questions (1) Enclosure (141) – Plaintiffs’ List of Witnesses with 11 (eleven) witnesses; (2) Enclosure (185) – Plaintiffs’ Additional List of Witnesses with 2 (two) witnesses; 25 (3) Enclosure (246) – Plaintiffs’ witness statement of Abdul Faizul Bin Abdul Hamid; 86 (4) Enclosure (247) – Plaintiffs’ witness statement of ASP Azani Bin Saupi; (5) Enclosure (248) – Plaintiffs’ witness statement of Ee Chong Wah; (6) Enclosure (249) – Plaintiffs’ witness statement of Ee Soon Kee; 5 (7) Enclosure (250) – Plaintiffs’ witness statement of Law Ah Kuan; (8) Enclosure (251) – Plaintiffs’ witness statement of Mohd Zahiruddin Bin Zamzam; (9) Enclosure (252) – Plaintiffs’ witness statement of Ng Eng Leong; 10 (10) Enclosure (253) – Plaintiffs’ witness statement of Tai Lee Chin; (11) Enclosure (254) – Plaintiffs’ witness statement of Tu Yong Eng; (12) Enclosure (256) – Plaintiffs’ witness statement of William Pang; (13) Enclosure (257) – Plaintiffs’ witness statement of Yong Keh Keong; 15 (14) Enclosure (186) – 1st defendant’s Amended List of Witnesses with 5 witnesses; (15) Enclosure (224) – 1st defendant’s witness statement of Haji Ishak Bin Ismail; (16) Enclosure (225) – 1st defendant’s List of Questions for the 20 subpoenaed witness, Lim Yoke Sim (F); (17) Enclosure (226) – 1st defendant’s List of Questions for the subpoenaed witness, Chong Wing Fat; (18) Enclosure (227) – 1st defendant’s witness statement of Peter Pui Yin Chong; 25 (19) Enclosure (234) – 1st defendant’s supplemental witness statement of Peter Pui Yin Chong; 87 (20) Enclosure (228) – 1st defendant’s witness statement of Chuah Boon Kooi; (21) Enclosure (231) – 1st defendant’s supplemental witness statement of Chuah Boon Kooi; (22) Enclosure (34) – 5th defendant’s List of Witnesses with 2 (two) 5 witnesses; (23) Enclosure (243) – 5th defendant’s witness statement of Asrul Efendi Bin Dahalan; (24) Enclosure (244) – 5th defendant’s witness statement of Lekshmi a/p Gunasekaran; 10 (25) Enclosure (200) – 6th to the 9th defendants’ List of Witnesses with 4 (four) witnesses; and (26) Enclosure (228) – 6th to the 9th defendants’ witness statement of Mohammad Rahmat Bin Azman. 15 58. The following documents were not efiled although the hard copies of the documents were handed over to the Court: (1) 6th to the 9th defendants’ witness statement of Mohd Azhar Bin Mohd Daud; (2) 6th to the 9th defendants’ witness statement of Puan Nurul Huda 20 Binti Abdul Rahman; and (3) 6th to the 9th defendants’ witness statement of Encik Adrin Bin Redzuan. 59. The documents, which were pending and which must be filed by the 25 parties on or before 23.03.2015 (Monday), are as follows: (1) Plaintiffs’ Summary of Case; 88 (2) Plaintiffs’ Opening Statement; and (3) 1st defendant’s Opening statement. 60. Subsequently, the parties filed the following documents for use in the full trial in compliance with the PTCM directions, which I had given on 5 26.03.2015: (1) On 26.03.2015, the plaintiffs filed the plaintiffs’ Summary of Case dated 03.03.2015, enclosure (261) and the plaintiffs’ Opening Statement dated 03.03.2015, enclosure (262); (2) On 30.03.3015, the 6th to the 9th defendants and the 1st 10 defendant filed the following documents: (a) The 6th to the 9th defendants’ Amended Opening Statement, re-dated 30.03.2015, enclosure (271); and (b) The 1st defendant’s Opening Statement dated 30.03.2015, enclosure (273); 15 (3) On 31.03.2015, the plaintiffs and the 1st defendant filed the following documents: (a) Statement of Issues to be tried (Revised No. 2) between the plaintiffs and the 1st defendant dated 30.03.2015, 20 enclosure (275), in which they added the following 5 new issues to the existing 10 (ten) issues: (i) Whether the 1st defendant is a bona fide purchaser for value of the property without any notice of fraud, forgery or deception? 25 (ii) Whether the 1st defendant is a lawful registered owner of the property? 89 (iii) Whether the plaintiffs have been negligent in any way? (iv) Whether the plaintiffs’ negligence (if any) had caused or contributed to the plaintiffs’ land being transferred to and registered in the name of the 1st 5 defendant? (v) Is the 1st defendant’s title defeasible by virtue of the fact that the instrument is void because of fraud, forgery or deception? 10 (b) Plaintiffs’ Opening Statement, re-dated 30.03.2015, enclosure (274). 2 (two) consent judgments dated 31.03.2015 61. However, on the first day of the full trial, viz on 30.03.2015, Mr. David 15 Hoh, the learned counsel for the 3 (three) plaintiffs in the main action, informed the Court that his clients, have agreed to enter into a consent judgment to settle their claim in the main action against the 1st and 5th defendants and to settle the 1st defendant’s counterclaim against his clients. 20 62. He also informed the Court that the 3 (three) plaintiffs, in the main action, has agreed to enter into another consent judgment to settle their claim in the main action against the 6 th to the 9th defendants. This was confirmed by Mr. Gerard Lourdesamy, the learned counsel for the 1st defendant. 25 63. Mr. Gerard Lourdesamy, the learned counsel for the 1st defendant, also informed the Court that his client was withdrawing its 90 counterclaim against the 5th defendant, with a sum of RM 2,000.00 as the agreed costs to be paid by his client to the 5th defendant. 64. Puan Rudaini, the learned counsel for the 5 th defendant, confirmed to the Court that the 1st defendant has agreed to pay a sum of RM 2,000.00 to the 5th defendant as the costs for the 1st defendant’s 5 withdrawal of the counterclaim against the 5th defendant. 65. Encik Mustafa P. Kunyalam, the Assistant State Legal Adviser, Selangor, who appeared together with Puan Kam Binti Sani, the learned counsels for the 6 th to the 9th defendants, in the main action, confirmed that their clients have agreed that the Court grants the 10 declaratory orders sought by the 3 (three) plaintiffs against them in the main action subject to payment of costs by them. 66. Mr. Gerard Lourdesamy, the learned counsel for the 1st defendant, further informed the Court that his client wished to continue with its counterclaim against the 6th to the 9th defendants as his client was not 15 agreeable to the amount of compensation, which was offered by them to his client. 67. Mr. David Hoh, the learned counsel for the 3 (three) plaintiffs in the main action, then informed the Court, that after the two proposed consent judgments are recorded by the Court, his clients wished to 20 enter Judgment-in-default of appearance against the 2nd to the 4th defendants in the main action as they did not file an appearance or statement of defence and they have never appeared in Court when the case was called up by the Court even though they were served with the writ and statement of claim. 25 68. All the parties present then prayed for an adjournment of the case to the next day to enable them to prepare the typewritten drafts of the 91 two consent judgments to enable the Court to record them the next day. 69. I allowed their joint request. I first adjourned the case to Tuesday, 31.03.2015, for the recording of the consent judgment between the 3 (three) plaintiffs and the 1st and 5th defendants in the main action and 5 between the 1st defendant and the 3 (three) plaintiffs in the 1st defendant’s counterclaim, and another consent judgment between the 3 (three) plaintiffs and the 6th to the 9th defendants in the main action. 70. I next adjourned the case to Monday, 13.04.2015, to Friday, 10 17.04.2015, for the full trial of the 1st defendant’s counterclaim against the 6th to the 9th defendants. 71. On the next day, Tuesday, 31.03.2015, I recorded two consent judgments both dated 31.03.2015. The first is a consent judgment to settle the 3 (three) plaintiffs’ claim against the 1st and 5th defendants 15 in the main action and the 1st defendant’s counterclaim against the 3 (three) plaintiffs and the 5th defendant in the main action as per the terms of the draft consent judgment agreed upon between them with some amendments (“the 1st consent judgment”). 72. The second is a consent judgment to settle the 3 (three) plaintiffs’ 20 claim against the 6th to the 9th defendants in the main action as per the terms of the draft consent judgment agreed upon between them with some amendments (“the 2nd consent judgment”). 73. The terms of the two consent judgments, enclosure (314), and enclosure (315), respectively, are important. Hence, both the consent 25 judgments are reproduced below. 92 1st consent judgment dated 31.03.2015 74. Enclosure (314) is the 1st consent judgment. It states as follows: “BEFORE JUDGE SU GEOK YIAM THE 31ST DAY OF MARCH 2015 IN OPEN COURT 5 CONSENT JUDGMENT BETWEEN THE PLANTIFFS AND THE 1ST DEFENDANT AND THE 5TH DEFENDANT THIS SUIT having been called and fixed for trial before the 10 Honourable Judge on 30.3.2015 and 31.3.2015 AND in the presence of David Hoh of Counsel for the Plaintiffs, Gerard Lourdesamy (A.C. Dewi with him) of Counsel for the 1st Defendant and Rudaini binti Abdullah of Counsel for the 5th Defendant, IT IS HEREBY AGREED BY CONSENT by the Plaintiffs and the 1st 15 Defendant and the 5th Defendant that all the claims of the Plaintiffs against the 1st and 5th Defendants under the Re-Amended Statement of Claim dated 26.2.2014 and all the counterclaims of the 1st Defendant against the Plaintiffs and the 5th Defendant under the Re-Amended Counterclaim dated 24.04.2014 be determined by 20 this Consent Order and IT IS HEREBY DECLARED AND ORDERED BY CONSENT that:- (1) The 3rd Plaintiff is the registered proprietor of the entire Land known as Hakmilik Geran Mukim No. 872, Lot 1011, Mukim 25 Cheras, Daerah Hulu Langat, Negeri Selangor [EMR2824, Lot No. 1011, Mukim Cheras, Selangor] (“the Land”) since 28.05.1974 and is the legitimate and rightful owner of the Land and also the true legal and beneficial owner of the Land; (2) On 01.02.2012, the Land was fraudulently transferred from 30 the 3rd Plaintiff to the 1st Defendant save and except that the 1st Defendant was not a party to the fraud and/or 93 forgery or deception in relation to and arising from the sale and transfer of the Land from the 3rd Plaintiff to the 1st Defendant; (3) Subject to paragraph (2) above, the fraudulent transfer of the Land from the 3rd Plaintiff to the 1st Defendant is null 5 and void ab initio; (4) Subject to paragraph (2) above, the registration of the Memorandum of Transfer of the Land on 01.02.2012 via Presentation No. 725/2012 registered by the Pendaftar Pejabat Tanah Hulu Langat Negeri Selangor from the 3rd 10 Plaintiff to the 1st Defendant is null and void ab initio; (5) The 2nd Defendant, 3rd Defendant and/or 4th Defendant (Chong Wing Fat and/or Lim Yoke Sim and/or Low Beng Hong) were never lawfully appointed as directors of the 3rd Plaintiff at any material time; 15 (6) Both the 1st Plaintiff’s (Ee Chong Wah) and the 2nd Plaintiff’s (Ee Soon Kee) signatures on the Company documents including those lodged with the 5th Defendant (SSM) in relation to allowing the 2nd Defendant, 3rd Defendant and/or 4th Defendant to be directors of the 3rd Plaintiff, are 20 forgeries; (7) The signatures of both Ee Chong Wah and Ee Soon Kee in the 3rd Plaintiff’s resolution purportedly to empower the 2nd Defendant, 3rd Defendant and/or 4th Defendant to sell the Land, are forgeries; 25 (8) The removal of both Ee Chong Wah and Ee Soon Kee as directors of the 3rd Plaintiff is fraudulent and/or illegal and that both Ee Chong Wah and Ee Soon Kee be reinstated as directors of the 3rd Plaintiff as at 4.9.2011; (9) The signatures of the 3rd Plaintiff’s company secretary, 30 Law Ah Kuan, in the 2 Forms 49 dated 4.9.2011 and 30.12.2011 together with Form 44 dated 4.11.2011 which changed the 3rd Plaintiff’s registered address from Tingkat 94 1 Wisma Cheong Hin, No. 116 Jalan Pudu, 55100 Kuala Lumpur (“Pudu Address”) to No. 5, Jalan Cuepacs 4F Taman Koperasi Cuepacs, 43000 Kajang Selangor (“Kajang Address”) were obtained by forgery and are illegal and/or void ab initio; 5 (10) The documents and/or all instruments lodged in SSM (including the Form 49 dated 4.9.2011) to remove both Ee Chong Wah and Ee Soon Kee as directors of the 3rd Plaintiff and/or to change the 3rd Plaintiff’s registered address from Pudu Address to Kajang Address were obtained by forgery 10 and are illegal and/or void ab initio; (11) The documents and/or instruments lodged in SSM to add the 2nd Defendant, 3rd Defendant and/or 4th Defendant (Chong Wing Fatt and/or Lim Yoke Sim and/or Low Beng Hong) as purported directors of the 3rd Plaintiff were 15 obtained by forgery and are illegal and/or void ab initio; (12) All the 3rd Plaintiff’s resolutions signed by the 2nd Defendant, 3rd Defendant and/or 4th Defendant (Chong Wing Fatt and/or Lim Yoke Sim and/or Low Beng Hong) as purported directors of the 3rd Plaintiff concerning interalia the sale of the Land 20 and/or the execution by Chong Wing Fatt and/or Lim Yoke Sim and/or Low Beng Hong as purported directors, of the instrument of transfer, to the 1st Defendant are void ab initio; IT IS HEREBY ALSO ORDERED BY CONSENT that:- 25 (13) The 1st Defendant’s Solicitor shall surrender the Geran Mukim Title of the Land which is in his possession and which is referred to in paragraph (1) above to the 3rd Plaintiff’s Solicitors within three (3) days from the date of the Order herein; 30 (14) The 1st Defendant and/or its directors, servants and/or agents shall execute a duly registrable instrument of transfer (National Land Code Form 14A) [Memorandum of Transfer] to re- 95 transfer the Land to the 3rd Plaintiff and to deliver the said Memorandum of Transfer together with all the 1st Defendant’s necessary resolutions and/or any documents required by the Hulu Langat Land Office in duplicate to the 3rd Plaintiff and/or their Solicitors within fourteen (14) days from the date of the 5 Order herein failing which the Senior Assitant Registrar of the High Court of Malaya at Kuala Lumpur do immediately thereafter execute the Memorandum of Transfer on behalf of the 1st Defendant; (15) The 1st Defendant is at liberty to apply at its own costs for a 10 refund of the adjudication fees and/or stamp duty and/or real property gains tax and/or any other fee paid by the 1st defendant to the relevant authorities upon the cancellation of the Memorandum of Transfer of the Land registered on 01.02.2012 via Presentation No. 725/2012 on the condition 15 that the Plaintiffs shall at no time be responsible or liable for the said refund to the 1st Defendant in any circumstances; (16) Pending compliance with paragraphs (13) and (14) above, the 1st Defendant whether by themselves, their directors, servants, agents, contractors, nominees, successors in title and/or all 20 related parties to the 1st defendant, assignees or otherwise are immediately restrained and howsoever shall not sell, transfer, mortgage, charge, lease, let, give licenses or any type of occupational or possessory rights, easements and/or to encumber the Land or any part thereof in any way, legal or 25 otherwise; (17) Subject to compliance with paragraphs (13) and (14) above, the Plaintiffs shall not have any claims or demands against the 1st Defendant howsoever and whatsoever arising either at present or future and/or contingent in respect of the Land and 30 matters arising there from; (18) Subject to compliance with paragraphs (13) and (14) above, the 1st Defendant shall not have any claims or demands 96 against the Plaintiffs howsoever and whatsoever arising either at present or future and/or contingent in respect of the Land and matters arising there from and the 1st Defendant withdraws its counterclaim against the Plaintiffs without liberty to file afresh; 5 AND IT IS HEREBY ORDERED BY CONSENT that from the 5th Defendant SSM Records:- (19) The 5th Defendant shall strike out and/or take out and/or remove retroactively the names of the 2nd Defendant, 3rd 10 Defendant and/or 4th Defendant as directors of the 3rd Plaintiff as at 04.09.2011 from the SSM Records within fourteen (14) days from the date of the service of the sealed Order made herein; (20) The 5th Defendant shall reinstate retroactively the names 15 of the 1st Plaintiff and 2nd Plaintiff as directors of the 3rd Plaintiff as at 04.09.2011 within fourteen (14) days from the date of the service of the sealed Order herein; (21) The 5th Defendant shall strike out the 3rd Plaintiff’s fraudulently registered office address as No. 5, Jalan 20 Cuepacs, 43300 Kajang, Selangor and reinstate retroactively the 3rd Plaintiff’s actual lawful registered office address as Tingkat 1, Wisma Cheong Hin, No. 116, Jalan Pudu, 55100 Kuala Lumpur as at 04.09.2011 within fourteen (14) days from the date of the service of the 25 sealed Order herein; (22) The 5th Defendant shall accept the 3rd Plaintiff’s Company’s Annual Returns and Financial Statements and/or Audited Accounts for the years 2011, 2012, 2013 executed by the 1st Plaintiff and 2nd Plaintiff as directors of the 3rd Plaintiff filed late 30 due to the fraudulent removal of their names as directors of the 3rd Plaintiff without censure or penalty; 97 (23) The 5th Defendant shall strike out from the 5th Defendant’s company register of the 3rd Plaintiff the following documents: (i) Form 49, Form 48A and extract of the Directors’ Circular Resolution all dated 04.09.2011 5 (ii) Form 44 dated 04.11.2011 (iii) Form 49, Form 48A and extract of the Directors’ Circular Resolution all dated 30.12.2011 AND IT IS ALSO HEREBY ORDERED BY CONSENT that:- 10 (24) As between the Plaintiffs and the 1st Defendant, there shall be no order as to costs in respect of the resolution of the Plaintiffs’ suit against the 1st Defendant as per the terms of this Consent Judgment and the withdrawal of the 1st Defendant’s counterclaim against the Plaintiffs in this 15 suit; (25) As between the Plaintiffs and the 5th Defendant, the 5th Defendant shall on a without admission as to liability basis pay the Plaintiffs costs of RM 5,000.00; (26) The 1st Defendant withdraws its counterclaim against the 20 5th Defendant without liberty to file afresh and with costs of RM 2,000.00 to be paid by the 1st Defendant to the 5th Defendant within fourteen (14) days from the date of the Order herein; (27) Provided the Parties herein have complied with the terms of 25 this Consent Judgment, the Parties shall not bring any claim whatsoever in relation to or arising out of any matter in connection with the Land save and except as provided for in this Consent Judgment; (28) If any Party is in default of any of the terms of this Consent 30 Judgment, then the non-defaulting Party is at liberty to commence committal proceedings against the defaulting Party for contempt of Court and/or take whatever legal action deems 98 fit with costs to be paid by the defaulting Party(s) on a full indemnity basis.” (Emphasis added). 75. In essence, the parties to the 1st consent judgment, viz the 3 (three) 5 plaintiffs, the 1st and 5th defendants, settled the 3 (three) plaintiffs’ claim against them in the main action and the 1st defendant settled its counterclaim against the 3 (three) plaintiffs and the 5th defendant by consenting to the following declaratory orders: (1) On the issue as to who is the legitimate and rightful owner of 10 the land and also the legal and beneficial owner of the land, it was agreed that the Court declares that the 3rd plaintiff is the registered proprietor of the land since 28.05.1974 and that the 3rd plaintiff is the legitimate and rightful owner of the land and also the legal and beneficial owner of the land; 15 (2) On the issue whether the land was, fraudulently, transferred from the 3rd plaintiff to the 1st defendant, it was agreed that the Court declares that on 01.02.2012, the land was, fraudulently, transferred from the 3rd plaintiff to the 1st defendant, save and except that the 1st defendant was not a party to the fraud and/or 20 forgery and/or deception in relation to the sale and transfer of the land from the 3rd plaintiff to the 1st defendant; (3) On the issue whether the transfer of the land from the 3rd plaintiff to the 1st defendant is null and void ab initio, it was agreed that the Court declares that subject to sub-paragraph 25 (2) above, the transfer of the land from the 3rd plaintiff to the 1st defendant is null and void ab initio due to fraud; 99 (4) On the issue whether the registration of the MOT of the land on 01.02.2012 by the Registrar of the Hulu Langat Land Office, Selangor from the 3rd plaintiff to the 1st defendant is null and void ab initio, it was agreed that the Court declares that subject to sub-paragraph (2) above, the registration of the MOT of the 5 land on 01.02.2012 via Presentation No. 725/2012 by the Registrar of the Hulu Langat Land Office, Selangor from the 3rd plaintiff to the 1st defendant is null and void ab initio; (5) On the issue whether the 2nd, 3rd, and/or 4th defendants, were lawfully appointed as directors of the 3rd plaintiff, at any material 10 time, it was agreed that the Court declares that the 2nd, 3rd and/or 4th defendants, were never lawfully appointed as directors of the 3rd plaintiff, at any material time; (6) On the issue whether the removal of the 1st and 2nd plaintiffs, as directors of the 3rd plaintiff, is fraudulent and/or illegal, it was 15 agreed that the Court declares that their removal as directors of the 3rd plaintiff, is fraudulent and/or illegal and that both the 1st and 2nd plaintiffs be reinstated as directors of the 3rd plaintif f , as at 04.09.2011; (7) On the issue whether the signatures of the 3 rd plaintiff’s 20 Company Secretary, Law Ah Kuan, in the 2 (two) Companies Act 1965 Form 49 dated 04.09.2011 and 30.12.2011, respectively, together with the Companies Act 1965 Form 44 dated 04.11.2011, which changed the 3rd plaintiff’s registered address from the Pudu address to the Kajang address (“the 25 said signatures”), were obtained by forgery and the Forms are illegal and/or void ab initio, it was agreed that the Court 100 declares that the said signatures of the 3rd plaintiff’s, Company Secretary, Law Ah Kuan, in the 2 (two) Companies Act 1965 Form 49 dated 04.09.2011 and 30.12.2011, respectively, were obtained by forgery and that the Forms are illegal and/or void ab initio; and 5 (8) On the issue whether the documents and/or instruments lodged in the 5th defendant on the directorships of the 2nd, 3rd and/or 4 th defendants in the 3rd plaintiff, were obtained by forgery and are illegal and/or void ab initio, it was agreed that the Court declares that the said documents and/or instruments were 10 obtained by forgery and are illegal and/or void ab initio. 76. The 3 (three) plaintiffs, the 1st defendant and the 5th defendant also consented to the Court making the following orders in the 1st consent judgment: 15 (1) On the issue of the GM title of the land, it was agreed that the 1st defendant’s solicitor shall surrender the GM title of the land, which is in his possession, and which is referred to in sub- paragraph (1) of paragraph 71 above, to the 3rd plaintiff’s solicitors within 3 (three) days from the date of the Order of 20 Court; (2) On the issue of the 1st defendant’s counterclaim against the 3 (three) plaintiffs, it was agreed that the 1st defendant withdraws its counterclaim against the 3 (three) plaintiffs without liberty to file afresh; 25 (3) On the issue of the rectification of the records of the 5th defendant in regard to the directorships of the 2nd to the 4th 101 defendants in the 3rd plaintiff, it was agreed that the 5th defendant shall strike out and remove retroactively their names as directors of the 3rd plaintiff, as at 04.09.2011, from the 5th defendant’s records within 14 (fourteen) days from the date of the service of the sealed Order of Court; 5 (4) On the issue of the reinstatement of the names of the 1st and 2nd plaintiffs, as directors of the 3rd plaintiff, it was agreed that the 5th defendant, shall reinstate retroactively their names as directors of the 3rd plaintiff as at 04.09.2011, within 14 (fourteen) days from the date of the service of the sealed Order 10 of Court; (5) On the issue of the fictitious Kajang address of the 3rd plaintiff, which is in the records of the 5th defendant, it was agreed that the 5th defendant, shall strike out the 3rd plaintiff’s, fraudulently, registered Kajang address and reinstate, retroactively, the 3 rd 15 plaintiff’s Pudu address at Tingkat 1, Wisma Cheong Hin, No. 116, Jalan Pudu, 55100 Kuala Lumpur as the actual lawful registered office address, as at 04.09.2011, within 14 (fourteen) days from the date of the service of the sealed Order of Court; (6) On the issue of the forged documents of the 3rd plaintiff, which 20 were filed, fraudulently, by the 2nd to the 4th defendants with the 5th defendant, it was agreed that the 5th defendant, shall strike out from its records, the following documents of the 3rd plaintiff: (i) Form 49 and Form 48A and the extract of the Directors’ Circular Resolution, all dated 04.09.2011; 25 (ii) Form 44 dated 04.11.2011; and 102 (iii) Form 49 and Form 48A and the extract of the Directors’ Circular Resolution, all dated 30.12.2011; (7) On the issue of costs between the 3 (three) plaintiffs and the 1s t defendant in respect of the resolution of the main action by the 5 3 (three) plaintiffs against the 1st defendant, and the withdrawal of the 1st defendant’s counterclaim against the 3 (three) plaintiffs, it was agreed that there shall be no order as to costs; (8) On the issue of costs between the 3 (three) plaintiffs and the 5 th defendant in the main action, it was agreed that the 5th 10 defendant shall on a without admission as to liability basis, pay to the 3 (three) plaintiffs costs of RM 5,000.00; and (9) On the issue of costs between the 1st defendant and the 5th defendant, in respect of the 1st defendant’s counterclaim against the 5th defendant, it was agreed that the 1st defendant 15 withdraws its counterclaim against the 5th defendant without liberty to file afresh and with costs of RM 2,000.00 to be paid by the 1st defendant to the 5th defendant within 14 (fourteen) days from the date of the recording of the 1st consent judgment. 20 2nd consent judgment dated 31.03.2015 77. Enclosure (315) is the 2nd consent judgment. It states as follows: “BEFORE JUDGE SU GEOK YIAM THE 31ST DAY OF MARCH 2015 IN OPEN COURT 25 CONSENT JUDGMENT BETWEEN THE PLANTIFFS AND THE 6TH TO THE 9TH DEFENDANTS 103 THIS SUIT having been called and fixed for trial before the Honourable Judge on 31.03.2015 AND in the presence of David Hoh of Counsel for the Plaintiffs and Kam binti Sani of Counsel for the 6th, 7th, 8th and 9th Defendants IT IS HEREBY AGREED BY 5 CONSENT of the Plaintiffs and the 6th, 7th, 8th and 9th Defendants that all the claims of the Plaintiffs against the 6th, 7th, 8th and 9th Defendants under the Re-Amended Statement of Claim dated 26.2.2014 be determined by this Consent Judgment and IT IS HEREBY DECLARED AND ORDERED BY CONSENT that:- 10 (1) The 3rd Plaintiff is the registered proprietor of the entire Land known as Hakmilik Geran Mukim No. 872, Lot 1011, Mukim Cheras, Daerah Hulu Langat, Negeri Selangor [EMR2824, Lot No. 1011, Mukim Cheras, Selangor] (“the Land”) since 28.05.1974; and is the legitimate and rightful owner of the 15 Land and also the true legal and beneficial owner of the Land; (2) On 01.02.2012, the Land was fraudulently transferred from the 3rd Plaintiff to the 1st Defendant save and except that the 1st Defendant was not a party to the fraud and/or forgery or deception in relation to and arising from the 20 sale and transfer of the Land from the 3rd Plaintiff to the 1st Defendant; (3) Subject to paragraph (2) above, the fraudulent transfer of the Land from the 3rd Plaintiff to the 1st Defendant is null and void ab initio; 25 (4) Subject to paragraph (2) above, the registration of the Memorandum of Transfer of the Land registered on 01.02.2012 via Presentation No. 725/2012 registered by the Pendaftar Pejabat Tanah Hulu Langat Negeri Selangor from the 3rd Plaintiff to the 1st Defendant is null and void ab initio; 30 (5) The 2nd Defendant, 3rd Defendant and/or 4th Defendant (Chong Wing Fat and/or Lim Yok Sim and/or Low Beng Hong) were 104 never lawfully appointed as directors of the 3rd Plaintiff at any material time; (6) Both the 1st Plaintiff’s (Ee Chong Wah) and the 2nd Plaintiff’s (Ee Soon Kee) signatures on the Company documents including those lodged with the 5th Defendant 5 (SSM) in relation to allowing the 2nd Defendant, 3rd Defendant and/or 4th Defendant to be directors of the 3rd Plaintiff, are forgeries; (7) The signatures of both Ee Chong Wah and Ee Soon Kee in the 3rd Plaintiff’s resolution purportedly to empower the 10 2nd Defendant, 3rd Defendant and/or 4th Defendant to sell the Land, are forgeries; (8) The removal of both Ee Chong Wah and Ee Soon Kee as directors of the 3rd Plaintiff is fraudulent and/or illegal and that both Ee Chong Wah and Ee Soon Kee be reinstated as 15 directors of the 3rd Plaintiff as at 4.9.2011; (9) The signatures of the 3rd Plaintiffs’s company secretary, Law Ah Kuan, in the 2 Forms 49 dated 4.9.2011 and 30.12.2011 together with Form 44 dated 4.11.2011 which changed the 3rd Plaintiff’s registered address form Tingkat 1 20 Wisma Cheong Hin, No. 116 Jalan Pudu, 55100 Kuala Lumpur (“Pudu Address”) to No. 5, Jalan Cuepacs 4F Taman Koperasi Cuepacs, 43000 Kajang Selangor (“Kajang Address”) were obtained by forgery and are illegal and/or void ab initio; 25 (10) The documents and/or all instruments lodged in SSM (including the Form 49 dated 4.9.2011) to remove both Ee Chong Wah and Ee Soon Kee as directors of the 3rd Plaintiff and/or to change the 3rd Plaintiff’s registered address from Pudu Address to Kajang Address were obtained by forgery 30 and are illegal and/or void ab initio; (11) The documents and/or instruments lodged in SSM to the 2nd Defendant, 3rd Defendant and/or 4th Defendant (Chong 105 Wing Fatt and/or Lim Yoke Sim and/or Low Beng Hong) as purported directors of the 3rd Plaintiff were obtained by forgery and are illegal and/or void ab initio; (12) All the 3rd Plaintiff’s resolution signed by the 2nd defendant, 3rd Defendant and/or 4th Defendant (Chong Wing Fatt and/or Lim 5 Yoke Sim and/or Low Beng Hong) as purported directors of the 3rd Plaintiff concerning interalia the sale of the Land and/or the execution by Chong Wing Fatt and/or Lim Yoke Sim and/or Low Beng Hong as purported directors, of the instrument of transfer, to the 1st Defendant are void ab initio; 10 (13) Both the 2nd Defendant’s (Chong Wing Fat) and the 3rd Defendant’s (Lim Yoke Sim) names shall be removed as directors of the 3rd Plaintiff form the 5th Defendant’s SSM records; 15 IT IS HEREBY ALSO ORDERED BY CONSENT that:- (14) The 6th, 8th and/or 9th Defendants shall cancel the transfer of the Land from the 3rd Plaintiff to the 1st Defendant and rectify the Land Register Book by registering the Land back in the 3rd Plaintiff’s name in the Land Register Book at the Pejabat 20 Tanah Hulu Langat Selangor as the rightful registered owner of the Land with no payment of adjudication fees and/or stamp duty for this rectification of the Land Register Book and/or any fee whatsoever by the 3rd Plaintiff to the 6th Defendant for the same within fourteen (14) days from the date of the Order 25 herein; (15) The 6th, 8th, and/or 9th Defendants shall rectify and reflect the 3rd Plaintiff as the registered proprietor of the Land in all lawful documents and records of the 6th Defendant and/or the 9th Defendant and/or to do all things necessary 30 within fourteen (14) days from the date of the Order herein; 106 (16) Upon the rectification of the Land Register Book and registration of the Land into the 3rd Plaintiff’s name, the 6th, 8th, and/or 9th Defendants shall immediately cancel, withdraw and remove the Registrar’s Caveat via Presentation No. 2296/2012 entered on the Land in 5 respect of the same; (17) As between the Plaintiffs and the 6th, 7th, 8th and 9th Defendants, the 7th and 9th Defendants shall on a without admission of any liability basis jointly pay the Plaintiffs costs of RM 20,000.00; 10 (18) Provided the Parties herein have complied with the terms of this Consent Judgment, the Parties shall not bring any claim whatsoever in relation to or arising out of any matter in connection with the Land save and except as provided for in this Consent Judgment upon full and punctual compliance by 15 the 6th, 7th, 8th and 9th Defendants of the terms of this Consent Judgment, the parties shall not be at liberty to bring any claims against each other; (19) If any Party is in default of any of the terms of this Consent Judgment, then the non-defaulting Party is at liberty to 20 commence committal proceedings against the defaulting Party for contempt of Court and/or take whatever legal action deems fit with costs to be paid by the defaulting Party on full indemnity basis. (Emphasis added). 25 78. In essence, the parties to the 2nd consent judgment, viz the 3 (three) plaintiffs and the 6th to the 9th defendants, settled the 3 (three) plaintiffs’ claim against them in the main action, on the following terms: 30 107 (1) The Court to grant similar declarations as mentioned in sub- paragraphs (1) to (8) of paragraph 74 above; (2) On the issue of the cancellation of the registration of the transfer of the land by the 3rd plaintiff to the 1st defendant (“the said registration”), it was agreed that the 6th, 8th and/or 9th 5 defendants shall cancel the said registration and rectify the Land Register Book by registering the land back in the 3rd plaintiff’s name in the Land Register Book at the Hulu Langat Land Office, Selangor, as the rightful registered owner of the land with no payment by the 3rd plaintiff of adjudication fees 10 and/or stamp duty and/or any other fee, whatsoever, within 14 (fourteen) days from the date of the Order of Court; (3) On the issue of the rectification of all lawful documents and records of the 6th defendant in relation to the 3rd plaintiff, it was agreed that the 6th, 8th and 9th defendants shall rectify and 15 reflect the 3rd plaintiff as the registered proprietor of the land in all lawful documents and records of the 6th and/or the 9th defendants; and/or do all things necessary for that purpose within 14 (fourteen) days from the date of the Order of Court; (4) On the issue of the Registrar’s caveat, which was entered on 20 the GM title of the land via Presentation No. 2296/2012, it was agreed that upon the rectification of the Land Register Book and the registration of the land back in the 3rd plaintiff’s name, the 6th, 8th, and/or 9th defendants shall immediately cancel, withdraw and remove the Registrar’s caveat; and 25 (5) On the issue of costs between the 3 (three) plaintiffs and the 6th, 7th, 8th and 9th defendants, it was agreed that the 7th and 9th 108 defendants shall, on a without admission of any liability basis, jointly, pay the 3 (three) plaintiffs costs of RM 20,000.00. Judgment-in-default dated 31.03.2015 (“the JID”) 79. On 31.03.2015, I entered the JID against the 2nd to the 4th 5 defendants. I had done this upon the application of the 3 (three) plaintiffs on the ground that the 2nd to the 4th defendants had been duly served with a copy of the writ and statement of claim but they have failed to enter their appearance or file their statement of defence. They were also absent and unrepresented at the full trial. 10 80. Enclosure (318) is the JID. It states as follows: “BEFORE JUDGE SU GEOK YIAM THE 31ST DAY OF MARCH 2015 IN OPEN COURT JUDGMENT AGAINST THE 2ND, 3RD AND 4TH DEFENDANTS 15 THIS SUIT was fixed for trial and called before the Honourable Judge on 30.03.2015 and 31.03.2015 AND in the presence of David Hoh, Counsel for the Plaintiffs, and the 2nd, 3rd and 4th Defendants who were absent and unrepresented at trial. 20 IT IS HEREBY ORDERED that:- (1) The 3rd Plaintiff is the registered owner of the whole Land known as Hakmilik Geran Mukim No. 872, Lot 1011, Mukim Cheras, Daerah Hulu Langat, Negeri Selangor (EMR 2824, Lot No. 1011, Mukim Cheras, Selangor) (“the Land”) since 25 28.05.1974 and is the legitimate and rightful owner of the Land and also the true legal and beneficial owner of the Land; (2) The GM Title for the Land was issued in the method that contradicted with the provisions of the National Land Code, 1965 and Schedule 14 of the National Land Code, 1965 and is 30 ultra vires, null and void ab initio; 109 (3) The Land was fraudulently transferred from the 3rd Plaintiff to the 1st Defendant; (4) The transfer which was purportedly carried out by fraud from the 3rd Plaintiff to the 1st Defendant is null and void ab initio; (5) The 2nd Defendant, 3rd Defendant and/or 4th Defendant (Chong 5 Wing Fat and/or Lim Yoke Sim and/or Low Beng Hong) were never lawfully appointed as directors of the 3rd Plaintiff at all material times; (6) Both the 1st Plaintiff’s (Ee Chong Wah) and the 2nd Plaintiff’s (Ee Soon Kee) signatures on the Company documents 10 including those lodged with the 5th Defendant (SSM) in relation to allowing the 2nd Defendant, 3rd Defendant and/or 4th Defendant to be directors of the 3rd Plaintiff, are forgeries; (7) The signatures of both Ee Chong Wah and Ee Soon Kee in the 3rd Plaintiff’s resolution purportedly to empower the 2nd 15 Defendant, 3rd Defendant and/or 4th Defendant to sell the Land, are forgeries; (8) The removal and/or resignation of both Ee Chong Wah and Ee Soon Kee as directors of the 3rd Plaintiff is fraudulent and/or illegal and both Ee Chong Wah and Ee Soon Kee be 20 reinstated as the directors of the 3rd Plaintiffs as at 04.09.2011; (9) The documents and/or instruments lodged with the SSM (including Form 49 dated 4.9.2011) to remove both Ee Chong Wah and Ee Soon Kee as the directors of the 3rd Plaintiff were 25 obtained by forgery and are illegal and/or void ab initio; (10) The documents and/or instruments lodged with SSM to admit the 2nd Defendant, 3rd Defendant and/or 4th Defendant as the purported directors of the 3rd Plaintiff were obtained by forgery and are illegal and/or void ab initio; 30 (11) All the resolutions of the 3rd Plaintiff signed by the 2nd Defendant, 3rd Defendant and/or 4th Defendant (Chong Wing Fat and/or Lim Yoke Sim and/or Low Beng Hong) as the 110 purported directors of the 3rd Plaintiff concerning the sale of the Land and/or the execution of the instrument of transfer by Chong Wing Fat and/or Lim Yoke Sim and/or Low Beng Hong as the purported directors to the 1st Defendant are void ab initio; 5 IT IS HEREBY FURTHER ORDERED that:- (12) The 2nd Defendant, 3rd Defendant and/or 4th Defendant, jointly and/or severally, pay the Plaintiffs’ damages; (13) Damages to be assessed by the Court; and 10 (14) The 2nd, 3rd and/or 4th Defendants, jointly and/or severally, pay the Plaintiffs’ costs of RM 15,000.00.” (Emphasis added). 1st defendant’s re-re-amended counterclaim against 6th to 9th 15 defendants 81. As a result of the two consent judgments and the one judgment-in- default all dated 31.03.2015, the 1st defendant amended its re- amended counterclaim with the leave of this Court. 82. In its re-re-amended counterclaim dated 26.05.2015, which it f iled on 20 05.06.2015, enclosure (333), the 1st defendant refers to the two consent judgments and the one judgment-in-default. 83. In paragraph 41, the 1st defendant added the 8th defendant and the words “GM title”. 84. It also substituted the words “GM title” for the words “original title” in 25 sub-paragraphs (a), (b), (c), (d), (e), (f) of the same paragraph, viz paragraph 41, under the caption “Particulars of Negligence”. 85. In the same paragraph, viz paragraph 41, it also added the words “EMR Title” after the words “old Title” in sub-paragraph (a). 111 86. In the same paragraph, viz paragraph 41, under the caption “Particulars of Negligence”, the 1st defendant also added two new sub-paragraphs, viz (f) and (g), to plead as follows: “(f) The 6th, 8th and/or 9th Defendants had failed or neglected to follow their Standard Opening Procedure [SOP] in the 5 conversion, issuance and/or delivery of the new Grant Mukim for the said Property replacing the old EMR Title that was still held by the Plaintiffs; and (g) The issuance of the new Grant Mukim Title for the said Property and the cancellation or conversion of the old EMR 10 Title for the said Property by the 6th, 8th and/or 9th Defendants did not follow the provisions of the National Land Code, 1965 and the Fourteenth Schedule thereto.” 87. In a new paragraph 42A, the 1st defendant pleads for the very first 15 time that it shall rely on the doctrine of res ipsa loquitur. 88. In paragraph 43, the 1st defendant added the letters “EMR” in between the words “old” and “Title” in sub-paragraph (a). 89. In the same paragraph, viz paragraph 43, under the caption “Particulars of Breach of Statutory Duty”, the 1st defendant also added 20 two new sub-paragraphs, viz (f) and (g), to plead as follows: “(f) The 6th, 8th and/or 9th Defendants had failed and/or neglected to follow their SOP during the conversion, issuance and/or delivery of the new Grant Mukim for the said Property replacing the old EMR Title that was still held by the 25 Plaintiffs; and (g) The issuance of the new Grant Mukim for the said Property and the cancellation or conversion of the old EMR Title for the said Property by the 6th, 8th and/or 9th Defendants did not follow the provisions of the National Land Code, 1965 and 30 the Fourteenth Schedule thereto.” 112 90. In the same paragraph, viz paragraph 43, under the caption “Particulars of Breach of Statutory Duty” in sub-paragraphs (a), (b), (c), (d) and (e), the 1st defendant also added the 8th defendant. 91. In the same paragraph, viz paragraph 43, the 1st defendant also raised for the very first time the “SOP of the 6th and/or 9th defendants” 5 in sub-paragraph (a) in which, it pleads as follows: “(c) The 6th Defendant, the 8th Defendant and/or the 9th Defendant failed to discharge their duty correctly and properly in accordance with the SOP of the 6th and/or 9th Defendants during the issuance of the original new Grant 10 Mukim Title for the said Property;” 92. In the same paragraph, viz paragraph 43, the 1st defendant also raised for the very first time, the “SOP” of the 6th, 8th and/or 9th defendants in sub-paragraph (d), in which, it pleads as follows: 15 “(d) The 6th Defendant, the 8th Defendant and/or the 9th Defendant had allowed parties other than the Plaintiffs to have dealings with them in the issuance of the original new Grant Mukim Title for the said Property contrary to their SOP;” 20 93. In sub-paragraph (e) of paragraph 43, the 1st defendant also raised for the very first time, the “SOP” of the 6th, 8th and/or 9th defendants and the 1st defendant. In that sub-paragraph it pleads as follows: “(e) The 6th Defendant, the 8th Defendant and/or the 9th 25 Defendant had issued and delivered the original new Grant Mukim Title for the said Property to third parties and not to the Plaintiffs contrary to their SOP;” 94. In paragraph 44, the 1st defendant also added the 8th defendant. 30 113 95. In the paragraph seeking reliefs from the Court, after paragraph 44A, the 1st defendant also prays for the very first time in sub-paragraph (d) that costs be ordered against the 6th, 7th and/or 8th and 9th defendants, jointly and severally, on a full indemnity basis instead of on an indemnity basis, as was prayed for earlier. 5 96. However, I noted that in the English translation of the re-re-amended counterclaim, the 1st defendant has, completely, removed the existing paragraphs (a) and (b) of its counterclaim dated 25.06.2012, which was filed on 25.06.2012, enclosure (13), from its re-re-amended counterclaim not re-dated, which was filed on 05.06.2015, enclosure 10 (333), and re-numbered the existing sub-paragraphs (c) to (j) of paragraph 50 as sub-paragraphs (a) to (e) after paragraph 44A instead of crossing them out and re-numbering the existing sub- paragraphs. I believe this could have been an oversight on the part of the 1st defendant’s solicitors as the Malay version still has the two 15 sub-paragraphs but they are crossed out to indicate that the 1st defendant has abandoned the remedies sought for in the first two sub-paragraphs. In the two sub-paragraphs (a) and (b) of the 1st defendant’s counterclaim, the 1st defendant had sought the following reliefs: 20 (a) A Declaratory order that it is the lawful registered proprietor of the land; and (b) A Declaratory order that it is a bona fide purchaser of the land for valuable consideration without notice of the fraud, forgery or deception/deceit as claimed by the 3 (three) plaintiffs in the 25 main action. 114 97. The 1st defendant’s re-re-amended counterclaim, enclosure (333), states as follows: “AMENDED COUNTERCLAIM AS RE-AMENDED AND FURTHER AMENDED AS RE-AMENDED (Pursuant to Order 15 Rules 2 and 3 5 Of the Rules of the High Court 1980) 40. The 1st Defendant repeats paragraphs 1 to 39 above. 40A. On 31.03.2015 the Plaintiffs recorded a Consent Judgment severally between the Plaintiffs and the 1st Defendant and the 5th Defendant and further between the Plaintiffs and the 10 6th to the 9th Defendants (“the said Consent Judgment”). 40B. Pursuant to the said Consent Judgment, the 1st Defendant withdrew their counterclaim against the Plaintiffs and the 5th Defendant without liberty to file afresh. 40C. According to the terms of the said Consent Judgment, the 15 plaintiffs and the 6th to the 9th Defendants admitted that the 1st Defendant was not involved in any fraud or forgery and/or deception in relation to and arising from the sale and transfer of the said Property from the 3rd Plaintiff to the 1st Defendant. 40D. Further, premised on the terms of the said Consent 20 Judgment, the 6th to the 9th Defendants have admitted to the reliefs sought by the Plaintiffs in this action without any reservation or limitation as to their liability. 40E. The 1st Defendant shall rely on the terms of the said Consent Judgment. 25 40F. Further on 31.3.2015, the Plaintiffs also entered a judgment in default of appearance against the 2nd, 3rd and 4th Defendants with damages to be assessed and costs on all the reliefs sought by the Plaintiffs in this action. 41. The 1st Defendant states that the Plaintiffs and the 5th 30 Defendant and 6th Defendant including the 8th Defendant and the 9th Defendant were negligent in discharging their duty 115 and obligations to the 1st Defendant in allowing or causing the documents of the 3rd plaintiff that were filed with the 5th Defendant and the 6th Defendant, the 8th Defendant and/or the 9th Defendant including the Grant Mukim Title for the said Property to be forged and misused. 5 PARTICULARS OF NEGLIGENCE (a) The 6th Defendant and/or 8th Defendant and/or 9th Defendant failed to discharge their duty and obligations when they allowed the original Grant 10 Mukim Title to be issued for the said Property although the 3rd Plaintiff was still holding the old Title (EMR Title) for the same Property; (b) The 6th Defendant and/or the 8th Defendant and/or the 9th Defendant had no dealings with the Plaintiffs 15 including the Plaintiff’s Company Secretary to inform them about the issuance of the grant mukim Grant Mukim Title for the said Property in the year 2002; (c) The 6th Defendant and/or the 8th Defendant and/or the 9th Defendant failed to discharge their duty correctly 20 and property when they issued the original new Grant Mukim Title for the said Property; and (d) The 6th Defendant and/or the 8th Defendant and/or the 9th Defendant had allowed parties other than the Plaintiffs to have dealings with them in the issuance of 25 the original new Grant Mukim Title for the said Property; (e) The 6th Defendant and/or the 8th Defendant and/or the 9th Defendant had issued and delivered the original new Grant Mukim Title for the said Property to third 30 parties and not the Plaintiffs; (f) The 6th, 8th and/or 9th Defendants had failed or neglected to follow their Standard Opening Procedure 116 [SOP] in the conversion, issuance and/or delivery of the new Grant Mukim for the said Property replacing the old EMR Title that was still held by the Plaintiffs; and (g) The issuance of the new Grant Mukim Title for the 5 said Property and the cancellation or conversion of the old EMR Title for the said Property by the 6th, 8th and/or 9th Defendants did not follow the provisions of the National Land Code, 1965 and the Fourteenth Schedule thereto. 10 42. As a result of the negligence of the Plaintiffs and the 5th and 6th Defendants and/or the 8th Defendant and/or the 9th Defendant, the 1st Defendant has and continues to suffer loss and damage. The 7th Defendant is vicariously liable for 15 the negligence of the 6th Defendant, the 8th Defendant and the 9th Defendant. 42A. The 1st Defendant shall rely on the doctrine of res ipsa loquitur. 43. The 1st Defendant further states that the 5th, 6th, 8th, and/or 20 9th Defendants had breached their statutory duty owed to the 1st Defendant under the Companies Act 1965 and the National Land Code, 1965. PARTICULARS OF BREACH OF STATUTORY DUTY 25 (a) The 6th Defendant, the 8th Defendant and/or the 9th Defendant failed to discharge their duty and obligations when they allowed the original Grant Mukim Title for the said Property to be issued although the 3rd Plaintiff was still holding the old EMR 30 Title for the same Property; (b) The 6th Defendant, the 8th Defendant and/or the 9th Defendant had no dealings with the Plaintiffs including 117 the Plaintiff’s Company Secretary to inform them about the issuance of the grant mukim Grant Mukim Title for the said Property in the year 2002; (c) The 6th Defendant, the 8th Defendant and/or the 9th Defendant failed to discharge their duty correctly and 5 properly in accordance with the SOP of the 6th and/or 9th Defendants during the issuance of the original new Grant Mukim Title for the said Property; (d) The 6th Defendant, the 8th Defendant and/or the 9th Defendant had allowed parties other than the 10 Plaintiffs to have dealings with them in the issuance of the original new Grant Mukim Title for the said Property contrary to their SOP; (e) The 6th Defendant, the 8th Defendant and/or the 9th Defendant had issued and delivered the original new 15 Grant Mukim Title for the said Property to third parties and not to the Plaintiffs contrary to their SOP; (f) The 6th, 8th and/or 9th Defendants had failed and/or neglected to follow their SOP during the conversion, issuance and/or delivery of the new Grant Mukim for 20 the said Property replacing the old EMR Title that was still held by the Plaintiffs; and (g) The issuance of the new Grant Mukim for the said Property and the cancellation or conversion of the old EMR Title for the said Property by the 6th, 8th and/or 25 9th Defendants did not follow the provisions of the National Land Code, 1965 and the Fourteenth Schedule thereto. 44. As a result of the breach of statutory duty by the 5th 30 Defendant and the 6th Defendant, 8th Defendant and/or 9th Defendant, the 1st Defendant has and continues to suffer loss and damage. The 7th Defendant is vicariously liable for 118 the breach of statutory duty by the 6th Defendant and/or 9th Defendant. 44A. The 1st Defendant shall further rely on the doctrine of res ipsa loquitur. 5 AND the 1st Defendant counterclaims against the Plaintiffs and the 5th Defendant and the 6th Defendant and the 7th and/or the 8th and the 9th Defendants jointly and severally as follows: (a) General damages in the sum of RM 2,000,000.00 for negligence or any other sum to be assessed by this 10 Honourable Court; (b) General damages in the sum of RM 2,000,000.00 for breach of statutory duty or any other sum to be assessed by this Honourable Court; (c) Interest at the rate of 4% per annum on the damages 15 as stated in prayers (c) to (g) (c) to (e) (a) and (b) above from the date of the filing of this Counterclaim until the date of full settlement; (d) Costs on a full indemnity basis; and (e) Such other reliefs, orders, directions, accounts and 20 inquiries that this Honourable Court deems fit and proper to grant.” 6th to 9th defendants’ Re-Amended Opening Statement 98. On 13.04.2015, the 6th to the 9th defendants filed their Re-Amended 25 Opening Statement, re-dated 13.04.2015, enclosure (299). 6th to 9th defendants’ re-re-amended statement of defence to 1st defendant’s counterclaim 99. Upon being served with a sealed copy of the 1st defendant’s re-re-30 amended counterclaim, the 6th to the 9th defendants amended their 119 re-amended statement of defence, which was re-dated 12.05.2014 and filed on 12.05.2014, enclosure (129), pursuant to the Order of this Court dated 16.06.2015. 100. In their re-re-amended statement of defence re-dated 15.06.2015, which they filed on 16.06.2015, enclosure (342), through the 5 Chambers of the State Legal Adviser, Selangor, the 6th to the 9th defendants deny that they were negligent and that they had breached their statutory duty to the 1st defendant. 101. They also plead, inter alia, as follows: (1) They are not bound by clause (2) of the 1st consent judgment, 10 which states that the 1st defendant was not a party to any act of fraud or forgery in the transfer of the said property, as they are not parties to it; (2) The 1st defendant must prove that it is a bona fide purchaser for value of the land; 15 (3) The 1st defendant must prove that it has undertaken all reasonable steps to trace the 2nd, 3rd and 4th defendants; (4) the 1st defendant must prove all of its allegations of negligence and/or breach of statutory duty and/or misfeasance and mala fide against the 6th to the 9th defendants as set out in its 20 counterclaim; (5) The original register document of title for the land had been converted by the 6th defendant to a computerised register document of title (“CRDT”) on 14.05.2002 under the Title No. GM 872, Lot 1011, Mukim Cheras, Daerah Hulu Langat 25 pursuant to the implementation of the “Computerised Land Registration System” (CLRS); 120 (6) As a result of the implementation of the CLRS, the old register document of title of the land has been destroyed by the 6th defendant; (7) The Registrar at the Land Office is empowered under paragraph 8(5) of the Fourteenth Schedule to the NLC 1965 to 5 convert an existing document of title without there being an application made by the registered owner, who is the 3rd plaintiff in the instant case. The date of conversion of the land was on 14.05.2002. However, the converted computerised issue document of title of the land has never been issued out to 10 anyone; (8) Based on further checks conducted by the 6th to the 9th defendants on the date of “6.10.2011” , which was printed on the Computerised Issue Document of Title (“CIDT”), which was presented by the 1st defendant’s solicitor to the Land Office for 15 the registration of the transfer of the land, on 01.02.2015, the 6th to the 9th defendants found that there was no dealing conducted on the land on that date. On top of that, the original CIDT for the land was never issued to anyone; (9) What had taken place on that date, viz 06.10.2011, was the 20 issuance of a certified true copy of the Computerised Register Document of Title (“CRDT”) to an unknown applicant. Therefore, the CIDT presented by the 1st defendant’s Solicitor was not an authorised document; (10) The 6th to the 9th defendants were, wrongly, named in the 25 counterclaim by the 1st defendant for an allegation of negligence, which, purportedly, caused the 1st defendant’s losses; 121 (11) Eventhough the 1st defendant’s claim is based on negligence, the 1st defendant failed to identify the individual, who committed the negligent act(s) as the 1st defendant failed to connect the alleged negligence, to the 6th, 8th or 9th defendants, personally; (12) The conduct of the 6th to the 9th defendants was in accordance 5 with the provisions of the NLC 1965; (13) The Registrar at the 6th defendant’s office had conducted his duties in conformity with the procedures relating to the transfer of the land in the NLC 1965, specifically, ss. 215, 217 and 218 of the NLC 1965, without any mala fide against all parties; 10 (14) The instruments for transfer, which were presented at the Registration Unit at the 6th defendant’s office, were fit for registration pursuant to s. 297 of the NLC 1965 and, therefore, it was the duty of the Registrar at the Registration Unit of the 6th defendant’s office to register the transfer instruments, which 15 were found to be fit for registration pursuant to s. 301 of the NLC 1965; (15) There were mistakes and digressions of facts when the 2nd, 3rd and 4th defendants were excluded by the 1st defendant in its counterclaim as pleaded in paragraphs 44 (a), (b), (c), (d) and 20 (e) of the Re-Amended Second Amendment of the Statement of Defence and Counterclaim, whereas the 2nd, 3rd and 4th defendants were the parties, directly, involved in the actions of transferring the land as opposed to the 6th defendant, which is merely a Government Agency performing its administrative 25 duties as Registrar for the registration of instruments of transfer of immovable properties, private caveats and Registrar’s caveats, which were found to be fit for registration; 122 (16) It is not impossible that the 1st defendant was in cahoots with the 2nd, 3rd and 4th defendants in manipulating the roles played by the 6th and 8th defendants. The 1st defendant had, unfairly, accused the 6th to 9th defendants with negligence and breach of statutory duty without any strong basis and/or justification that 5 the 6th, 8th or 9th defendants had personally committed negligence and breach of statutory duty; (17) the Registrar at the 6th defendant’s office at all material times conducted its duty as Registrar in accordance with the provisions of the NLC 1965; 10 (18) The 6th to the 9th defendants are accorded protection under s. 22 of the NLC 1965 from any action filed and/or claim made against them as the Registrar at the Registration Unit of the 6th defendant’s office had, at all material times, conducted its duties under the NLC 1965 in good faith; and 15 (19) There is a mandatory requirement under ss. 5 and 6 of the Government Proceedings Act 1956 for the 1st defendant to identify the alleged officer, who committed the act of negligence and/or omission, by naming him in the counterclaim. 20 102. The 6th to the 9th defendants’ re-re-amended statement of defence, re-dated 15.06.2015, enclosure (342), states as follows: “SECOND RE-AMENDED STATEMENT OF DEFENCE OF THE 6TH TO 9TH DEFENDANTS IN RESPONSE TO THE FIRST DEFENDANT’S RE-AMENDED SECOND AMENDMENT OF THE 25 STATEMENT OF DEFENCE AND COUNTERCLAIM 1. … 2. The 6th to the 9th Defendants filed this Second Re-Amended Statement of Defence of the 6th to 9th Defendants In 123 Response To The First Defendant’s Re-Amended Second Amendment of the Statement of Defence and Counterclaim dated 18.6.2015 without prejudice to its right to file any relevant application against First Defendant’s Re-Amended Second Amendment of the Statement of Defence and 5 Counterclaim. First Defendant’s claim that the 6th to the 9th Defendants were negligent in performing their duties. 2A. Paragraphs 40A and 40B of the First Defendant’s Re-10 Amended Second Amendment of the Statement of Defence and Counterclaim are not disputed by the 6th to the 9th Defendants. 2B. Paragraph 40C of the First Defendant’s Re-Amended Second Amendment of the Statement of Defence and 15 Counterclaim is wholly denied by the 6th to the 9th Defendants. It is hereby pleaded that the Consent Judgment entered between Plaintiffs and the First Defendant was separate from the Consent Judgment entered between Plaintiffs and the 6th to 9th Defendants. Besides that, the 6th 20 to 9th Defendants were not parties to the Consent Judgment dated 31.3.2015 entered between Plaintiffs and the First and the Fifth Defendants. Therefore, the 6th to 9th Defendants have never conceded the terms recorded in the said consent judgment pertaining to averment that the 1st 25 Defendant was not a party to any act of fraud or forgery in the transfer of the said property. Furthermore, the 6th to 9th Defendants demand the First Defendant to prove that its involvement in the sale and purchase as well as transfer of the said property vide GM 872, Lot 1011, 30 Mukim Cheras, Daerah Hulu Langat, Negeri Selangor (formerly known as EMR 2824, Lot 1011, Mukim Cheras, Daerah Hulu Langat, Negeri Selangor) (“hereinafter 124 referred as the said property”) was a bona fide purchase for a valuable consideration. 2C. Paragraphs 40D and 40E of the First Defendant’s Re- Amended Second Amendment of the Statement of Defence and Counterclaim are wholly denied by the 6th to 9th 5 Defendants. The 6th to 9th Defendants further assert that there wasn’t any admission of liability on its part in any of the terms of the said Consent Judgment. 2D. Paragraph 40F of the First Defendant’s Re-Amended Second Amendment of the Statement of Defence and 10 Counterclaim are not disputed by the 6th to the 9th Defendants. However, the First Defendant is hereby put to strict proof to show that it has undertaken all reasonable steps to trace the Second, Third and Fourth Defendants respectively. 15 3. The 6th to 9th Defendants wholly denies the First Defendant’s allegation in paragraph 41 of the First Defendant’s Re-Amended Second Amendment of the Statement of Defence and Counterclaim which avers that the 6th to 9th Defendants had committed negligence and 20 breach of duty against the First Defendant by allowing the filing of papers belonging to the 3rd Plaintiff to the 6th Defendant including the issuance of the original title document which was falsified or forged. 4. The 6th to the 9th Defendants wholly denies the First 25 Defendant’s allegation in paragraph 41(a), (b), (c), (d) and (e) of the First Defendant’s Re-Amended Second Amendment of the Statement of Defence and Counterclaim specifically on the allegation that the 6th to 9th Defendants did not perform its duty by allowing the issuance of the 30 original title document while the Plaintiffs still has in its posession the old title document of the said property. 125 Therefore, the First Defendant is hereby put to strict proof in proving all of its allegation. 5. The original title document for the said property was under EMR 2824, Lot 1011 which was later converted to computerised issue document of title. 5 6. The original title document for the said property had been converted to computerised issue document of title pursuant to the enforcement of the “Computerised Land Registration System” (CLRS). The said computerised issue document of title has been registered by the 6th Defendant on 10 14.5.2002 under the Title No. GM 872, Lot 1011, Mukim Cheras, Daerah Hulu Langat. 7. On the other hand, issues relating to the old document of title belonging to the 3rd Plaintiff must come from the 3rd Plaintiff itself and not from the First Defendant. In any event, 15 the old register document of title for the said property has been destroyed by the 6th Defendant before issuance of the computerised document of title. 7A. Paragraph 41(f) and (g) of the First Defendant’s Re- Amended Second Amendment of the Statement of Defence 20 and Counterclaim are wholly denied by the 6th to 9th Defendants. Registrar at the land office is empowered under paragraph 8(5) of the 14th Schedule of the National Land Code, 1965 (NLC) to convert existing document of title without there being an application 25 made by the registered owner, i.e. the 3rd Plaintiff. The date of conversion for the said property was on 14.5.2002. However, the converted issue document of title has never been issued out to anyone. Based on further checks conducted by the 6th to 9th Defendants on the printed date of 30 “6.10.2011” on the Computerised Issue Document of Title (“CIDT”) presented by the First Defendant’s solicitor for the transfer of the said property, it was found that there was no 126 dealings conducted on the said property on such date. On top of that, the original CIDT for the said property was never issued to anyone. What took place was issuance of a certified true copy for the said title from the Computerised Register Document of Title (“CRDT”) to 5 an unknown applicant. Therefore, the CIDT presented by the First Defendant’s Solicitor was (sic) an authorised document. 7B. The 6th to 9th Defendants were wrongly named in the counterclaim by the First Defendant for an allegation of 10 negligence which purportedly caused the First Defendant’s losses. Any allegation of negligence against the 6th, 8th and 9th Defendants are hereby strongly denied by the 6th, 8th and 9th Defendants since they were not the parties who committed negligence as alleged by the First 15 Defendant in its paragraphs (a) to (g) under paragraph 41 of the Re-Amended Second Amendment of the Statement of Defence and Counterclaim (hereinafter referred as the “alleged negligence”). In a claim based on negligence, the First Defendant failed to identify the individual who 20 committed the negligent act(s) and the First Defendant failed to connect the alleged negligence has been committed personally by any of the 6th, 8th or 9th Defendants. 8. In reference to paragraphs 42 and 42A of the Re-Amended 25 Second Amendment of the Statement of Defence and Counterclaim, the 6th to 9th Defendants wholly denied the averments made by the First Defendant and put them to strict proof to justify its claims. It is further stressed that the conducts of the 6th to 9th Defendants were in 30 accordance to provisions under the National Land Code, 1965. 127 Allegations of breach of statutory duty by the 6th to 9th Defendants 9. The 6th to 9th Defendants wholly deny the alleged breach of statutory duty purportedly committed by the 6th, 8th and 9th Defendants as pleaded by the First Defendant in 5 paragraphs 43, 43(a), (b), (c), (d), (e), (f) and (g) of the Re-Amended Second Amendment of the Statement of Defence and Counterclaim. Therefore, the First Defendant is hereby put to strict proof in justifying all of its allegations and claims. The 6th to 9th Defendants repeat and reaffirm its 10 earlier averments in paragraphs 2, 2B, 2C, 2D, 3, 4, 5, 6, 7A, 7B and 8 above. 10. In regards to paragraphs 44 and 44A of the Re-Amended Second Amendment of the Statement of Defence and Counterclaim, it was wholly denied by the 6th to 9th 15 Defendants. Therefore, the First Defendant is hereby put to strict proof in justifying all of its allegations and claims. The 7th Defendant will only be vicariously liable if it is proven beyond doubt that the 6th and/or 8th Defendant and/or 9th Defendant had committed negligence and/or omission in 20 performing its statutory duty. The 7th Defendant repeat its averments in paragraphs 7 and 7B above. 11. Further, the Registrar at the 6th Defendant’s office had conducted their duties conforming to the procedures relating to transfer of property in pursuant to provision 25 and/or specifically to sections 215, 217 and 218 NLC without any mala fide against all parties. Instruments for transfer which has been presented at the Registration Unit at the 6th Defendant’s office were fit for registration according to section 297 NLC, therefore it was the duty 30 of the registrar at the Registration Unit at the 6th Defendant’s Office to register the transfer instrument 128 which was fit for registration pursuant to section 301 NLC. 12. The 6th to 9th Defendants plead that there were mistakes and confusions of facts when the 2nd, 3rd and 4th Defendants were excluded by the First Defendant in 5 their Counterclaim as pleaded in paragraphs 44 (a), (b), (c), (d) and (e) of the Re-Amended Second Amendment of the Statement of Defence and Counterclaim, whereas the 2nd, 3rd and 4th Defendants were the parties directly involved in the actions of transferring the land as 10 oppose to the 6th Defendant which was merely a Government Agency performing its administrative duties as registrars for instruments of transfer of properties, private caveats and Registrar Caveats which was fit for registration. The 7th Defendant will only be 15 vicariously liable if it is proven beyond doubt that the 6th Defendant and/or the 8th Defendant and/or 7th Defendant had committed negligence and/or omission in carrying out their administrative duties. The 6th to 9th Defendants denies that the 6th to 9th Defendants are liable for every claim of 20 damages claimed by the First Defendant in its paragraph 44A(a) to (e) of the Re-Amended Second Amendment of the Statement of Defence and Counterclaim. 13. It is clear that the First Defendant has a mala fide intention against the 6th to 9th Defendants and it is not impossible 25 that the First Defendant was in cahoots with the 2nd, 3rd and 4th Defendants in manipulating the roles played by the 6th and 7th Defendants. The First Defendants had unfairly accused the 6th to 9th Defendants with allegation of negligence, breach of statutory duties without any 30 strong basis and/or justification that the 6th, 8th or 9th Defendants had personally committed negligence and breach of statutory duties. The 7th Defendant will only be 129 vicariously liable if it is proven beyond doubt that the 6th Defendant and/or 8th Defendant and/or 7th Defendant had committed negligence and/or omission in carrying out their administrative duties. 14. The 6th to 9th Defendants did not have any personal interest 5 in the said property, and besides that, the Registrar at the 6th Defendant’s office at all material times conducted its duty as registrar in accordance to provisions under the NLC. 15. The 6th to 9th Defendants plead for protection provided 10 to the 6th, 8th and 9th Defendants under section 22 of the NLC. The registrars at the Registration Unit at the 6th Defendant’s office had at all material times conducted its duties under the NLC 1965 with bona fide and there should not be any action and/or claim made against 15 them. 16. The 6th to 9th Defendants also pleads the mandatory requirement for the First Defendant to identify the alleged officer who committed negligence and/or omission as required under section 5 and 6 of the 20 Government Proceedings Act 1956. 17. Except as expressly acknowledged hereinbefore, the 6th to 9th Defendants denies all of the averments and claims made by the First Defendant in its Re-Amended Second Amendment of the Statement of Defence and Counterclaim 25 as if it were created and traversed seriatim in particular. 18. Therefore, the 6th to 9th Defendants humbly plead for this honorable court to dismiss the First Defendant’s Re- Amended Second Amendment of the Statement of Defence and Counterclaim with costs.” 30 (Emphasis added). 130 103. On 17.06.2015, the 6th to the 9th defendants filed their Re-Re- Amended Opening Statement, re-dated 17.06.2015, enclosure (352), in which they have stated, inter alia, that the 6th to the 9th defendants entered into the 2nd consent judgment with the 3 (three) plaintiffs without any admission of liability with costs of RM 20,000.00 to be 5 paid by them to the 3 (three) plaintiffs; that the 6 th to the 9th defendants are not liable in negligence or for breach of statutory duty to the 1st defendant as they have complied with all the procedures in the NLC 1965 for the registration of the transfer of the land from the 3rd plaintiff to the 1st defendant; and that the 1st defendant and/or its 10 solicitor were negligent in failing to ensure that the documents for the transfer were in order and that the presentation of the documents for the transfer were in accordance with the legal requirements and standard conveyancing practice. 15 1st defendant’s reply to 6th to 9th defendants’ re-re-amended defence 104. In response, the 1st defendant filed its reply dated 25.06.2015 to the re-re-amended defence of the 6th to the 9th defendants (“the 1st defendant’s reply”). 105. In paragraph 2 of the 1st defendant’s reply, the 1st defendant relies on 20 clause (2) of the 1st consent judgment to plead that the 1st defendant was not involved in the fraud, forgery and/or deception in the sale and transfer of the land from the 3rd plaintiff to the 1st defendant as the parties in the 2nd consent judgment, which include the 6 th to the 9th defendants, have agreed to this term. 25 106. Clause (2) states as follows: 131 “(2) On 01.02.2012 the Land was fraudulently transferred from the 3rd Plaintiff to the 1st Defendant save and except that the 1st Defendant was not a party to the fraud and/or forgery or deception in relation to and arising from the sale and transfer of the Land from the 3rd Plaintiff to the 1st 5 Defendant” (Emphasis added). 107. In paragraphs 3 and 4 of the 1st defendant’s reply, the 1st defendant also relies on the 2 (two) consent judgments to plead that as a result 10 of the 2 (two) consent judgments, the issue whether the 1st defendant is or is not a bona fide purchaser of the land is not relevant to the 1st defendant’s counterclaim against the 6th to the 9th defendants. 108. In the 1st defendant’s reply, the 1st defendant also pleads, inter alia, as follows: 15 (1) That the 1st defendant is a bona fide purchaser of the land for sufficient consideration and that at all material times between the months of January and March 2012, it had no knowledge of the fraud, forgery and/or deception that occurred in the sale and transfer of the land from the 3rd plaintiff to the 1st defendant; 20 (2) That the 6th to the 9th defendants have breached and/or contravened paragraphs 8(3), (9)(a) to (d) and 14 in the Fourteenth Schedule to the NLC 1965; (3) That the 6th to the 9th defendants were negligent and/or had breached their statutory duty when they did or omitted to do the 25 following acts: (a) They failed to issue the computer printed issue document of title (“CIDT”) or Dokumen Hakmilik Keluaran Komputer 132 (“DHKK”) in Malay of the land although the computer printed register document (“CRDT”) of title or Dokumen Hakmilik Daftar Komputer (“DHDK”) in Malay for the land had been issued on 14.05.2002 after the conversion of the EMR title to the GM title; 5 (b) They failed to inform the 3rd plaintiff that the DHDK had been issued and that the 3rd plaintiff was required to surrender the EMR handwritten issue document of title for cancellation and destruction before the DHKK would be issued and delivered to the 3rd plaintiff; 10 (c) They issued and/or caused to be issued a DHKK document on 06.10.2011 (which is now alleged not to exist) of the land, which was delivered to a party other than the 3rd plaintiff and, which was misused. The DHKK dated 06.10.2011 of the land could not be prepared 15 unless the 3rd plaintiff had first surrendered the EMR handwritten issue document of title for cancellation and destruction by the 6th to the 9th defendants; (d) Their admission that a certified true copy of the DHDK of the land was issued at the request of an unknown party 20 proves that they were negligent and/or had breached their statutory duty; (e) They failed to reject the presentation of the DHKK of the land, which was produced by the 1st defendant through their solicitors, Messrs. Peter Pui & Partners, during the 25 presentation of the MOT in Form 14A for the land on 01.02.2012 for registration after verifying the same with 133 their computerised land registration system but which they plead is not valid; (f) On the contrary, the 6th to the 9th defendants accepted and registered the MOT for the transfer of the land to the 1st defendant and also issued the verification document 5 for the registration of the transfer of the land; (g) They then issued a new DHKK of the land in the name of the 1st defendant after the registration of the transfer was completed on 01.02.2012 and they also cancelled and destroyed the DHKK dated 06.10.2011, which was in the 10 name of the 3rd plaintiff; (h) At all material times the DHKK dated 06.10.2011 was held and delivered by the 3rd defendant to the 1st defendant’s then solicitors, Messrs. Peter Pui & Partners, for the purposes of the transfer of the land on 01.02.2012. 15 (i) The following new allegations of the 6th to the 9th defendants contained in paragraph 7A of the re-amended statement of defence of the 6th to the 9th defendants, viz that the Registrar of Titles is empowerd under paragraph 8(5) of the Fourteenth Schedule to the NLC 1965 to 20 convert the existing document of title without there being an application by the registered owner, who is the 3rd plaintiff in this case; that the DHKK or computer printed issue document of title (“CIDT”) was never issued out on 06.10.2011; and that what had occurred was that a 25 certified true copy of the computer printed register document of title was issued to an unknown applicant; cannot be believed and are an afterthought as they did 134 not exist in the year 2012 when the 6th to the 9th defendants filed their first statement of defence and they are unreasonable reasons and were contrived by the 6th to the 9th defendants to conceal their negligence and/or breach of statutory duty and/or misfeasance or mala fide; 5 (j) It is also astonishing that the 6th to the 9th defendants have alleged that the registration of the transfer of the land on 01.02.2012 was proper and in accordance with all the stipulated procedures when the 6th to the 9th defendants themselves have admitted that the DHKK 10 dated 06.10.2011 did not exist in their computerised land registration system and yet the 6th to the 9th defendants had accepted the registration of the transfer of the land on 01.02.2012 including the DHKK that was presented by the 1st defendant, through their solicitors, Messrs. Peter Pui & 15 Partners, and they later cancelled the DHKK and issued a new DHKK in the name of the 1st defendant; (k) The 1st defendant has identified the persons who were negligent when the plaintiffs joined the 6th, 8th and 9th defendants as defendants to this action and the joinder 20 was confirmed by the Court of Appeal in its Order dated 26.02.2014; and (l) The 1st defendant denies that the conduct of the 6th to the 9th defendants is in accordance with the NLC 1965 as pleaded in paragraphs 8 and 11 of the 6th to the 9th 25 defendants’ re-amended statement of defence and the 1s t defendant relies on ss. 297 to 302 of the NLC 1965. 135 109. The 1st defendant’s reply states as follows: “REPLY TO THE RE-AMENDED DEFENCE OF THE 6TH TO THE 9TH DEFENDANTS 1. Save as to where it is expressly admitted the 1st Defendant 5 joins issue with the 6th to the 9th Defendants on their Re- Amended Defence dated 18.6.2015. 2. The 1st Defendant denies paragraph 2 of the Re-Amended Defence of the 6th to the 9th Defendants and states that clause (2) in the Consent Judgment dated 31.3.2015 in 10 Enclosure 278 between the Plaintiffs and the 6th to the 9th Defendants clearly states that the 1st Defendant was not involved in the fraud, forgery and/or deception in the sale and transfer of the said Property from the 3rd Plaintiff to the 1st Defendant. 15 3. The 1st Defendant further states that the issue of whether the 1st Defendant is or is not a bona fide purchaser of the said Property from the 3rd Plaintiff is no longer relevant because of the Consent Judgments recorded on 31.3.2015 between the Plaintiffs and the 1st and 5th 20 Defendants in Enclosure 277 and between the Plaintiffs and the 6th to 9th Defendants in Enclosure 278. 4. The issue of whether the 1st Defendant is or is not a bona fide purchaser of the said Property is also not relevant to the 1st Defendant’s Counterclaim against the 25 6th to the 9th Defendants herein. 5. Nevertheless, the 1st Defendant states that they are a bona fide purchaser of the said Property for sufficient consideration and that the 1st Defendant had no knowledge at all material times between the months of 30 January and March 2012 of the fraud, forgery and/or deception that occurred in the sale and transfer of the said Property from the 3rd Plaintiff to the 1st Defendant. 136 6. The 1st Defendant denies paragraph 2C of the Re-Amended Defence of the 6th to the 9th Defendants and states that the terms of the Consent Judgment dated 31.3.2015 between the Plaintiffs and the 6th to the 9th Defendants in Enclosure 278 are clear and obvious. The 6th to the 9th Defendants did 5 not admit liability only in relation to the issue of the costs of the action. 7. Paragraph 2D of the Re-Amended Defence of the 6th to the 9th Defendants is not admitted by the 1st Defendant. The 1st Defendant had on 27.3.2015 obtained an Order for 10 Substituted Service of the Subpeona to Testify and Produce Documents against the 2nd and 3rd Defendants (Enclosure 232) and the 4th Defendant is believed to be in Laos. 8. The 1st Defendant denies paragraph 7A of the Re-Amended Defence of the 6th to the 9th Defendants and puts the 6th to 15 the 9th Defendants to strict proof thereof. 9. The 1st Defendant states that the 6th to the 9th Defendants have breached and/or contravened paragraphs 8(3), (9)(a) to (d) and 14 in the 14th Schedule to the National Land Code, 1965. 20 10. The 6th to the 9th Defendants were negligent and/or had breached their statutory duty when they failed to issue the Computer Printed Issue Document of Title [Dokumen Hakmilik Keluaran Komputer (DHKK)] for the said Property although the Computer Printed Register Document of Title 25 [Dokumen Hakmilik Daftar Komputer (DHDK)] for the said Property had been issued on 14.5.2002 after the conversion of the EMR title to the Mukim Grant type of title. 11. Further, the 6th to the 9th Defendants were negligent and/or had breached their statutory duty when they failed to inform 30 the 3rd Plaintiff that the DHDK had been issued and that the 3rd plaintiff was required to surrender the EMR type of issue 137 document of title for cancellation and destruction before the DHKK would be issued and delivered to the 3rd Plaintiff. 12. In addition, the 6th to the 9th Defendants were negligent and/or had breached their statutory duty when they issued and/or caused to be issued a DHKK document on 6.10.2011 5 (which is now alleged not to exist) for the said Property that was delivered to a party other than the 3rd Plaintiff and misused. The DHKK dated 6.10.2011 could not be issued for the said Property unless the 3rd Plaintiff had first surrendered the EMR issue document of title for cancellation and 10 destruction by the 6th to the 9th Defendants. 13. The fact that the 6th to the 9th Defendants have admitted that a certified true copy of the DHDK for the said Property was issued at the request of an unknown party proves that they were negligent and/or had breached 15 their statutory duty. 14. The 1st Defendant also states that if the DHKK produced by the 1st Defendant through their solicitors Messrs. Peter Pui & Partners during the presentation of the Memorandum of Transfer (Form 14A) of the said 20 Property on 1.2.2012 for registration was not valid, why didn’t the 6th to the 9th Defendants reject the presentation for registration after verifying the same with their computerised land registration system. On the contrary, the 6th to the 9th Defendants accepted and 25 registered the said transfer and also issued the verification document for the said transaction. 15. Further, the 6th to the 9th Defendants issued a new DHKK for the said Property in the name of the 1st Defendant after the transfer transaction was completed on 1.2.2012 and they 30 also cancelled and destroyed the DHKK dated 6.10.2011 that was in the name of the 3rd Plaintiff. 138 16. At all material times the DHKK dated 6.10.2011 was held and delivered by the 3rd Defendant to the 1st Defendant’s then solicitors, Messrs. Peter Pui & Partners for the purposes of the transfer of the said Property on 1.2.2012. 5 17. The new allegations of the 6th to the 9th Defendants contained in paragraph 7A of the Re-Amended Defence of the 6th to the 9th Defendants cannot be believed and is an afterthought and did not exist in the year 2012 when their original defence was filed and are unreasonable reasons 10 and contrived by the 6th to the 9th Defendants to conceal their negligence and/or breach of statutory duty and/or their own misfeasance or mala fide. 18. It is also astonishing that the 6th to the 9th Defendants have alleged that the registration of the transfer of the 15 said Property on 1.2.2012 was proper and in accordance with the all the stipulated procedures. 19. The 1st Defendant denies paragraph 7B of the Re-Amended Defence of the 6th to the 9th Defendants and states that the negligence of the 6th, 8th and 9th Defendants was identified 20 when the Plaintiffs joined them as Defendants to this action and the said joinder was confirmed by the Court of Appeal in the Order dated 26.2.2014. 20. The 1st Defendant denies paragraphs 8 and 11 of the Re- Amended Defence of the 6th to the 9th Defendants and shall 25 rely on sections 297 to 302 of the National Land Code, 1965. 21. In this case the 6th to the 9th Defendants themselves have admitted that the DHKK dated 6.10.2011 did not exist in their computerised land registration system and yet the 6th to the 30 9th Defendants had accepted the registration of the transfer of the said Property on 1.2.2012 including the said DHKK that was presented by the 1st Defendant through their 139 solicitors Messrs. Peter Pui & Partners and they later cancelled the said DHKK and issued a new DHKK in the name of the 1st Defendant. These acts of the 6th to the 9th Defendants clearly prove their negligence and/or breach of statutory duty. 5 22. Paragraph 12 of the Re-Amended Defence of the 6th to the 9th Defendants is denied and the 1st Defendant repeats paragraphs 9 to 21 above. 23. Paragraph 13 of the Re-Amended Defence of the 6th to the 9th Defendants is denied and the 1st Defendant repeats 10 paragraphs 2, 6, 9 to 21 above. 24. Paragraph 14 of the Re-Amended Defence of the 6th to the 9th Defendants is denied and the 1st Defendant repeats paragraphs 9 to 21 above. 25. Paragraph 15 and 16 of the Re-Amended Defence of the 6th 15 to the 9th Defendants is denied and the 1st Defendant repeats paragraphs 19 to 21 above. Dated the 25th day of June, 2015.” (Emphasis added). 20 12 (twelve) issues for determination of Court in counterclaim between 1st defendant and 6th to 9th defendants 110. On 05.11.2015, the 1st defendant filed the Statement of Issues to be tried in the counterclaim dated 04.11.2015, enclosure (421). 25 111. In their Statement of Issues to be tried in the counterclaim between the 1st defendant, who is the sole plaintiff in the counterclaim and the 6th to the 9th defendants, who are the 5th, 6th, 7th and 8th defendants in the counterclaim, the parties framed the following 12 (twelve) issues for the determination of the Court: 30 140 “1. Whether the Geran Mukim No. 872, Lot 1011, Mukim Cheras, Daerah Hulu Langat, Negeri Selangor (“the Geran Mukim Title”) of the Land was issued by the 5th and/or 7th and/or 8th Defendants in the Counterclaim in contravention of the provisions of the National Land Code 1965 namely 5 section 5A and the 14th Schedule thereto and the Standard Operating Procedure (“SOP”) of the 6th and/or 8th Defendant in the Counterclaim? 2. Whether the 5th and/or 7th and/or 8th Defendant in the Counterclaim were negligent and/or in breach of their 10 statutory duty under the National Land Code 1965 and the 14th Schedule thereto and the SOP of the 6th and/or 8th Defendant in the Counterclaim in the conversion of the EMR 2824, Lot No. 1011, Mukim Cheras, Selangor (“the EMR Title”) of the Land to the Geran Mukim Title? 15 3. Whether the Geran Mukim computer printed issue document of title and plan of the Land purportedly issued on 6.10.2011 exists in the computer land registration system of the 5th and/or 8th Defendants in the Counterclaim? 4. Whether the Geran Mukim computer printed issue document 20 of title and plan of the Land purportedly issued on 6.10.2011 was allegedly delivered by the 5th and/or 7th and/or 8th Defendants in the Counterclaim to a party other than the 3rd Plaintiff in the Main Suit? 5. Whether the 5th and/or 7th and/or 8th Defendants in the 25 Counterclaim were negligent and/or in breach of their statutory duty under the National Land Code 1965 and the 14th Schedule thereto and the SOP of the 6th and/or 8th Defendants in the Counterclaim in the purported issuance of the Geran Mukim computer printed issue document of title 30 and plan of the Land on 6.10.2011 and in its alleged delivery to a party other than the 3rd Plaintiff in the Main Suit? 141 6. Whether as a result of the 5th and/or 7th and/or 8th Defendants’ negligence and/or breach of statutory duty in the Counterclaim, the Plaintiff in the Counterclaim has suffered any loss and damage? 7. Whether the 6th Defendant in the Counterclaim is vicariously 5 liable for the acts or omissions of the 5th, 7th and/or 8th Defendants in the Counterclaim in the conversion of the EMR Title of the Land to the Geran Mukim Title? 8. Whether the 6th Defendant is vicariously liable for the acts or omissions of the 5th, 7th and/or 8th Defendants in the 10 Counterclaim in the purported issuance of the Geran Mukim computer printed issue document of title and plan of the Land on 6.10.2011 and in its alleged delivery to a party other than the 3rd Plaintiff in the Main Suit? 9. Whether the 5th, 6th, 7th and 8th Defendants in the 15 Counterclaim have been wrongly named as parties to the Counterclaim by the Plaintiff? 10. Whether the Plaintiff’s Counterclaim against the 5th to the 8th Defendants has complied with the requirements of sections 5 and 6 of the Government Proceedings Act 1956? 20 11. Whether the conversion of the Geran Mukim Title was done in good faith and in compliance with the relevant procedures and rules under the National Land Code 1965 by the 5th to the 8th Defendants in the Counterclaim thereby entitling them to protection under section 22 of the Code? 25 12. Whether the Plaintiff in the Counterclaim was a bona fide purchaser for value of the said Land from the 3rd Plaintiff in the Main Suit?” Full trial of 1st defendant’s re-re-amended counterclaim 30 112. On 17.06.2015, the full trial of the 1st defendant’s re-re-amended counterclaim, founded on the 2 (two) pleaded causes of action of the 142 tort of negligence and/or breach of statutory duty, against the 6th to the 9th defendants in the main action, commenced. 113. The full trial continued on 18.06.2015, 02.11.2015, 06.11.2015, 26.01.2016, 27.01.2016 and 28.01.2016. The full trial concluded on 29.01.2016. 5 Parties in 1st defendant’s re-re-amended counterclaim 114. The parties in the 1st defendant’s re-re-amended counterclaim are as follows: (1) Supreme Tribute is the sole plaintiff. It is the 1st defendant in the 10 main action; (2) Goodland Realty Sdn. Bhd. (Company No.: 14959-D) is the 1st defendant. It is the 3rd plaintiff in the main action; (3) Ee Chong Wah is the 2nd defendant. He is the 1st plaintiff in the main action; 15 (4) Ee Soon Kee is the 3rd defendant. He is the 2nd plaintiff in the main action; (5) The SSM is the 4th defendant. It is the 5th defendant in the main action; (6) Dato’ Haji Mohd Amin Bin Ahmad Yahya, the Land 20 Administrator of Hulu Langat, is the 5th defendant. He is the 6th defendant in the main action; (7) Kerajaan Negeri Selangor or the State Government of Selangor is the 6th defendant. It is the 7th defendant in the main action; (8) Mohd Azhar Bin Mohd Daud, the A.D.O. of Hulu Langat is the 25 7th defendant. He is the 8th defendant in the main action; and 143 (9) Pengarah Tanah Dan Galian, Negeri Selangor in Malay or “the Director of Lands & Mines, State of Selangor” in English is the 8th defendant. He is the 9th defendant in the main action. References to parties in 1st defendant’s re-re-amended counterclaim 5 115. For ease of reference and in order to avoid confusion as the 2nd to the 4th defendants were not made parties to the counterclaim by the 1st defendant, I shall refer to the parties in the 1st defendant’s re-re- amended counterclaim (“the counterclaim”) in the same capacities, in which they were named in the main suit, viz as follows: 10 (1) The sole plaintiff in the counterclaim, who is the new registered proprietor of the land, as the 1st defendant; (2) The 1st defendant in the counterclaim, who is the original registered proprietor of the land, as the 3rd plaintiff; (3) The 2nd and 3rd defendants in the counterclaim, who are the 2 15 (two) original Directors of Goodland, as the 1st and 2nd plaintiffs; (4) The 3 (three) new Directors of Goodland, who are not parties in the counterclaim, as the 2nd, 3rd and 4th defendants; (5) The 4th defendant in the counterclaim, viz the SSM, as the 5th defendant; 20 (6) The 5th defendant in the counterclaim, who is the Land Administrator of Hulu Langat, Selangor, as the 6th defendant; (7) The 6th defendant in the counterclaim, which is the Selangor State Government, as the 7th defendant; (8) The 7th defendant in the counterclaim, who is the A.D.O. of Hulu 25 Langat, Selangor, as the 8th defendant; and 144 (9) The 8th defendant in the counterclaim, who is the Director of Lands & Mines, Selangor, as the 9th defendant. Parties’ 9 (nine) witnesses in full trial of 1st defendant’s counterclaim 116. In the full trial, the parties called 9 (nine) witnesses altogether. 5 1st defendant’s 4 (four) witnesses 117. The 1st defendant called 4 (four) witnesses. They are as follows: (1) Mr. Manoharan A/L Muthiah, a Chartered Accountant, who is a Director of the 1st defendant and who has no personal 10 knowledge of the purchase of the land by the 1st defendant from the 3rd plaintiff, which was, purportedly, represented by the 2nd and 3rd defendants, as PW1; (2) Mr. Ee Soon Kee, the 2nd plaintiff, as PW2; (3) Mr. Pui Yin Chong (“Mr. Pui”), an advocate and solicitor, who 15 was the 1st defendant’s solicitor at the material time and who acted for the 1st defendant in the presentation of the documents to the Land Office, for the registration of the transfer of the land from the 3rd plaintiff to the 1st defendant, as PW3; (4) Sr. Ishak Bin Ismail, a registered valuer and a quantity 20 surveyor, who had valued the market value of the land at RM 2.8 million and the forced sale value of the land at RM 2 million in his report dated 30.08.2012, which was prepared 7 (seven) months after the transfer of the land was registered on 01.02.2012), as PW4. 25 145 6th to 9th defendants’ 5 (five) witnesses 118. The 6th to the 9th defendants called 5 (five) witnesses. They are as follows: (1) Mohammad Rahmat bin Azman, the Penolong Pegawai Tadbir, as DW1; 5 (2) ASP Azani bin Saupi G/11766, the police officer, who was attached to the Ibu Pejabat Polis Daerah Serdang as Ketua Bahagian Siasatan Jenayah Komersial , and who was the Investigating Officer (“the I.O.”) of the police report lodged by the 2nd plaintiff, as DW2; 10 (3) Puan Nurul Huda binti Abdul Rahman, the Pembantu Tadbir N17 di Pejabat Tanah Daerah Hulu Langat, who was the clerk on duty at the counter and who received the documents for the registration of the transfer of the land from the 3rd plaintiff to the 1st defendant, which were presented by Mr. Pui, as DW3; 15 (4) En. Mohd Azhar bin Mohd Daud, the A.D.O. of Hulu Langat, as DW4; and (5) En. Adrin bin Redzuan, the Pembantu Tadbir N17 di Pejabat Tanah Daerah Hulu Langat, who was the clerk on duty at the Registration Unit of the Land Office, whose duty was to verify 20 the documents, which were received by Puan Nurul Huda binti Abdul Rahman (DW3), as DW5. 1st defendant’s submissions 119. Mr. Gerard Lourdesamy, the learned counsel for the 1st defendant, 25 submitted that the 1st defendant’s counterclaim should be allowed as it has succeeded in proving its counterclaim against the 6th to the 9th 146 defendants on a balance of probability based on the following reasons: (1) It is beyond doubt that the 6 th to the 9th defendants owe a duty of care to the 1st defendant both in common law and under the NLC 1965. This is because the existence of the duty of care in 5 common law and a statutory duty of care under ss. 297 to 302 of the NLC 1965 is well established and cannot be disputed (see Lee Siew Ken & Anor. v Pengarah Tanah dan Galian Negeri Selangor [2015] AMEJ 1502; Uptown Properties Sdn. Bhd. v Pentadbir Tanah Wilayah Persekutuan & Ors. [2012] 10 8 MLJ 713; and CIMB Bank Berhad v Ambank (M) Berhad & Ors. [2015] 3 MLRH); (2) In the instant case, although PW1 gave evidence that he was only appointed as a director of the 1st defendant on 20.04.2015 and that he has no personal knowledge of the facts of the 15 counterclaim as he was not directly involved in the transaction to purchase the land in late 2011 and early 2012, his evidence is admissible under the exception to the hearsay rule to establish the fact that PW1’s sources of information were Chua Boon Kooi and Tee Choon Siong, who are directors of the 1st 20 defendant and not to establish the truth of what was told to him by Chua Boon Kooi and Tee Choon Siong; (3) PW1 gave evidence that his sources of information of the transaction to purchase the land in late 2011 and early 2012 were Chua Boon Kooi, Tee Choon Siong and PW3; 25 (4) PW1 also explained that Chua Boon Kooi was unwell and undergoing heart problems and, hence, he could not testify on 147 behalf of the plaintiff even though his name was in the 1st defendant’s original List of Witnesses; (5) PW3 gave evidence that he mainly dealt with Tee Choon Siong, the 1st defendant’s director, when it came to the taking of instructions. This is also not hearsay evidence as PW3 had 5 personal knowledge of what was communicated to him by Tee Choon Siong; (6) PW3 also gave evidence that he paid, on behalf of the 1st defendant, the purchase price of RM 2 million in cash in a few cheques to the 3rd defendant. He said that he had done this 10 because the 3rd defendant told him she represented the 3 rd plaintiff and she showed him the resolution of the 3 rd plaintiff, which authorized her to accept the payment of the purchase price, on behalf of the 3rd plaintiff; (7) Even though the second witness of the 6 th to the 9th defendants 15 (DW2) gave evidence that the police have yet to obtain the original cheques issued by the 1st defendant from the bank, as the police have yet to complete their investigation against the 2nd to the 4th defendants for the offence of cheating under s. 420 of the Penal Code, PW3 gave evidence that the amounts 20 as stated in the cheques totaling a sum of RM 2 million have been debited from the 1st defendant’s bank account based on the 1st defendant’s bank statements; (8) PW3 also gave evidence that he was given the original copy of the GM CIDT by the 3rd defendant. PW3 also gave evidence 25 that the GM CIDT of the land was issued on 06.10.2011 and that he had presented the original copy of the GM CIDT 148 together with the MOT for the registration of the transfer of the land from the 3rd plaintiff’s name to the 1st defendant’s name to the Hulu Langat Land Office; (9) In the Statement of Agreed Facts for the counterclaim, the 6th to the 9th defendants have agreed that the 6th defendant had 5 converted the EMR issue document of title of the land to a GM CIDT and plan of the land (paragraph 10); that the GM CIDT and plan of the land were never delivered to the 3rd plaintiff (see paragraph 11); and that the 3rd plaintiff never surrendered the EMR issue document of title to the 6 th and/or 8th defendants to 10 be cancelled and destroyed (see paragraph 12). Hence, the 6th to the 9th defendants are estopped from contending that the GM CIDT was never issued and that only a certified true copy of the CRDT was issued on 06.10.2011; (10) Since there were 2 (two) documents of title, which were issued 15 for the same land, the 1st defendant has established the negligence of the 6th to the 9th defendants (see Lee Siew Ken & Anor. v Pengarah Tanah dan Galian Negeri Selangor [2015] AMEJ 1502); (11) The facts of the instant case are on all fours with the case of 20 Lee Siew Ken & Anor. v Pengarah Tanah dan Galian Negeri Selangor [2015] AMEJ 1502; (12) In Uptown Properties Sdn. Bhd. v Pentadbir Tanah Wilayah Persekutuan & Ors. [2012] 8 MLJ 713, the Land Office was found to be negligent and in breach of its statutory duty for 25 issuing a duplicate CIDT of the land when the landowner was in possession of the CIDT of the land; 149 (13) Whereas in Uptown Properties Sdn. Bhd. v Pentadbir Tanah Wilayah Persekutuan & Ors. [2012] 8 MLJ 713, the Land Office was found to be negligent and in breach of its statutory duty for allowing a forged issue document of title to be used for the purpose of the transfer of the land; 5 (14) The 6th, 8th and 9th defendants’ first witness (DW1) and third witness (DW3) gave evidence that they verified the copy of the GM CIDT produced by PW3 and they found that it was a genuine and authentic GM CIDT. They came to this conclusion after they had carried out the verification process by visually 10 examining it. They looked at the quality of the paper and upon holding it up against the light they saw it had the security features of a genuine and authentic GM CIDT. However, DW3 said she did not scan the bar code on the copy of the GM CIDT produced by PW3. In failing to do so, she has shown a 15 somewhat cavalier and lackadaisical attitude on her part in verifying the authenticity of the document, which can amount to negligence or breach of statutory duty (see Ketua Polis Ibu Pejabat Kontingen Polis Seremban Negeri Sembilan & Anor. v Manoharan a/l Dorasamy [2004] 3 MLJ 565); 20 (15) Upon being satisfied of the genuineness and authenticity of the copy of the GM CIDT produced by PW3, the Land Office then registered the transfer of the land from the 3 rd plaintiff to the 1st defendant based on the particulars of the purchaser and the vendor in the MOT and the particulars of the persons, who 25 signed the MOT on behalf of the purchaser and the vendor of the land. Having done that, the Land Office cancelled and 150 destroyed the original copy of the GM CIDT produced by PW3, which was in the name of the 3rd plaintiff, without keeping any record of it in its Computerized Land Registration System (“CLRS”) as that was its SOP, and a new GM CIDT, which was issued in the name of the 1st defendant, was handed over to 5 PW3; (16) DW3 was emphatic that the copy of the GM CIDT produced by PW3 was a genuine title that had been issued by the Land Office. The 6th to the 9th defendants’ fifth witness (DW5) also said as much. DW5 added that if the title had not existed the 10 CLRS would have shown that the title was cancelled. DW5 also said that when he keyed in the data, it showed that the title existed; (17) DW1 and DW3 also gave evidence that they have no records of the particulars of the person to whom a certified true copy of the 15 CRDT was, allegedly, prepared and given on 06.10.2011. They also gave evidence that they do not know the identity of the officer, who had, allegedly, prepared and given a certified true copy of the CRDT to the unknown person on 06.10.2011, as his or her name was not entered into the CLRS. The failure to 20 maintain proper and accurate data either in the CLRS or in the manual records or files of the Land Office is by itself sufficient to amount to negligence and breach of statutory duty (see the decision of the Court of Appeal in Pendaftar dan Pemeriksa Kereta-Kereta Motor, Melaka & Ors. v KS South Motor Sdn. 25 Bhd. [2000] 2 MLJ 540; and the decision of the Federal Court 151 in Pengarah Jabatan Pengangkutan Negeri Selangor & Ors. v Sin Yoong Ming [2015] 1 MLJ 1); (18) DW1 and DW3 also admitted that they do not have a proper system in place to record the issuance of titles and to verify the identity of the persons who collect the computer printed issue 5 documents of title of lands from the office of the Registrar of Titles; (19) In fact, DW1 and the 6th, 8th and 9th defendants’ second witness (DW2) testified that except for whatever data that is stored in the CLRS, which can be accessed to verify the the particulars 10 of the title during the registration of the transfer, there is no requirement to check manually with the records to see if the title presented is genuine or not. But in re-examination, DW5 said that when he keyed in the data during the processing of the transfer documents, the CLRS showed that the title was in 15 existence and if it did not exist in the system, the CLRS would show that it had been cancelled; (20) Hence, the 1st defendant has proven that the 6th, 8th and/or 9th defendants were negligent in the issuance of the GM issue document of title of the land with the plan of the land on 20 06.10.2011 to an unknown person, as his or her particulars were not recorded in the CLRS, without informing the 1st and 2nd plaintiffs of the replacement of the EMR title of the land on 14.05.2002 with the GM title of the land, and without asking the 3rd plaintiff to surrender the EMR issue document of title for 25 cancellation and take delivery of the GM computer printed issue document of title; 152 (21) In doing and/or omitting and/or failing to do the abovementioned acts, the 1st defendant has proven that the 6th to the 9th defendants also breached its statutory duty to the 1st defendant as it also failed to perform their statutory duty under paragraph 8 (9) (c) and (d) of the Fourteenth Schedule, which is 5 mandatory in nature, to inform the 3rd plaintiff to surrender the EMR issue document of title for cancellation and take delivery of the GM computer printed issue document of title; (22) The 1st defendant has also proven that the 6th, 8th and/or 9th defendants had, verified the original copy of the CIDT, which 10 was produced by Mr. Pui together with the MOT for the transfer of the land, and had, thereafter, registered the transfer of the land from the 3rd plaintiff to the 1st defendant; (23) The 1st defendant has also proven that the 6th, 8th and/or the 9th defendants had then destroyed the original copy of the GM 15 CIDT, which was produced by Mr. Pui, and issued a new GM CIDT of the land with the name of the 1st defendant as the new registered proprietor of the land; (24) Therefore, the 1st defendant has proven that in doing the acts mentioned above and in omitting to inform the 3rd plaintiff to 20 collect the GM CIDT and to surrender the EMR issue document of title for cancellation, the 6th, 8th and/or 9th defendants were not only negligent at common law, they were also in breach of their statutory duty to the 1st defendant as provided in s. 297 to s. 302 of the NLC 1965 and paragraph 8 (9) (c) and (d) and 25 paragraph 14 of the Fourteenth Schedule to the NLC 1965 as the unknown person, who had collected the GM CIDT with the 153 plan of the land, had misused the GM CIDT of the land with the plan of the land to cause loss and damage to the 1st defendant, viz a sum of RM 2 million being the purchase price of the land, which was paid to the 3rd plaintiff, through the 3rd defendant; (25) The 6th, 8th and 9th defendants cannot rely on s. 22 of the NLC 5 1965 as a blanket immunity to absolve the Registrar of Titles and/or Land Administrator from any civil liability as they did not act in good faith or bona fide in the discharge of their duties to the 1st defendant. This is because they did not act, at all material times, with due care and honesty in the course of the 10 presentation and registration of the transfer of the land. In any event, if there is negligence or breach of statutory duty on the part of the 6th and 8th defendants, then the immunity does not arise (see Lee Siew Ken & Anor. v Pengarah Tanah dan Galian Negeri Selangor [2015] AMEJ 1502; Uptown 15 Properties Sdn. Bhd. v Pentadbir Tanah Wilayah Persekutuan & Ors. [2012] 8 MLJ 713; and CIMB Bank Berhad v Ambank (M) Berhad & Ors. [2015] 3 MLRH); (26) An adverse inference under s. 114 (g) ought to be drawn against the 6th and the 8th defendants from their failures to 20 attend Court to testify in their defence against the 1st defendant’s counterclaim, which come across as acts of defiance of the joinder Order made by the Court of Appeal on 26.02.2014 (see pgs. 10 to 12 of enclosure (147) (Part A) ; (27) The Federal Court in Pow Hing & Anor. v Registrar of T itles, 25 Malacca [1981] 1 MLJ 155 issued a warning to public officials on the wanton disregard or sloppy application of express 154 statutory provisions in the exercise of their functions under the NLC 1965 and it is regretted that the warning appeared to have not been heeded by the public officials in the instant case; (28) The issue whether the 1st defendant is a bona fide purchaser for value of the land is not relevant based on clause (2) of the 5 1st consent judgment, which binds the 6th to the 9th defendants, as they had signed it, albeit with the 3 (three) plaintiffs and not with the 1st defendant (see Tan Geok Lan (P) v La Kuan @ Lian Kuan [2004] 3 AMR 177); (29) Be that as it may, the 1st defendant has proven that the land 10 was purchased for sufficient consideration as its fourth witness (PW4) had given evidence that he prepared a valuation report 7 (seven) months after the transfer of the land from the 3rd plaintiff to the 1st defendant was registered on 01.02.2012, in which he stated that the market value of the land is RM 2.8 million and 15 that the forced sale value of the land is RM 2 million, which is the price that the 1st defendant paid for the purchase of the land; (30) Although the Stamp Duty Office of the Inland Revenue Board has adjudicated the stamp duty for the MOT for the transfer of 20 the land at RM 208,920.00, purportedly, based on the market value of the land being RM 7.164 million and the 1st defendant has paid the sum of RM 208,920.00 to the Stamp Duty Office, none of the 6th, 8th and 9th defendants’ four witnesses (DW1 and DW3 to DW5) knew the market value of the land to be RM 25 7.164 million or explained the basis of the calculation by the Stamp Duty Office of the stamp duty of RM 208,920.00; 155 (31) Furthermore, the 6th, 8th and 9th defendants did not call a witness from the Survey and Valuation Department to testify on the market value of the land or to produce a valuation report for the basis of the adjudication of the stamp duty on the MOT for the transfer of the land to support their contention that the price 5 of RM 2 million, which was paid by the 1st defendant for the purchase of the land was not a valuable consideration unlike the 1st defendant, who had called PW4, to give evidence and to tender a valuation report prepared by PW4 to support the 1st defendant’s counterclaim; 10 (32) The same applies to the evidence of the 1st defendant’s second witness (PW2), who is the 2nd plaintiff. Although, the 2nd plaintiff (PW2), who was called by the 1st defendant as its second witness, gave evidence that the land is estimated to be worth, approximately, RM 20 million, as mentioned in his police report 15 No: BT9 Cheras/002854/12 dated 02.03.2012, he did not produce any valuation report to support his evidence to that effect; (33) The 1st defendant has also proven that the purchase price of RM 2 million, which was agreed upon by the 2nd and 3rd 20 defendants, who were authorized to represent the 3 rd plaintiff based on the documents shown by them to the 1st defendant, was paid by the 1st defendant in 4 (four) cheques to the 3rd plaintiff, through the 3rd defendant; (34) Hence, as an alternative contention of the 1st defendant, the 1st 25 defendant submits that the Court ought to accept the evidence of PW1, PW3 and PW4, which was supported by PW4’s 156 valuation report dated 30.08.2012, and hold that the 1st defendant is a bona fide purchaser of the land for sufficient consideration; (35) The 1st defendant is also entitled to rely on the indoor management rule or the Rule in Royal British Bank v 5 Turquand (1856) 6 E&B 327 as far as the 3rd plaintiff’s internal documents are concerned as PW3 gave evidence that he had made payment of the purchase price for the land to the 3rd plaintiff, through the 3rd defendant, in accordance with the 3rd plaintiff’s directors’ and shareholders’ resolutions, based on the 10 certified true copies of the resolutions, which were given to him by the 3rd defendant; (36) The 1st defendant is also entitled to rely on the doctrine of constructive notice in regard to a company’s public documents. This is because the 1st defendant’s third witness (PW3), who is 15 the 1st defendant’s previous solicitor, gave evidence that he had relied on the truth of the contents of the certified true copies of the 3rd plaintiff’s public documents, viz the Memorandum of Association and Articles of Association and the Companies Act 1965 Form 24, Form 44 and Form 49, which were given to him 20 by the 3rd defendant and also the Companies Act 1965 Form 55 (including the audited accounts which were submitted together with Form 55) (see the decision of the Supreme Court in KL Engineering Sdn. Bhd. v Arab-Malaysian Finance Bhd. [1994] 2 MLJ 201); 25 (37) These public documents of the 3rd plaintiff come within another exception to the hearsay rule, which is contained in s. 74(b) of 157 the Evidence Act 1950, being public records kept in Malaysia of private documents; (38) Contrary to the contention of the 6 th to the 9th defendants, the 1st defendant has also proven that PW3 was not negligent in the transfer of the land from the 3rd plaintiff to the 1st defendant. 5 PW3 gave evidence that he had taken all the necessary and prudent measures to check and verify the information in the certified true copies of the documents provided to him by the 3rd defendant by conducting searches with the Land Office, the SSM, the Insolvency Department Malaysia and CTOS. Upon 10 conducting the check and verification, PW3 found that the information in the certified true copies of the documents provided to him by the 3rd defendant was true and accurate; (39) Since, the 1st defendant has established the negligence and breach of statutory duty on the part of the 6 th and 8th 15 defendants, the 1st defendant has established that the 7th and 9th defendants are, vicariously, liable to the 1st defendant for the tort of negligence of the 6th, 8th and/or 9th defendants and also the breach of statutory duty by the 6th, 8th and/or 9th defendants (see ss. 12, 13 (1) and 16 (2) of the NLC 1965); and 20 (40) Eventhough the 6th to the 9th defendants contend that the 1st defendant has not complied with ss. 5 and 6 of the Government Proceedings Act 1956 in that the wrong persons were named as the actual tortfeasors, the 1st defendant contends that it is sufficient for the 1st defendant to bring an action against the 25 State Director of Lands and Mines in order to establish liability on the State Authority (see s. 16 (1) and s. 5 of the NLC 1965). 158 120. Therefore, Mr. Gerard Lourdesamy, the learned counsel for the 1st defendant, prays that the Court holds the 6th and 7th defendants and/or the 8th and 9th defendants, jointly and severally, liable to pay to the 1st defendant damages in the sum of RM 2 million together with interest and costs. 5 6th to 9th defendants’ submissions 121. Encik Ismail bin Baharom, the learned counsel for the 6th to the 9th defendants, submitted that the 1st defendant has failed to prove its counterclaim against the 6th to the 9th defendants on a balance of 10 probability based on the following reasons as set out in the 6th to the 9th defendants’ written submissions and submissions-in-reply: (1) It is trite law that in order to succeed on a claim in negligence the 1st defendant must prove, firstly, that the 6th to the 9th defendants owed the 1st defendant a duty of care; secondly, 15 that this duty was breached by the 6th to the 9th defendants; thirdly, that the 1st defendant suffered harm as a result of the breach; and fourthly, that the damage is not too remote (see Arab-Malaysian Finance Bhd v Steven Phoan Cheng Loon & Ors [2003] 1 CLJ 585); 20 (2) The 6th to the 9th defendants’ first witness (DW1) gave evidence that the two documents presented by Mr. Pui (PW3) were found to be complete and fit for registration and, hence, there was no negligence in the registration of the transfer; (3) The 1st defendant’s alleged loss is caused or contributed to by 25 PW3’s negligence in not ensuring that the copy of the GM CIDT and the Form 14A, were genuine as the 1st defendant’s, 159 alleged, loss was caused by the fraudulent title and MOT, which could not be detected by DW1; (4) The officers at the Registration Unit of the 6th defendant do not have the expertise to detect the genuineness of documents presented for registration, in this case, the forged copy of the 5 GM CIDT and the fraudulent MOT in Form 14A, and, hence, they should not be held negligent if they are not able to detect the forgery and fraud in the two documents, which were presented for registration by PW3 on 01.02.2012 (see Selvaraju Velasamy & Anor v Abdullah Ali Kutty [2009] 2 10 CLJ 753); (5) The 6th to the 9th defendants were not negligent and were not in breach of their statutory duty to the 1st defendant as it did not prepare the GM CIDT, which was presented by PW3; (6) The copy of the GM CIDT, which was presented by PW3 was a 15 forged GM CIDT as it was not prepared by the Land Office; (7) The 1st defendant and PW3 were negligent in making payment of the purchase price, directly, to and in the name of the 3rd defendant instead of in the name of the 3rd plaintiff; (8) The 1st defendant was negligent when it paid for the Real 20 Property Gains Tax (“RPGT”) instead of insisting that the RPGT be paid by the 2nd and 3rd defendants as provided in the RPGT Act 1976; (9) The 1st defendant was aware that there was an abnomally big difference between the market value of the land as assessed by 25 the Stamp Duty Office of the Inland Revenue Board, viz RM 7.164 million, and the price of RM 2 million, which the 1st 160 defendant, allegedly, paid to the 3rd defendant for the purchase of the land; (10) PW3 was also negligent in acting for both the vendor and purchaser in the sale and purchase of the land; (11) PW3 was also negligent in not meeting up, personally, with Law 5 Ah Kuan to confirm his identity as the 3rd plaintiff’s Company Secretary; (12) PW3 was also negligent in not verifying with the National Registration Department, the particulars of the 2nd and 3rd plaintiffs in the photostat copies of their NRICs, which were 10 used by the 2nd and 3rd defendants; (13) In view of the above, the 1st defendant cannot be said to be a bona fide purchaser for value of the land (see Au Meng Nam & Anor v Ung Yak Chew & Ors [2007] 4 CLJ 526); (14) DW2 gave evidence that the 2nd to the 4th defendants are the 15 suspects in the cheating case, which was reported to the police vide Bt 9 Cheras Rpt 002854/12; that the 3 (three) suspects were arrested and remanded for 7 days; and that they were released because the police investigations were not completed. He also gave evidence that the police investigations are now 20 complete but the Investigation Paper has not been referred to the Deputy Public Prosecutor’s office for directions as to the prosecution of the 2nd to the 4th defendants; (15) DW2 also said that there is no evidence that the 6th to the 9th defendants are involved in the fraud and forgery perpetrated by 25 the 2nd to the 4th defendants on the 3 (three) plaintiffs in regard to the transfer of the land; 161 (16) The 6th to the 9th defendants are protected by the immunity under s. 22 of the NLC 1965 as they carried out their duties in good faith; (17) Since the 1st defendant did not plead elements of mala fide on the part of the 6th to the 9th defendants, the immunity accorded 5 to the 6th to the 9th defendants under s. 22 of the NLC 1965 must prevail (see Generation Products Sdn Bhd v Majlis Perbandaran Klang [2008] 5 CLJ 417 and JW Properties Sdn Bhd v. Perbadanan Kemajuan Pertanian Selangor & Anor [2016] 1 CLJ 13); 10 (18) The 6th to the 9th defendants were merely performing an administrative duty in the registration of the transfer and, hence, there was no statutory duty owed to the 1st defendant (see Leelawathy Ratnam & Ors v. Pengarah Hartanah Dan Galian Negeri Selangor & Anor [2010] 1 LNS 1185; X 15 (Minors) v Bedfordshire County Council [1955] 3 ALL ER 353; and David Chellah v Monorail Malaysia Technology Sdn Bhd & Ors [2009] 3 CLJ 771); and (19) There is no evidence to show that the Land Office had prepared the GM CIDT which was, allegedly, handed over to the 3rd 20 defendant, who in turn, allegedly, handed it over to PW3, who, in turn, allegedly, presented it to the Land Office on 01.02.2012 together with the MOT in Form 14A for the registration of the transfer of the land from the 3rd plaintiff to the 1st defendant. 25 162 122. Hence, Encik Ismail bin Baharom, the learned counsel for the 6th to the 9th defendants, prays that the Court dismisses the 1st defendant’s counterclaim with costs. Decision of Court on 1st defendant’s counterclaim 5 123. On 07.02.2017, after having considered the submissions of and the authorities cited by Mr. Gerard Lourdesamy, the learned counsel for the 1st defendant, and Encik Ismail bin Baharom, the learned counsel for the 6th to the 9th defendants, I was satisfied that the 1st defendant has failed to prove its counterclaim against the 6th to the 9th 10 defendants, on the balance of probabilities. 124. I, accordingly, ordered the 1st defendant’s counterclaim dismissed with costs. 125. I then invited suggestions from Encik Ismail bin Baharom and Mr. Gerard Lourdesamy on the amount of costs to be awarded against 15 the 1st defendant. 126. Encik Ismail bin Baharom left the amount of costs to be paid by the 1st defendant to the discretion of the Court. 127. Mr. Gerard Lourdesamy, the learned counsel for the 1st defendant proposed a sum of RM 10,000.00 as costs based on the following 4 20 (four) reasons: (1) The 1st defendant said fraud was committed; (2) The 1st defendant said it has paid and lost a sum of RM 2 million; (3) But the police say they are unable to locate Lim Yoke Sim (F), 25 the 3rd defendant, to whom the 1st defendant paid the sum of RM 2 million, although the Court has decided otherwise; and 163 (4) The 1st defendant has also transfered the land back to the 3rd plaintiff, viz the original registered proprietor. 128. I then ordered the 1st defendant to pay a sum of RM 10,000.00 as costs to the 6th to the 9th defendants. 5 129. I further ordered the SAR to issue the allocatur certificate pursuant to O. 59, r. 7(4) of the Rules of Court 2012 (“RC 2012”). 130. I finally ordered that the allocatur fee must be paid before the fair copy of the Order made that day could be extracted. 131. Being dissatisfied with the dismissal of its counterclaim with costs of 10 RM 10,000.00, the 1st defendant filed a notice of appeal on 06.03.2017 to the Court of Appeal against my decision dated 07.02.2017. Reasons for decision of Court dated 07.02.2017 15 132. Below are the reasons for my decision dated 07.02.2017. 133. There are two main issues for the determination of the Court in the counterclaim. The 1st main issue is whether the 6th, 8th and/or 9th defendants are liable to the 1st defendant for negligence and/or breach of statutory duty. The 2nd main issue is, if the Court finds them 20 liable, whether the 7th defendant ought to be held, vicariously, liable to the plaintiff in the counterclaim for the negligence and/or breach of statutory duty of the 6th, 8th and/or 9th defendants. 134. At the outset, I noted that the 2nd, 3rd and 4th defendants, who were sued by the 1st, 2nd and 3rd plaintiffs, for their alleged fraudulent roles 25 in the sale and transfer of the land by the 3rd plaintiff to the 1st defendant are not parties in the counterclaim. This is because the 1st 164 defendant did not file a counterclaim against them even though it has alleged in its defence and counterclaim that it was the 2nd and 3rd defendants, who had shown to the 1st defendant the original copy of the Title Deed of the land; and who had represented the 3rd plaintiff in the sale of the land by the 3rd plaintiff to the 1st defendant; and who 5 had, in their capacities as the new Directors of Goodland, executed the MOT for the transfer of the land by the 3rd plaintiff to the 1st defendant. 135. I noted that the 1st defendant also did not commence third party proceedings against the 2nd to the 4th defendants in relation to the 10 sale and transfer of the land by the 3rd plaintiff to the 1st defendant for a sum of RM 2 million, which the 1st defendant alleged was the price, which it had paid to the 3rd plaintiff for the purchase of the land. 136. I further noted that the basis of the 1st defendant’s defence to the claim of the 3 (three) plaintiffs, is that its title as the new registered 15 proprietor of the land is indefeasible by virtue of s. 340 of the NLC 1965. 137. I further noted that the basis of the 1st defendant’s counterclaim against the 3 (three) plaintiffs and the 5th to the 9th defendants, is also that its title as the new registered proprietor of the land is indefeasible 20 by virtue of s. 340 of the NLC 1965. 138. I further noted that the 1st defendant relies on the following reasons for the basis of its defence to the claim of the 3 (three) plaintiffs and the basis of its counterclaim against the 3 (three) plaintiffs and the 5th to the 9th defendants: 25 (1) It is a bona fide purchaser for value of the land; 165 (2) It has no knowledge and was not a party to the fraud allegedly perpetrated by the 2nd and 3rd defendants and/or the 4th defendant on the 3 (three) plaintiffs and the 6th to the 9th defendants; (3) In the purchase of the land from the 3rd plaintiff, it had relied on 5 the genuineness of all the documents shown to it by the 2nd and 3rd defendants, including the original Title Deed of the land; (4) The documents state that the 2nd and 3rd defendants are the new Directors of the 3rd plaintiff; that they were authorized by the resolutions passed by the 3rd plaintiff’s board of directors 10 and shareholders to look for a purchaser for the land and to sell the land to the 1st defendant; and that the 2nd defendant was authorized vide a resolution of the 3rd plaintiff to receive payment of the 10% of the purchase price of the land from the 1st defendant; 15 (5) It had also conducted searches at the 5th defendant, the Hulu Langat Land Office and CTOS Sdn. Bhd., respectively, to verify the genuineness of the documents shown to it by the 2nd and 3rd defendants; (6) The results of its searches confirm the genuineness of the 20 documents shown to it by the 2nd and 3rd defendants; (7) Hence, it had no reason to doubt the genuineness of the documents shown to it by the 2nd and 3rd defendants; (8) In reliance on the documents shown to it by the 2nd and 3rd defendants and the results of its searches at the 5th defendant, 25 the Hulu Langat Land Office and CTOS Sdn. Bhd., respectively, it had paid a sum of RM 2 million to the 3rd plaintiff, represented 166 by the 2nd and 3rd defendants, for the purchase of the land, which is a fair market value of the land at the material time; (9) The 3 (three) plaintiffs were negligent, in, inter alia, not carrying out their internal management of the 3rd plaintiff with proper care and in accordance with the procedures as laid down in the 5 Companies Act 1965; (10) The 5th defendant, was negligent in discharging its duty and responsibility towards the 1st defendant by allowing or causing the fabricated documents of the 3rd plaintiff to be filed with the 5th defendant, which were then misused by third parties; 10 (11) The 6th, 8th and 9th defendants, were negligent in discharging their duty and responsibility towards the 1st defendant by allowing or causing the fabricated documents of the 3rd plaintiff to be misused by third parties in the transfer of the land from the 3rd plaintiff to the 1st defendant, and the 6th defendant and/or 15 the 9th defendant were negligent in the issuance of the original Title Deed of the land, which was then misused by third parties, when there was no application by the 3rd plaintiff for a new Title Deed of the land as the original copy of the EMR handwritten issue document of title of the land was still in the 3rd plaintiff’s 20 possession; (12) In converting the EMR title to the GM title without first informing the 3rd plaintiff in issuing the GM computer printed issue document of title of the land on 06.10.2011 to to an unknown third party and in registering the MOT for the transfer of the 25 land to the 1st defendant, the 6th, 8th and 9th defendants had also breached their statutory duty to the 1st defendant; and 167 (13) The 7th defendant is, vicariously, liable to the 1st defendant for the negligence and/or breach of statutory duty of the 6th, 8th and 9th defendants. 139. I further noted that the 1st defendant had filed a Revised List of 5 Witnesses with the following 5 (five) named witnesses for the full trial of the main action and the counterclaim: (1) Mr. Chuah Boon Kooi, NRIC No. 740131-10-5069, a director of Supreme Tribute, who resides at No. 6, Jalan Bunut 8, Taman Sri Bunut, 42700 Banting, Selangor; 10 (2) Mr. Pui Yin Chong, an advocate and solicitor from Messrs. Peter Pui & Partners, Advocates & Solicitors, No. 2A-2, Jalan Puteri 2/5, Bandar Puteri, 47100 Puchong, Selangor; (3) Sr. Hj. Ishak bin Ismail, a registered valuer and quantity surveyor of IM Global Property Consultants Sdn. Bhd., No. 47-15 2, Tingkat 2, Wisma IMG, Jalan 3/76D, Desa Pandan, 55100 Kuala Lumpur; (4) Mr. Chong Wing Fat (to be subpoenaed), NRIC No. 600404-06- 5177, a director of Goodland Realty, who resides at No. 36, Jalan Telawi 6, Bangsar, 55100 Kuala Lumpur; and 20 (5) Lim Yoke Sim (F) (to be subpoenaed), NRIC No. 640313-10- 5766, a director of Goodland Realty, and who resides at No. 2, Jalan 9/5, 46000 Petaling Jaya, Selangor; 140. At the conclusion of the full trial for the counterclaim, I found that the 25 proven and/or admitted salient facts are as follows: 168 (1) The original registered proprietor of the land is the 3rd plaintiff. I t was and still is in possession of the EMR handwritten issue document of title of the land; (2) Subsequently, the 6th defendant, converted the handwritten EMR register document of title to a computer printed Geran 5 Mukim register document of title in 2002; (3) However, the 6th defendant did not inform or notify the 3rd plaintiff about the conversion, which was done in 2002, of the EMR title of the land to the GM title; (4) Between the months of January and March 2012, Mr. Chua 10 Boon Kooi and Mr. Tee Choon Siong, the 1st defendant’s directors, purportedly, purchased the land from the 3 rd plaintiff, through the 2nd and 3rd defendants, who, purportedly, represented to the 1st defendant’s 2 (two) directors that they had replaced the 2nd and 3rd plaintiffs as the new Directors of 15 the 3rd plaintiff, and that they were authorized by resolutions, purportedly, passed by the 3rd plaintiff’s board of directors and shareholders to sell the land to the 1st defendant for a sum of RM 2 million and that the 3rd defendant was, similarly and purportedly, authorized to accept payment of the 10% of the 20 purchase price of the land from the 1st defendant and also the 90% balance purchase price of the land; (5) The 2nd and 3rd defendants, purportedly, showed to the 1st defendant the original GM CIDT of the land and they gave to the 1st defendant certified true copies of the 2nd to the 4th 25 defendants’ NRICs; 169 (6) The 1st defendant did not obtain a valuation report for the land to find out the market value of the land before it agreed to purchase the land for a sum of RM 2 million; (7) Mr. Pui, the 1st defendant’s solicitor, was, purportedly, given certified true copies of the 3rd plaintiff’s Memorandum of 5 Association, Articles of Association, board of directors’ and shareholders’ resolutions and Companies Act 1965 Form 24, Form 44 and Form 49 by the 3rd defendant but he did not meet up with Law Ah Kuan, the 3rd plaintiff’s Company Secretary, to verify the contents of the certified true copies of the documents; 10 (8) Instead, he conducted a search at the Land Office and he was able to verify that the land was registered in the name of the 3 rd plaintiff and he also conducted searches at the 5 th defendant, viz the SSM, and also CTOS and he was able to verify from the records of the 5th defendant that the contents of the certified 15 true copies of the 3rd plaintiff’s public documents were true and accurate; (9) Mr. Pui, purportedly, made payment of the purchase price of RM 2 million to the 3rd defendant in cash by way of 4 (four) cheques from the bank accounts of Messrs. Peter Pui and 20 Partners. The four cheques were produced and identified by DW2, the I.O., but upon the objection of the 6 th to the 9th defendants, they were marked as ID-3, ID-4, ID-5 and ID-6, respectively, by the Court, as they were only photostat copies of the cheques and there was no satisfactory reason given for 25 the non-production of the original cheques; 170 (10) DW2 explained to the Court that he had asked the bank to provide him with the information as to when and how the cheques were cleared and into whose account the monies were paid but he had yet to receive any reply from the bank; (11) After Mr. Pui had, purportedly, made payment of the RM 2 5 million to the 3rd defendant, he was, purportedly, given the original copy of the GM CIDT by the 3rd defendant; (12) The amounts as stated in the 4 (four) cheques were, purportedly, debited from the bank accounts of Messrs. Peter Pui and Partners but there was no evidence to show into whose 10 bank account or accounts, the amounts as stated therein had been, purportedly, credited; (13) Subsequently, a, purported, original copy of the GM CIDT, allegedly, prepared on 06.10.2011 by the Land Office, was presented by Mr. Pui together with a fraudulent MOT in Form 15 14A, which was executed by the 2nd and 3rd defendants, purportedly, as the new Directors of the 3rd plaintiff, on behalf of the 3rd plaintiff, and by Chua Boon Kooi and Tee Choon Siong, the 1st defendant’s directors, for the 1st defendant, for the transfer of the land from the 3rd plaintiff to the 1st defendant; 20 (14) The clerk at the Land Office checked the 2 (two) documents presented and passed them to the officer-in-charge for his verification; (15) The officer-in-charge verified the copy of the GM CIDT presented by Mr. Pui. He was satisfied that the copy of the GM 25 CIDT, which was produced by Mr. Pui, was genuine and authentic. He was unaware that the MOT was fraudulent as the 171 2nd and 3rd defendants had earlier made use of forged copies of the 2nd and 3rd plaintiffs’ NRICs to replace them as the new Directors of the 3rd plaintiff when the 2nd and 3rd defendants filed the 2 (two) forged Companies Act 1965 Form 49; and (16) On 01.02.2012, the transfer of the land, from the 3rd plaintiff to 5 the 1st defendant as per the fraudulent M.O.T. and the GM CIDT, was registered and the GM CIDT in the name of the 3rd plaintiff, was cancelled and destroyed by the Land Office and a new GM CIDT was issued in the name of the 1st defendant. 10 141. I was of the respectful view that the above proven and/or admitted salient facts are insufficient for the Court to hold the 6th to the 9th defendants liable, jointly and severally, to the 1st defendant, in negligence and/or for breach of statutory duty and to order them to pay to the 1st defendant general damages of a sum of RM 2 million 15 together with interest at 4% per annum from the date of the filing of the 1st defendant’s counterclaim and costs on a full indemnity basis. Fourteenth Schedule of NLC 1965 142. A new Part One (A) captioned “Computerized Land Registration 20 System” and a new schedule viz, the Fourteenth Schedule were inserted into the NLC 1965 immediately after s. 5 vide the National Land Code (Amendment) Act 1992 (Act A832), to provide for a Computerized Land Registration System (CLRS), which is a new system of land registration involving the computerization of the 25 existing land registration system. The new s. 5A in Part One (A) states as follows: 172 “5A Coming into force of the Computerized Land Registration System in any land Registry (1) The Minister may, with the approval of the National Land Council, by notification in the Gazette of the Federation, appoint a date for the coming into force of the Computerized Land 5 Registration System in any land Registry. (2) For the purposes of subsection (1), the term "land Registry" means— (a) in the case of land held or to be held under Registry title, or under the form of qualified title corresponding to 10 Registry title, the office of the Registrar of Titles; (b) in the case of land held or to be held under Land Office title, or under the form of qualified title corresponding to Land Office title, the office of the Land Administrator. (3) Upon the coming into force of the Computerized Land 15 Registration System in any land Registry— (a) the provisions of the Fourteenth Schedule shall apply; and (b) the provisions of this Act insofar as they relate to the forms of documents of title, the procedure for the 20 preparation and registration of any document of title, any dealing in land and any entry or endorsement of any note, memorial or memorandum or any correction or cancellation thereof on any document of title shall be read with the modifications, amendments, additions, 25 deletions, substitutions or adaptations as provided in the Fourteenth Schedule. (4) Except as provided in paragraph (b) of subsection (3), all other provisions of this Act shall remain in force and continue to apply to 30 every document of title, instrument or other document prepared under the Computerized Land Registration System.” 173 143. The CLRS came into force vide the National Land Code (Amendment Of The Fourteenth Schedule) Order 1995 [P.U.(A) 92/1995], which was made by the Minister with the approval of the National Land Council pursuant to s. 5A(1) of the NLC 1965. 144. The Fourteenth Schedule to the NLC 1965 (“the Fourteenth 5 Schedule”) sets out the detailed provisions for the Computerized Land Registration System or Sistem Pendaftaran Tanah Berkomputer (“SPTB”) in Malay. 145. The term “Computerized Land Registration System” is defined in paragraph 1 (Interpretation) of the Fourteenth Schedule as follows: 10 “Computerized Land Registration System means the procedures for the registration of titles, the documents required to be prepared thereby and any entry in any document of title through the use of a computer. The system includes both manual and computerized procedures;” 15 146. Paragraph 2 of the Fourteenth Schedule provides for the mode of making an entry on a document of title under the CLRS. Paragraph 8 of the Fourteenth Schedule provides for the conversion of an exising document of title to a computer printed document of title. Paragraph 20 14 of the Fourteenth Schedule provides for the verification document to be verified after the Registrar has determined that an instrument is fit for registration in accordance with the provisions of Chapter 3 of Part Eighteen. These 3 paragraphs of the Fourteenth Schedule state as follows: 25 “FOURTEENTH SCHEDULE (Section 5A) COMPUTERIZED LAND REGISTRATION SYSTEM 2. Mode of making an entry on a document of title under the Computerized Land Registration System 174 For the purposes of this Act, whenever an entry is required to be made on the computer printed document of title by the Registrar under this Act, it shall be taken as a requirement that— (a) the Registrar makes the entry by use of a computer; and (b) the Registrar prepares a new computer document of title and 5 cancel and destroy the previous version of the computer printed document of title. … 8. Conversion to computer register document of title (1) Upon the coming into force of the Computerized Land 10 Registration System in a land Registry, the Registrar shall convert the existing register documents of title to the computer printed register documents of title and shall sign and seal the same. (2) An existing register document of title shall continue to be in 15 force and valid for all purposes of this Act until a computer printed register document of title is prepared and signed and sealed by the Registrar. (3) After the conversion of an existing register document of title, the existing issue document of title in respect thereof 20 shall continue to be in force and valid for all purposes of this Act until the relevant computer printed issue document of title is prepared and issued to the proprietor. (4) Any registered proprietor whose land comes within the jurisdiction of a land Registry in which the Computerized 25 Land Registration System is implemented may at any time apply for conversion of an existing issue document of title to a computer printed issue document of title by lodging the existing issue document of title at the said land Registry. 30 175 (5) The Registrar may on his own accord convert any existing issue document of title without there being an application made under subparagraph (4). (6) In respect of an existing document of title prepared under the National Land Code, the computer printed document of title 5 shall be prepared as in Form 5BK, 5CK, 5DK, 5EK, 11AK or 11BK, as the case may be, with the plan of the land [in] Form B1 or B2, as the case may be. (7) In respect of an existing document of title prepared under the previous land law, the computer printed document of title shall 10 bear the like title with the plan of the land [in] Form B1 or B2, as the case may be. (8) The title to be issued under subparagraph (7) shall be deemed to be a title in continuation. (9) Upon the conversion of an existing document of title to a 15 computer printed document of title under the preceding subparagraphs, the Registrar shall— (a) make two copies of the plan from the existing register document of title, where in the case of final title, from the copy as approved by the Director of Survey and Mapping 20 under paragraph 396(1)(e), in Form B1 or B2, as the case may be, and shall be duly authenticated under his hand and seal; (b) endorse across the face of the existing register document of title to the effect that the title in question 25 has been converted to the computer printed register document of title; and on the making of such endorsement the existing register document of title shall be deemed to have been cancelled; (c) call upon the proprietor to take delivery of the computer 30 printed issue document of title and the plan of the land; provided that where the conversion is effected by the 176 Registrar on his own accord under subparagraph (5), he shall not be obliged to deliver to the proprietor the computer printed issue document of title unless the existing issue document of title is produced to him; and 5 (d) cancel and destroy the existing document of title when submitted to him. … 14. Verification document to be verified (1) After the Registrar has determined that an instrument is fit 10 for registration in accordance with the provisions of Chapter 3 of Part Eighteen or that any other matter shall be entered into the document of title, he shall verify the contents of the verification document and if he finds the verification document to be in order, he shall authenticate the document under his 15 hand and seal. (2) After the Registrar has registered any instrument of dealing or entered any other matter into a computer printed document of title, he shall cause the verification document to be filed.” (Emphasis added). 20 147. Based on the interpretation of the various words and phrases in paragraph 1 in the Fourteenth Schedule, which is the interpretation paragraph for the Fourteenth Schedule, an “exising document of title” is “a register document of title registered before the commencement 25 of the Computerized Land Registration System and includes an issue document of title in respect thereof, if any”; a “computer printed document of title” is “a document of title prepared by use of a computer”; and “matter” is “any instrument presented for registration 177 or any order, notification, application or other document presented for entry into the register”. 148. There are 2 (two) types of computer printed documents of title. As defined in paragraph 1 in the Fourteenth Schedule, one is a “computer printed register document of title”, which is a register 5 document of title prepared by use of a computer”. The other is a “computer printed issue document of title”, which is an issue document of title prepared by use of a computer”. 149. S. 297 of the NLC 1965 provides that it shall be the duty of the Registrar to determine in accordance with the provisions of Chapter 3 10 the fitness for registration of every instrument entered in the Presentation Book and if the instrument is fit for registration, and accompanied by the documents required by s. 294, to register it in the manner provided in Chapter 4. If the instrument is not fit, or is not accompanied by the necessary documents, to proceed in accordance 15 with the provisions of s. 298 or s. 299, as appropriate. The section states as follows: “297 Registrar to determine fitness for registration, and register if fit and accompanied by necessary documents Except in the case of any such instrument which is subsequently 20 withdrawn under section 296, it shall be the duty of the Registrar to determine in accordance with the provisions of Chapter 3 the fitness for registration of every instrument entered in the Presentation Book, and— (a) subject to Part Nineteen, if the instrument is fit for registration, 25 and accompanied by the documents required by section 294, to register it in the manner provided in Chapter 4; 178 (b) if the instrument is not fit, or is not accompanied by the necessary documents, to proceed in accordance with the provisions of section 298 or 299, as appropriate.” 150. S. 298 of the NLC 1965 provides that where any instrument is not fit 5 for registration, the Registrar shall reject it forthwith unless the unfitness consists solely of some formal defect or clerical error. The section states as follows: “298 Rejected or suspension for unfitness, or absence of certain documents 10 (1) Where any instrument is not fit for registration, the registrar shall reject it forthwith unless the unfitness consists solely of some formal defect or clerical error. (2) Where any instrument— (a) is unfit for registration solely by reason of a formal defect 15 or clerical error; or (b) being a lease, sub-lease or charge, is not accompanied by a duplicate thereof as required by paragraph (b) of subsection (1) of section 294; or (c) being an instrument to which paragraph (a) or (b) of 20 subsection (3) of that section applies, is not accompanied by the document or documents required by that paragraph, the Registrar shall suspend the registration thereof for such period, not exceeding fourteen days, as he may consider necessary for 25 enabling the defect or error to be rectified or, as the case may be, the document or documents in question to be produced, and, at the expiry of that period, shall register or reject the instrument as appropriate. (3) On suspending the registration of any instrument pursuant to 30 subsection (2), the Registrar shall give notice thereof to the person 179 or body by whom the instrument was presented, specifying therein the period of the suspension and the reasons therefor. (4) On rejecting any instrument pursuant to subsection (1) or (2), the Registrar shall mark it with the word "Rejected", return it to the person or body by whom it was presented together with a note of 5 the reasons therefor, and cause a note of the rejection to be made in the Presentation Book.” 151. S. 300 of the NLC 1965 provides for instruments to be dealt with in order of presentation. The section states as follows: 10 “300 Instruments to be dealt with in order of presentation (1) The Registrar shall not register, reject or suspend any instrument until— (a) every instrument presented prior thereto, and affecting the same land or interest, has been either registered, 15 rejected or withdrawn; and (b) he has given effect to, or rejected, any prior application under Chapter 7 for the endorsement on the same register document of title of any tenancy exempt from registration. 20 (2) Where, by virtue of subsection (2) of section 292, two or more instruments affecting the same land or interest are to be taken as having been presented at the same moment of time, they shall be treated for the purposes of this section as having been presented in 25 such order as the Registrar may determine, being the order which, in his opinion, will best give effect to the intention of the parties.” 152. S. 301 of the NLC 1965 provides that an instrument is fit for registration if certain conditions as set out therein are satisfied. The 30 section states as follows: “301 When an instrument is fit for registration 180 An instrument shall be fit for registration under this Part if, but only if, the following conditions are satisfied— (a) that it is one of the classes of instrument set out in subsection (1) of section 292 as authorised to be so registered; (b) that it complies with— 5 (i) the provisions of Part Thirteen as to the form, content, execution and attestation of instruments of dealing generally, and the persons and bodies capable of taking thereunder; and (ii) the provisions of Parts Fourteen to Seventeen with 10 respect to instruments of the particular class in question; (c) that the dealing which it effects is not contrary to any prohibition or limitation imposed by this Act or any other written law for the time being in force, or to any restriction in 15 interest to which the land in question is for the time being subject; (d) that it does not declare or, except as permitted by section 344, disclose the existence of any trust; and (e) that it is duly stamped in accordance with the provisions of 20 The Stamp Ordinance 1949: Provided that where a certificate of sale has been given to a purchaser in respect of any charged land or lease under subsection (3) of section 259 or subsection (4) of section 265, any requirement 25 to obtain the consent of the State Authority relating to the restriction in interest to such land or lease in question shall not be applicable.” 153. S. 302 of the NLC 1965 confers discretion on the Registrar to make enquiries and require the production of evidence, oral or 30 documentary, as he may consider necessary or desirable for the 181 purpose of determining the fitness of any instrument for registration by the Registrar. The section states as follows: “302 Enquiries, etc by Registrar (1) Subject to subsection (2), the Registrar may make such enquiries, and require the production of such evidence, oral or 5 documentary, as he may consider necessary or desirable for the purpose of determining the fitness of any instrument for registration under this Part. (2) The powers conferred by this section shall be exercisable subject to the limitations imposed by section 303 and, in the case of 10 any instrument executed under a power of attorney, paragraph (b) of section 311.” 154. S. 340 of the NLC 1965 provides, inter alia, for registration of any title to confer indefeasibility of title, except in certain circumstances. 15 These circumstances are set out in sub-section (2)(a) to (c). The section states as follows: “340 Registration to confer indefeasible title or interest, except in certain circumstances (1) The title or interest of any person or body for the time 20 being registered as proprietor of any land, or in whose name any lease, charge or easement is for the time being registered, shall, subject to the following provisions of this section, be indefeasible. (2) The title or interest of any such person or body shall not 25 be indefeasible— (a) in any case of fraud or misrepresentation to which the person or body, or any agent of the person or body, was a party or privy; or (b) where registration was obtained by forgery, or by 30 means of an insufficient or void instrument; or 182 (c) where the title or interest was unlawfully acquired by the person or body in the purported exercise of any power or authority conferred by any written law. (3) Where the title or interest of any person or body is 5 defeasible by reason of any of the circumstances specified in subsection (2) — (a) it shall be liable to be set aside in the hands of any person or body to whom it may subsequently be transferred; and 10 (b) any interest subsequently granted there out shall be liable to be set aside in the hands of any person or body in whom it is for the time being vested: Provided that nothing in this subsection shall affect any title or 15 interest acquired by any purchaser in good faith and for valuable consideration, or by any person or body claiming through or under such a purchaser. (4) Nothing in this section shall prejudice or prevent- 20 (a) the exercise in respect of any land or interest of any power of forfeiture or sale conferred by this Act or any other written law for the time being in force, or any power of avoidance conferred by any such law; or (b) the determination of any title or interest by operation of 25 law.” (Emphasis added). Whether the two consent judgments have rendered irrelevant the issue whether the 1st defendant is a bona fide purchaser for value of 30 the land in the 1st defendant’s counterclaim? 183 155. I disagreed with the 1st defendant’s contention that the issue whether the 1st defendant is a bona fide purchaser for value of the land is irrelevant to the determination by the Court of the liability of the 6th to the 9th defendants for loss and damage, allegedly, suffered by the 1s t defendant as set out in its counterclaim, due to the 2 (two) consent 5 judgments, in particular, the 2nd consent judgment, which was entered into between the 3 (three) plaintiffs and the 6 th to the 9th defendants. 156. Below are my reasons. Cause of action based on negligence 10 157. It is trite law that in a cause of action based on negligence, the plaintiff must prove on the balance of probabilities the following 4 (four) ingredients of the tort of negligence against the defendant: (1) That the defendant owes a duty of care to the plaintiff; (2) That the defendant has breached his duty of care to the 15 plaintiff; (3) That the plaintiff has suffered loss or damage as a result of the defendant’s breach of his duty of care to the plaintiff; and (4) The loss or damage suffered by the plaintiff is not too remote. 20 158. It is also trite law that in order to establish that the defendant owes a duty of care to the plaintiff, the plaintiff must establish that it is reasonably forseeable that the defendant’s failure to take care may injure the plaintiff and that the plaintiff is a “neighbour” of the defendant, viz that the plaintiff was “closely and directly” affected by 25 the defendant’s conduct. Hence, in order to succeed, the plaintiff must establish that there is a degree of “proximity” between the 184 plaintiff and the defendant, not in the sense of physical proximity, but in the sense of “close and direct relations”. Lord Atkin’s general test of foreseeability plus “proximity” gave the courts a basis on which the existence of a duty of care could be decided in all cases. This principle is known as Lord Atkin’s “neighbour principle”. 5 159. In their book entitled “Tort”, Sweet & Maxwell’s Textbook Series, Paula Giliker and Silas Beckwith, the learned authors, wrote as follows on Lord Atkin’s “neighbour principle”: “2-008 In 1932, the House of Lords decided the famous case of Donoghue v Stevenson. The facts of the case have 10 become legendary, although it shoud be noted that, because the case was decided by the House of Lords on a point of law and was then settled before going to trial, these facts were never actually proved. … 15 At first sight, it seemed that the decision in Donoghue v Stevenson had simply added yet another category to the separate instances of negligence recognized by the law. What has become significant about the case, however, is Lord Atkin’s analysis of the law and his 20 subsequent formulation of a general principle for determining the existence of a duty of care. This is what Lord Atkin said: “… in English law there must be, and is, some general conception of relations giving rise to a duty 25 of care, of which the particular cases found in the books are but instances. The liability for negligence … is no doubt based upon a general public sentiment of moral wrongdoing for which the offender must pay. But acts or omissions which any 30 moral code would censure cannot in a practical world be treated so as to give a right to every person injured by them to demand relief. In this way rules of 185 law arise which limit the range of complainants and the extent of their remedy. The rule that you are to love your neighbour becomes in law, you must not injure your neighbour; and the lawyer's question, Who is my neighbour? receives a restricted reply. 5 You must take reasonable care to avoid acts or omissions which you can reasonably foresee would be likely to injure your neighbour. Who, then, in law is my neighbour? The answer seems to be – persons who are so closely and directly affected by 10 my act that I ought reasonably to have them in contemplation as being so affected when I am directing my mind to the acts or omissions which are called in question.” 15 Lord Atkin’s general principle contained two elements. First, there was the element of “reasonable foreseeability”. Thus, a duty of care would be owed where the defendant ought reasonably to foresee that this failure to take care may cause injury to 20 another. (This, of course, is the same as what Brett M.R. had said in Heaven v Pender.) The second element was the test of “neighbourhood” – a duty of care would be owed only where the claimant was “closely and directly” affected by the defendant’s 25 conduct. Brett, M.R.’s simple test of foreseeability of harm, therefore, became qualified by the additional need to show, as Lord Atkin put it, a degree of “proximity” between the claimant and the defendant, not in the sense of physical proximity, but in the 30 sense of “close and direct relations”. Lord Atkin’s general test of foreseeability plus “proximity”, then, gave the courts a basis on which the existence of a duty of care could be decided in all cases. It allowed them to view negligence as a tort in 35 186 its own right, capable of being developed to meet any new factual situation which arose. It is important, however, not to overestimate the significance of Lord Atkin’s general principle. It has already been noted that, in modern times, it is recognized 5 that this principle alone fails to provide a workable solution to the problem of imposing a duty of care. The principle suffers from a number of fundamental flaws. First, although Lord Atkin speaks of “acts or omissions”, we shall see that the law treats liability for acts very 10 differently from liability for omissions. Secondly, as the law has developed, it has become clear that, besides identifying the defendant’s “neighbour”, it is also necessary to identify the type of loss which the “neighbour” is likely to suffer (or, in other words, the type 15 of interest which the claimant is seeking to use the law to protect) before any decision can be made about whether to impose o duty of care. Lord Atkin’s words, spoken in the context of personal injury caused by a defective product, gave little indication of the degree of “proximity” 20 which would be required in other factual situations. We shall see that, especially where other types of harm are in issue, the courts, for policy reasons, have had to say that a far greater degree of “proximity” is required in some situations than in others. In Donoghue v 25 Stevenson, Lord Atkin observed: There will no doubt arise cases where it will be difficult to determine whether the contemplated relationship is so close that the duty arises. 30 Such prescience, it will be seen, was all too accurate. The second step: applying the general principle 187 2-009 Without Lord Atkin’s “neighbour principle”, the decision in Donoghue v Stevenson would simply have been another isolated example of negligence liability.” What is the 1st defendant’s proven case? 5 160. As stated earlier, the 1st defendant called 4 (four) witnesses (PW1, PW2, PW3 and PW4) to prove its counterclaim against the 6 th to the 9th defendants. 161. The 1st defendant’s proven case is as follows: Mr. Manoharan a/l Muthiah (PW1), the 1st defendant’s representative, gave evidence 10 that he never visited the land before the 1st defendant purchased the land (see p. 41/NP/J1). He left all the necessary checks and verification with the SSM and the Hulu Langat Land Office to the 1st defendant’s previous solicitor, Mr. Pui (PW3). PW1 also said he had never dealt with the 2nd and the 3rd defendants, who, purportedly, 15 represented the 3rd plaintiff in the sale of the land to the 1st defendant. 162. Mr. Pui (PW3) gave evidence that he is a practicing advocate and solicitor and that he was instructed by Mr. Tee Choon Siong, a director of the 1st defendant, who went to his office sometime in January 2012, together with Chua Boon Kooi, another director of the 20 1st defendant, to prepare the sale and purchase agreement for the purchase of the land from the 3rd plaintiff. PW3 said he mainly dealt with Mr. Tee Choon Siong when it came to taking instructions from the 1st defendant. Mr. Tee Choon Siong informed him that the two parties in the sale and purchase transaction had agreed on the 25 purchase price of RM 2 million for the land. 188 163. PW3 also said that he dealt with the 3rd defendant, who, purportedly, represented the 3rd plaintiff in the sale of the land to the 1st defendant. He was given an original copy of a computer printed title deed of the land by the 3rd defendant after he had, purportedly, made payment of the RM 2 million to the 3rd defendant. He prepared the MOT for the 5 transfer of the land into the 1st defendant’s name. He did not know that the MOT was a fraudulent MOT due to the fraudulent acts of the 2nd and 3rd defendants in executing the MOT on behalf of the 3 rd plaintiff, when they were not the lawful directors of the 3 rd plaintiff. On 01.02.2012, he presented the original copy of a computer printed title 10 deed of the land together with the MOT for the transfer of the land to the Land Office for the registration of the transfer of the land from the 3rd plaintiff to the 1st defendant. The Land Office accepted the two documents presented by him and it registered the transfer and it cancelled and destroyed the original copy of a computer printed title 15 deed of the land and it issued a new computer printed title deed of the land in the name of the 1st defendant. 164. Ee Soon Kee (PW2) gave evidence that he does not know the 2nd to the 4th defendants. However, he did give evidence that he saw the 2nd and 3rd defendants, who were arrested by the police, at the Bandar 20 Kinrara Police Station. He also gave evidence that the police released them without charging them for cheating under s. 420 of the Penal Code even though he had lodged a police report against them for fraud and forgery of documents to, dishonestly, cause wrongful loss of the land to him, the 1st plaintiff and the 3rd plaintiff. 25 165. Sr. Ishak Bin Ismail (PW4) gave evidence that upon the request of the 1st defendant, he had prepared a valuation report for the land in 189 which he stated that the market value of the land is RM 2.8 million and the forced sale value of the land is RM 2 million. 166. The 1st defendant also sought to rely on the evidence of the 6 th to the 9th defendants’ 2nd witness (DW2) to support its contention that it has proven that the 1st defendant was also a victim of the cheating 5 committed by the 2nd to the 4th defendants. This was because DW2 had given evidence to that effect and DW2 even said that unlike the 3 (three) plaintiffs, who had succeeded in recovering back the land, the 1st defendant had lost the RM 2 million, which it had paid for the purchase of the land. 10 167. Nevertheless, I found that there was no duty of care, which was owed to the 1st defendant by the 6th, 8th and/or 9th defendants, as I agreed with the 6th to the 9th defendants based on the reasons given by the 6th to the 9th defendants that the 1st defendant failed to prove on the balance of probabilities that it was a bona fide purchaser for value of 15 the land. 168. It follows that since there was no duty owed to the 1st defendant, the question of whether there was a breach of the duty did not arise for the determination of the Court. 169. The same is applicable to the question whether the 1st defendant has 20 suffered loss or damage resulting from the breach of duty by the 6th, 8th and/or 9th defendants. 170. I found that the 1st defendant has failed to prove on the balance of probabilities that the 6th to the 9th defendants were negligent. 25 Whether the 1st defendant has proven that it is a bona fide purchaser for value of the land? 190 171. I also disagreed with the 1st defendant’s alternative contention that it has proven on the balance of probabilities that it is a bona fide purchaser for value of the land. 172. Below are my reasons. 173. I rejected the evidence of the 1st defendant’s two witnesses (PW1 and 5 PW3) that the 1st defendant is a bona fide purchaser for value of the land. This is because their evidence is hearsay evidence and, hence, inadmissible as they informed the Court that they have no personal knowledge of the transaction for the sale and purchase of the land between the 1st defendant, purportedly, as purchaser, and the 3rd 10 plaintiff, purportedly, as vendor, for the purchase price of RM 2 million. 174. I drew an adverse inference against the 1st defendant for its failure to call Chua Boon Kooi and Tee Choon Siong, both of whom, are directors of the 1st defendant, who, purportedly, had personal 15 knowledge of the sale and purchase transaction between the 1st defendant and the 3rd plaintiff. This is because the 1st defendant failed to give satisfactory reasons for not calling them. Chua Boon Kooi, is, allegedly, the 1st defendant’s key witness since he had direct dealings with the 2nd and 3rd defendants. PW1 gave evidence that it was Chua 20 Boon Kooi, who dealt with the 2nd and 3rd defendants. PW3 gave evidence that he was instructed by Chua Boon Kooi and Tee Choon Siong but, mostly, by Tee Choon Siong to proceed with the completion of the purchase of the land from the 3 rd plaintiff, and he dealt only with the 3rd defendant. Hence, I could find no credible and 25 cogent evidence from which I could conclude that the 1st defendant was a bona fide purchaser of the land. 191 175. On the issue of the admissibility or otherwise of PW1’s and PW3’s evidence on the purchase of the land by the 1st defendant from the 3rd plaintiff, Mr. Gerard Lourdesamy contended that the evidence of PW1 and PW3 is admissible under the exception to the rule against hearsay. This is because the 1st defendant was not relying on the 5 truth of the statements made by Chua Boon Kooi, a director of the 1 s t defendant, to PW1 and PW2. The 1st defendant was merely relying on the fact that the statements were made by Chua Boon Kooi, a director of the 1st defendant, to PW1 and PW2. He cited and relied on two cases, viz Subramaniam v Public Prosecutor [1956] MLJ 220 10 and Leong Hong Khie v Public Prosecutor and Tan Gong Wan v Public Porsecutor [1986] 1 MLJ 206 to support his contention. 176. However, I agreed with the 6 th to the 9th defendants that the 1st defendant’s contention was misconceived. This is because I was of the respectful view that the exception to the hearsay rule as 15 embodied in the ratio decidendi of the Privy Council case of Subramaniam v Public Prosecutor [1956] MLJ 220 and as applied by the Federal Court in Leong Hong Khie v Public Prosecutor and Tan Gong Wan v Public Porsecutor [1986] 1 MLJ 206, and which were cited by and relied upon by the 1st defendant, at p.13 of its 20 written submissions, is inapplicable to the 1st defendant’s counterclaim as the facts are different. 177. I noted that in Subramaniam v Public Prosecutor, supra, the appellant was charged in the High Court with being in possession of 20 rounds of ammunition, an offence under Regulation 4(1) (b) of the 25 Emergency Regulations 1951. The facts which are based on the prosecution’s evidence in the trial in the High Court are that on 29 192 April 1955, a patrol comprising members of the security forces went out to search a terrorist camp where an engagement had taken place earlier on the same day between another patrol and some terrorists. The patrol found the camp deserted. On searching the surrounding area, they found the appellant wounded on the head, back, neck, 5 right arm and right hand, with a belt containing twenty rounds of ammunition upon him. It was in respect of this ammunition that the appellant was charged. 178. In the trial in the High Court, the appellant relied on hearsay evidence in his defence to create a doubt on whether he had the mens rea to 10 commit the offence. He said that when he was walking down a small hill, a Chinese came out and stopped him and said “Do you know who I am?” and in saying so he drew out a revolver from behind him and pointed it at the appellant and said “I am a communist” and it was then that the appellant knew that he was one. The appellant then 15 described how he was forced to accompany the terrorists, one of whom walked in front and two behind, who told him he was being taken to their leader. It was at this juncture that the trial Judge intervened and ruled that hearsay evidence is not admissible and all the conversion with bandits is not admissible unless they are called. 20 179. At the conclusion of the trial, the appellant was found guilty, convicted and sentenced to death. His appeal to the Federal Court was dismissed. Hence, his appeal to the Privy Council. The Judicial Committee of the Privy Council allowed his appeal on the ground that if a complete version according to the appellant, of what was said to 25 him by the terrorists, and by him to them has been shut out, if believed could and might have afforded cogent evidence of duress 193 brought to bear on the appellant. In the course of his evidence, the appellant also stated that he was given the ammunition belt to wear but no weapon, the object, according to him, being that others could use the ammunition. The Judicial Committee of the Privy Council found that the appellant’s evidence suggested generally that he was 5 in fear, that he planned to unsuccessfully to escape, and that he had no alternative but to do as the terrorists asked him to do. 180. The Privy Council held that in ruling out peremptorily the evidence of conversation between the terrorists and the appellant the trial Judge fell into error. This is because evidence of a statement made to a 10 witness by a person who is not himself called as a witness may or may not be hearsay. It further held as follows at p. 222: “It is hearsay and inadmissible when the object of the evidence is to establish the truth of what is contained in the statement. It is not hearsay and is admissible when it is proposed to establish by 15 the evidence, not the truth of the statement, but the fact that it was made. The fact that the statement was made, quite apart from its truth, is frequently relevant in considering the mental state and conduct thereafter of the witness or of some other person in whose presence the statement was made. In the case 20 before their Lordships statements could have been made to the appellant by the terrorists, which, whether true or not, if they had been believed by the appellant, might reasonably have induced in him an apprehension of instant death if he failed to conform to their wishes.” 25 (Emphasis added). 181. However, in the instant case, the 1st defendant was not charged with cheating the 3 (three) plaintiffs and/or the 5th defendant and/or the 6th 194 to the 9th defendants, which is an offence under s. 420 of the Penal Code or with abetment of the offence of cheating of the 3 (three) plaintiffs and/or the 5th defendant and/or the 6th to the 9th defendants, which is an offence under s. 108 read together with s. 420 of the Penal Code. In the instant case, the 3 (three) plaintiffs sued the 1st to 5 the 9th defendants for recovery of the land and for damages suffered on the ground that the land had been, fraudulently, transferred and registered in the name of the 1st defendant, by forgery and/or by means of an insufficient and/or void instrument(s) and as a result of the negligence of and breach of statutory duty by the 5 th to the 9th 10 defendants. 182. The 1st defendant’s pleaded defence is that it has no knowledge of the 2nd and 3rd and/or the 4th defendants’ fraud, forgery and the use of a forged and/or in sufficient instrument to transfer the land to the 1st defendant; that the 3 (three) plaintiffs and the 5th to the 9th defendants 15 were negligent; and that 5th to the 9th defendants had breached its statutory duty to the 1st defendant. 183. The 1st defendant also filed a counterclaim against the 3 (three) plaintiffs, the 5th defendant and the 6th to the 9th defendants for damages for negligence and breach of statutory duty. In doing so, the 20 1st defendant relied on its defence that it was deceived by the 2nd and 3rd defendants and/or the 4th defendants and that it is a bona fide purchaser for value of the land. Yet, the 1st defendant did not see it f it to include the 2nd to the 4th defendants as defendants in its counterclaim. 25 184. I noted that none of the persons in the 1st defendant, who the 1st defendant alleges to have personal knowledge of the purchase of the 195 land from the 3rd plaintiff were called to testify on behalf of the 1st defendant as to the truth or otherwise of the 1st defendant’s pleaded defence and counterclaim. I also noted that Chua Boon Kooi’s and Tee Choon Siong’s names were not mentioned in the 1st defendant’s pleaded defence and counterclaim. 5 185. Hence, I was of the respectful view that the 1st defendant’s failure to sue the 2nd to the 4th defendants, including Lim Yoke Sim (F), the 3rd defendant to whom, the 10% of the purchase price and the balance purchase price were, allegedly, paid by the 1st defendant is fatal to its case. 10 186. I agreed with the contention of the 6th to the 9th defendants that they were not estopped from raising the issue that the 1st defendant must prove that it is a bona fide purchaser for value of the land in spite of the 1st consent judgment, which was entered into by the 3 (three) plaintiffs in the main action with the 1st defendant, to settle their claim 15 against the 1st defendant and the 1st defendant’s counterclaim against them since they were not parties to the 1st consent judgment. Hence, they are not bound by the terms of the 1st consent judgment. 187. I also agreed with the 6th to the 9th defendants’s contention that, similarly, the 1st defendant could not rely on the contents of the 2nd 20 consent judgment, which settled the 3 (three) plaintiffs’ claim against the 6th to the 9th defendants, in the full trial of its counterclaim against the 6th to the 9th defendants, to absolve the 1st defendant from having to prove that it is a bona fide purchaser for value of the land as it is not a party to the 2nd consent judgment. 25 188. I was also of the respectful view that the reliance by the 1st defendant on the evidence of its 2nd witness (DW2) is misguided as it did not 196 assist the 1st defendant to establish its pleaded case against the 6th, 8th and 9th defendants that the 1st defendant had no knowledge of the fraud and forgery committed by the 2nd, 3rd and/or 4th defendants in the purported transfer of the land from the 3 rd plaintiff to the 1st defendant. As stated earlier in this Judgment, DW2 was not called as 5 an expert witness by the 6th to the 9th defendants to give his opinion on the culpability of the 1st defendant’s directors and/or officers in the fraudulent transfer of the land from the 3 rd plaintiff to the 1st defendant. He was called as a witness of fact to inform the Court as to the outcome of the police investigations and the evidence which 10 the police had gathered against the 2nd to the 4th defendants. From his evidence, it is clear that the investigations, which were conducted by the police are not completed yet even though the police report was lodged more than 4 (four) years ago. Based on his evidence, it is also clear that there is no evidence of the alleged payment by the 1st 15 defendant to the 3rd plaintiff of the purchase price of RM 2 million for the land. 189. I also found that the facts, firstly, that the 1st defendant has paid a sum of RM 2 million (Ringgit Malaysia Two million) to Lim Yoke Sim (F), the 3rd defendant; secondly, that she had, purportedly, received it 20 on behalf of the 3rd plaintiff, for the purchase of the land; and thirdly, that the 1st defendant had purchased the land for a valuable consideration; which were pleaded by the 1st defendant in its counterclaim, were unproven by the 1st defendant. No receipts were tendered to prove that the alleged payment was, indeed, made. In 25 cross-examination, PW3 agreed that the RM 2 millon purchase price is well below the market price of RM 7.164 million based on the valuation of the Inland Revenue Board. He also agreed that this is 197 very, very unusual. He added that this is within the knowledge of his client, viz the 1st defendant. Hence, I found that the 3 (three) pleaded facts were bare allegations. 190. Therefore, I found that the 1st defendant has failed to prove that it is a bona fide purchaser for value of the land within the meaning of s. 340 5 of the NLC 1965. Cause of action for breach of statutory duty 191. I was of the respectful view that the statutory duty is only owed by the 6th, 8th and 9th defendants to the 1st defendant if the 1st defendant can 10 prove on the balance of probabilities that it is a bona fide purchaser for value of the land. Since this was not done by the 1st defendant, I held that the issue whether the 6th, 8th and 9th defendants have breached their statutory duty to the 1st defendant did not arise for the determination of the Court. 15 192. Below are my reasons. 193. In the case of Abdul Aziz bin Lebai Milin & 101 Others v Suruhanjaya Pengangkutan Awam Darat (Kuala Lumpur High Court Civil Suit No.: 22NCVC-710-12/2015, unreported), I had said as follows on the cause of action for breach of statutory duty, which was 20 pleaded by the plaintiffs in their writ of summons and statement of claim: “110. … it is trite law that in any case in which a class of individuals have a common law right of action in respect of the breach of a duty imposed by a statute, by virtue of the fact that there is no 25 remedy provided in the law concerned for the breach of the statutory duty, the plaintiffs must plead that they belong to this class of individuals and that they have a common law right of action 198 against the defendant in respect of the breach of a duty imposed by a statute by virtue of the intention of the statute to confer on them protection as a class of persons (see London Passenger Transport Board v Upson (1949) AC 155; Tok Jwee Kee v Tay Ah Hock & Sons Ltd & Town Council, Johore Bahru, supra; Dr 5 Abdul Hamid Abdul Rashid & Anor v Jurusan Malaysia Consultants (Sued As A Firm) & Ors, supra; Pendaftar Hakmilik, Pejabat Tanah Dan Galian Negeri Selangor v Bank Pertanian Malaysia Berhad [2016] 2 MLJ 543; and Pendaftar Hakmilik, Pejabat Pendaftaran Wilayah Persekutuan Kuala 10 Lumpur & Anor v Poh Yang Hong, supra). 111. In the instant case, although the plaintiffs have pleaded that they are taxi drivers, purportedly, licensed by the defendant to drive metered taxis, they have not pleaded that they constitute a class of persons, who have a common law right of action against the 15 defendant in respect of the breach by the defendant of any of the purported duties and responsibilities imposed on the defendant by the LPT Act 2010 or the SPAD Act 2010 and that, therefore, they are legally entitled to claim, as general damages, the loss, which they have, allegedly, suffered in their incomes and/or profits from 20 their taxi business, which is an economic loss, which was caused by the defendant’s breach of the statutory duty. … What must be pleaded and shown by a plaintiff in a cause of action based on a breach of statutory duty? 25 133. In Tok Jwee Kee v Tay Ah Hock & Sons Ltd & Town Council, Johore Bahru [1969] 1 MLJ 195, the material facts are that the appellant claimed a declaration that the approval of building plans by the Johore Town Council was contrary to s. 145 of the Town Boards Enactment and, therefore, illegal and inoperative. He 30 also claimed damages against the council and also against the owner of the land on which the building was built. It was also alleged that there had been a breach of the building by-laws but the 199 only damage alleged as a result of such breach was damage to the appellant's property from falling cement plasters etc. 134. Both defendants pleaded that the plaintiff's statement of claim discloses no cause of action and should be struck out as being frivolous and vexatious. The merits of the claim had not been 5 fully ventilated. On 30.10.1967, Ali J. heard arguments on a preliminary objection in law when both defendants argued that, even assuming that the approval of the building plans by the Town Council was wrong, the plaintiff had no cause of action. On 29.06.1968, the learned judge decided that he agreed with this 10 argument. 135. The plaintiff appealed to the Federal Court. The Federal Court allowed the appeal. It held as follows under “Held” in the Headnotes: “(1) the Town Council is liable to the appellant if in 15 breach of the outright prohibition of section 145 of the Town Boards Enactment it passed the neighbour's building plan when it was not in conformity with the approved town plan and such breach results in damage to the plaintiff; 20 (2) the council is not liable to the plaintiff for breach of the by-laws, it not being alleged that the council has caused damage by negligence or trespass; (3) the neighbour is liable to the plaintiff for breach of by-law 46 if and only if, the breach results in actual damage to 25 the plaintiff and in any event, irrespective of whether the neighbour was in such breach or not, the neighbour is liable to the plaintiff for any damage caused by negligence and/or trespass.” (Emphasis added). 30 136. S. 145 of the Town Boards Enactment reads as follows: “Effect of approved plan. 145 (i) The board shall refuse to approve the plan of any new building … unless such plan is in conformity with the 35 approved plan. (ii) …” 200 137. The Federal Court held that the section imposes on the board a statutory duty and that the board would be in breach of this duty if it approved a building plan not in conformity with an approved plan. 5 138. In delivering the judgment of the Federal Court, Suffian FJ quoted an excerpt in paragraph 688 of Halsbury's Laws of England, 3rd Edition, Volume 36, and he also said as follows at pgs. 200-202: "The position is summed up by Halsbury's Laws of England, 3rd Edition, Volume 36, in paragraph 688 as follows:– 10 "An individual can sue for a breach of statutory duty only if the statute imposes a duty enforceable by a party aggrieved as well as a public duty. The answer to the question whether the statute imposes a duty so 15 enforceable does not necessarily depend upon whether the statute was intended to protect a limited class of persons or the public as a whole. Nevertheless it is of importance to determine what was the intention of the statute in this 20 respect, because, if the statute on its true construction is intended to protect a particular class, it is some indication that members of that class are intended to have a right of action…. On the other hand, if the statute is intended to 25 protect the public as a whole, it will not usually be construed as giving a right of action to individual members of a particular class. In any case in which a class of individuals has a common law right of action in respect of the 30 breach of a duty imposed by a statute, a plaintiff to succeed must shew that he is within the class of persons which is intended to be protected and to which the duty is therefore owed." 35 I now turn to two cases involving the English Town Planning Acts illustrating the operation of the above principle. First, 201 there is Buxton v Minister of Housing and Local Government [1960] 3 All ER 408 in which Salmon J. held that persons affected by the Minister's order regarding certain developments could not succeed in having the order quashed. He said at page 411:– 5 "Before the town and country planning legislation any landowner was free to develop his land as he liked provided he did not infringe the common law. No adjoining owner had any right which he could enforce in the courts in 10 respect of such development unless he could shew that it constituted a nuisance or trespass or the like. The scheme of the town and country planning legislation, in my judgment, is to restrict development for the benefit of the public at large 15 and not to confer new rights on any individual members of the public, whether they live close to or far from the proposed development." That decision was followed by Paull J. in Gregory v London 20 Borough of Camden [1966] 2 All ER 196. In this case the plaintiffs were the owners and occupiers of two houses at the back of which was a large open space forming part of the grounds of a convent. The defendants, the local planning authority, granted planning permission to the trustees of the 25 convent to erect a large new school in the convent grounds and, later, for a second means of access to it which would probably affect the amenities of the plaintiffs' houses, as many hundreds of pupils might well use this access and pass close to them. The plaintiffs brought an action for a declaration that the grants of 30 planning permission were ultra vires the defendants. Assuming that the grants were ultra vires, it was held that the plaintiffs had no right to ask for the declaration, because there was no infringement of any of their legal rights. Paull J. said at page 202:– 35 "There are certain statutes which were passed to protect a certain class of people; and if a statute is passed to protect a class of persons, then any one in that class who is affected by a 202 breach of the statute may bring an action for damages in respect thereof. The Town Planning Acts, however, have been passed to give rights to the public only and not to any particular class of the public." 5 In this country we have the case of District Council Central, Province Wellesley v Yegappan [1966] 2 MLJ 177 where an adjoining owner, in the words of Thomson L.P. at page 178, "is anxious to prevent … developers making use of their land 10 [adjoining his] in a way he does not like or, if he cannot do so, to obtain some sort of compensation from them". To do this, he attempted to exploit what he alleged to be minor breaches of the building by-laws in the plans which the developers had prepared and the Council passed. The learned Lord President said at 15 page 177:– "… the most [the adjoining owner] has been able to allege, … is that in one or two respects the buildings covered by the plans will contravene the by-laws when they are erected. If this 20 happens and if the result affects his interests to such an extent as to constitute, for example, a nuisance, he will have his action and the approval of the building plans by the local authority will afford the developers no 25 protection." As regards the plaintiff's remedy against the council in respect of these breaches of the by-laws, the learned Lord President said at page 177:– "He certainly has none against the local 30 authority." The law that may be extracted from the above is, in my opinion, as follows:– (a) The prohibition by section 145 is, as has already been 35 noted, clearly a statutory duty imposed on the council and the council is liable in damages for breach of that duty if it is thought that the duty is for the benefit not of the public generally but of individuals or of a particular or definable class of the public, provided 40 203 that the Enactment provides no remedy, civil or criminal, for such breach. This duty is not, however, a duty imposed on persons other than the council such as the neighbour in the instant case. (b) The same principle applies as regards the duty, if any, 5 imposed under the relevant by-laws. In my judgment the duty imposed on the Johore Bahru Town Council by section 145 is owed not only to the public generally but to a broad class – a particular definable class 10 of the public of which the plaintiff is one. When the council zones an area for residential purposes, the zone benefits not only the inhabitants of the town generally, it benefits in particular the inhabitants of the zone. Persons buying land in the zone are prepared to pay an increased price because of the promise of 15 peace and quiet and the attractions of living in a residential zone. There is no remedy, civil or criminal, provided by the Enactment for any breach of section 145, nor does the Enactment even say that a complaint may be made to the 20 State Authority. Therefore, if any breach by the council of its duty under section 145 (either through oversight, ineptitude, indifference to the law or worse) results in damage to the owner of any adjoining land in a residential zone such as the plaintiff, he has, in my judgment, a civil remedy for 25 damages against the council. It will be recalled that in Solomons' case [1954] 2 QB 243 Lord Goddard C.J., while holding that any breach by an owner of a statutory duty imposed under the London Building Acts (Amendment) Act, 1939, exposed him to an action for damages, yet was of the opinion 30 that it did not necessarily follow that, if the London County Council required certain precautions to be taken in places of public resort such as theatres, and a fire took place and persons were injured, every one of them would have a cause of action. Similarly, in the instant case I am of the opinion that it does not 35 necessarily follow that the Johore Bahru Town Council is liable for any damage caused by breach of its duty under section 145, to all the inhabitants of the town. 204 In my opinion, the scheme of the Johore Town Boards Enactment is quite different from that of the current English town and country planning legislation; it is not state-wide in scope, it is restricted to specific towns in the State and section 145 is effective only as regards town areas which have been zoned, 5 while the English legislation blankets the entire country and hence the decision in Buxton [1903] 3 All 408 and Gregory [1966] 2 All ER 196. Accordingly I would allow the appeal against the Town 10 Council in so far as section 145 is concerned. … I set aside Ali J.’s judgment and remit this case to the lower court for trial of the issues of fact and determination of the suit in the light of the law set out in his judgment. Some of 15 the facts to be investigated are as follows:- (a) Was the council in breach of section 145 and if so what damage has been caused to the plaintiff by such breach? (There is no need to enquire whether or not the council was also in breach of the by-laws).” 20 (Emphasis added). 139. Reverting back to the instant case and upon applying the principles as laid down by the Federal Court in the above case to the instant case, I am of the view that the plaintiffs must plead that 25 the SPAD Act 2010 and/or the LPT Act 2010 imposes a duty enforceable by the plaintiffs as a party aggrieved as well as a public duty and that the SPAD Act 2010 and/or the LPT Act 2010 does not provide a remedy for the infringement of their legal right by the defendant. 30 140. This is because it is important for the Court to determine what was the intention of the statute concerned, viz, the SPAD Act 2010 and/or the LPT Act 2010, which the plaintiffs are relying on in the plaintiffs’ cause of action for a breach of statutory duty. If on its true construction, it is to protect a particular class, 35 within which the plaintiffs are included, it is some indication that members of that class are intended to have a right of action against 205 the defendant. If on its true construction, the statute is intended to protect the public generally, it will not usually be construed as giving a right of action to individual members of a particular class. 141. This distinction is important because the plaintiffs in the instant case must plead that they are either individuals or come 5 within a particular or definable class of the public, who have a common law right of action in respect of the breach of a statutory duty imposed by the SPAD Act 2010 and/or the LPT Act 2010 and that the SPAD Act 2010 and/or the LPT Act 2010 provides no remedy, civil or criminal for the alleged breach of statutory duty. To 10 succeed, the plaintiffs must show that they are within the class of persons, which is intended to be protected by the SPAD Act 2010 and/or the LPT Act 2010 and to which the duty is, therefore, owed. Otherwise, the plaintiffs have no right to ask for the remedies or reliefs claimed in the writ and the statement of claim because there 15 was no infringement of any of their legal rights. 142. In the High Court case of Dr Abdul Hamid Abdul Rashid & Anor v Jurusan Malaysia Consultants (Sued As A Firm) & Ors [1997] 3 MLJ 546, at p. 567, James Foong J ruled as follows on what must be shown by a plaintiff in a cause of action for a breach 20 of statutory duty: “Firstly, whether the pleadings of the plaintiffs sufficiently disclose material facts to support the plaintiffs' claim for breach of statutory duty against the second defendant. In order to succeed under a cause of action for breach of statutory 25 duty, the plaintiffs must show that they came within the class of person intended by an Act or regulation to be protected, that the statutory provision was broken, and that they suffered damage and that this damage was caused by the breach of the provision – see Atkin Court Forms Vol 20 30 (2nd Ed) (1993 Issue) p 226. In essence, the entire claim based on breach of statutory duty depends on the provision of the statute or by-laws being alleged to be breached. The affected legal provision has thus become a material fact that needs to be disclosed, for failure to do so will cause the defendant 35 206 to be caught by surprise and be prejudiced in their defence. Unlike the general principles of pleading where laws need not be pleaded, in an action based on a breach of statutory duty, it is absolutely necessary and essential for the plaintiffs to disclose the specific legislation affected; for it is the basis for the plaintiffs' 5 claim. In fact, this is the approach recommended in the Atk in Court Forms, where all the precedents covering this aspect of the claim fully disclose the relevant provision of the statute or by- laws alleged to be breached.” (Emphasis added). 10 143. In that case, the material facts are that the plaintiffs, who were husband and wife, were owners of a piece of property (“Lot 3007”). They had hired the first defendant, an engineering firm, to construct a double storey house (“the house”) on Lot 3007. The 15 plans of the house were signed by the fourth defendant, the proprietor of the first defendant, who was a registered engineer at the material time. The second defendant, which was the Town Council, approved the building plans with its usual specifications and conditions. After the house was completed, the second 20 defendant carried out investigations. But the house was handed over to the plaintiffs even though no certificate of fitness was issued for the house. About three and a half years later, the house began to collapse due to landslide, which forced the plaintiffs to evacuate the premises. 25 144. The plaintiffs sued the first to the fifth defendants. The plaintiffs claimed that the fifth defendant, who was the chief clerk and draftsman of the first defendant, was also a co-proprietor of the first defendant together with the fourth defendant. Their claim against the first, fourth and fifith defendants were founded on 30 contract and tort. Their claim against the third defendant was based on nuisance, negligence and the rule of Rylands v Fletcher. The third defendant was the contractor engaged in erecting a double storey bungalow on a neighbouring land (“Lot 3008”). 207 145. The plaintiffs’ claim against the second defendant was founded on negligence and breach of statutory duties under the Local Government Act 1976, the Street, Drainage and Building Act 1974 and the Uniform Building By-Laws 1984. However, the second defendant argued as follows: 5 (i) The plaintiffs’ pleadings did not sufficiently disclose material facts to support their claim for breach of statutory duty; (ii) The Uniform Building By-Laws 1984 were not in force at the material time; and (iii) The Street, Drainage and Building Act 1974 prevented the 10 cause of action against the second defendant to succeed even in the event of of a breach of statutory duty by the second defendant. 146. The quantum of damages suffered by the plaintiffs were not 15 in dispute. 147. The learned Judge allowed the plaintiffs’ claim against the first, third and fourth defendants and dismissed the plaintiffs’ claim against the second and fifth defendants. His Lordship held, inter alia, that a claim for pure economic loss can be entertained in an 20 action for negligence (Bolam v Friern Hospital Management Committee [1957] 2 All ER 118 followed). 148. In dismissing the plaintiffs’ claim against the second defendant, His Lordship held as follows in paragraph (4) of the Headnotes under “Held”: 25 “(4) In their claim against the second defendant, the plaintiffs’ pleadings had failed to sufficiently disclose material facts for breach of statutory duty and negligence. Also, the Uniform By- Laws 1984 in which various provisions were said to have been breached by the second defendant had yet to come into force at 30 the date the breach was said to have been committed. Moreover, s 95 of the Street, Drainage and Building Act 1974 exempted the second defendant from being sued for such purposes. Thus the claim against the second defendant must fail (see pp 567B-I and 568A-F).” 35 208 194. I also said as follows on the elements which must be pleaded in a cause of action for breach of statutory duty: “150. In his dissenting judgment in the Court of Appeal case of Pendaftar Hakmilik, Pejabat Tanah Dan Galian Negeri Selangor v Bank Pertanian Malaysia Berhad, supra, dismissing the 5 appellant’s appeal with cost, Prasad Sandosham Abraham JCA said as follows on what are the elements to satisfy the tort of breach of statutory duty: “[83] The elements to satisfy the tort of breach of duty are as follows: 10 a) The injury suffered by the plaintiff is within the ambit of the statute, b) The statutory duty imposes a liability to civil action, c) The statutory duty is not fulfilled, and d) The breach of the statutory duty has caused his 15 injury. (See Hu Sepang v Keong Ong Inn & & Ors (1991) 1 MLJ 440).” 151. In that case, the material facts are that the respondent had sued the appellant for damages for negligence and for a breach of 20 statutory duty relating to a charge on 2 pieces of land (“the lands”), by a company known as Magna Iron Sdn Bhd (“MISB”), in return for a loan of RM 19,700,000.00 to MISB to finance the purchase for the land. The respondent claimed that the appellant was negligent and that it had also breached its statutory duty when it did two things. 25 Firstly, it issued new computerized titles to the lands in the name of Ulu Selangor Estates Sdn Bhd (“USESB”), the lawful and registered proprietor of the lands, when the old titles were still in the possession of USESB. Secondly, it allowed the registration of the transfer of the lands from USESB to MISB, and the charge of the 30 lands by MISB to the respondent even though there was neither approval nor consent from the Estate Land Board pursuant to section 214(A) of the National Land Code 1965 (“the NLC”), due to 209 the size of the lands, which exceeded the size prescribed in that section, where approval or consent of the Estate Land Board is required. 152. After the registrations of the transfers of the lands in favour of MISB and the charge in favour of the respondent, 2 (two) new 5 grants of title, which were computerized, were, allegedly, issued by the appellant vide the Land Office, which reflected that MISB is the new registered proprietor of the lands and that the respondent was the registered chargee of the lands. The respondent then released the loan sum of RM 19,700,000.00 to USESB vide their solicitors. 10 153. However, USESB had contended in a separate suit, viz Kuala Lumpur High Court Suit No.: 53-21-278-2008, that the registrations of title in favour of MISB and the charge in favour of the respondent, respectively, were null and void as there was neither approval nor consent from the Estate Land Board pursuant 15 to section 214(A) of the NLC and that the transfers of the lands to MISB were effectuated by fraud as the original titles to the lands are still with USESB. 154. USESB had obtained judgment-in-default against MISB in the presence of the appellant and the High Court also ruled that the 20 computerized documents of title to the lands in the name of MISB be struck off from the register of titles and as a consequence, of that, the charge in favour of the respondent was also removed by the appellant as the Registrar of titles. 155. The learned trial Judge in that case had found that the 25 appellant was negligent and, hence, the appeal by the appellant to the Court of Appeal against her decision. The Court of Appeal, by a majority, allowed the appeal because the majority found that the learned trial Judge had erred when she held that the respondent has succeeded in establishing that the appellant was negligent in 30 issuing the 2 (two) computerized titles when there was no evidence 210 to show that the appellant had, in fact, issued them in the first place. 156. Reverting back to the instant case, and upon applying the principle of law as set out in paragraph [27] of the Judgment of the learned dissenting Judge in the above case, I found that the 5 plaintiffs have not pleaded in the statement of claim, the 4 (four) elements for their cause of action for breach of statutory duty, viz that the injury suffered by them, viz the loss in their incomes and/or profits, is within the ambit of the SPAD Act 2010 or the LPT Act 2010; that the statutory duty imposes a liability to civil action; that 10 the statutory duty is not fulfilled by the defendant; and that the breach of the statutory duty by the defendant has caused the plaintiffs’ injury. 157. In Pendaftar Hakmilik, Pejabat Pendaftaran Wilayah Persekutuan Kuala Lumpur & Anor v Poh Yang Hong, supra, 15 the Federal Court held that there has been a breach of the statutory duty imposed on the second appellant (“the second defendant”) and its negligence in the manner in which it had maintained its record resulting in the loss occasioned to the respondent (“the plaintiff”). Hence, it found the second defendant liable in damages 20 to the plaintiff under the common law. 158. At p. 414, in paragraphs (2), (3) and (4) under “Held dismissing the appeal with costs”, Zulkefli CJ (Malaya), who delivered the Judgment of the Federal Court, held as follows: “(2) There has been a breach of the statutory duty 25 imposed on the second defendant and its negligence in the manner in which it had maintained its record resulting in the loss occasioned to the plaintiff. The duty of care on the part of the second and the third defendants in 30 the context of the present case was two-fold. Firstly, there is the statutory duty under the NLC to maintain the register of all lands caused to be 211 registered at the registry, and in particular to ensure that the information contained in the register is correct, true and accurate and reflects the true and actual description of the title to the land as well as the true identity of the registered proprietor thereof. 5 Secondly, there is the common law duty of care whereupon there can be a claim for negligence for the same alleged wrong (see paras 28 & 31). (3) There is a clear distinction between a claim for compensation provided for under s 386 of the NLC, 10 and a claim for damages under the common law, for an act of negligence by the second defendant in its maintenance of the records of the register of titles. In the present case, the plaintiff’s claim in the matter was simply for damages under the common 15 law and not a relief sought for compensation under s 386 of the NLC. The High Court judge was right in arriving at a decision that the second defendant was liable and owed a duty of care to the plaintiff in the circumstances of the case (see paras 32–33). 20 (4) A common law duty of care can arise in the performance of a statutory function. The second defendant had a statutory function to ensure that the records entered in the register of titles and maintained in the office of the 25 second defendant contained particulars which were accurate. A failure of that duty can give rise to the coexistence of statutory duty and common law duty of care (see para 37).” (Emphasis added). 30 159. In the above case, the material facts are that the respondent (“the plaintiff”), had entered into a sale and purchase agreement with the first appellant (‘the first defendant’) to purchase a property 212 (“the property”). A private search at the second appellant’s (‘the second defendant’) office showed that the first defendant was the registered proprietor of the property. The memorandum of transfer and other documents to effect the transfer and charge of the property were presented to the second defendant’s office for 5 registration. Whilst registration was pending, the plaintiff found out that the property was in fact held under another description and was registered to one Mohamad Nor. The plaintiff conducted searches of the land title to the property at the second defendant’s office again and the results showed that the land was registered in 10 the name of the first defendant. However, it was also discovered that the same land, but held under a different title was registered under the name of Mohamad Nor. 160. The plaintiff alleged that the second defendant breached their duty of care to the plaintif by misrepresenting the true and 15 actual particulars of the property. The plaintiff further alleged that the second defendant failed to maintain true and accurate records. As a result of the plaintiff’s reliance on the second defendant’s records, the plaintiff had suffered losses. Hence, the plaintiff sued the second and third defendants for damages for a breach of 20 statutory duty under the National Land Code 1965 to maintain a register of all lands caused to be registered at the Land Registry and/or for damages in the tort of negligence. The second and third defendants denied the whole of the plaintiff’s claim and maintained that there was no duty of care owed to the plaintiff. They averred 25 that the information was accurate according to the second defendant’s records at the time it was provided for. They also averred that the plaintiff was not entitled to the reliefs claimed. 161. The High Court allowed the plaintiff’s claim. The second and third defendants appealed to the Court of Appeal, which dismissed 30 the appeal. Hence, their appeal to the Federal Court. 162. At p. 419, His Lordship said as follows: 213 “[9] The High Court gave judgment in favour of the plaintiff on his claim for damages premised on the tort of negligence and breach of statutory duty on the part of the second defendant . It was the High Court’s finding that the second defendant failed to ensure at all times that the particulars of the land, 5 as per its registered records and furnished to the plaintiff in exchange for a payment of fee, contained accurate details of the land to be relied upon by the plaintiff. … [12] The Court of Appeal affirmed the decision of the High Court. 10 The Court of Appeal having addressed itself on the parties’ pleaded causes of action and the factual circumstances of the case, held that the contention of the second and third defendants that they owed no duty of care to the plaintiff was without merit.” (Emphasis added). 15 163. And at p. 425 as follows: “[37] We would like to state here that a common law duty of care can arise in the performance of a statutory function. In the instant case, the second defendant had a statutory function to ensure that the records entered in the register of titles and 20 maintained in the office of the second defendant contained particulars which are accurate. A failure of that duty can give rise to the coexistence of statutory duty and common law duty of care (see the case of X (minors) v Bedfordshire County Council; M (a minor) v Newham London Borough Council; E (a minor) v Dorset 25 County Council [1995] 3 WLR 152).” (Emphasis added). … 167. In the Court of Appeal case of Pendaftar Hakmilik, Pejabat Tanah Dan Galian Negeri Selangor v Bank Pertanian Malaysia 30 Berhad, supra, Prasad Sandosham Abraham JCA quoted excerpts from the judgment of Lord Wright in the English case of London Passenger Transport Board v Upson (1949) AC 155, at page 168, and held that a claim for damages for breach of a statutory duty intended to protect a person in the position of the particular 35 plaintiff is a specific common law right in order to make effective, for 214 the benefit of the injured plaintiff, his right to the performance by the defendant of the defendant’s statutory duty. Prasad Sandosham Abraham JCA said as follows: “[26] An action for breach of statutory duty must not be confused with an action for negligence. I can do no better 5 than to quote Lord Wright in the case of London Passenger Transport Board v Upson (1949) AC 155 at page 168 and I quote: a claim for damages for breach of a statutory duty intended to protect a person in the 10 position of the particular plaintiff is a specific common Law right which is not to be confused in essence with a claim for negligence. The statutory right has its origin in the statute, but the particular remedy of an 15 action for damages is given by the common law in order to make effective, for the benefit of the injured plaintiff, his right to the performance by the defendant of the defendant’s statutory duty ... it is not a claim 20 in negligence in the strict or ordinary sense ... At the same time it resembles actions in negligence in that the claim is based on a breach of a duty ... whatever the resemblances, it is essential to keep in mind 25 the fundamental differences of the two classes of claim. [27] It is clear the same alleged wrong entitles a plaintiff to institute a claim for breach of statutory duty 30 and negligence in the alternative, as they are two distinctive causes of action. (Emphasis added).” 195. In the case of Wong Kok Leong & Another v Tan Kit Leng @ Tan 35 Choon Lim & 2 Others ((Kuala Lumpur High Court Civil Suit No.: 215 22NCVC-674-12/2015, unreported), I referred to Tetuan Tan Teng Siah Realty Sdn Bhd v Island Oil Palm Plantations Sdn Bhd & Anor (1997) 4 CLJ 634, in which the learned Judge referred to the decision of Lord Atkin in Evans v Bartlam [1937] AC 473 at p. 480 and said as follows: 5 “A judgment entered in default is not a judgment decided on merits and is liable, as it does not finally dispose off the rights of the parties, to be set aside. As Lord Atkins, in Evans v Bartlam [1937] AC 473 at 480 observed: The principle obviously is that unless and until the court has 10 pronounced a judgment upon the merits or by consent, it is to have the power to revoke the expression of its coercive powers where that has been obtained by a failure to follow any of the rules of procedure.” 15 196. I also referred to Amalan Tepat Sdn Bhd v Panflex Sdn Bhd [2011] 7 CLJ 121, in which the Federal Court held that since the declaration was one of the main prayers of the plaintiffs, before such a relief is granted there must be evidential basis to do so. In that case, the facts are similar with the facts before this Court and the Federal Court 20 decided as follows: “Held (allowing the appeal) Per Richard Malanjum CJ (Sabah & Sarawak) delivering the judgment of the court: (1) As declaration was the main prayer of the respondent, it is a 25 rule of practice that before such relief is granted there must be evidential basis to do so. Courts are very slow in granting declaratory prayer without any evidence and argument advanced. It is a rule of practice that 'the court does not make declarations of right either on admissions or in default of 30 216 pleading' (Gan Boon Kyee v. Yap Hong Sin & Anor; Patten v. Burke Publishing Co). The main relief in the impugned judgment was the declaration that the supplementary agreement entered between the respondent, the first defendant and the appellant had been validly terminated by 5 the respondent. It was also on record that the impugned judgment was granted upon the dismissal of the encl. 14 application for extension of time to file the defence by the appellant. In other words, the impugned judgment was in fact a judgment in default of defence. There was nothing to 10 indicate that discretion was exercised by the court when granting the declaratory relief as found in the impugned judgment. The impugned judgment being declaratory in substance had not met the entrenched rule of practice applicable as exposited above for the granting of declaratory 15 relief. (paras 13, 16, 17 & 19).” I then held that hence, it is trite law that where a declaration is one of the main prayers sought for, it can only be granted if there is evidence to that effect; 197. In Wong Kok Leong & Another v Tan Kit Leng @ Tan Choon Lim 20 & 2 Others (supra), I also said as follows: “In Amalan Tepat Sdn Bhd v Panflex Sdn. Bhd., supra, Richard Malanjum CJ (Sabah & Sarawak) referred to Scarman LJ’s judgment in Patten v. Burke Publishing Co [1974] 3 All ER 217 at 253, [1974] 1 WLR 991 at 1030 and His Lordship said as follows at 25 p. 127 concerning the exception to the general rule: “Scarman LJ gave judgment to the same effect but in somewhat different terms. He said ([1974] 3 All ER 217 at 253, [1974] 1 WLR 991 at 1030): When what is sought is a declaration, there is 30 the risk of irremediable injustice; the court has spoken and words cannot be recalled, even though later they may be negatived: "nescit vox 217 missa reverti" (Horace Ars Poetica I 390). The power of the court to give declaratory relief on a default of pleading, of course, exists, but, for the reason crystallised by Horace in those four words of his, should be exercised only in cases 5 in which to deny it would be to impose injustice on the claimant. This approach leads me to the conclusion that the declaratory relief contained in the minute of judgment annexed to the order of Geoffrey Lane J should be disallowed at this 10 stage. There was of course a strong objection to the inclusion of the declaration sought in that case. Even after trial it is not the normal practice of the court to make a declaration that the 15 defendant had been guilty of fraud or negligence. Justice can be done to the plaintiff by awarding him damages. If he wishes to parade the basis upon which damages have been awarded to him, he has a judgment which he can produce. The judgment will contain the findings of fraud or negligence upon the basis of 20 which the damages have been awarded, and that should be sufficient for the plaintiff's purpose. But in the absence of a judgment reached after hearing evidence a declaration can be based only on unproved allegations. The court ought not to declare as fact that which might not have proved to be such had 25 the facts been investigated. Quite apart from this, however, it is clear from Wallersteiner v. Moir that the rule is a rule of practice only. It is not a rule of law. It is a salutary rule and should normally be followed, but it should be followed only where the claimant can obtain the fullest justice to which he is entitled 30 without such a declaration. (emphasis added). Conclusion 198. Based on the above reasons, the Court is satisfied that Supreme Tribute, the 1st defendant in the main action and the sole plaintiff in 35 the counterclaim, has failed to prove its counterclaim against the Land Administrator of Hulu Langat, Selangor; the Selangor State 218 Government; the A.D.O. of Hulu Langat, Selangor and the Director of Lands & Mines, Selangor; the 6th to the 9th defendants in the main action, who are the 5th to the 8th defendants in the counterclaim, based on negligence and/or breach of statutory duty. 199. In the premises, the Court dismissed the 1st defendant’s counterclaim 5 against the 6th to the 9th defendants in the main action with costs of RM 10,000.00. Dated: 29 August 2017 10 (DATUK SU GEOK YIAM) Judge High Court Civil NCvC 11 15 Kuala Lumpur 20 COUNSELS 25 1. Mr. Hoh Foo Fah, David together with Mr. Chris Y. H. Tan, the learned counsels for the 3 (three) plaintiffs in the main action and the 1st to the 3rd defendants in the counterclaim, at: Messrs. Lim & Hoh Advocates & Solicitors 30 #08-02, 8th Floor, Bangunan Ming Jalan Bukit Nanas 50250 Kuala Lumpur 219 2. Mr. Gerard Lourdesamy together with Cik A. C. Devi, the learned counsels for the 1st defendant in the main action and the plaintiff in the counterclaim, at: Messrs. Gerard Lourdesamy & Associates Suite 502, 5th Floor, 5 Menara Mutiara Majestic, 15 Jalan Othman, 46000 Petaling Jaya, Selangor Darul Ehsan 3. Mdm. Rudaini bt. Abdullah, the learned counsel for the 5th defendant in 10 the main action and the 4th defendant in the counterclaim, at: Suruhanjaya Syarikat Malaysia Tingkat 28, Menara SSM@Sentral No. 7, Jalan Stesen Sentral 5 50623 Kuala Lumpur 15 4. Encik Mustapha Kunyalam together with Puan Kam Binti Sani and Encik Ismail bin Baharom, the learned counsels for the 6th to the 9th defendants in the main action and the 5th to the 8th defendants in the counterclaim, at: 20 Kamar Penasihat Undang-Undang Negeri Selangor Darul Ehsan Tingkat 4, Podium Utara Bangunan Sultan Salahuddin Abdul Aziz Shah 40512 Shah Alam 25 Selangor Darul Ehsan CASE REFERENCE: 30 1. Lee Siew Ken & Anor. v Pengarah Tanah dan Galian Negeri Selangor [2015] AMEJ 1502. 2. Uptown Properties Sdn. Bhd. v Pentadbir Tanah Wilayah Persekutuan & Ors. [2012] 8 MLJ 713. 3. CIMB Bank Berhad v Ambank (M) Berhad & Ors. [2015] 3 MLRH. 35 220 4. Ketua Polis Ibu Pejabat Kontingen Polis Seremban Negeri Sembilan & Anor. v Manoharan a/l Dorasamy [2004] 3 MLJ 565. 5. Pendaftar dan Pemeriksa Kereta-Kereta Motor, Melaka & Ors. v KS South Motor Sdn. Bhd. [2000] 2 MLJ 540. 6. Pengarah Jabatan Pengangkutan Negeri Selangor & Ors. v Sin Yoong 5 Ming [2015] 1 MLJ 1. 7. Pow Hing & Anor. v Registrar of Titles, Malacca [1981] 1 MLJ 155. 8. Tan Geok Lan (P) v La Kuan @ Lian Kuan [2004] 3 AMR 177. 9. Royal British Bank v Turquand (1856) 6 E&B 327. 10. KL Engineering Sdn. Bhd. v Arab-Malaysian Finance Bhd. [1994] 2 10 MLJ 201. 11. Arab-Malaysian Finance Bhd v, Steven Phoan Cheng Loon & Ors [2003] 1 CLJ 585. 12. Selvaraju Velasamy & Anor v Abdullah Ali Kutty [2009] 2 CLJ 753. 13. Generation Products Sdn Bhd v Majlis Perbandaran Klang [2008] 5 15 CLJ 417. 14. Au Meng Nam & Anor v Ung Yak Chew & Ors [2007] 4 CLJ 526. 15. JW Properties Sdn Bhd v Perbadanan Kemajuan Pertanian Selangor & Anor [2016] 1 CLJ 13. 16. Leelawathy Ratnam & Ors v. Pengarah Hartanah Dan Galian Negeri 20 Selangor & Anor [2010] 1 LNS 1185. 17. X (Minors) v Bedfordshire County Council [1955] 3 ALL ER 353. 18. David Chellah v Monorail Malaysia Technology Sdn Bhd & Ors [2009] 3 CLJ 771. 19. Subramaniam v Public Prosecutor [1956] MLJ 220. 25 20. Leong Hong Khie v Public Prosecutor and Tan Gong Wan v Public Porsecutor [1986] 1 MLJ 206. 21. Abdul Aziz bin Lebai Milin & 101 Others v Suruhanjaya Pengangkutan Awam Darat (Kuala Lumpur High Court Civil Suit No.: 22NCVC-710- 12/2015, unreported). 30 22. Wong Kok Leong & Another v Tan Kit Leng @ Tan Choon Lim & 2 Others ((Kuala Lumpur High Court Civil Suit No.: 22NCVC-674- 12/2015, unreported). 23. Tetuan Tan Teng Siah Realty Sdn Bhd v Island Oil Palm Plantations Sdn Bhd & Anor (1997) 4 CLJ 634. 35 221 24. Evans v Bartlam [1937] AC 473. 25. Amalan Tepat Sdn Bhd v Panflex Sdn Bhd [2011] 7 CLJ 121. 5 LEGISLATION REFERENCE: 1. Ss. 11 and 141, Forms 49 and 44 of the Companies Act 1965. 2. Ss. 5 and 6 of the Government Proceedings Act 1956. 3. Ss. 5A, 22 and 340, Form 14A, and the Fourteenth Schedule of the National Land Code 1965. 10 BOOK REFERENCE: 1. “Tort”, Sweet & Maxwell’s Textbook Series, Paula Giliker and Silas Beckwith. 15

Tika 2.6.0

T-05(M)-448-12/2016

PENDAKWARAYATPR Puan Kwan Li Sa PERAYU WAN AMIRUL MUBIN BIN WAN KAMARUDDIN

Dangerous drugs — Appeal — Appeal against conviction and sentence — Appellant charged with trafficking and possession in dangerous drugs — Whether information leading to the discovery of the impugned drug was inadmissible — Whether defence cast reasonable doubt against prosecution case — Whether the learned judge had undertaken a full appreciation of the evidence — Whether defence sufficiently considered by trial judge — Whether trial judge erred in decision — Dangerous Drugs Act 1952 [Act 234], s 12, s37(da), s 39B(1)(a); Evidence Act 1950, s 8, s 27

29/08/2017

YA TAN SRI IDRUS BIN HARUNKorumYA DATO' AHMADI BIN HAJI ASNAWIYA TAN SRI IDRUS BIN HARUNYA DATUK KAMARDIN BIN HASHIM

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=f3f04a77-ba91-44db-971f-44ce35ab2a85&Inline=true

Microsoft Word - AP - (57) WAN AMIRUL MUBIN BIN WAN KAMARUDDIN DALAM MAHKAMAH RAYUAN MALAYSIA DI PUTRAJAYA (BIDANG KUASA RAYUAN) RAYUAN JENAYAH NO : T-05(M)-448-12/2016 ANTARA WAN AMIRUL MUBIN BIN WAN KAMARUDDIN … PERAYU DAN PENDAKWA RAYA … RESPONDEN [Dalam Perkara Mahkamah Tinggi Malaya Di Kuala Terengganu Perbicaraan Jenayah No: 45A-09-09/2014 & 45A-10-09/2014] Antara Pendakwa Raya Dan Wan Amirul Mubin Bin Wan Kamaruddin] CORAM AHMADI BIN HAJI ASNAWI, JCA IDRUS BIN HARUN, JCA KAMARDIN BIN HASHIM, JCA 2 JUDGMENT OF THE COURT [1] The appellant in this appeal was charged in the High Court on 2 counts of trafficking in and possession of dangerous drugs under sections 39B(1)(a) and 12(2) of the Dangerous Drugs Act 1952 [Act 234] respectively in the following terms: First Charge “Bahawa kamu pada 20.6.2014, jam lebih kurang 9.00 malam bertempat di L15-1 Lt 3371 Jalan Sekolah Intan Zaharah, Kampung Balai Besar di dalam daerah Dungun, di dalam Negeri Terengganu, telah mengedar dadah berbahaya iaitu Heroin seberat 64.59 gram dan dengan itu kamu telah melakukan suatu kesalahan di bawah seksyen 39B(1)(a) Akta Dadah Berbahaya 1952 yang boleh dihukum di bawah seksyen 39B(2) Akta yang sama”. Second Charge “Bahawa kamu pada 20.6.2014, jam lebih kurang 9.00 malam bertempat di L15-1 Lt 3371 Jalan Sekolah Intan Zaharah, Kampung Balai Besar di dalam daerah Dungun, di dalam Negeri Terengganu, telah ada dalam kawalan kamu dadah berbahaya iaitu Heroin seberat 9.08 gram dan dengan itu kamu telah melakukan suatu kesalahan di bawah seksyen 12(2) Akta Dadah Berbahaya 1952 yang boleh dihukum di bawah seksyen 39(A)(2) Akta yang sama”. [2] The appellant was convicted on both charges. On the first charge, the appellant was sentenced to death whereas on the second charge, the appellant was sentenced to 10 years imprisonment from the date of conviction. The learned judge, in respect of the second charge however, did not impose the mandatory whipping of not less than 10 strokes prescribed by section 39A(2) of Act 234 stating that the appellant, had 3 already been sentenced to death on the first charge. We begin, in considering the appeal by the appellant, by stating relevantly the following evidence that we have garnered from, and which appear clearly in the notes of evidence. It is the prosecution’s narrative that on 20 June 2014 circa 9 p.m., acting on an information in connection with dangerous drug activity, Sub-Inspector Ismail bin Omar (PW4) with a team of police personnel carried out a raid on a house at L15-1, Lt 3371, Jalan Sekolah Intan Zaharah, Kampung Balai Besar, Dungun in the state of Terengganu. Before entering the compound of the house, PW4 and his team first conducted an observation on the house from which PW4 could see the light which shined the house. PW4 suspected that there was someone in the house after which PW4 proceeded to the house through the gate which was not locked and stopped in front of the door. When PW4 heard the occupants of the house talking, he thereupon knocked the door. A Malay male, who was during the trial identified as the appellant, opened the naco louvre window of the front room. PW4 immediately identified himself as a police officer and instructed the appellant to open the door. The appellant initially refused to open the door but after being told to do so by PW4 several times, the appellant then opened the door. Upon entering the house, PW4 took the appellant to the same front room, which was the first bedroom, where he could see a woman, Anisa Suhaila binti Moktar (PW7) with a child who was about 1 year old in the said room. [3] PW4 later learned that PW7 was the appellant’s wife. Subsequently, a body search was conducted on the appellant but nothing incriminating was found on his body. PW4 then searched the room from which a bag containing cash of RM6000.00 was found by the side of a dressing table. A further search in the same room by PW4 which was witnessed by the appellant did not yield a discovery of anything 4 incriminating. Neither did PW4 find anything incriminating in the second room of the house when a search was subsequently conducted there. [4] PW4, accompanied by Lance Corporal Faizal Amri bin Zakaria (PW5), and the rest of the raiding team next proceeded to the third room which was closed but the door was not locked from inside. Both the appellant and PW7 were also taken to the said room. PW4 observed that there were clothes which were hung on a rope with one end connected to a wall and the other to a rack used for keeping things, some clothes which were folded on the floor and a pile of clothes on the floor near the wall. Underneath the said pile of clothes, PW4 found a newspaper package and when he asked the appellant about the content of the said package, it was met with silence but the appellant looked shocked, pale and nervous. PW4 questioned both the appellant and PW7 about the package but the latter did not admit it was hers. The appellant on the contrary, at first kept quite but upon being questioned by PW4 a few times, finally nodded his head. Witnessed by PW5 and in the presence of the appellant, PW4 proceeded to open the package from which he found 10 transparent plastic bottles with yellow caps each containing white powdery substances suspected to be dangerous drug [Exhibits P9B(1-10) and P9C]. These exhibits were seized by PW4. The appellant, after being handcuffed, together with PW7, were taken to the first room. According to PW4, he suspected that there were other incriminating things kept in the house. [5] PW4 subsequently administered a caution under section 37A(1)(b) of Act 234 (now section 37B(1)(b)) on the appellant. PW4 read out the caution from a piece of paper (Exhibit P29) which he kept in his wallet after which he proceeded to question the appellant. The questions and 5 answers thereto were recorded by PW4 in a black note book (Exhibit P30) found on the dressing table and they are reproduced below – “Pada 20.6.2014 lebih kurang 2125hrs di bilik pertama di alamat L15-1 LT 3371 Jalan Sekolah Intan Zaharah, Kampung Balai Besar saya menyoal Wan Amirul. S : Adakah awak faham dengan kata-kata amaran yang telah saya bacakan tadi? J : (OKT berdiam diri sahaja). S : Adakah awak ada menyimpan/menyembunyikan apa-apa barang salah? J : OKT diam dan hanya (mengangguk). S : Bolehkah awak menunjukkan tempat di mana barang itu disembunyikan? J : Ya S : Di mana barang itu? J : Di belakang rumah. S : Bolehkah awak membawa saya ke tempat tersebut? J : Boleh. S : Di mana tempat sebenar barang tersebut disembunyikan? J : Di bawah batu besar. (Setelah saya menyuluh dengan menggunakan lampu suluh ke arah seketul batu dan bertanya ‘adakah batu ini’ Perayu terus menunjuk dengan menggunakan jari telunjuk tangan kanan ke arah batu tersebut). S : (Setelah saya mengalihkan batu tersebut saya bertanya lagi kepada OKT di mana barang tersebut?) J : OKT menunjuk yang barang tersebut ditanam di dalam tin di dalam tanah. (Setelah saya mengais tanah di tempat tersebut saya nampak satu tin yang bertudung. Setelah itu saya bertanya soalan lagi.) S : Di manakah barang tersebut? 6 J : Barang tersebut berada di dalam tin dibungkus dengan plastik. (Setelah saya membuka tudung tin saya dapati terdapat satu bungkusan plastik dan saya terus mengangkat tin tersebut) S : Adakah dadah yang awak maksudkan ada di dalam tin/plastik ini? J : Ya. (Saya terus mengambil bungkusan yang terdapat dalam plastik tersebut satu demi satu dan seterusnya mengangkat plastik tersebut keluar dengan diperhatikan oleh Wan Amirul dan 2 anggota saya Sudin dan Aper). S : Adakah dadah berada dalam bungkusan tersebut? J : Ya. (Saya terus membuka bungkusan dan menunjukkan dadah kepada Wan Amirul). S : Dadah ini milik siapa? J : Saya punya. S : Siapa yang simpan/tanam dadah ini? J : Saya. S : Adakah kamu bercakap benar? J : Ya. tt tt (Wan Amirul Mubin (SI Ismail Omar RF 94316)” Bin Wan Kamaruddin) The appellant signed Exhibit P30 after he was requested to do so by PW4. [6] Based on the questions, and the information provided by the appellant, PW4 was led to the back of the house by the appellant where he pointed to a rock which PW4 whereupon removed and upon removing the said rock, PW4 found the impugned drug hidden in a biscuit tin buried in the ground. The biscuit tin was found to contain a plastic package (Exhibit P17) from which plastic packets [Exhibits P18 (1-7)] tied with a 7 rubber band were recovered. Each plastic packet had 10 plastic bottles with yellow caps containing white powdery substances suspected to be dangerous drug. The number of the plastic bottles in the 7 plastic packets seized by PW4 in total was 70 [Exhibit P10B (1-70)]. It is noteworthy that PW7 told PW4 that she had no knowledge about the impugned drug. [7] PW4 seized all the incriminating exhibits and handed them over to Inspector Kasevan a/l Chandra, (PW1), the investigating officer. The evidence of the chemist, Zuzilawati binti Hassim (PW3), which was hardly challenged by the defence, confirmed conclusively that on analysis the white powdery substances were heroin with the net weight of 64.59 grammes in respect of the 70 plastic bottles [Exhibits P10B)(1-70) and P10C], the subject matter of the first charge, and 9.08 grammes in respect of the 10 plastic bottles [Exhibits P9B(1-10) and P9C], the subject matter of the second charge. Heroin therefore, according to PW3 and based on the chemist report prepared by her (Exhibit P28), is for the time being comprised in the First Schedule to Act 234 and hence dangerous drug as defined in section 2 thereof. It was also in the prosecution evidence that the house was rented by the appellant from Ahmad Abadi bin Mohd Ali (PW9), the owner thereof. According to PW9, he rented the house to the appellant in March 2014 and the house rental was handled by his younger brother Jailani bin Mohd Ali (PW12). PW12 in turn testified that he cleaned the house and removed all household items from the house before it was rented to the appellant. He gave the key to one Mokhtar Awang, PW7’s father, in March 2017 who rented the house for the appellant and PW7. PW12 further testified that the monthly rental fee was RM300.00. 8 [8] At the close of case for the prosecution, the learned judge accepted the evidence of PW3 that the white powdery substances which she had analysed were heroin with the net weight as specified in both charges. The learned judge was also satisfied that the chain of evidence in respect of the proscribed drugs was unbroken right from the point of time it was found at the location as described above to the time it was sent to PW3 for analysis and thereafter returned to PW12 where it was kept in safe custody until the same was produced as evidence in the court below during the trial. The learned judge also accepted that the house was rented by the appellant from PW9 through PW12. From the evidence of PW9 and PW12, His Lordship found that the house key was given to one Mokthar Awang, PW7’s father. Before the appellant and PW7 moved into the house, it was first cleaned up and cleared of any things which belonged to the previous tenant. Thus, according to the learned judge, anything found in the house belonged to the appellant and PW7. His Lordship found that the appellant had knowledge, custody and control of the impugned drug found in the third room of the house. As regards the drug found at the back of the house, the learned judge accepted the evidence adduced by the prosecution that the appellant led PW4 and PW5 to the discovery of the drug in question holding that sections 27 and 8 of the Evidence Act 1950 applied. Under the circumstances, the learned judge made an affirmative finding that the appellant had actual acknowledge, control and custody of the drug which was hidden in the biscuit tin and buried in the ground which in turn was covered with the rock. In view of the substantial quantity of the impugned drug contained in the 70 plastic bottles, a reasonable inference could be drawn therefrom that the drug was not meant for personal consumption but was intended for sale and trafficking to a third party. Accordingly, after undertaking a maximum evaluation of the evidence adduced by the prosecution, the 9 learned judge was satisfied on a prima facie basis, that each and every essential element of the offence under section 39B(1)(a) of Act 234 and under section 12(2) of the same Act had been proved. The learned judge also found that the presumption under section 37(da) of Act 234 applied to the appellant in respect of the first charge. [9] The appellant tendered himself as a witness. Save for the appellant, no other witnesses were called by the defence. His defence in essence was that, at the time of the raid at his house, he was at home with PW7 and his eight months old child. The appellant rented the house 3 to 4 months before he was arrested. The house had a fence. The appellant denied that the drugs found in the third bedroom and at the back of his house buried in the ground belonged to him or to his wife, PW7. He added that he did not know where did the drugs come from. The appellant also denied that the drug found at the back of the house was based on the information that he had given to the police. [10] The learned judge found that the defence was one of a bare denial unsupported by any evidence. From the defence evidence, it was clear that the house was occupied by the appellant, PW7 and their child at the material time. He kept the key to the house and paid rental to the owner through his father in law. The learned judge also considered the appellant’s testimony that no one, not even his neighbours came to the house and hence ruled out any probability of any one coming to the house and kept the drugs at the house. It follows therefore that the drugs found at the appellant’s house belonged to him. The learned judge was satisfied that the appellant failed to rebut the presumption under section 37(da) of Act 234 on the balanced of probabilities and to raise a reasonable doubt in the prosecution’s case. The appellant was accordingly convicted on 10 both charges and sentenced to death on the first charge and to 10 years imprisonment on the second charge. [11] Now we turn to consider the appeal. Before we examine the rival arguments urged on behalf of the parties, it would be apposite to start off by dealing with the question of proof. For this purpose, suffice for us to state that there are 3 requisite elements of the offence of trafficking of dangerous drug described in the first charge which the prosecution is required to prove and these are – a. the appellant was in possession of the dangerous drug with the net weight as specified in the charge; b. the appellant at the relevant time and date and the place in question had trafficked in the said dangerous drug; and c. the drug specified in the first charge is for the time being comprised in the First Schedule to Act 234 and therefore is dangerous drug as defined in section 2 of the same Act. The charge under section 12(2) of Act 234 for the offence of possession of the dangerous drug would require the prosecution to prove the element of possession of the said dangerous drug at the material time and that the same is for the time being comprised in the First Schedule to Act 234 as defined in section 2 thereof with the net weight specified in the second charge. [13] At this stage, we will allude briefly to the main points in the appellant’s appeal before us in questioning the decision of the learned judge. The first point taken in the appeal concerns the contention that so far as the evidence shows, the prosecution had failed to prove that the 11 appellant was in possession of the impugned drug at the relevant time, let alone trafficking in the said drug. This issue is common to both charges. Secondly, as regards the first charge, it was strenuously contended on behalf of the appellant that the information leading to the discovery of the impugned drug pursuant to section 27 of the Evidence Act 1950 was inadmissible. [14] It would be convenient to deal with these issues together. One thing is extremely clear, that is that, the prosecution led evidence through PW7 that both the appellant and PW7 lived at the house in question at the time of the raid. The evidence of PW9 who was the owner of the house and his younger brother PW12, confirmed that the key to the house was given to the appellant through PW7’s father around the month of March 2014. The house was rented by the appellant. This is the uncontroverted fact as the appellant had admitted it in his evidence. Both PW9 and PW12 testified that they had no knowledge about the drugs found by the police inside and outside the house which formed the subject matter of both charges. The appellant’s wife, PW7, also denied any knowledge about the drugs. The house which the appellant occupied was fenced up and in his evidence the appellant testified that he kept the house key with him and that no one including his neighbours came to the house within the perimeter fence. This evidence, in our opinion, demonstrates the clear fact that the appellant was in control of the house, and the site behind the house where the drugs were found. When this is established, prima facie, the appellant was undoubtedly in control of the impugned drugs. This proposition was authoritatively explained in R v Woodman [1974] 2 All ER 955 in which Widgery CJ said – 12 “We have formed the view without difficulty that the recorder was perfectly entitled to do what he did, that there was ample evidence that English China Clays were in control of the site and had taken considerable steps to exclude trespassers as demonstrating the fact that they were in control of the site, and we think that in ordinary and straightforward cases if it is once established that a particular person is in control of a site such as this, then prima facie he is in control of articles which are on the site” [15] The learned judge in his decision invoked the presumption of trafficking under section 37(da) of Act 234. It is, we apprehend, the basic requirement of the law that, any reliance on the presumption under section 37(da) would necessitate the prosecution to prove that the appellant had possession of the impugned drug. That is the essential element which must be proved by the prosecution and the trial judge on his part is required, as evident by the use of the word ‘found’ in the opening phrase of section 37(da), to make an express affirmative finding of the basic or primary facts with regard to the possession of the impugned drug so that when this is fulfilled, the proof of possession would consequently give rise to the presumption of trafficking, [Muhammed bin Hassan v Public Prosecutor [1998] 2 MLJ 273 at pages 288 and 289]. [16] The law must now be taken as settled that to prove possession of the drug in question, the prosecution must inevitably prove that the appellant knew the nature of the drug he possessed, he had power of disposal thereof and was conscious of the same. The law of possession was lucidly explained by the Federal Court in the case of PP v Denish Madhavan [2009] 2 CLJ 209. Abdul Aziz Mohamad FCJ there said – 13 “[15] The question of others having access to the respondent’s room was considered by the learned trial judge both after the close of the case for the prosecution and in evaluating the case after hearing the defence. The learned trial judge said that the matter of access by others was “to negative the proof of exclusive possession”. Before us the respondent’s counsel was candid enough as to what the respondent’s aim was in seeking to show the probability of access by others as a matter negativing exclusive possessions: it was to assert that the cannabis in the three bags under the bed could have been concealed or planted there by these other persons. The learned trial judge did not allow himself to be distracted by this suggestion of access by others from the evidence that he found to exist of “exclusive” possession of the cannabis on the part of the respondent. He did, nevertheless, make findings on the evidence relating to access by others. He found on the evidence that Boy had already ceased living at the house when it was raided. As regards Razali, he found there was no evidence that Razali had a set of the keys of the house although there was evidence that Razali had been entering the house to care for a hamster that was in a cage in the common or guest area. [16] Before proceeding to consider the reasons for the Court of Appeal’s decision, we will say a few words about “exclusive” possession. It is inappropriate to speak of possession of an article in criminal law as exclusive possession. One is, either in possession or not in possession, although one could be in possession jointly with another or others. To say that the prosecution of a drug case fails because there has been no proof of exclusive possession is apt to convey the wrong impression that it is only in cases where possession is entirely with one person, - that is, “exclusive” – that a conviction is possible. When the learned trial judge said “The accused sought to negative the proof of exclusive possessions…”, we take it that he meant no more than that the respondent sought to show that he was not in possession of the drugs because he had no knowledge of their 14 existence and that the drugs could have been placed in his bags by some other person or persons. [17] The idea of exclusively features in the meaning of “possessions” in criminal law as one of the elements necessary to constitute possession. As Taylor J said in Leow Nghee Lim v. Reg. [1955] 1 LNS 53 : …It is often said that ‘possession must be exclusive’. This is ambiguous. Possessions need not be exclusive to the accused. Two or more persons may be in joint possession of chattels, whether innocent or contraband. The exclusive element of possession means that the possessor or possessors have the power to exclude other persons from enjoyment of the property. Custody likewise may be sole or joint and it has the same element of excluding others. The main distinction between custody and possession is that a custodian has not the power of disposal. The statement that ‘possessions must be exclusive’ is often due to confusion of the fact to be proved with the evidence by which it is to be proved. It is essential to keep this distinction clearly in mind, especially when applying presumptions. [18] Thomson J, in Chan Pean Leon v. Public Prosecutor [1956] 1 LNS 17, said that “possession” for the purpose of criminal law involves possession itself – which some authorities term “custody” or “control” – and knowledge of the nature of the thing possessed. As to possession itself he cited the following definition in Stephen’s Digest (9th edn, p. 304), in which the exclusive element mentioned by Taylor J appears: A moveable thing is said to be in the possessions of a person when he is so situated with respect to it that he has the power to deal with it as owner to the exclusion of all other persons, and 15 when the circumstances are such that he may be presumed to intend to do so in case or need. [19] Once the elements needed to constitute possession are established, including the element of exclusive power to deal, then what is established is possession, not exclusive possession. So much for exclusive possession.” [17] Having considered the evidence, and mindful of the above principle relating to the law of possession, we find no difficulty whatsoever in holding that the element of knowledge in respect of the illicit drug which is necessary to show possession of the same, had been established by the combined evidence of the appellant’s information and his conduct which led distinctly to the discovery of the drug concealed in the biscuit tin and buried in the ground at the back of his house with the surface covered by earth and the rock. It is abundantly clear that this information, had been proved pursuant to section 27 of the Evidence Act 1950 and is admissible since the drug that was recovered was in consequence of the information given by the appellant to PW4. We now quote from the Evidence Act 1950 section 27 – “How much of information received from accused may be proud 27. (1) When any fact is deposed to as discovered in consequence of information received from a person accused of any offence in the custody of a police officer, so much of that information, whether the information amounts to a confession or not, as relates distinctly to the fact thereby discovered may be proved.” [18] We are mindful of the fact that the information was obtained after the appellant was cautioned pursuant to section 37A(1)(b) of Act 234. However, we consider the appellant’s information that the drug was at the 16 back of the house and that he subsequently led the police to the exact spot where the drug was found as an information which falls squarely under section 27 of the Evidence Act 1950. Such information, in order to be admissible in evidence, does not require the prosecution to prove that the information was voluntary, hence it is not necessary to conduct a trial within a trial to determine the voluntariness thereof. To support this proposition, we refer to the case of Siew Yoke Keong v PP [2013] 4 CLJ 149 in which the Federal Court at page 167 paragraph [28] clearly stated that for such information to be admissible in evidence, there is no duty on the prosecution to prove the voluntariness of the information, hence it is not necessary to conduct a trial within a trial to determine the voluntariness of the information. The essential requirement is that the appellant gave the discovery information to PW4 and in this case we are satisfied that he actually did. [19] The other requirement turns on the credibility of the witness namely PW4 who gave the evidence in connection with the discovery information [Krishna Rao Gurumurthi & Anor v PP & Another Appeal [2007] 4 CLJ 643]. It is apparent from the learned judge’s comprehensive judgement that His Lordship had directed himself on the issue of credibility of PW4 and accepted his evidence that the discovery information was in fact given by the appellant to him. The information was also accurate. The learned judge considered that the appellant led PW4 to and pointed the exact spot where the drug was found. As earlier stated, the drug was concealed in the biscuit tin and buried in the ground with the surface covered with earth and the rock. It would be useful to remember that the initial discovery of the drug in the third bedroom did not lead to the discovery of the drug at the back of the house. In fact the learned judge observed correctly that the police team did not know about the drug hidden at the back of the 17 house. It was only upon the information provided by the appellant that PW4 found the drug in question. It was so hidden that it required some efforts on the part of the police team before the drug was found. The learned judge considered and accepted the evidence of PW4 that he did not have initial information in respect of the site where the drug was hidden. [20] Moreover, the manner in which the drug was hidden in no way leaves any margin of doubt in our minds that the appellant knew about the drug and where it was kept. It could not have been found without the discovery information and the conduct of the appellant in taking PW4 and pointing to the exact location where the drug was finally found. The court in the case of Faisal Abd Aziz v PP [2011] 9 CLJ 285 on this issue had this to say – “A quick look at the grounds of judgment, will indicate that the trial judge had in fact made an affirmative finding of possession of the drugs by the appellant. In his judgment, the judge (at p.55 of the record of appeal) wrote: It is also pertinent to stress that the manner of the packaging in small packets and the circumstances relating to the accused conduct of handing the two packets P8A and P8B and the act of pointing and picking the Old Spice bag P9 and handing it to SP3 to my mind not only established custody and control over P8A and P8B and P9 but also knowledge as to the contents of the cannabis in P8A and P8B and the cannabis content of P9. The manner and the place where P9 was found namely concealed in the bushes clearly establishes that it was only the accused who knew of its placement and concealment. It cannot have been 18 found without the accused conduct of pointing to P9 and the plastic packets P8A and P8B was taken from the same place where P9 was found. Based on the available evidence, we find that the learned trial judge has not erred in law or on facts in making such a finding.” [21] That brings us to the prosecution’s argument on the relevancy of the appellant’s conduct in leading PW4 and other police personnel to the site where the drug was found. The evidence of PW4 that the appellant led the police personnel to and pointed out the exact spot where the drug was found hidden is in our judgment relevant and admissible as conduct under section 8(2) of the Evidence Act 1950. Such evidence of conduct is admissible irrespective of whether the appellant’s statement to PW4 which preceded such conduct falls within the purview of section 27 of the same Act. This was the approach adopted by the Federal Court in Siew Yoke Keong v PP, supra, when it held as follows: “[29] In addition, it must be added that the evidence of Siew leading PW6 and the police team to the first house and pointing out the place where the bunch of eight keys was found, and later pointing out the place where the key to the safe was found would also be relevant and admissible as conduct under s. 8 of the Evidence Act. In this regard in Prakash Chand v State AIR [1979] SC 400, the Supreme Court of India said: For example, the evidence of circumstances, simpliciter, that an accused person led a police officer and pointed out the place where stolen articles or weapons which might have been used in the commission of the offence were found hidden, would be admissible as conduct, under section 8 of the Evidence Act, irrespective of whether any information contemporaneously with or antecedent to 19 any such conduct falls within the purview of section 27 of the Evidence Act...” [22] At the close of case for the prosecution, the learned judge admitted the information in evidence pursuant to section 27 of the Evidence Act 1950 after His Lordship was satisfied that the conditions in which such information could be admitted had been fulfilled– a. the discovery of the drug was in consequence of the discovery information supplied by the appellant ; b. the appellant at the relevant time was under police detention; c. the drug recovered was in fact hidden from the public view; d. PW4 did not have any prior knowledge of the fact that the drug was concealed at the place in question; and e. the information was given by the appellant and recorded in Exhibit P30 by PW4. [23] It is an important point to emphasize that the learned judge only relied on the evidence relating to the relevant information recorded in Exhibit P30 that led distinctly to the discovery of the drug. His Lordship excluded other words which formed part of the information provided by the appellant to PW4. To be specific the learned judge did not consider the appellant’s admission as shown below– “S: Dadah ini milik siapa? J: Saya punya. S: Siapa yang simpan/ tanam dadah ini? J: Saya”. 20 It might be apposite to be reminded of the obvious, that section 27 of the Evidence Act 1950 on this aspect only accepts so much of the information as relates distinctly to the fact thereby discovered. The well-establised principal which governs the admissibility of an information under section 27 is that any statement which is prejudicial to the person from whom such information is received is inadmissible and if it is admitted, it ought to be expunged [PP v Lim Hock Boon [2009] 3 CLJ 430]. It is plain that the learned judge was entirely correct in admitting the information in evidence pursuant to section 27 of the Evidence Act 1950 and in concluding that such information and conduct of the appellant manifestly showed knowledge of the drug concealed at the site in question. Accordingly, we cannot accede to the argument urged for the appellant that the information is not admissible. [24] We would once again allude in greater detail to the evidence of PW4 which described the manner in which the drug was carefully concealed in order to avoid detection. The site in question which was at the back of the house and near the rear fence was covered with the earth and the rock. When PW4 removed the rock using a steel digger (PW4 called ‘cok’ in the Malay language) which he found at the back of the house, he noticed that the spot was covered with earth. He used the steel digger to dig and remove the earth until he could see the cover of the biscuit tin. PW4’s evidence was supported by his officer PW5. In our judgment, the cumulative effect of the combined evidence of the manner in which the drug was concealed at the back of the house, coupled with the fact that he was the tenant thereof and PW7’s clear denial of any knowledge about the drug, clearly showed that there was a strong connection between the appellant and the place chosen as well as the drug that was found. An inference which could be drawn, without question, could significantly go 21 beyond a mere inference of knowledge. We would say without any hesitation that an inference could also convincingly be made that considering the circumstances of this case, the appellant was in control of the drug and was so situated with respect to it that he had the power to deal with it as owner that would exclude others from enjoyment of the same and was thus in possession of the said drug [PP v Denish Madhavan, supra]. It clearly evinced the appellant’s intention to conceal the drug in order to avoid detection by the relevant enforcement authorities. [25] Therefore, His Lordship’s conclusion that the appellant had possession of the drug in the first charge could not be faulted and his inevitable invocation of the presumption of trafficking in the illicit drug under section 37(da) of Act 234 was impeccable. The weight and the nature of the drug which was proven to be heroin as specified in the first charge and proved by the prosecution during the trial through the conclusive evidence of PW3 which we have considered very early in our judgement, supported the invocation of the presumption. We would in addition hold that the learned judge was also correct in taking into account the substantial quantity of the drug contained in the 70 plastic bottles which justified His Lordship’s inference that the said drug was not meant for the appellant’s personal consumption. In our judgment, the quantity of the drug was much larger than was likely needed for the appellant’s consumption. He could not have such a quantity in his possession carefully kept in 70 plastic bottles, concealed in the biscuit tin, buried in the ground and covered with the rock save for the obvious purpose of trafficking it to others known or unknown. 22 [26] We turn to the second charge. The question immediately arises is whether the learned judge had undertaken a full appreciation of the evidence. We have to remember that the prosecution had to prove the essential element of possession of the drug at the place, time and date as specified in the second charge. It is abundantly clear that the prosecution had adduced overwhelming evidence to show that the appellant was in possession of the drug found in the third bedroom at the appellant’s rented premises. It is apparent from the evidence that the house from which the drug was found was occupied by the appellant, PW7 and their eight month old child. At the time of the raid, only the appellant, PW7 and their child were in the house. The house was locked and the door was opened by the appellant at the relevant time. The prosecution also led evidence through PW9 and PW12 that the key to the house was handed over to PW7’s father and that the house was cleaned and cleared of household items of the previous tenant before the key was given to PW7’s father. Both PW9 and PW12 in their evidence testified that they had never seen the incriminating exhibits found in the house. Moreover, PW7 in her testimony confirmed that the drug did not belong to her and she had no knowledge about the same. The sum total of the above evidence clearly established that the appellant knew about the drug and was therefore conscious of his possession of the same. The appellant’s defence which is in the nature of a bare denial failed to rebut the above evidence. [27] The defence adopted by the appellant does not affect nor dislodge the prosecution evidence that the appellant had possession of the impugned drug. Instead, the appellant’s testimony had further strengthened the prosecution’s case against him. In his defence, the appellant testified that he paid rentals for the house to his father in law to be paid to the landlord. He also admitted that the house key was kept by 23 him and that there was only one key which he never gave to other persons except his wife. Cross-examined by the learned Deputy Public Prosecutor, the appellant agreed that he had control and care of the house. The appellant also told the court that no other persons, including his neighbours came to the house. It is clear to us therefore that anything found in the house belonged to the appellant and PW7. But, so far as it concerned PW7, she had denied any knowledge about the drug found in the house and that on the contrary, she testified that the drug did not belong to her. This evidence was accepted by the learned judge. It would therefore be inevitable for the learned judge to arrive at a correct finding that the evidence adduced by the prosecution and the appellant’s defence clearly showed beyond any doubt that the appellant alone had custody or control of the premises from which the drug was found and by virtue of section 37(d) of Act 234, the appellant is deemed to be in possession of the drug and until the contrary is proved, to have known the nature of such drug. We accept the position in law that the ‘deemed’ state of affairs in section 37(d) that is, the deemed knowledge is by operation of law and there is no necessity to prove how that particular state of affairs is arrived at. The prosecution need only to establish the basis or primary facts necessary to give rise to that state of affairs, that is, the finding of custody or control [Muhammed bin Hassan v Public Prosecutor, supra]. In any event, there is no evidence that the appellant was framed up by the police or any other persons. We would observe that this is not the defence case at all. On the contrary, the evidence has clearly shown that the appellant was in possession of the drug that would exclude others from enjoyment of the same. [28] It is at this stage important to state that the defence case in respect of both charges is one of a bare denial. As regards Exhibit P30 which 24 contains the information under section 27 of the Evidence Act 1950, the appellant flatly denied that he ever gave the information and signed it. It is hard to believe that the appellant did not sign Exhibit P30 when the irrefragable evidence showed that PW7 had also signed a similar document in Exhibit P32 in which she denied knowledge or having possession of the drug found at the back of the house. His stance would not, in our judgement, go beyond a mere denial as to persuade us to accept his claim that he did not give the information. We would say that PW4 could not have discovered the proscribed drug if not for the information obtained from the appellant. It is unthinkable that PW4 had fabricated evidence in view of the complete absence of any evidence or allegation by the appellant that PW4 had made up a story regarding Exhibit P30. In fact, the appellant admitted during cross – examination that PW4, PW5 as well as PW7 had absolutely no reasons to lie about him. PW4 and PW5 were police officers who were merely performing their duties and they had no reasons to lie or to frame up the appellant whom they said they did not know. The learned judge had accepted their evidence and we find no reasons whatsoever to interfere with the decision and the assessment of the evidence of PW4, PW5 and PW7 by the learned judge. The learned judge was perfectly entitled to accept the evidence of these witnesses whose credibility His Lordship found to be impeccable. [29] In the case of Wong Kok Chun lwn PP [2012] 1 LNS 419 this Court in the judgement of Hasan Lah JCA (as His Lordship then was) said– “[62] Kami juga menolak pembelaan perayu bahawa dia tidak ada memberi maklumat sedemikian kepada SP5 kerana kami berpendapat tidak ada sebab untuk SP5 berbohong mengenai perkara ini. SP5 adalah seorang pegawai polis yang melaksanakan 25 tanggungjawabnya. Tidak ada sebab untuk beliau menganiaya perayu. Apa yang diberitahu oleh SP5 kepada mahkamah adalah perkara yang sebenarnya berlaku. Hakim perbicaraan telah menerima keterangan SP5 dan tidak ada sebab untuk kami mengganggu keputusan tersebut. Perlu juga ditegaskan di sini dalam menilai kebolehpercayaan saksi-saksi, Mahkamah Rayuan tidak sepatutnya mengganggu dapatan hakim perbicaraan kerana beliau adalah orang yang lebih layak untuk membuat pertimbangan sedemikian (lihat Andy Bagindah v. PP [2000] 3 CLJ 289; [2000] 3 MLJ 644)”. [30] It is significant to bear in mind that since both PW4 and PW5, were merely carrying on their official duties at the relevant time, in law the court is entitled to presume that their official acts were regularly performed and prima facie they did so honestly and conscientiously. Section 114 illustration (e) of the Evidence Act 1950 in this regard provides that the court many presume that judicial and official acts have been regularly performed. In the case of PP v Dato’ Seri Anwar Ibrahim [2014] 4 CLJ 162, the Court of Appeal said – “It must be borne in mind that s. 114 illustration (e) of the Evidence Act 1950 provides that the court may presume that judicial and official acts have been regularly performed. In State of Punjab v. Rameshwar Dass [1957] Cri LJ 1630, the Punjab & Haryana Court held at p. 1631 as follows: It is well settled that prima facie the public servants must be assumed to act honestly and conscientiously. It would, therefore, be basically wrong, without other cogent ground to consider them as untrustworthy witness in respect of their activities in performance of their official duties merely because of their official status unless 26 the evidence is considered to be suspicious and that the conviction of the accused cannot be sustained on the statements of the official witnesses. The presumption that a person acts honestly applied as much in favour of a police officer as of other persons, and it is not a judicial approach to distrust and suspect him without good grounds.” [31] Accordingly, without cogent reasons that would allow us to hold otherwise, it would be manifestly wrong to consider PW4 and PW5 as untrustworthy witnesses in handling this case. In the end what we have before us is nothing more than the bare oral testimony which was a mere denial. We are satisfied that the appellant’s denial in his defence, as alluded to earlier considered in the light of the entire evidence upon which this Court has subjected to anxious scrutiny, has failed to exonerate the appellant from his involvement in both offences of trafficking and possession of the dangerous drugs under sections 39B(1)(a) and 12(2) of Act 234 respectively and could not rebut the presumption of trafficking under section 37(da) of Act 234 in relation to the first charge and the presumption of possession and knowledge under section 37(d) of the same Act in respect of the second charge. A bare denial is insufficient to raise a reasonable doubt in the prosecution’s case [Faisal Abd Aziz v PP, supra]. It was a perilous course of action for the appellant to take that would amount to the appellant offering no explanation to the prosecution’s case. This was what the Court of Appeal in Amran Senin v PP [2013] 1 LNS 1504 had held– “[48] The High Court Judge narrated and evaluated the defence of the appellant from pages 223 to 239 of the Appeal Record at Jilid 2. Having invoked the presumption of trafficking under section 37(da) of 27 the DDA, the High Court Judge held that the defence has the burden of rebutting the presumption on the balance of probabilities (Public Prosecutor v. Yuvaraj [1969] 2 MLJ 89, PC). The High Court Judge agreed with the deputy public prosecutor having conduct of the prosecution that the defence of the appellant was nothing more than a mere denial. Indeed the High Court Judge after having assessed the whole evidence aptly said at page 238 of the Appeal Record at Jilid 2: “Jelas daripada keseluruhan keterangan yang dikemukakan bahawa pembelaan ‘T’ semata-mata penafian yang tidak disokong oleh mana-mana keterangan sama ada dari saksi-saksi pendakwaan mahupun keterangan beliau sendiri.” [49] A defence of bare denial envisages the situation where the accused offers no explanation to the prosecution’s case and merely denies the evidence piled up against him. This was the line of defence adopted by the appellant. It was a perilous course of action to take (D.A. Duncan v. Public Prosecutor [1980] 1 LNS 12; [1980] 2 MLJ 195, FC; Public Prosecutor v. Nur Hassan bin Salip Hashim & Anor [1993] 2 CLJ 551; Andy bin Bagindah v. Public Prosecutor [2000] 3 CLJ 289; [2000] 3 MLJ 644, CA; Public Prosecutor v. Low Soo Song [2004] 1 LN 582 [2004] 3 AMR 320; and PP v. Abdul Manaf Muhamad Hassan [2006] 2 CLJ 129, FC). [50] It must be emphasised that both SP4 and SP9 had no bad motives to frame up the appellant. The appellant also agreed that the police had no reason to put the appellant in trouble especially when the offence carried with it the death penalty. Consequently, there was no reason not to believe the evidence of SP4 and SP9. [51] The High Court Judge rightly took judicial notice that “ganja” emitted a strong smell and even if what the appellant said was true that the drugs were located in the boot of the Proton Wira motorcar (which was strenuously denied by the prosecution), it cannot be 28 overlooked that the appellant could still smell the “ganja”. The strong smell of “ganja” was even detected by SP4. [52] At the end of the day, the defence of mere denial cannot rebut, on the balance of probabilities, the presumptions of trafficking under section 37(da) of the DDA. It was a forgone conclusion for the appellant.” [32] Having regard to all the foregoing reasons and the well recognised principles distilled from the authorities hereinbefore referred to, we think it is proper at this concluding stage for a finding to be made that the appellant’s convictions on both charges are safe. It is clear to us that the learned judge undertook a correct and adequate judicial appreciation of the entire evidence concluding in the end that the appellant, as regards the first charge had obviously failed to rebut the presumption of trafficking under section 37(da) of Act 234 and as for the second charge, had failed to rebut the presumption of possession and knowledge under section 37(d) of the same Act on the balance of probabilities. Accordingly, we unanimously find no difficulty whatsoever in holding on the strength of the evidence and on the law that the charges of trafficking in and possession of the dangerous drugs namely heroin had been successfully proved against the appellant beyond reasonable doubt. We therefore affirmed the order of conviction and sentence by the learned judge in respect of both charges. [33] However, a final point needs to be made. The learned judge, in respect of the second charge, refrained from imposing a mandatory whipping of not less than 10 strokes under section 29 39A(2) of Act 234 on the ground that the appellant had also been sentenced to death on the first charge. We think the decision is erroneous. The learned judge had obviously taken into account irrelevant factor as the death sentence imposed for the offence under the first charge should not have any bearing on the sentence to be meted out for the offence under the second charge. His Lordship had undoubtedly omitted to consider that the sentence of whipping is mandatory for the offence with which the appellant was charged and found guilty under section 12(2) and punishable under section 39A(2) of Act 234. For these reasons we sentenced the appellant to whipping of 10 strokes in addition to the sentence of imprisonment of 10 years imposed by the learned judge. The appeal is dismissed. Signed ( IDRUS BIN HARUN ) Judge Court of Appeal, Malaysia Putrajaya Dated: 29 August 2017 30 1. Counsel For The Appellants - Encik Wan Zainuddin bin Wan Musa Wan Zainudddin & Co. No.17, Lot 3684 Taman Sri Intan Jalan Sultan Omar 20300 Kuala Terengganu 2. Counsel For The Respondent - Puan Kwan Li Sa Timbalan Pendakwa Raya Bahagian Perbicaraan dan Rayuan Jabatan Peguam Negara No. 45, Persiaran Perdana Presint 4 62100 Putrajaya

Tika 2.6.0

B-05(M)-58-01/2016

PENDAKWARAYATPR En. Ahmad Sazilee bin Abdul Khairi PERAYU Cheu Kok Choon

Dangerous Drugs — Trafficking — Appeal against conviction and sentence — 560.1 grammes of methamphetamine — Hidden inside the pair of tights that the appellant wore — Whether statutory presumption rebutted— Whether the drug found was a frame-up against the appellant — Allegation of frame-up by police — Whether conviction safe — Dangerous Drugs Act 1952 [Act 234], s 37(da), s 39B(1)(a)

29/08/2017

YA TAN SRI IDRUS BIN HARUNKorumYA DATUK SERI HAJI MOHD ZAWAWI BIN SALLEHYA TAN SRI IDRUS BIN HARUNYA DATUK KAMARDIN BIN HASHIM

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=8af3cd5a-d8f3-4646-b2bb-42282b189675&Inline=true

Microsoft Word - AP - (58) CHEU KOK CHOON DALAM MAHKAMAH RAYUAN MALAYSIA DI PUTRAJAYA (BIDANG KUASA RAYUAN) RAYUAN JENAYAH NO : B-05(M)-58-01/2016 ANTARA CHEU KOK CHOON … PERAYU DAN PENDAKWA RAYA … RESPONDEN [Dalam Perkara Mahkamah Tinggi Malaya Di Shah Alam Perbicaraan Jenayah No: 45A-136-12/2014 Antara Pendakwa Raya Dan Cheu Kok Choon] CORAM MOHD. ZAWAWI BIN SALLEH, JCA IDRUS BIN HARUN, JCA KAMARDIN BIN HASHIM, JCA 2 GROUNDS OF JUDGMENT [1] The appellant in this appeal was tried in the High Court under section 39B(1)(a) of the Dangerous Drugs Act 1952 (Act 234 for short) for an offence of trafficking in dangerous drug involving 560.1 grammes of methamphetamine which is punishable under section 39B(2) of the same Act. He was convicted of the offence and sentenced to death by the High Court. This appeal is against the decision of the High Court in which the appellant was convicted and sentenced for the above offence. On 11.8.2017 this appeal was dismissed by this Court. At that instant, we did state that reasons in writing would be given for that dismissal in due course and this we now do. We begin by setting out the charge against the appellant which reads – “Bahawa kamu pada 6 Mac 2014, lebih kurang jam 6.59 pagi bertempat di kawasan Balai Perlepasan Dalam Negeri, LCCT Sepang, di dalam Daerah Sepang, di dalam negeri Selangor Darul Ehsan, telah didapati memperedarkan dadah berbahaya iaitu seberat 560.1 gram Methamphetamine dan dengan itu kamu telah melakukan suatu kesalahan dibawah Seksyen 39B(1)(a) Akta Dadah Berbahaya 1952 yang boleh dihukum di bawah Seksyen 39B(2) Akta yang sama.” [2] The material facts upon which the prosecution’s case is based are simple and straight forward. On 6.3.2014 at approximately 6.59 am, Constable Mohamad Shahril bin Tambi Chik (PW3) was on duty at the security check point where there was a AMD or Alloy Metal Detector Machine (the detector machine for short) to screen passengers at the Departure Hall of the Low Cost Carrier Terminal Sepang (the LCCT for short). With PW3, at that particular time, was Constable Mohd Khuddri Isa. It was led in evidence that the detector 3 machine sounded when the appellant was walking through it indicating that it had detected the presence of metal objects. PW3 then proceeded to make a physical body inspection on the accused following which he felt some object below the appellant’s waist. The appellant at the relevant time wore a blue shirt and a pair of blue jeans. When PW3 questioned the appellant about it, the appellant told PW3 that it was his body fat. As PW3 was suspicious of the answer, the appellant was then brought by PW3 to a room which was located behind the detector machine for thorough inspection. Whilst in the room, PW3 told the appellant to take off his trousers and PW3 noticed thereafter that the appellant was wearing a pair of black tights instead of an underwear. The appellant then took out from his tights a pink cloth bag [Exhibit P8] and 2 black cloth bags [Exhibits P9 and P10]. Upon being told subsequently by PW3 to open the 3 bags the appellant opened the bags and from inside these bags he took out 3 plastic packets [Exhibits P8A, P9A and P10A] which were found to contain powdery crystal substances [Exhibits P11, P12 and P13]. When PW3 asked the appellant what was the thing in the 3 plastic packets the appellant said it was ‘syabu’. [3] After the search, the appellant, together with the drug exhibits were brought by PW3 to a police station situated at the LCCT where PW3 lodged a police report [Exhibit P17]. From the LCCT police station, PW3 accompanied by police escorts, brought the appellant and the incriminating exhibits to Sepang Police Station (IPD Sepang). Whilst at the IPD Sepang, PW3 marked the 3 cloth bags as S1, S2 and S3 and the 3 plastic packets as S1A, S2A and S3A. PW3 also found from the wallet taken from the rear pocket of the appellant’s trousers cash in the sum of RM2,429.00. A search list (Exhibit P18A- 4 D) for the exhibits seized from the appellant was also prepared by PW3. On the same day at about 1 pm, PW3 handed over the appellant and all the exhibits listed in the handing over exhibits list (Exhibit P19A-F) to the investigating officer, PW6 who kept the exhibits in a cupboard in his office under lock and key. PW6 also marked Exhibit P8 as AA, Exhibit P8A as AA1, Exhibit P9 as AB, Exhibit P9A as AB1, Exhibit P10 as AC and Exhibit P10A as AC1 before they were placed in the cupboard. [4] On 7.3.2014, PW6 sent Exhibits P8, P8A, P9, P9A, P10 and P10A which were placed inside a sealed box marked as A (Exhibit P7) to the chemist, PW1 for analysis. The evidence of PW1 as well as the chemist report (Exhibit P6) prepared by her, were hardly challenged by the defence and it confirmed on analysis that Exhibit P8A contained 188.4 grammes of methamphetamine, Exhibit P9A contained 182.0 grammes of methamphetamine and Exhibit P10A contained 189.7 grammes of methamphetamine. The combined weight of the illicit drug is 560.1 grammes which is the weight specified in the charge. The drug is comprised in the First Schedule of Act 234 and therefore is dangerous drug as defined in section 2 thereof. On 14.7.2014, PW6 received Exhibit P7 together with a chemist report (Exhibit P6) from PW1. The exhibits were kept in the exhibits store at IPD Sepang under lock and key until it was produced in the High Court during the trial of this case. [5] On 11.3.2014, PW6 had also sent a specimen of the appellant’s blood (Exhibit P26), a pair of the appellant’s blue jeans (Exhibit P22) and a pair of the appellant’s black tights (Exhibit P24) to the chemist, PW4. PW6 received these exhibits together with a chemist report 5 (Exhibit P28) from PW4 on 3.11.2015. We could glean from Exhibit P28 that, based on the analysis conducted by PW4, only 2 bags that is Exhibits P8 and P10 were found to contain traces of the appellant’s DNA profile and as regards the other bag (Exhibits P9), no traces of DNA could be extracted thereform. [6] At the close of case for the prosecution, the learned judge made the following findings: a. the evidence of PW1 sufficiently proved that the incriminating powdery crystal substances consisted of 560.1 grammes of methamphetamines; b. the prosecution had proven that the appellant was in possession of the impugned drug which was hidden inside the pair of tights that the appellant wore. From the way the drug was carefully kept in the 3 cloth bags and concealed under the appellant’s waist by the pair of tights he was wearing, it could be inferred that the appellant had knowledge of the impugned drug. The fact that he was wearing the pair of tights instead of an underwear showed that the appellant wanted to secure the drug closely to his body and to prevent it from falling out and to avoid detection; c. there was no doubt that the drug recovered by PW3 was the same drug sent to and examined by PW1 and subsequently produced in court as evidence. Every link in the chain of evidence relating to the custody of the drug exhibit from the moment the exhibit was recovered by PW3 up to the time it was produced in court was sufficiently proven by the prosecution; 6 d. even though there were some discrepancies in PW3’s evidence, they were not material and did not affect the strength of the prosecution’s case, his evidence was more than sufficient to prove possession of the impugned drug by the appellant; e. as the weight of the drug was 560.1 grammes in excess of the stipulated statutory limit, the presumption of trafficking under section 37(da) of Act 234 was invoked; and f. the prosecution had succeeded in proving a prima facie case of drug trafficking against the appellant as charged. The appellant was called upon to enter on his defence. [7] The appellant in his defence tendered himself as a witness. Save for the appellant, no other witnesses were called to testify on behalf of the defence. On the facts of the defence evidence, the position adopted for the appellant is that in essence, on 6.3.2014 the appellant passed through the metal detector machine before he boarded an aircraft bound for Labuan. When the machine made a sound, a police personnel conducted a body inspection on him and thereafter directed him to go to a room where his wallet and luggage were inspected. The appellant testified that he carried some cash and he refused to give the money in his wallet. He claimed that the police personnel then gave the drug to him whilst he was in the room and he was told to hold it. The appellant was subsequently taken to the police station at the LCCT after which he was taken to IPD Sepang. At IPD Sepang, the appellant claimed that he told the police that he carried cash RM50,000.00 in his luggage bag and when he refused to give the money to the police personnel at the LCCT, they brought out the 3 packets of drug which the appellant denied any 7 knowledge of its contents. However, the police officer at IPD Sepang did not believe the appellant and they instead gave him a good beating. The appellant insisted that the drug did not belong to him and he only knew the 3 packets contained the drug after the police opened them at IPD Sepang. [8] Under cross-examination, the appellant maintained his earlier evidence that the police personnel framed him up by giving him the drug when he refused to give the money. The appellant however admitted that he did not lodge a police report the reason being that he was sent to the prison in Sungai Buloh. He agreed to a suggestion by the learned Deputy Public Prosecutor that when he was brought before a Magistrate he had the opportunity to lodge a complaint that he was beaten up by the police and that the police set him up but he did not do so. The appellant also agreed that he could have asked his family or counsel to make a police report and that he did not know the motive of the police to push the drug to him. [9] In his grounds of judgement, the learned judge accepted the evidence of PW3 holding that there were no cogent reasons to disbelieve him. PW3, according to His Lordship, was not an interested witness but a police officer performing his duty at the LCCT. Further, there was no evidence adduced by the appellant to show that PW3 bore any grudge against the appellant or had any evil motive against him. The learned judge rejected the defence version that the case against the appellant was a police set up and accepted the prosecution’s case that the drug was found inside the appellant’s pair of tights. As regards the alleged cash of RM50,000.00, the learned judge found that there was not an iota of evidence to prove the said 8 amount existed and that the defence failed to put the appellant’s case of the police frame-up in detail that is the police found his cash of RM50,000.00 and when he refused to give them, they took out the drug and framed him up. Accordingly, the defence failed to rebut on a balance of probabilities the presumption of trafficking under section 37(da) of Act 234. The appellant was found guilty as charged and sentenced to death by hanging. [10] We shall now to consider the appeal by the appellant which without doubt, turns upon a pure question of fact. It centres on the principal issue concerned with the evidence of PW4 that the DNA traces of the appellant were not found on a bag marked AB (Exhibit P9) which, we apprehend, immediately raises the question as to who was the owner of the said bag, could it be that the bag and the other 2 bags from which the drugs were found belonged to an unknown person. It thus brings us to the argument that it did not make sense for the learned judge to hold that all the drugs found in the 3 bags belonged to the appellant. In our judgement in this appeal, it would be useful to remember that the evidence of PW4 showed that she received Exhibits P8, P9 and P10 from PW1. These exhibits were the 3 bags which were found to contain the 3 plastic packets containing the impugned drug hidden inside the appellant’s pair of tights which he wore at the material time. The chemist report which was prepared by PW4 (Exhibit 28) reveals that only 2 bags, that is, Exhibits P8 and P10 were found to contain traces of DNA profile of the appellant whereas with regard to the other bag that is Exhibit P9, no traces of DNA could be extracted from it. PW4 in her oral testimony explained that she tried to obtain DNA traces but no such traces were found on Exhibit P9. Elaborating further, PW4 testified that she tried to obtain 9 DNA traces based on the traces of sweat on the bag in question but this would be dependent on the person who held the bag that is whether he was sweating when he held the bag and more accurately or he touched the bag for a shorter or longer time. If the bag was held or touched for a longer time there was a possibility that DNA traces would be left on the bag. [11] In his grounds of judgement, the learned judge observed that PW4 had explained giving reasons why the traces of DNA were not found as opposed to the bags marked as Exhibits P8 and P10. The above evidence shows that PW4 had given her explanation and one thing seems to be clear to us that is that the learned judge accepted the said explanation and rejected the contention urged for the defence that there was a doubt as to the actual person having possession of all the 3 bags. We find no reasons whatsoever to disturb the factual finding made by the learned judge and we accept PW4’s explanation on the absence of the appellant’s DNA profile as reasonable under the circumstances of the case. [12] In any event, it is a significant point to emphasise that, notwithstanding the above finding, the learned judge correctly held that without considering the findings of the DNA that would corroborate the connection between the appellant and the drug found in the 3 bags, there was overwhelming evidence to show that the appellant had possession of the proscribed drug at the material time. We would say on this aspect that where there is clear evidence indicating the identity of the offender, finger print evidence, and if we may add, DNA traces of the offender assumes little value or significance. It is only in a situation where the identity of the culprit is 10 in question or required to be proved, fingerprint or DNA evidence will greatly help the prosecution in proving the identity of the offender. We find support in this proposition by referring to the decision in the case of Public Prosecutor v Mansor Md. Rashid & Anor [1997] 1 CLJ 233 in which at page 250 the Federal Court there said– “Where the identity of a culprit is in question or required to be proved, fingerprint evidence would be of great significance and immense value. In the present case under appeal, however, the charge alleged trafficking in the form of sale and there is evidence indicating the identities of the alleged offenders and the sale transaction. Fingerprint evidence on the newspaper wrapping, white plastic and the loytape, therefore, assumes little value or significance.” [13] The prosecution had adduced sufficient evidence to show that the appellant was in actual physical control and custody of the 3 bags hidden in his pair of black tights found to contain the impugned drug. There can be no doubt whatsoever that the appellant had knowledge and thus possession of the illicit drug. The prosecution had adduced more than sufficient evidence upon which the learned judge was justified to found a conviction against the appellant. We do not think that the law imposes a burden of proof higher than is necessary and requires the court to determine not whether there is sufficient evidence to warrant a conviction of the accused but to determine that the methodology of the police investigation must be 100% correct regardless of the fact that the police had gathered sufficient evidence to sustain a conviction against the appellant. In the case of Public Prosecutor v Badrulsham bin Baharom [1988] 2 MLJ 585 this is what the court at page 593 said – 11 “In the present case, the prosecution had clearly established that the accused was in actual physical custody and control of P3 and its contents. From the totality of the evidence, the prosecution had also clearly established that the accused had the necessary knowledge of P6A-H and the nature of the dangerous drugs in question. In the circumstances, I cannot find fault with the police for failing to send the exhibits to the chemist in order to carry out finger print tests. The contention of the learned defence counsel, with due respect, amounts to nothing more than to ask this court to determine not whether there was sufficient evidence adduced before this court to warrant a conviction of the accused but to determine that the methodology of the police investigation must be 100% correct regardless of the fact that the police had gathered more than sufficient evidence to sustain a conviction of the accused. I cannot lend a judicial countenance to such a contention.” [14] The learned judge invoked the presumption of trafficking under section 37(da) of Act 234 as the weight of the drug far exceeded the statutory weight prescribed in paragraph (xvi) thereof. In order to raise presumed trafficking under section 37(da) of Act 234 it is necessary for the prosecution to prove the basic or primary fact that would show that at the material time the appellant was in possessions of the illicit drug. The word ‘found’ in the opening phrase of section 37(da) connotes a finding during a trial by the court. Therefore, a finding of possession of the drug is necessary. This is the basic or primary fact which is incumbent on the prosecution to prove and for the court to be satisfied that such fact is established before the presumed trafficking of the drug can be invoked [Muhammed bin Hassan v Public Prosecutor [1998] 2 MLJ 273]. 12 [15] Now what is the evidence of basic or primary fact which constitute possession of the impugned drug which the learned judge said had been proven by the prosecution. From the evidence of PW3, it is abundantly clear that the drug was found inside the pair of tights that the appellant wore. The learned judge was without question correct to hold that the appellant was caught red handed with the drug under his custody and control. But, is there sufficient evidence from which knowledge of the drug could be inferred. The element of knowledge necessary to prove possession, according to the learned judge, could be inferred from the conduct of the appellant in carefully keeping the drug in the 3 bags and concealing them under the appellant’s waist by the pair of tights the appellant was wearing. It is said that to establish possession by an accused person of any dangerous drugs it must first be shown that he had knowledge of the drugs which were to be in his possession [Public Prosecutor v Badrulsham bin Baharom [1988] 2 MLJ 585]. [16] We find no reasons to disagree with the learned judge’s finding that the conduct of the accused in wearing the pair of tights instead of an underwear clearly showed the appellant intended to secure the drug closely to his body and to prevent them from falling out or avoid from being detected by visual examination. The law is now obvious and trite that the method employed to carry a drug may furnish evidence of knowledge. This Court in the case of Teh Hock Leong v PP [2008] 4 CLJ 764 laid down this proposition which was affirmed subsequently by the Federal Court and reported in Teh Hock Leong v Public Prosecutor [2010] 1 MLJ 741. We quote from the decision of this Court the relevant excerpts – 13 “[7] It is true that mens rea possession is an element of the offence of trafficking. But it is an element like the mental element in other crimes which cannot be established by direct evidence save in a case where an accused expressly admits the commission of the offence. It has, like the mens rea in other offences, to be established by circumstantial evidence. In other words it is an ingredient that is to be inferred from the totality of the circumstances of a particular individual case. We can here do no better than to quote from the judgement of Lord Diplock in Ong Ah Chuan v. Public Prosecutor [1981] 1 MLJ 64, at p.69: Proof of the purpose for which an act is done, where such purpose is a necessary ingredient of the offence with which an accused is charged, presents a problem with which criminal courts are very familiar. Generally, in the absence of an expressed admission by the accused, the purpose with which he did an act is a matter of inference from what he did. Thus, in the case of an accused caught in the act of conveying from one place to another controlled drugs in a quantity much larger than is likely to be needed for his own consumption in the inference that he was transporting them for the purpose of trafficking in them would, in the absence of any plausible explanation by him, be irresistible- even if there were no statutory presumption such as is contained in section 15 of the Drugs Act. [8] Turning to the facts of the present instance, we agree with the learned trial judge that the method employed to bring the drugs in question from Thailand into Malaysia was done in a most cunning fashion to escape detection by the authorities. The method employed to convey or transport a drug may sometimes furnish evidence of knowledge. For example, an attempt to carefully conceal a drug may indicate an intention to avoid detection and thereby point to knowledge. Of course it all depends on the facts of each individual case.” [our emphasis] 14 [17] We would additionally hold that the fact that the drug was found inside the appellant’s pair of tights which he wore clearly indicated that he was so situated with respect to it that he had the power to deal with, dispose of, or exclude other persons from enjoyment of, the same [PP v Denish Madhavan [2009] 2 CLJ 209]. [18] The Federal Court in Public Prosecutor v Abdul Rahman bin Akif [2007] 5 MLJ 1 adopted the approach taken by the House of Lords in Warner v Metropolitan Police Commissioner [1968] 2 All ER 356 in considering the evidence necessary before a person could be deemed to be in possession of a prohibited substance in which Lord Morris dealt with the question as follows: “If there is assent to the control of a thing, either after having the means of knowledge of what the thing is or contains or being unmindful whether there are means of knowledge or not, then ordinarily there will be possession. If there is some momentary custody of a thing without any knowledge or means of knowledge or what the thing is or contains then, ordinarily, I would suppose that there would not be possession. If, however, someone deliberately assumes control of some package or container, then I would think that he is in possession of it. If he deliberately so assumes control knowing that it has contents, he would also be in possession of the contents. I cannot think that it would be rational to hold that someone who is in possession of a box which he knows to have things in it is in possession of the box but not in possession of the things in it. If he had been misinformed or misled as to the nature of the contents, or if he had made a wrong surmise as to them, it seems to me that he would nevertheless be in possession of them.” [19] We bear in mind the correct principle so lucidly expressed in the above case and we would say that so far as the evidence shows, 15 there is no doubt that the appellant was in physical control of the 3 bags and its contents. Considering the manner in which the bags were concealed, it would not be rational for this Court to hold that the appellant who was in possession of the bags did not have possession of the drugs kept in these bags. It is extremely clear that the appellant was in possession of both the bags and the drug in it and as such the learned judge was correct in invoking the presumption of trafficking in the said drug pursuant to section 37(da) of Act 234. We would also add that the appellant had no reasons to conceal the bags inside the pair of tights which he wore if he truly did not know the contents of the bags. It certainly did not reflect an innocent mind. In Muhammad Yusuf v PP [2011] 9 CLJ 488, where the appellant was found to have concealed the packages which contained dangerous drug on different parts of his body, this Court held that such conduct did not reflect an innocent mind. Suffice to say, no innocent person in the right frame of mind would have hidden the bags inside the pair of tights he is wearing unless he is carrying something he consciously knew to be incriminating and he did so in order to avoid detection by the relevant enforcement agency. The conduct of the appellant in concealing the 3 bags in our view gives rise to a clear inferences of the the existence of knowledge on the part of the appellant of the drug and thus the appellant could be said to have the mens rea possession of the same [Chiew Thien Leng v. Public Prosecutor [2014] 1 LNS 347]. [20] It was strenuously contended for the appellant that he was the victim of a police frame up. According to the appellant, he refused to give the cash money to the police and as a result, the police gave the 3 bags containing the impugned drug and directed him to hold them. Thereafter, the police took photographs of the appellant after which 16 he was taken to the LCCT police station with the drug in his hands. Later on, the appellant was brought to IPD Sepang where the appellant alleged that he informed the police that he only carried with him cash of RM50,000.00 in his luggage bag and when he refused to give the cash to the police at the LCCT, the police personnel brought out the 3 packets of drug which the appellant denied any knowledge of its contents. It would appear from the appellant’s line of defence that the police had acted mala fide against him but why the police had done so, the appellant was not able to offer a plausible explanation. The learned judge had carefully considered this issue and found that the defence was wholly untenable and failed to rebut on the balance of probabilities the presumption under section 37(da) of Act 234. [21] We agree with the learned judge’s finding that under cross- examination, the appellant testified that he did not know the motive of the police to push the drug to him. It was also in evidence that the appellant did not lodge a police report pertaining to his complaint of the alleged police frame-up even though there was ample opportunity to do so through his family or his lawyer or to the magistrate when he was brought to the magistrate court to be remanded. [22] The learned judge had observed the demeanour of the prosecution’s material witness namely PW3 and was satisfied that he was a credible witness. There was, moreover no evidence adduced by the appellant to show that PW3 bore any grudge against him. PW3 was merely carrying out this duty and he reacted correctly when the detector machine sounded by proceeding to conduct a physical inspection on the appellant and when he felt some object below the appellant’s waist he questioned the appellant about it. But when PW3 17 was suspicious of the answer the appellant gave, PW3 decided to conduct a thorough inspection in the room at the LCCT. This action in our judgement, was to be expected of a police officer and the whole process of questioning and inspection conducted by PW3 was in fact in the normal and ordinary course of duty of a police personnel. There was obviously an absence of relevant or clear bad faith or evil motive in what PW3 had done. [23] Further, as the learned judge had correctly held, it was inherently improbable that PW3 could have produced the 3 bags containing drug from nowhere and used to frame up the appellant. The appellant it is to be observed, did not even mention where did PW3 take the bags from. Surely if the defence story was true, the appellant could have told the court where was the drug taken from by PW3. We also agree with the finding by the learned judge that there was not an iota of evidence to prove that the cash of RM50,000.00 existed. In fact, as the evidence showed, only cash of RM2429.00 was recovered by PW3 from the appellant’s wallet found in the back pocket of the appellant’s blue jeans (Exhibit P18 (a-d)). In the end, the complete absence of any evidence on the alleged RM50,000.00, we would hold without any hesitation that the appellant’s testimony in respect of the money is a figment of his imagination and the learned judge was absolutely right in rejecting it. [24] In any event, it ought to be mentioned that the appellant’s defence that he was set up by the police was never specifically put to the prosecution’s witnesses in particular PW3, in detail that the police found RM50,000.00 and when he refused to give them, the police personnel took out the bags containing the drug and gave it to him. 18 This failure as the learned judge correctly held, could move the trial court to dismiss this particular line of defence as an afterthought or a recent invention. The law on this subject must be taken to be well settled that is, the necessity to put the essence of his case to the material prosecution’s witnesses is not a mere technical rule of evidence, it is indeed a rule of essential justice so that any such failure by the defence would have serious implication on the accused’s credibility and the weight to be attached to his evidence. We now quote from the Federal Court’s decision in Siew Yoke Keong v PP [2013] 4 CLJ 149 the following excerpts on this subject : “We do not think the learned trial judge could be faulted for that. In Alcontara Ambross Anthony v. PP, the Federal Court said : In a criminal trial, the whole point and purpose of the defence having to put its case to such of the prosecution witnesses as might be in a position to admit or deny it, is to enable the prosecution to check on whether an accused’s version of the facts is true or false, and thus avoid the adverse comment, that the defence is a recent invention in other words, “kept up its sleeve”, as it were – and revealed for the first time when the accused makes his defence from the witness box or the dock, thus detracting from the weight to be accorded to the defence. However, failure on the part of the defence to put its case as aforesaid, can never, by itself, relieve the prosecution of its duty of establishing the charge against the accused beyond any reasonable doubt. [46] Although failure on the part of the defence to put its case to the material prosecution’s witness, can never by itself relieve the prosecution of its duty to prove the charge against the accused beyond reasonable doubt (Alcontara Ambross Anthony v. PP), such failure by the defence did have serious implication on the accused’s credibility and the weight to be 19 attached to his evidence. The necessity of putting the essence of his case to the material prosecution’s witness is not a mere technical rule of evidence. It is a rule of essential justice. In PP v. Dato’ Seri Anwar Ibrahim (No. 3) [1999] 2 CLJ 215; [1999] 2 MLJ 1, at pp. 424-425 (CLJ); 193-194 (MLJ) Augustine Paul J. (as he then was) said: The nature of the defence is to be ascertained not only from the evidence of the accused himself but also from the trend of the cross- examination of the prosecution witnesses and from the arguments of the accused’s counsel at the close of the trial (see Kuli E Ors v. Emperor AIR 1930 Call 442). It is therefore important for the accused to put his essential and material case to the prosecution witnesses in cross-examination. This is a principle of essential justice and was neatly stated by Mukhriji J in AEG Carapiet v. AY Derderian AIR 1961 Cal 359 in the following terms: The law is clear on the subject. Whenever the opponent has declined to avail himself of this opportunity to put his essential and material case in cross-examination, it must follow that he believed that the testimony given could not be disputed at all. It is wrong to think that is merely a technical rule of a evidence. It is a rule of essential justice. It serves to prevent surprise at trial and miscarriage of justice, because it gives notice to the other side of the actual case that is going to be made when he turn of the party on whose behalf the cross-examination is being made comes to give and lead evidence by producing witnesses. It has been stated on high authority of the House of Lords that this much a counsel is bound to do when cross- examining that he must put to each of his opponent’s witnesses in turn, so much of his own case as concerns that particular witness or in which that witness had any share. If he asks no questions with regard to this, then he must be taken to accept the plaintiff’s account in its entirety. Such failure leads to miscarriage of justice, first by springing surprise upon the party when he has 20 finished the evidence of his witnesses and when he has no further chance to meet the new case made which was never put and secondly, because such subsequent testimony has no chance of being tested and corroborated. [47] In Wong Swee Chin v. PP [1980] 1 LNS 138; [1981] 1 MLJ 212 at p. 213, the Federal Court said: A correct statement of the law is that failure of the defence to cross- examine the prosecution witnesses on the matter merely goes to the credibility of their testimony, to wit, the fact they found the ammunition in the appellant’s trouser pockets remains unshaken. On this point we need only say there is a general rule that failure to cross-examine a witness on a crucial part of the case will amount to an acceptance of the witness’s testimony. But as is common with all general rules there are also exceptions as pointed out in judgement of the Supreme Court of New Zealand in Transport Ministry v. Garry where Haslam J. said at page 122: In Phipson on Evidence 11th edition paragraph 1544 the learned authors suggest examples by way exception to the general principle that failure to cross-examine will amount to an acceptance of the witness’s testimony, viz where. …The story is itself of an incredible or romancing character, or the abstention arises from mere motives of delicacy…or when counsel indicates that he is merely abstaining for convenience, e.g to save time. And where several witnesses are called to the same point it is not always necessary to cross-examine them all.” [25] Before we conclude, a point of importance which the learned judge dealt in his grounds of judgement concerned the issue of the identify of the impugned drug with respect to which His Lordship was 21 satisfied of the unbroken chain of evidence relating to the custody of the drug exhibit right from the time it was seized from the appellant and sent to PW1 for analysis until it was produced in court during the trial as evidence. So far as the evidence showed, we cannot find fault with the learned judge’s careful analysis of the evidence concerning the chain of evidence on the custody of the drug exhibits. We shall not delve on the issue in great detail in this judgement as this is not the issue in contention in this appeal, but for completeness, we ought to mention that it is apparent on our careful perusal of the notes of evidence, that the appellant failed to cross- examine the prosecutions witnesses in connection with the identity and the evidence relating to the movement and custody of the drug exhibits. Therefore such failure goes to the credibility of the appellant and amounts to an acceptance of the prosecution’s witnesses evidence. [26] We think it is proper and clear at this concluding stage for a finding to be made that the learned judge had made a correct and adequate judicial appreciation of the entire evidence resulting at the end in a rejection of the defence case. The learned judge had audio- visual advantage of the witnesses who testified during the trial and was satisfied that the prosecution’s witnesses in particular PW3 were credible whose evidence could be acted upon. We have absolutely no reasons to interfere with the findings made by the learned judge that the defence failed to rebut the presumption of trafficking in the dangerous drug specified in the charge under section 37(da) of Act 234 on the balance of probabilities. For the reasons that we have given, we are satisfied that the charge of trafficking under section 39B(1)(a) of Act 234 was successfully 22 proved by the prosecution beyond reasonable doubt and accordingly we affirm the conviction and sentence made by the learned judge. The appeal is dismissed. Signed ( IDRUS BIN HARUN ) Judge Court of Appeal, Malaysia Putrajaya Dated: 29 August 2017 1. Solicitor For The Appellant - Tuan W.C. Chiang Chiang Chambers No.25-3, Jalan PJU 5/3 PJU 5, Dataran Sunway Kota Damansara 478100 Petaling Jaya 2. Solicitor For The Respondent - Tuan Ahmad Sazilee bin Abdul Khairi Timbalan Pendakwa Raya Bahagian Perbicaraan dan Rayuan Jabatan Peguam Negara No. 45, Persiaran Perdana Presint 4 62100 Putrajaya

Tika 2.6.0

BA-24-514-05/2017

PLAINTIF DEVI A/P DORAISAMY DEFENDAN NADARAJAN A/L PITCHAIMUTHU

28/08/2017

YA DATUK AZIMAH BINTI OMAR

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=0dea3de9-069a-4c80-8d94-6379b3765350&Inline=true

1 DALAM MAHKAMAH TINGGI DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA SAMAN PEMULA NO. : BA-24-514-05/2017 Dalam perkara mengenai Kaveat Persendirian No. Perserahan 31482/2013 atas Hakmilik Lot 13021, Seksyen 1, Hakmilik GRN 269254, Bandar Ulu Klang, Daerah Gombak, Negeri Selangor Darul Ehsan. DAN Dalam Perkara Seksyen 327 Kanun Tanah Negara 1965 DAN Dalam perkara mengenai Seksyen 329(1) Kanun Tanah Negara, 1965 ANTARA DEVI A/P DORAISAMY ... PLAINTIF 2 DAN NADARAJAN A/L PITCHAIMUTHU ... DEFENDAN ALASAN PENGHAKIMAN (Kandungan 1 - Pembatalan Kaveat Persendirian) A. PENGENALAN [1] Plaintif di dalam Saman Pemulanya (Kandungan 1) memohon perintah-perintah berikut: i. supaya Kaveat Persendirian No. Perserahan 314828/2013 (kaveat persendirian tersebut) yang dimasukkan oleh Defendan pada 23.5.2013 ke atas Lot 13021, Seksyen 1, Hakmilik GRN 269254, Bandar Ulu Klang, Daerah Gombak, Negeri Selangor Darul Ehsan (hartanah tersebut) dibatalkan/diketepikan di bawah seksyen 327 Kanun Tanah Negara 1965 (KTN.) ii. bahawa Pendaftar/ Pentadbir Tanah Pejabat Negeri Selangor membatalkan kaveat persendirian tersebut . 3 iii. gantirugi ditaksirkan. B. LATAR BELAKANG KES [2] Latar belakang kes yang membawa Plaintif memfailkan Kandungan 1 adalah seperti berikut: 2.1 Plaintif (Devi a/p Doraisamy, No. K/P: 660707-02-5302) adalah pemilik/tuanpunya berdaftar hartanah tersebut. 2.2 Menurut Plaintif hartanah tersebut adalah rumah matrimoni (matromanial home) yang telah dibeli oleh beliau dan suaminya pada tahun 1992. Hartanah tersebut kini didiami oleh Plaintif, suami dan dua orang anak lelakinya. Hutang bank ke atas hartanah tersebut telahpun habis dibayar pada tahun 2004. 2.3 Sebelum ini, hartanah tersebut telah didaftarkan atas nama suami Plaintif iaitu Ramasamy a/l Kannan No.K/P 610311-08- 5469. 4 2.4 Pada 23.5.2013, Defendan (Nadarajan a/l Pitchaimuthu No.K/P 600707-08-6119) telah memasukkan kaveat persendirian tersebut ke atas hartanah tersebut. C. BANTAHAN DEFENDAN [3] Defendan telah menentang permohonan Plaintif ini dan di dalam Afidavit Jawapannya, Defendan telah membangkitkan pengataan – pengataan berikut: (a) Hartanah tersebut pada asalnya adalah kepunyaan Ramasamy yang mana hakmilik hartanah tersebut adalah dipegang di bawah Geran Hakmilik H.S. (D) 21986 PT No.1872, Mukim Setapak, Daerah Gombak Selangor. Kemudian hakmilik hartanah tersebut telah diberi hakmilik baru yang dipegang di bawah geran baru yang dipegang Plaintif di bawah Lot 13021, Seksyen 1, Hakmilik GRN 269254, Bandar Ulu Klang, Daerah Gombak, Negeri Selangor Darul Ehsan. (b) Defendan telah memasukkan kaveat persendirian ke atas hartanah tersebut kerana kegagalan Ramasamy suami Plaintif membayar hutang-hutangnya kepada Defendan melalui perjanjian-perjanjian yang ditandatanganinya. Defendan telah mendakwa bahawa beliau telah memberikan Ramasamy pinjaman wang sebanyak RM355,000.00 yang butir-butir hutang Ramasamy kepada Defendan adalah seperti berikut: 5 i. Tarikh: 1.10.2009 Pinjaman wang sebanyak RM75,000.00 diberikan kepada Ramasamy (suami Plaintif) yang mana penerimaan wang oleh Ramasamy di akui atas baucer tunai (cash voucher); ii. Tarikh: 26.4.2010 Defendan telah membayar wang sebanyak RM5,000.00 sebagai deposit dan RM55,000.00 sebagai baki deposit kepada Ramasamy untuk membeli hartanah tersebut di bawah Geran Asal. Bagi bayaran ini Defendan dan Ramasamy telah menandatangani satu Perjanjian Jual Beli bertarikh 26.4.2010 (perjanjian jual beli tersebut) dan Borang 14A pindahmilik tanah. iii. Untuk tempoh bulan Mei hingga Jun 2010 Pinjaman wang sebanyak RM100,000.00 secara tunai telah diberikan kepada Ramasamy. Ramasamy telah mengisu lima keping cek untuk jumlah keseluruhan RM100,000.00 kepada Defendan sebagai menjelaskan bayaran ini. Cek-cek tersebut ini diterima oleh Defendan dan masih disimpan. vi. Suatu perjanjian persahabatan bertarikh 3/12/2010 (“Kontrak Persahabatan Pinjaman Wang) telah dimasuki oleh Defendan dan Ramasamy, di mana Defendan meminjamkan wang tunai sebanyak RM120,000.00 kepada Ramasamy. Pembayaran wang RM120,000.00 ini telah diakui Ramasamy. 6 (c) Defendan telah mendakwa Ramasamy telah gagal untuk membayar balik wang-wang yang dipinjamkan oleh Defendan kepadanya. Oleh itu, Defendan telah memfailkan tindakan writ saman terhadap Ramasamy di Mahkamah Sesyen Kuala Lumpur (WA-B52NCVC-280-06/2017) dan tindakan tersebut telah ditetapkan untuk pengurusan kes pada 27.7.2017. (d) Defendan juga telah mendakwa bahawa pada 30.08.2013 Ramasamy telah membuat laporan polis bahawa geran tanahnya telah hilang dan kemudian meminda meminda laporan polis yang bertarikh 23/03/2012 menyatakan bahawa geran Hartanah tersebut telah diberikan kepada Defendan. [4] Di dalam Borang 19B (Borang Memasukkan Kaveat Persendirian), alasan-alasan kemasukan kaveat Defendan adalah seperti berikut: Alasan-alasan tuntutan saya/kami atas tanah/kepentingan itu ialah:- a. Saya telah membeli hartanah tersebut melalui Perjanjian Jual Beli dengan RAMASAMY A/L KANNAN (NO. K/P: 610311-08-5469) DAN NADARAJAN A/L PITCHAIMUTHU (NO. K/P: 600707-08-6119) dengan harga belian sebanyak RM60,000.00 sebagai deposit kepada Penjual pada tahun 2010 dan kemudian atas permintaan Penjual, Pembeli telah memberi sebanyak RM120,000.00 (Jumlah sebanyak RM180,000.00 telah jelas kepada penjual). Oleh itu penjual telah depositkan Hakmilik asal kepada Peguamcara Pembeli untuk simpanan sebagai stakeholder. 7 b. Maka dengan ini saya memohon untuk satu kaveat persendirian dimasukkan bagi hartanah tersebut bagi menjaga kepentingan saya. [5] Kemasukan kaveat persendirian Defendan ke atas hartanah tersebut telah disokong oleh Surat Akuan seperti berikut: SURAT AKUAN Saya, NADARAJAN A/L PITCHAIMUTHU (NO. K/P: 600707-08-6119) adalah seorang warganegara Malaysia yang beralamat di No. 3, Jalan 1A/55A, Taman Setiawangsa, 54200 Kuala Lumpur dengan sesungguhnya dan sebenarnya mengaku bahawa:- 1. Saya memasuki kaveat persendirian ke atas hartanah Hakmilik H.S.(D) 21986 PT 1872, Mukim Setapak, Daerah Gombak, Negeri Selangor Darul Ehsan. Dimaklumkan bahawa saya telah membeli hartanah tersebut melalui perjanjian jual beli dengan RAMASAMY A/L KANNAN (No. K/P: 610311-08-5469) dengan harga belian sebanyak RM250,000.00 sahaja dan saya juga telah menjelas sebanyak RM180,000.00 harga belian kepada RAMASAMY A/L KANNAN. 2. Bersama-sama ini saya lampirkan dokumen-dokumen berikut untuk rujukan dan perhatian pihak tuan:- i) Sesalinan Perjanjian Jual Beli di antara RAMASAMY A/L KANNAN dengan saya; dan 8 ii) Sesalinan Hakmilik asal telah didepositkan dengan Peguamcara Pembeli. 3. Bagi menjaga kepentingan saya, maka dengan ini saya memasukkan satu kaveat Persendirian ke atas hakmilik tanah tersebut dalam jadual diatas untuk mengikat hartanah tersebut. [6] Berdasarkan pengataan-pengataan di atas Defendan mendakwa bahawa beliau mempunyai kepentingan berkaveat ke atas hartanah tersebut dan bagi menjamin kepentingannya dilindungi, maka kaveat persendirian telah dimasukkan olehnya ke atas hartanah tersebut. D. SAMADA DEFENDAN MEMPUNYAI KEPENTINGAN BERKAVEAT [7] Di dalam perkara kepentingan berkaveat dan peruntukan seksyen 323 KTN, Mahkamah ini suka merujuk kepada perenggan B-D, muka surat 755 alasan penghakiman Gopal Sri Ram, HMR di dalam kes Luggage Distributors (M) Sdn Bhd v Tan Hor Teng [1995] 1 MLJ 719. Di muka surat 755 ini, YA Gopal Sri Ram telah menerangkan ruang lingkup kepentingan berkaveat yang diperuntukkan di bawah seksyen 323 dengan menyatakan berikut: “CAVEATABLE INTEREST 9 To paraphrase s 323(1)(a) of the Code, a private caveat may be entered at the distance of any person or body who claims either: (1) the title to land; or (2) any registrable interest in land. The parameters of caveatability under s 323(1)(a) are therefore circumscribed by these words: ’title’ and ‘registrable interest’. It is only one who makes a claim to either of these in land may enter a private caveat. Although the words ‘title’ and ‘registrable interest’ are not defined by the Code, their meaning may be gathered from the scheme of the Code and from indefeasibility provision, namely, s 340(1). The latter points to a bifurcation between title (the equivalent of the English fee simple) and registrable interests, that it, leases, charges and easements.” [8] Undang-undang mengenai perlanjutan tempoh kaveat ataupun permohonan untuk pembatalannya adalah jelas dan mantap. Di dalam sesuatu permohonan untuk melanjutkan atau membatalkan kaveat, Mahkamah hendaklah menentukan dan mempertimbangkan persoalan-persoalan berikut: i. samada pengkaveat mempunyai kepentingan berkaveat terhadap hartanah tersebut. 10 ii. samada kepentingan berkaveat tersebut menimbulkan atau mendedahkan isu-isu serius untuk dibicarakan. iii. samada imbangan keselesaan memihak bahawa kaveat tersebut dikekalkan. iv. samada terdapat keadaan istimewa di pihak pemohon yang melayakkan status quo diganggu/diubah. [9] Di dalam perkara ini juga, Mahkamah Rayuan di dalam kes Luggage Distributors (M) Sdn Bhd v Tan Hor Teng [1995] 1 MLJ 719 telah menggariskan ujian-ujian yang harus digunapakai di dalam menentukan dan menimbangkan sesuatu permohonan untuk membatalkan kaveat di mana muka.surat 724, Mahkamah Rayuan telah menyatakan berikut : “In considering an application for the removal of a caveat, the procedure to be adopted should be a simple and summary one. At first stage, the court will examine the grounds expressed in the application for the caveat to see whether they show a caveatable interest. Once the court is satisfied that 11 the caveator’s claim amounts in law to a caveatable interest, it must then go on to consider whether the claim disclosed a serious question meriting a trial. After these two stages have been crossed, the court must decide where the balance of convenience” [10] Di dalam perkara berkaitan permohonan untuk membatalkan kaveat juga, Majlis Privy di dalam kes Eng Mee Yong & Ors v V Letchumanan [1979] 2 MLJ 212 telah memutuskan berikut: “This is the nature of the onus that lies upon the caveator in an application by the caveatee under section 327 for removal of a caveat; he must first satisfy the court that on the evidence presented to it his claim to an interest in the property does raise a serious question to be tried; and having done so he must go on to show that on the balance of convenience it would be better to maintain the status quo until the trial of the action, by preventing the caveatee from disposing of his land to some third party.” [11] Di dalam kes Kho Ah Soon V Duniaga Sdn Bhd [1996] 2 MLJ 181, Mahkamah Persekutuan telah sekali lagi menekankan berkenaan prinsip undang-undang di dalam pembatalan kaveat di mana Peh Swee Chin, HMP telah menyatakan di muka surat 184 seperti berikut: 12 “It is settled that in a matter of removal of a caveat as between a caveator and caveatee, as in the instant appeal, the onus is on the caveator to satisfy the Court that his evidence does raise a serious question to be tried as regards his claim to an interest in the land in question, and having done so he must show that, on a balance of convenience, it would be better to maintain the status quo until the trial of the action by preventing the caveatee from disposing of his land, as laid down by Lord Diplock in Eng Mee Yong & Ors v V Letchumanan [1979] 2 MLJ 212, and by analogy indirectly to American Cyanamid Co v Ethicon [1975] AC 396 as indicated by Lord Diplock, the serious question for trial referred to above could mean a question not being vexatious or frivolous”. E. PENGHUJAHAN PLAINTIF [12] Adalah menjadi hujahan Plaintif bahawa adalah jelas di dalam kes ini bahawa Defendan tidak mempunyai kepentingan berkaveat ke atas hartanah teresbut kerana Defendan adalah seorang peminjam wang tidak berlesen (Ah Long) yang telah meminjamkan wangnya kepada Ramasamy iaitu suami kepada Plaintif. [13] Atas pinjaman-pinjaman wang yang telah diberikan oleh Defendan kepada Ramasamy, Defendan telahpun memfailkan dua tindakan sivil iaitu Mahkamah Sesyen Kuala Lumpur (WA-B52NCVC-280- 13 06/2017 – Eksibit “NP-8’, Kandungan 3) dan Mahkamah Tinggi Kuala Lumpur (WA-22NCVC-328-07/2017- Eksibit “NP-13’, Kandungan 3). Bagi tindakan di Mahkamah Sesyen, Defendan telah menuntut terhadap Ramasamy pembayaran balik pinjaman-pinjaman yang telah diberikannya. Manakala bagi tindakan Mahkamah Tinggi Kuala Lumpur Defendan adalah tindakan terhadap Ramasamy dan Plaintif bagi mengekalkan kaveat persendiriannya (No.Perserahan 31482/2013 yang dimasukkannya terhadap hartanah H.S. (D) 21986 PT No.1872, Mukim Setapak, Daerah Gombak Selangor di samping untuk memohon perlaksanaan spesifik perjanjian jual beli bertarikh 26.4.2010. Menurut peguam Plaintif, kedua-dua tindakan ini telah hanya difailkan oleh Defendan pada tahun 2017, masing-masing pada 22.6.2017 dan 3.7.2017 walaupun kedua-dua perjanjian jual beli dan kontrak pinjaman persahabatan telahpun ditandatangani tujuh tahun lalu. [14] Plaintif tidak menafikan bahawa suaminya Ramasamy memang ada menandatangani perjanjian pinjaman wang dengan Defendan tetapi kerana tidak fasih bahasa Inggeris beliau telah mendepositkan geran hakmilik asal hartanah tersebut kepada peguam pinjaman Defendan 14 Bala Naido sebagai jaminan kepada pembayaran balik pinjaman- pinjaman yang diberikan oleh Defendan. [15] Plaintif menafikan bahawa Perjanjian Jual Beli yang dikemukakan oleh Defendan di Eksibit “NP-4”, Kandungan 3 (Afidavit Jawapan Defendan) adalah perjanjian jual beli hartanah tersebut kerana perjanjian ini telah tidak dikuatkuasakan dan disempurnakan oleh Defendan. [16] Menurut peguam Plaintif pendepositan geran hakmilik asal hartanah tersebut bukanlah satu gadaian yang berdaftar ke atas hartanah tersebut kerana Defendan adalah peminjam wang tidak berlesen dan tiada dokumen-dokumen gadaian telah ditandatangani. [17] Peguam Plaintif telah selanjutnya menghujahkan bahawa Defendan telah menyatakan bahawa alasan beliau memasukkan kaveat ke atas hartanah adalah untuk melindungi kepentingan Defendan atas perjanjian bertarikh 3.12.2010 (NP-6 di mana Ramasamy telah bersetuju untuk Defendan mengambil hartanah tersebut jika Ramasamy gagal membuat pembayaran balik pinjaman wang 15 RM120,000.00 (Klausa 2, perenggan 2 NP-6). Namun, jika dirujuk di kepada Borang 19B dan Surat Akuan Sumpah menyokong kemasukan kavaet persendiriannya, Defendan sendiri tidak jelas alasan-alasan apakah yang beliau bergantung untuk kemasukan kaveat persendirian ke atas hartanah tersebut. [18] Peguam Plaintif menghujahkan seterusnya bahawa di Borang 19B dan Surat Akuan Defendan, Defendan telah bergantung kepada pinjaman-pinjaman wang yang diberikannya kepada Ramasamy dan juga mengakui atas pinjaman-pinjaman wang tersebut, Ramasamy telah memberikan kepadanya dokumen hakmilik hartanahnya. [19] Adalah dihujahkan oleh peguam Plaintif berdasarkan tindakan- tindakan yang difailkan oleh Defendan di Mahkamah Sesyen (tuntutan wang) dan Mahkamah Tinggi Kuala Lumpur (perlanjutan kaveat), sebenarnya tuntutan Defendan adalah semata-mata tuntutan monetori) terhadap Ramasamy yang tidak membangkitkan apa-apa kepentingan berkaveatnya ke atas hartanah tersebut. 16 [20] Bagi menyokong hujahannya, peguam Plaintif telah bergantung kepada kes-kes berikut: i. Wong Kuan Tan v Gambut Development Sdn Bhd [1984] 1 CLJ (Rep) 441 ii. Registrar of Titles, Johore v Temenggong Securities Ltd [1976] 2 MLJ 44 iii. Ladang SPK Sdn Bhd v Rainbow Entity Sdn Bhd & Anor [2014] 10 MLJ 22 iv. Institut Teknologi Federal Sdn Bhd. v IIUM Education Sdn Bhd & Another Appeal [2008] 1 CLJ 745 F. PENGHUJAHAN DEFENDAN [21] Peguam Defendan di dalam kes ini tidak menafikan bahawa sememangnya terdapat transaksi-transaksi pinjaman wang oleh Defendan kepada Ramasamy di mana pinjaman wang tersebut telah menyebabkan Defendan memasukkan kaveat persendirian ke atas hartanah tersebut. Menurut peguam Defendan bagi pinjaman sebanyak RM120,000.00 yang dipinjamkan kepada Ramasamy melalui kontrak pinjaman bertarikh 3.12. 2010, Ramasamy di klausa 2 kontrak pinjaman tersebut telah mengaku janji untuk membayar semula hutang tersebut dalam tempoh enam (6) bulan dan sekiranya 17 gagal bersetuju bahawa berhak untuk memfailkan tindakan terhadap Ramsamy ataupun mengambilalih hartanah tersebut pada harga RM250,000.00. [22] Di perenggan 21 hujahan bertulis peguam Defendan, peguam Defendan telah menghujahkan bahawa wang-wang yang dihutang oleh Ramasamy berdasarkan perjanjian pinjaman dan perjanjian jual beli tersebut adalah alasan yang sah untuk kaveat Defendan dikekalkan di atas hartanah tersebut. G. ANALISIS DAN DAPATAN MAHKAMAH [23] Di dalam kes ini, peguam Defendan sendiri mengakui bahawa kontrak pinjaman persahabatan dan perjanjian jual beli tersebut yang ditandatangani oleh Defendan dan Ramasamy pada tahun 2010 adalah untuk pinjaman-pinjaman wang yang diberikan oleh Defendan kepada Ramasamy. [24] Di dalam Borang 19B juga, Defendan telah menyatakan pada awalnya beliau telah memberi Ramasamy sebanyak RM60,000.00 sebagai deposit tetapi atas permintaan Ramasamy beliau telah 18 memberikan wang sebanyak RM120,000.00 kepada Ramasamy. Oleh itu Ramasamy telah mendepositkan hakmilik asal kepada peguamcara sebagai stakeholder. [25] Ramasamy telah gagal membayar balik wang-wang yang dipinjamnya dan oleh itu Defendan telah memfailkan guaman Mahkamah Sesyen Kuala Lumpur dan Guaman Mahkamah Tinggi Kuala Lumpur. [26] Berdasarkan keterangan-keterangan dokumentar yang dikemukakan di hadapan Mahkamah ini, adalah sangat jelas dan nyata bahawa perjanjian jual beli yang dimasuki oleh Ramasamy dan Defendan bukanlah perjanjian jual beli hartanah tersebut. Perjanjian jual beli tersebut telah dimasukki Ramasamy dan Defendan atas pinjaman- pinjaman wang yang diberikan oleh Defendan. Justeru itu, tuntutan Defendan adalah satu tuntutan yang berbentuk monetari yang tidak membangkitkan suatu kepentingan berkaveat Defendan ke atas hartanah tersebut. 19 [27] Adalah menjadi prinsip-prinsip undang-undang jelas dan mantap bahawa faktor atau sebab kewangan bukan terjumlah sebagai suatu Kepentingan Berkaveat. (Sila lihat: i. Taipan Focus Sdn Bhd v Baiduri PJ Sdn Bhd [2005] 3 CLJ 73, yang mana Hakim Suriyadi telah menyatakan seperti yang berikut: “…suffice to say that a mere debt being monetarily based does not fall within the purview of an interest in land, and hence falls outside the realm of caveatable interest. Such debt does not relate to the land.)” ii. Institut Teknologi Federal Sdn Bhd. v IIUM Education Sdn Bhd & Another Appeal [2008] 1 CLJ 745 Mahkamah Rayuan telah memutuskan antara lain bahawa: [27]…it is settled that caveatable interest must be definite right relating to land and capable of enforcement and a 20 caveator must be in a position to institute a suit for a specific performance of claim…”) [28] Di dalam hal ini juga. Mahkamah ini merujuk kepada prinsip yang telah digariskan Hakim Buhagiar di dalam satu keputusan Mahkamah Rayuan di dalam kes In Chin Cheng Hong & Hameed & Ors [1954] MLJ 169. [29] Prinsip yang diutarakan oleh Hakim Buhagiar ini telah dirujuk juga oleh Hakim Gopal Sri Ram di dalam kes Luggage Distributors apabila YA telah merujuk kepada penghakiman Hakim Gill di dalam kes Inter-Continental Mining Co Sdn Bhd v Societe Des Etains De Bayas Tudjuh [1974]1 MLJ 145 di mana rujukan telah di buat kepada muka surat 170 alasan penghakiman Hakim Buhagiar yang menyatakan: “This agreement is non-staturory and non-registrable instrument; such instruments do not create an estate or interest, legal or equitable, in the land but create a contractual right, a personal right of action; it passes no actual interest in the land that can be called an equitable estate in the ordinary sense, but an equitable interest of a contractual nature under the instrument consisting of a right to be 21 registered as the owner of the interest purported to be conferred by the instrument (vide Hogg, Registration of Titles to Land at p 116). As Lord Dunedin stated in Haji Abdul Rahman v Mohamed Hassan [1917] AC 209: ‘The agreement is valueless as a transfer or burdening instrument, but it is good as a contract.’ This contractual right may be sufficient to give a person an ‘interest’ in the land for the purposes of protection by restrictibe entry in the register; the claim to an interest in land arising out of the contract is sufficient to make it caveatable interest and to support a caveat (In re Registration of Caveat (1908) Innes 114). The whole system of caveats is founded on the principle that they exist for the protection of alleged as well as proved interests and of interests that have not yet become actual interest in land, but a caveat, being in the nature of statutory injunction, does not in itself make a claim or right either better or worse.’ Applying the principles enunciated in the above cases to the facts of the present case it would seem clear that if the agreement is in substance a sublease, though not in the required statutory form, equity will treat it as an agreement for a sublease and specifically enforce it, in which case the appellants have a right in equity to a registrable interest in the land, so that they are entitled to lodge a 22 caveat under s 323(1)(a) of the National Land Code. (Emphasis added).” (Penekanan oleh Mahkamah ini). [30] Berdasarkan alasan-alasan di atas, permohonan Plaintif di Kandungan 1 adalah dibenarkan. Mahkamah ini juga memerintahkan supaya Defendan untuk membayar kos sebanyak RM8000.00 kepada Plaintif. ..................................................... (DATUK AZIMAH BINTI OMAR) Hakim Mahkamah Tinggi Shah Alam Selangor Darul Ehsan Bertarikh 28 haribulan Ogos 2017 Peguam Plaintif - Tetuan Manogar & Co M. Manogaran Peguam Defendan - Tetuan Ramesh Yum & Co Ramesh N.P. Chandran Nur Sazarina Said

Tika 2.6.0

WA-24C(ARB)-9-04/2017 & WA-24C(ARB)-12-04/2017

PLAINTIF Kejuruteraan Bintai Kindenko Sdn Bhd DEFENDAN Serdang Baru Properties Sdn Bhd

28/08/2017

YA DATO' LEE SWEE SENG

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=a6af00d5-2bea-4792-a9f9-9f7e4355926c&Inline=true

1 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE STATE OF WILAYAH PERSEKUTUAN, MALAYSIA (CIVIL DIVISION) ORIGINATING SUMMONS NO: WA-24C(ARB)-9-04/2016 In the matter of Section 42 of the Arbitration Act 2005 and Order 69 of the Rules of Court 2012; And In the matter of the Arbitration Act, 2005 and in the matter between Serdang Baru Properties Sdn Bhd (Claimant) and Kejuruteraan Bintai Kindenko Sdn Bhd (Respondent); And In the matter of a Final Award published by David Cheah Ming Yew on 9.3.2016 and the Final Award Corrective Notice dated 7.4.2016. BETWEEN KEJURUTERAAN BINTAI KINDENKO SDN BHD ... PLAINTIFF (COMPANY NO. 89776-P) AND SERDANG BARU PROPERTIES SDN BHD ... DEFENDANT (COMPANY NO. 16558-W) 2 (Heard together with) IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE STATE OF WILAYAH PERSEKUTUAN, MALAYSIA (CIVIL DIVISION) ORIGINATING SUMMONS NO: WA-24C(ARB)-12-04/2017 In the matter of the Arbitration Act, 2005 and In the matter of an Arbitration between Serdang Baru Properties Sdn Bhd (Claimant) and Kejuruteraan Bintai Kindenko Sdn Bhd (Respondent); And In the matter of a Final Award published by David Cheah Ming Yew on 9.3.2016, the Final Award Corrective Notice dated 7.4.2016 and the Final Award Corrective Notice No. 2 dated 4.5.2016; And In the matter of High Court Originating Summons No. WA- 24C(ARB)-9-04/2016 and Court Order dated 8.12.2016; And In the matter of Section 38 of Arbitration Act 2005 and Order 69 or Rules of Court 2012; 3 And In the matter of Present Jurisdiction of this Honourable Court BETWEEN KEJURUTERAAN BINTAI KINDENKO SDN BHD ... PLAINTIFF (COMPANY NO. 89776-P) AND SERDANG BARU PROPERTIES SDN BHD ... DEFENDANT (COMPANY NO. 16558-W) THE JUDGMENT OF YA LEE SWEE SENG [1] This is a sequel to Enclosure 1 of Originating Summons No: WA- 24C(ARB)-9-04/2016 (“OS 2016”) which was an application by the Plaintiff here who was the Respondent in an arbitration for the arbitral award to be varied under section 42 of the Arbitration Act 2005 (“AA 2005”). Project [2] The Plaintiff as Contractor had been appointed by the Defendant as Employer via a Letter of Acceptance dated 5.2.2000 to design, 4 construct and complete the development of a 19-storey retail commercial centre with residential apartments. The formal contract governing the parties was based on the JKR Conditions of Contract for Design and Build and Turnkey Projects 1999 edition subject to certain modifications. [3] The Defendant had terminated the Plaintiff by a letter of termination dated 2.6.2008 for inter alia a failure to proceed regularly and diligently with the Works. Proceedings in Arbitration [4] The Defendant had then proceeded with arbitration for a total LAD claim of RM33,555,000.00. The calculation was based on an agreed LAD of RM15,000.00 per day for sectional works and RM40,000.00 for the main building works for the relevant period of delay. The learned Arbitrator allowed only RM32,235,000.00 as LAD, having found that the Plaintiff was entitled to some Extension of Time. The learned Arbitrator found that the Defendant as Claimant/Employer in the arbitration was so entitled and there was no need to prove its loss. However the learned Arbitrator had also assessed the actual damage suffered by the Defendant as Claimant/Employer to be RM6,233,659.55, perhaps in anticipation of the High Court disagreeing with him because of the 5 principle of law propounded by the Federal Court in Selva Kumar A/L Murugiah v Thiagarajah A/L Retnasamy [1995] 1 MLJ 817. [5] Selva Kumar (supra) was reaffirmed by a later Federal Court case of Johor Coastal Development Sdn Bhd v Constrajaya Sdn Bhd [2009] 4 MLJ 445. The Federal Court was of the view that pursuant to section 75 of the Contracts Act 1950, a party claiming liquidated damages is legally obliged to prove its damages in accordance with the principles set out in Hadley v Baxendale (1854) 9 Exch 341. As such, the Federal Court has decided that the Defendant could not simply rely on the amount stipulated as liquidated damages as damages but instead has to prove its damages. [6] The Plaintiff as Respondent in the arbitration counterclaimed for inter alia the sum of RM25,525,624.87 being the value of works carried out by them as of 29.5.2007 together with a turnkey factor of 15%. The Plaintiff also claimed for a return of the Advances made and monies paid to the Defendant. [7] The learned Arbitrator allowed the Plaintiff’s counterclaim and so the nett sum payable by the Defendant as Claimant/Employer to the Plaintiff as Respondent/Contractor in the arbitration was RM1,718,943.99. 6 [8] The learned Arbitrator also awarded simple interest at 5% per annum from 3.6.2008 (a day after termination date) up to 9.3.2016 (date of Award) and thereafter at 5% simple interest per annum until realization. Previous Proceedings in this Court [9] The questions of law that the Plaintiff had referred to this Court pursuant to an application filed under section 42 AA 2005 are set out in Annexure A to OS 2016. Only the Second and Third Questions of Law were relevant and they are set out as follows: Second Question of Law: Given that the Arbitrator has assessed the damages suffered by the Defendant to be RM6,233,659.55, can he as a matter of law award the Defendant a higher sum? Third Question of Law: a. Whether there must be an express provision to state that parties are contracting out of Section 75 of the Contracts Act 1950 in the light of Clause 56 of the Conditions of Contract. b. Whether as a matter of law given that Section 75 of the Contracts Act 1950 deals with the award of damages parties can agree to contract out of the Contracts Act 1950. 7 c. Whether upon a reading of Clause 5.8 and/or Clause 5.10 of the Main Contract, parties had in fact contracted out Section 75 of the Contract 1950. [10] After hearing arguments of the parties this Court had varied the award as follows as reported in Kejuruteraan Bintai Kindenko Sdn Bhd v Serdang Baru Properties Sdn Bhd [2017] MLJU 528: “[95] The Court, in a reference on questions of law, may under section 42(b) vary the award or under section 42(d) set aside the award, in whole or in part. [96] For the reasons given above, I had therefore varied the Award as follows: That paragraph 954 of the Award dated 9.3.2016 and paragraph 5 of the corrective Award dated 4.5.2016 be set aside and the entitlement for payment as set out therein be set aside and it was further ordered that the Claimant/Defendant shall pay the Respondent/Plaintiff the sum of RM28,220.284.44 as set out in the table above instead of the sum awarded of RM1,718,943.99. 8 [97] That paragraph 966, 967 and 968 of the Award dated 9.3.2016 and paragraph 6 of the corrective award dated 4.5.2016 be set aside and it was ordered as follows: a) that the Claimant/Defendant shall pay the Respondent/Plaintiff simple interest at the rate of 5% per annum on the sum of RM28,220,284.44 from 3.6.2008 up to 9.3.2016. b) that the Claimant/Defendant shall pay the Respondent/Plaintiff simple interest at the rate of 5% per annum on the sum of RM28,220,284.44 from the date of the award until the actual realisation of the said payment by the Claimant/Defendant. [98] I had also ordered the Defendant to pay the Plaintiff costs of RM20,000.00 for this application.” [11] Against that order of this Court made on 8.12.2016 the Defendant had on 5.1.2017 appealed to the Court of Appeal. Pending the hearing of the appeal by the Court of Appeal the Defendant has applied by Enclosure 23 in OS 2016 to stay the order varying the award of the learned Arbitrator. 9 Prayer [12] However by consent of the parties this Court had proceeded to hear OS No. WA-24C(ARB)-12-04/2017(“OS 2017”) which is the application of the Plaintiff under section 38 of the AA 2005 and under Order 69 Rules of Court 2012 to enforce the Award of the learned Arbitrator as varied by this Court by its order of 8.12.2016. [13] After hearing parties and the objection raised by the Defendant on the fact that based on the Court of Appeal’s case of Far East Holdings Bhd v Majlis Ugama Islam Dan Adat Resam Melayu Pahang [2015] 4 MLJ 766, the learned Arbitrator has no power under the AA 2005 to grant pre-award interest, this Court allowed the varied Award to be registered as a judgment of this Court less the interest of 5% per annum from 3.6.2008 (date of termination) up to 9.3.2016 (date of the Award). [14] Against that decision the Plaintiff has filed an appeal to the Court of Appeal for the pre-award interest amounted to about RM11 million. [15] The parties were able to agree on the terms of a conditional stay of the order with respect to Enclosure 23 of OS 2016 and as the varied arbitration award has now become a judgment of the Court less the pre- award interest, parties had recorded the terms of the consent order for a conditional stay of the judgment of this Court dated 8.12.2016 as follows: 10 “By consent there shall be conditional stay of the enforcement of the judgment allowed in OS No. WA-24C(ARB)-12-04/2017 conditional upon the following: 1. Kejuruteraan Bintai Kindenko Sdn Bhd shall be at liberty to lodge a prohibitory order and private caveat against the said land referred to in the Affidavit of Serdang Baru Properties Sdn Bhd except that Kejuruteraan Bintai Kindenko Sdn Bhd shall not proceed further with a writ of seizure and sale by way of a public auction of the said land until the disposal of the appeal filed herein by Serdang Baru Properties Sdn Bhd; 2. Serdang Baru Properties Sdn Bhd shall file an affidavit within 7 days hereof disclosing that there are no creditors to the combined sum of RM1 million or more; 3. Liberty to apply; 4. No order as to costs.” [16] With the recording of the above consent order, learned counsel for the Defendant withdrew OS 24C(ARB)-16-05/2017 and so that OS opposing the enforcement of the Arbitral Award was withdrawn and so struck out with no order as to costs. 11 Principles Whether the party against whom an Arbitral Award is given may oppose recognition and enforcement of the Award at the enforcement stage where the element of pre-award interest is concerned when it had not applied to set aside or vary the Award where that element is concerned [17] The grounds for refusing recognition or enforcement of an Award under section 39(1) of the AA 2005 follow closely the grounds for setting aside an Award under section 37(1) of the AA 2005. Section 39(1) of the AA 2005 reads as follows: “Grounds for refusing recognition or enforcement 39. (1) Recognition or enforcement of an award, irrespective of the State in which it was made, may be refused only at the request of the party against whom it is invoked— (a) where that party provides to the High Court proof that— (i) a party to the arbitration agreement was under any incapacity; (ii) the arbitration agreement is not valid under the law to which the parties have subjected it, or, failing any indication 12 thereon, under the laws of the State where the award was made; (iii) the party making the application was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present that party’s case; (iv) the award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration; (v) subject to subsection (3), the award contains decisions on matters beyond the scope of the submission to arbitration; (vi) the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement was in conflict with a provision of this Act from which the parties cannot derogate, or, failing such agreement, was not in accordance with this Act; or (vii) the award has not yet become binding on the parties or has been set aside or suspended by a court of the country in which, or under the law of which, that award was made; or 13 (b) if the High Court finds that— (i) the subject-matter of the dispute is not capable of settlement by arbitration under the laws of Malaysia; or (ii) the award is in conflict with the public policy of Malaysia.” (emphasis added) [18] There is no good reason why a party that has not applied to set aside an Award under section 37 or refer a question of law under section 42 may not at the stage of enforcement of the Award raise the grounds listed under section 39(1) to oppose enforcement of the Award. [19] As the Award was against the Defendant as Claimant in the arbitration, the Claimant was well entitled to apply to set aside the Award under section 37 or refer a question of law under section 42 at least with respect to pre-award interest but it did not do so. [20] The Plaintiff as Respondent in the arbitration did apply to vary the Award under section 42 but that was not on the point of the power of the Arbitrator to award pre-award interest but rather on the Award of LAD without the need to prove loss but by applying the agreed formula for the LAD. Indeed it is not for the Plaintiff to raise the issue of pre-award interest as it is a point in favour of the Plaintiff whether on the smaller 14 sum as awarded by the learned Arbitrator or the much bigger sum as varied by this Court. [21] The question then is whether the Defendant as Claimant in the arbitration may raise this now in opposing the recognition and enforcement of the Award. [22] The fact that Parliament had allowed the same grounds under a setting aside of an Award under section 37(1) to be repeated in an application to oppose recognition and enforcement under section 39(1) would mean that Parliament does not consider the same grounds to be redundant. [23] Granted, in a domestic arbitration, both an application for setting aside under section 37 and also a corresponding application under s 38 of the AA 2005 to recognize and enforce the Award, generally the Court would hear both applications together as one would be a flip side of the other in that if the Award is set aside than correspondingly it will not be enforced and conversely if not set aside it would generally be enforced. [24] However, in the case of an international arbitration, the setting aside is at the Court where the seat of arbitration is. In the case of an international arbitration the seat of arbitration may well be different from the jurisdiction where a party may want to enforce an Award in its favor. 15 An Award for instance may be against the public policy of the State where the Award is sought to be enforced though the same Award is not successfully set aside by the Court where the seat of arbitration is. [25] Likewise whilst an application for setting aside may not be made after the expiry of ninety days from the date on which the party making the application had received the award as provided under section 37(4) of the AA 2005 there is no such time frame for the enforcement of an award by way of registering it as a judgment of the Court under section 38 of the AA 2005. This is understandable and the enforcement would normally be applied for in the State where the award debtor has assets to be attached. [26] As both sections 37 and 38 of the AA 2005 are applicable to domestic as well as international arbitration it is difficult to say that a ground that could be raised in a setting aside of an Award if not raised, cannot be so raised for the first time in opposing an application for recognition and enforcement of the Award. [27] Our Supreme Court in State Government of Sarawak v Chin Hwa Engineering Development Company [1995] 3 MLJ 237 had recognized passive remedy even under the old Arbitration Act 1952. His Lordship Edgar Joseph Jr FCJ observed at page 245 as follows: 16 “We agree, that in certain circumstances, a party may avail himself of a passive remedy by which is meant he does not take the initiative to attack an award, but simply waits until his opponent seeks to enforce the award by action or summary process, when he resists enforcement. Mustill and Boyd on Commercial Arbitration (2nd Ed) at p 546 have instanced two situations when the passive remedy would be available; namely: (1) where the award is so defective in form or substance that it is incapable of enforcement; (2) where the whole or part of the award is ineffective, on the ground that the relief granted lies outside the jurisdiction of the arbitrator.” [28] The Singapore Court of Appeal wrestled with this issue of “passive remedy” in PT First Media TBK v Astro Nusantara International BV and Ors [2013] SGCA 57; [2014] 1 SLR 372. “Active remedy” is understood to mean an award debtor applying to set aside an Award and “passive remedy” as in a award debtor resisting or opposing an application by an award creditor to recognize and enforce the Award. It was explained thus in the award by Sundaresh Menon CJ as follows: “38 Thus, under the 1950 EAA, an award debtor had two options to avoid the consequences of an award: (a) the active remedy of setting aside under s 23; or (b) the passive remedy of resisting 17 enforcement under s 26. This is buttressed by Sir Michael Mustill and Stewart Boyd, The Law and Practice of Commercial Arbitration in England (Butterworths, 1982) ("Mustill & Boyd"), where the authors recognised that there are two categories of remedies available after an award has been released. They termed these two categories as "passive remedies" and "active remedies" and described their operation in the following terms (at p 489): A party avails himself of a passive remedy when he does not himself take any initiative to attack the award, but simply waits until his opponent seeks to enforce the award by action or summary process, and then relies upon his matter of complaint as a ground why the Court should refuse enforcement. [emphasis added in italics and bold italics] 39 The authors' commentary (at p 488) on the options available to parties with jurisdictional objections is remarkably on point: Jurisdictional problems If concerned with the existence or continued validity of the arbitration agreement, the validity of the notice to arbitrate or the qualifications of the arbitrator, [a party may] issue an 18 originating summons or a declaration. Alternatively, [that party may] wait until after the award [has been published] and then set aside the award or raise the objection as a ground for resisting enforcement. [emphasis added in italics and bold italics] 40 If the system of "choice of remedies" is to be interpreted as one which permits parties to defend against an award passively by seeking to resist its recognition and enforcement in the enforcing court even though no active attack had been taken against the award, which is exactly how both Mr Landau and Mr Joseph understood it and how we saw it, it is evident that the features of this system were already part of English arbitration law by the 1970s at the latest.” [29] In Singapore international arbitration is governed by the International Arbitration Act (Cap 143A,2002 Rev Ed) (“IAA”) wherein section 3 provides as follows: “3.—(1) Subject to this Act, the Model Law, with the exception of Chapter VIII thereof, shall have the force of law in Singapore.” [30] The “Model Law” referred to is the Model Law on International Commercial Arbitration adopted by the United Nations Commission on 19 International Trade Law ("the Model Law"). Chapter VIII of the Model Law is where the various grounds for refusing recognition or enforcement of the arbitral award are set out in Article 36 thereof which is reproduced in our section 39 of the AA 2005. [31] Their section 19 on the enforcement of awards merely states that leave of the High Court is required for its enforcement as a judgment of the Court. It is the same as our section 27 of our old Arbitration Act 1952 and section 26 of the English Arbitration Act 1950. It reads: “Enforcement of awards 19. An award on an arbitration agreement may, by leave of the High Court or a Judge thereof, be enforced in the same manner as a judgment or an order to the same effect and, where leave is so given, judgment may be entered in terms of the award.” [32] The Singapore Court of Appeal had to delve and dig deeply into the legislative history of the IAA and the rationale for excluding the application of Chapter VIII of the Model Law in coming to the conclusion that the Courts there would still refer to the grounds for resisting an enforcement of an award as set out in Article 36 of the Model Law in deciding whether or not leave to enforce the award as a judgment of the Court ought to be given. The Chief Justice of Singapore Sundaresh Menon CJ concluded as follows: 20 “84 As we have held, the content of the power to refuse enforcement under s 19 must be construed in accordance with the purpose of the IAA which, as we have stated, is to embrace the Model Law. Given that de-emphasising the seat of arbitration by maintaining the award debtor's "choice of remedies" and alignment with the grounds under the New York Convention are the pervading themes under the enforcement regime of the Model Law, the most efficacious method of giving full effect to the Model Law philosophy would, in our view, be to recognise that the same grounds for resisting enforcement under Art 36(1) are equally available to a party resisting enforcement under s 19 of the IAA.” [33] Quite obviously we do not have this problem as the whole of Article 36 of the Model Law is reproduced in our section 39 of the AA 2005. The reproduction in section 39 following the same grounds in a setting aside of an award under section 37 cannot be for decorative purposes but for the deliberate design of permitting the same grounds not raised because there was no previous application to set aside under section 37 to be raised in resisting or opposing an application under section 39 of the AA 2005. The repetition of the same grounds has nothing to do with it being redundant but everything to do with reiteration 21 as in making those same grounds available in resisting an enforcement application under section 39 of the AA 2005. [34] One can appreciate that if a ground has been argued in a setting aside application under section 37 and the same ground is sought to be argued under a subsequent section 38 application in opposing an enforcement of an Award, then res judicata might well apply to prevent the same ground from being ventilated again. [35] In this case the matter of pre-award interest is not a matter that may be submitted for arbitration as section 33(6) of the AA 2005 as interpreted by the Court of Appeal in Far East Holdings Bhd & Anor v Majlis Ugama Islam Dan Adat Resam Melayu Pahang and another appeal [2015] 4 MLJ 766 simply does not allow an Arbitrator to make an Award covering pre-award interest. [36] Thus if the Award contains a decision on pre-award interest it is an Award which contains a decision on a matter beyond the scope of the submission to Arbitration under section 39(1)(a)(v) of the AA 2005. That is so even though both parties had wanted the Arbitrator to grant pre- award interest as in their respective Claims and Counterclaims. 22 Whether the effect of Far East Holdings (supra) as decided by the Court of Appeal is such that this Court shall give effect to it and separate the pre-award interest from the enforcement of the Award [37] The Court of Appeal in Far East Holdings Bhd & Anor v Majlis Ugama Islam Dan Adat Resam Melayu Pahang and another appeal [2015] 4 MLJ 766 Court of Appeal held that notwithstanding that interest was not pleaded, the Arbitrator granted the pre-award interest based on the common-law rights and under section 11 Civil Law Act, 1956. The Court of Appeal held that the Arbitrator has erred in law in granting the interest: "[98] On the issue of interests, we agree with the learned judge that the Arbitrator has erred in law in awarding pre and post-award interests. Having considered the Act, we find that under s33(6), the Act has made specific provision for post award interest, but does not provide for pre-award interest. Clearly, the Act does not contemplate the awarding of pre-award interest. We agree with the submissions by learned counsel for FEH and KAOP that when the Act specifically provides for post award interest but is silent on pre-award interest, then implicitly the legislature did not intend to confer on an arbitrator the power to award pre-award interest. Therefore, we agree with the learned judge that the 23 award of pre-award interest ought to be set aside." (emphasis added) [38] Section 33(6) of the AA 2005 provides that: "Unless otherwise provided in the arbitration agreement, the arbitral tribunal may – (a) award interest on any sum of money ordered to be paid by the award from the date of the award to the date of realization; and (b) determine the rate of interest." [39] The above said decision was followed in the High Court cases of Kerajaan Malaysia v Tasja Sdn Bhd [2016] MLJU 371 and Kerajaan Malaysia (Kementerian Sumber Asli Dan Alam Sekitar) v Kumpulan Sakata Sdn Bhd [2016] 7 CLJ 412. I had stated for the reasons set out the two cases just referred to, my personal preference for the awarding of pre-award interest, but respecting the doctrine of stare decisis or binding precedent, any High Court would be bound by a decision on the same issue given by a Court of Appeal that is the ratio of the case and not a mere obiter. In Kerajaan Malaysia (Kementerian Sumber Asli Dan Alam Sekitar) (supra) it was observed as follows: 24 “[27] However for the time being, the position of the law on pre- award interest is as declared by the Court of Appeal in the Far East Holdings’ (supra) case. Irrespective of my personal predilection and preference, the position of the law on pre-award interest as may be awarded by an arbitrator is as propounded authoritatively by the Court of Appeal in the Far East Holdings' case (supra). To put it pointedly and plainly, an arbitrator has no jurisdiction to award pre-award interest but only post-award interest if provided for in the arbitration agreement. [28] The law will have the opportunity to develop as the cases from which the principle is derived, go through to the apex court. In the meanwhile, the doctrine of stare decisis or binding precedent, applies to the High Court. [29] Both judicial deference and discipline would demand of a High Court to follow the decision of a Court of Appeal on a point of law already decided. Whilst one may be at liberty to state the persuasive arguments to the contrary, one is not at liberty to disregard an authoritative pronouncement of the law of a court higher up in hierarchy. The following reminder of the Federal Court in Metramac Corporation Sdn Bhd v. Fawziah Holdings Sdn Bhd 25 [2006] 3 CLJ 177; [2006] 4 MLJ 113 would resonate with all who respect the rules of binding precedent: [45]... In order to appreciate the importance of adhering to the doctrine of stare decisis useful references may be made to Cassell & Co Ltd v. Broome & Anor [1972] 1 All ER 801 where Lord Hailsham said at p 809: The fact is, and I hope it will never be necessary to say so again, that, in the hierarchical system of courts which exists in this country, it is necessary for each lower tier, including the Court of Appeal, to accept loyally the decisions of the higher tiers. Where decisions manifestly conflict, the decision in Young v. Bristol Aeroplane Co Ltd [1944] 2 All ER 293 offers guidance to each tier in matters affecting its own decisions. It does not entitle it to question considered decisions in the upper tiers with the same freedom. Even this House, since it has taken freedom to review its own decisions, will do so cautiously. That this is so is apparent from the terms of the declaration of 1966 itself where Lord Gardiner LC said: Their Lordships regard the use of precedent as an indispensable foundation upon which to decide what is 26 the law and its application to individual cases. It provides at least some degree of certainty upon which individuals can rely in the conduct of their affairs, as well as a basis for orderly development of legal rules. [30] Ever so often, an admonishment along the lines spelt out in Periasamy Sinnappan v. Public Prosecutor [1996] 3 CLJ 187 at pp. 213-214; [1996] 2 MLJ 557 at p. 582 has been repeated to rein in respect for the authority of a higher court: Lastly, the learned appellate judge did not sufficiently address his mind to the decision in Khoo Hi Chiang. We find the cavalier fashion in which he approached the judgment of a five-member bench of the Supreme Court in a case which was an authority binding upon him to be quite appalling. We are convinced that the learned appellate judge ought not to have brushed it aside as he did. We may add that it does not augur well for judicial discipline when a High Court Judge treats the decision of the Supreme Court with little or no respect in disobedience to the well-entrenched doctrine of stare 27 decisis. We trust that the occasion will never arise again when we have to remind High Court judges that they are bound by all judgments of this court and of the Federal Court and they must, despite any misgivings a judge may entertain as to the correctness of a particular judgment of either court, apply the law as stated therein.” (emphasis added) [40] However there is no need to set aside the whole of the Award as the saving provision in section 39(3) AA 2005 allows the matter not submitted as in could not be submitted to arbitration to be excised from and separated from the matters submitted to Arbitration. [41] Section 39(3) further provides as follows: “39(3) Where the decision on matters submitted to arbitration can be separated from those not so submitted, only that part of the award which contains decisions on matters submitted to arbitration may be recognized and enforced.” [42] The part that is affected and infected with respect to the pre-award interest can be clearly and clinically severed or excised from the part of the Award that is intact, which integrity has not been compromised or contaminated in any way by the pre-award interest element. 28 [43] The consequence is that the part containing the pre-award interest at the rate of 5% per annum on the Arbitral Sum of RM28,220,284.44 from 3.6.2008 up to 9.3.2016 be removed from the recognition and the enforcement of the Award. Pronouncement [44] The part of the Award enforced as a judgment of the Court is the Arbitral Sum of RM28,220,284.44 and interest at the rate of 5% per annum from 9.3.2016 (date of the Award) to the date of realization. [45] I had therefore allowed judgment to entered accordingly for the above part of the Award together with agreed costs of RM5,000.00 to be paid by the Defendant to the Plaintiff. Dated: 28 August 2017. - signed - Y.A. LEE SWEE SENG Judge Construction Court Kuala Lumpur For the Plaintiff : Sanjay Mohan together with Adam Lee (Messrs Mohanadass Partnership) 29 For the Defendant : Felix Dorairaj (Messrs Dorairaj, Low & Teh) Date of Decision : 2 May 2017

Tika 2.6.0

WA-24NCVC-508-03/2017

PLAINTIF ASHEEQ ALI BIN SETHI ALIVI DEFENDAN 1. UNIVERSITI KEBANGSAAN MALAYSIA 2. MENTERI PENDIDIKAN TINGGI 3. KERAJAAN MALAYSIA

28/08/2017

YA DATUK S. NANTHA BALAN

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=149f1b19-0ae3-4ed2-afc5-9f8d1d41ea42&Inline=true

l').\LA.VI MAI IKAMAH TINGGI M \Lr\YA DI KU«\1_A LLMPUR Dzlam Pukm Alumn 5 Kzcdah 4. Arum" 7. Arum IS Kzcdnll I6 am Arum 23 Ka¢dnh—Kat<la|I Mahkmmh 20|2. Dan Dzlnm Frrkau Srksyn-n 41 Aim R:-1i[$pu<:fil< 1950 Dan Dalnm Pukua Scluycn 25(2) dm Jndunl Ah: Mnhknn-ml: Kzhakzman 1964 Dan Dalnm Pcrkara Sc yen 13(3) (b) Am Umvemu dan Kvfleg UmversmI97‘l Dan Dalam Pcrkzra 3 am In Pezlembagizn Pcrsckutuan Dan Dalam Pcrkam Kacdah 3 am :3 Ka:dsh—Kaz:dah Unwexsxri Ktbzngsaan Mz.|z}sn (Tamcmb Fclzgar-Pelaayn) 1999 Dan Dzhm Pexlmra Tmdzkzn 'l'auu:xub Hnl hhxnl llemu an 2 mum zam (Pmdnan) ulcll Dcfendan Ptrtnma tcrlwadnp Plamufi am 1 m 22 \NT.\R\ ASHEEQ ALI BIN SETH! ALIVI INO.1»,’l’ u5u915—u—(aw7; .,.PLAINTIl-‘ D.\N 1. UNIVERSITI xa-zamnsmn MALAYSIA 2. MENTERI PENDIDIKAN TINGGI 3. KERAJAAN MALAYSIA MDEFENDAN-DEFENDAN (1 [mid togcdum mm: L>AIA.\1 I\L\HK.«\M,\H TINGGI MALAYA DI klV.\LA LLIVIPI ‘R n.\m.\1\\‘u mu ' ' Dalzm pukzn Amnn 5 Kzedah 4, Anznn 7, «man 15 Kaedah m dan /\I\u'»m 23 K Kncdah Mahkamzh 2012 Dan Dulaln ptrkam bcksxmn 41 Akra RchfSp<-s|fik wso Dan mum pukara Sclzsycn 25(2) dan Jndunl Am Mahkzmzh Kulnkumnn 1904 Dun Pap:-urn my (0 rd) 4» (0 «gr my an In nib r nnler. Inlay ....«..n-3. mar-lny. .:......y u .,.u..e: V Mate my pvvvnlon o[ In wnlien law, Whkihll whhln fill cup... In uuum the Clnlplu: am.» Of u. my manna uuzrfa: wuh. .7: mu: m I1: dmuplbd xx! in .n, mnnlrcr mlnrfemd M101. My :m:..m Kludy‘ lzwnxh, udmxnmmmz wk. nr any m w rarnad am by or undgr In: dm-(Hanoi u. WVHI nu: puvmwmnol me Umvcmny, pmm, mm-. 9. interfere wlh, wr uusz Ia be pmrcnltd. ohsmmled or mlufcvui with. my nmccr ur rmplnyte .4 me ummsm nx any puson wclvng Imdu -n. dmclvon at pu....m.».. 0! cm. nWA::r «z allyllwyte. Fmm curymg um rm Mrk. duty :1! funcunn. pm": W Ivburn-cl. or any (u I): ymenlmi or muuma. my smdm (mm ulumng any mum mmrul 0. cm, Bf fivm cum", m my lrwumle nmmy. ..:;....z= mule M purl:-Apnlc u. Ihr mm uflny umnuulwu. |ecIur:,1mon:A.clm avoLherVeg.1nnuk ncnvuy mmcd max by of mm mgamm nr mm m. pennxwvn, Mm: Univwm): damage. umprr xmcxfue wuh. muvr. u. m my mama dul mm. mm subslancnaMscl.n1\¢]:or[7m|m1:y m Ike um.suy, In: my .u mm rm) nu u. 5. an»: m In: mum ;. ..; m can: ar he mu, In can: any nhsmxuon. muanvsuentt. m.,.m. ‘um unlanmgcz m ..., puwn inlln: unweruly, L.) mmnvenznny Inslluchonm reqummrnt :11 the Umve ., I main. . rncmbrv cf Ihc mm, mm or mm ham, unplugve m rzspecl oflhruse A71v.hcIihnzy,vLs mag and mhcrllnhlxci m Ilm lmrurg. U; svnllmtnc any ....m.qi.... m mqmu-nuzmoi m nmhorind push rspccl .71 m: use nlzny labonmry. Vabonmty equpmmx. lppamms or sahzlunx. and alher lzmlmzs m lhr |:\bunmry.“ [emphasis added] Page mm ‘I6 Rnk 1:. nf um Untverilll Kcbnnguan M7|l:Ay<m [Dxszlphnc of Smdunu) mu.-5 ma (rum) 209/ moo) (‘nun 13")1cads 25‘: -us >Iunem'x .um..=. ouuld: u...... m xa xluduul-, mgmfnlxon. mm, 0! W... at ;u.a...:.«4 mu - ry ....: nr ,..nm....- n. .u._» mean, ......m.- the Llmplu dirml adwrrn arm on m. Univrmly ur mm. as |h:mIzruI1allhe |\n|vux|Iy (2; 'n.. Viv:-Chnmellor may nun g....:.n..... in mm umimin mm m ..rq...u::.: m lb» Inlervsu nllhe Inkvuslly -- [emphasis added] 17. Rulc 3 and 13 of (hi: V[mvns1Iyofl\In]ay1< {DIscIplm:- of Sruden(.<) Rules 1999 (Pl'(A) Z67/1999) are sxmxlarly worded Federal Cunuilulion I8. >\ruc1c m nf me Fedcml Fnnvrxnzrinn .. found in Pm U zhcrznf and pmndcx for “frccdum ufIpL':ch, nsscmbly and assuzmuun". n mad: as.» --m s.m.1~\:uu....m:x.uma«7, my may ulum mm m: nghl no rmamu cf vptech and up.m...‘.. (by ull elllxun huve n..» am I.» ulclnhlr penzvubly and wilhmn "us. (:7 Mlcmnem mm»: nghv ln(nnv\aL1(-cmlmnx (Ev v.n.....=... n... in Iuw a......-‘- m 4... Kim ..gn;¢.,.u;..»»a by u-ug:-pn m 0H Hm): (1). sun): rcmicxmrw u n dam: rncenary M vxpcdlml in II): ml:-r::1 of m. sccumy at m F¢d=n|wu m any pm "mar. Va]: :2 m 2; (‘J «A; fncndly Mlaumu uvlh nlhm m...m<. public ...m nr nwnlnv and xzslncuons dtslgmd m prolsvl an pnulcga um. muanl am! my Lcgmlnhve Annmbly nut in plandn‘ agmnsl wmempl mwn. drlzmallau. ormmzmwm m any m...«. m an the right mnfenrd :7, plngnph an ofclnsc uu. mu. .mrma..... ,.- in am... nanny 1:! mm... .. nu nlzrntuflht ..¢..m, nllfie Fedennon 0! any pull mm: ...- public ma, In) an lh: ugh: culvltnefl Ivy pamg1lph(I.)0l cum (l].:u:h nsmclwur 1: mm. nlcmawy nr :.,.ea.cm m m mum. nl\b< sec , nfdrlefadtrallun arm) mil mzm-L ..-mu: nrdrv nr mcvmluy xm..u....., an 1?»: right 1.. {mm nwcmlnmx cunfened 1», paragraph m of Chusa m mag mm b: Imrmed by my Ilw Nluvng Io hsbeuv nr edmmmn 1., lmpnxmg nxlntuuns m m: mums at m: secum) of mu Ytdrrannvt nrnny pm lkercnfm ,...n:.= nxdu undrr Clmuc m on. Parlumem mny pm In“ pvmh 3 me qnrsvonxng olany mm. nghl. mm. punuul prnfltgc fivmrelgnly 4|! pmugauvr mnvma or pmudtd by ux pmvmuxu ol PM In. Amck :52‘ I5Jar m utherwvyc m... mmlauon m Ih: Implrm-.nIxIim\In:r:of .5 may vx qmnca m sum Ian " Annlylil and cnncluniun Made of Cnmmcncu-nI:nv. 19 The am pom! am 1 \\1.U deal \v|Lh 15 me issue of proper mode of mmmenctmnznr. According to me decision afLhe Fcdeml Court 111 Ahmadjg/51 ‘um /my t/4 Fmgum/1 zebymm ¢- I(..I.mvmn pm ¢~ on [me] 5 cu B65 [2010] 3 M1,] 145, n‘ the rnattrr mvolvcs . public authority exucismg namror} pom and «I1.» manu mvnlvcs . subsranual clemcnr af public law as uppnied Io pnulc 1.w, am. the propel mud: would la: ,u4.=..1mw undcI01dcr 53 Ilulrs of am Hxgjl cm. [980 (now one: 51 Rules of Cuurt 2012) , pg. 13 at 2; -1511 1.... .. .. ...«.<...., co. .. yudgc vnhcn «ma»... .... mch mall-I .. fir: uoalam whnbzr line .5 . ......|.c law clunmk ... 9.: dupuv: It In»: .n..... 1... inlr . me... .. nu... um. .... ...r........u ........7.|.. ..r....ma. n... u... .....p...........e .....«.. «......m be by wny ..m u .1 me mic. u .......e .u......... ..... ...-..... .... m... m. .9... ....... ..¢........ WIICII .: .». ..... .. ....... ,..«.............. u .. ... ....,s........ puhllc ..w .u........ lhnl .... pnmeduve umirr 0 53 .. .... lint m... 5. .......a DI'llN'«‘l3CI1R|Dy M ... nshk ... W... .»... .. am. .:.. ........v. pmcesm x... mm: ........ .5 under um... m Ihungh ...m.....g . public ......o...y, mg mod: .. .»............= “.1. M... undzr o 5: .1... 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Maria Section 15(3) of the uuca proh\|ms 2 smdtnr nf :1 .....mm, from dulng angzhulg w show x)mpnth\' or suppolhtu“m1\'sm:|cty orgnxuzrmun, may or gzunp uf pcxxons whirl: um Hoard delcmunes to be unsuitable Lo Lhe uuercsls and we1.l—l:eing of me skudcnm 0. me um.-m:,v." Rule 3 As : pmvmon on general prohibition not only on student acuvmrs wuhin and mnsxd: the campus, but contains mm 4 Ru1c13 pmhtbnuom ma. cnn~nr\n: a dxsclpllnary offchcc ‘ nn um mm hand prohxlnls Enldtnl zcnvmes cums. the cnrnpus which was n dncc! ndvcxse cfftct an the u...vm.:,» 1:! which .5 pxcgudmzl .0 the “mm of me Um\'c:suy". Axnclc m of me Fcdzml Consumdun dczls mm freedom of speech. assembly and association, subyecl to thc hlnimnnns contained Khueln Th: xrnperauve question :5 xrherhu the Unxvcmuzs’ Acuon m cnrnmencing dxscxpllnary pmccedings mun" me plamnffs mumd Am; 10 Dr me Fcdzral Cunxumuan I should add am dus cm Is not about whemtx flu‘ findmgs of em by me dxsmphnary body of LM and um! wax: agmnst the wughl ofcndcnce. musam 26. 25‘ Thosc questions ma) hc xelcvnxu. 1: at .11, in sepamzc yudlclal mucw pmcccnlings lo clulltngc the xhsrxphnzry pmcecdnxgs [oz my pmccduml mfirrmues 0. sulzsianuvc injusucc, .r my. Thus. an npphcnnons here do not mvolxc . ch.~z.|.|:ngt to me andmgs offnus of the d.\s<:IpL\nary mbunal. Th: Unlvtrsmcs pmceedtd on [ht bnsis mm the plainlxfk pamcxpattd m an lllegzl rally Thc rzasnn as .0 wk, my rally is rrgnrdcd as Illzgnl, u m my mew nneltum for present purpoxc; '11.: strand and mud pls.\uLI[l's m oszm hm nddmonnl chargcs of Lrespzssmg me me L m mmpus. All me pm-mrr; wax: xdmufied as mam: of Lhe defendant and questioned by me pullce. Turn of lhcm wuc damned Thc Univcrellws commencrd disciplinary pmcceding: beams: they took the \1:\\ am the plannuffx’ pnmclpnnon |n the nlly hnnl bmug]-n ampm m an urn\‘cxsu_w. 1. AS rclcvnnt .0 ask, whuhcx ml. action on d1: p1...mrrs* pan an bung chszcpul: m U.\1/UKM? um shun answcr 1: mm m 15 [01 me UM/UKM d.\supL1na13' bodies to dzcxle whether or not me conduct of me plmnuffs am or did not bung dAs(:pu[e (0 me unxvcxslty Most ctnzlrfly u .5 not rm um mun m dzcxde wmhu may condutr brought dxxrtpmv: m me Unlvznmus‘ 11.: a.mp1..m,~ body of um/uxm m the Sula ,..¢hmy m decide whether gm. an acunn am Indeed bung v.I.\sxcpuv.c u. the nnlrcrsily mg mu 2; 30. 31 32. n...., K11(- qucxrmn is ..-........ the acts of the um/um disciphnnq body vxolnzd .1.. p1..i....:r.' fights ...w.. .\....1. no of .1.c mm: Consmuuon. 1.. u... regnxd, .. .5 p..u...... ... um: um .1.. Umvensxucs ..u.a on Lhe Rules .0 mm d..sc|p]xn:u'y pxocaedmgs ngzmst us students. And so, .. .5 mm... .9 .51. wherhcx .1.. Rulcs art by d1cms:.l\'es ../zm L7fEfr\fl1Cle no of mg Fcdual cu..su.....o..> 1. .5 u-nponam m not: .1... mm... 15(3) of .I.. UL'C.\ mm].- p.n........ . ....,ac... of .1 .......c..... rm... 4...... nnyklung ... show sympxlhy 0. suppmr, .0 “any sucmry ...g....z......., body u. g.....,. of [mucus whxh the 5...... dm......... .1. be ....s.....b1. ... u.. mterests and w:Ll—beIng ofd-A: students ox (J1: Unxverslly " F0. my pm, I am ......b1. .4. 5.. Im. .. csm be said rhm .mao.. 15(3) uuca contnvencs (hr: nglus gxamrd by Amclc 10 or me Fedrzal Consnnmon 1.. so far as Rules 3 ....a 13 am concerned. they .... gencnl pmhlblnanl The fun .1... the U...»-c..-...c. ma :........m| .|.c ...-. of .1.... ....a..... ... orgzmzulg and pnxuclpzung ... a rally wit!-mu: u.. conscnz of .1.. mnnus of the plen-uses, uespnssing ....o pxoptny belonging .0 moum, bung quesucuned by pom ox being damned by me polite as bung conlrary m the .01. of an p1.....ms as student: and, .. fizman, dcmmcnul .0 me good nun: ma .ep.... of .5. llnlvexsiuns. dons .10., ... my new. ....d¢. such c1..c.p1......- pmcccdmgs as being mm mm 0. conI'nr§ m Amd: I0 of «he F:dcn1] Constitution. Paue mm 33. 34 36. A. am‘ .....=.1 ..... n[ the new .1»... the ,.1......ns hm ..... xdcnufiu-J 2... purponad ur any mconsxslunq.‘ bclwzcn sccuon 15(3) ULC.\ and um Rules w..1. Amcle. IU or Lht Ftdcul Consuluuon 1. 5 cu... ma. rhem .5 nothmg ... semen 15(3) UUCA .1... pmhxbns me ngl-.2 of (h: plnlnuffs ... nsszrnble, Indecd, for any rcsmcnon .o ....o..... m . pm1..b........ .. has .0 1.: a mu] p.<.n..1....o.. before .. can be .2... .0 molar: .|.= r.....I......-mu Inbuncs of lhc p1n.....£rs 1.. any even; .r secuon 15(3) L’U(;\ .5 deemed as bemg resuxcnve of m freedom gamed by Arm}: to of (h: Fndeml Consutunon, 1 hold a... such rzsmcnon (.I my) .5 ....n.... d1: ....b.. of Amcl: 1U®(n)o[rJ1c Fed:za1Consutuuon 1.. my x1=\\‘. mancxs nfdlsciplmr ofthc .....k..... and lhc .cg..1....... of mag... b.1..»..=. and co..a..=. mm... ...d/... o\I|s|dc [hm unlvcrslty mus: ..cmm.1, rm... pm or pubhc uxdu or mouhly A.» M. correctly subnntzcd, . univmsnty .5 \\-hex: smdcnls 5.... knawltdge and conumbe mu. Inn-nng and Lmnung on what .5 ugh. 3.... wrong, what .5 legal and what .. nor. An edumuonal msutunon may nct momlly ... .1.e pmpck and consntuuonzl scnse of am term Hence, .1.c msmcuun. .6 my. .5 reasonable ma nusnflablc an gmunds of pubhc order and monluy. .>a...mm 37. 39. Th: nvcmrching pnnclplc Inn: um must be bum: in mmd n II'\l| mm n 1: ptcsnrnption of cunsuumonal \‘aLld.|(y uf Lhc xmpugned pmvismns of cum and me Kulcs. The lnnden ofpmofrhexnfoxc has on me pm sctkmg m estabhsh ID the <:onLzuy Counsrl [ax EM ma am n A: unposslblc .0 lzy down an zbmau smndanl apphublc to all cases. He smd me: u would be me duty of me cnnn to mnsldcr ml. llnpugncd law upllrarely, rcgnrd bring lend to the nature nr lhc rlgllr llllzgud no new been mfnngcd. Lh: nnelen,.ng purpose of Lh: vumcuon, me exn»... and the Luguntv or me e\'Il sought to b: xemcdned. um Iorgemng an pzt\'zl.hng mndlunns of H1: umc Counsel snln-nlned an: an plzlnuffs dld not mucly assemble They were part Ufa sneer pious! and nee, occupied premises nor belonging to them and wnlhour me conscm of me nwners nf me premises and were quemoned/dcmiued 1:3 [ht point: Tlwte nennn. do not cnluncc thc gnud namc nr me Insumuan which an plnnnm belong lo. Acwnllng I0 counsel, in works to me contrary‘ um Ihcy ma nothing i.I1:gnL In so saymg |hcy enmended am we rally was not lllegal Thqr claim am «he, never cntercd Daumn Mzrdelm. It 15 one of [hr mun comcnuoms of me plzlnuffs w also alleged Lhn me pollct never thllrged (hrm for any offmc: That may well be so Fag: unm 40 41 11.: quewon oful-1cd1:1’ the rally wns legal m Illcyl is not rm um court In decide. 1: us nu Lhosc who make. um zllcgauons to support ma: cunnenuon. Hen: me Umrclsmts have alleged mu the plzmuff paxuclpatcd 1.. :4 rally “taupe /«mm/* 11.: plmnuffs muntam howevat um Lhey merzly assanbled on (ht meets and am they ma zvet} nght (0 do so On the quemnn of .1“ pohct not taking acuon mus: them. an vmw 1 Ink: 1; 211.. pulicc mm. 101- .11: lack of .1) .1 2 xepzmzu mm. um um Unnvcrsiflcs do not luv: to win [01 cnrmnal pmcccdlngs bcfoxz Ialung my ncuon against Lheu students Th: pubhc pn>sc::uIA3x's declsmn not (0 mkz ncnon Against me zrudcnts may 1;: xnfluenccd by a host of conslderauuns. As 1 ma, 11.1; use is not mu: whether me Unxvzrsmes had a basxs Fox lalung disciphnzry pmcczdxngs must d1: plmnnffs \\7he(hu [actually mm ‘1'I\:{ a basm or not 1; not 11.: 1.<suc hue. The sole xssu: 1; w!1<thcr szcuon 15(3) UUCA ma 11.: Rules am comxary .9 Amclc 10 cf um Fcd:m1Consutunun In my ncw, stcuon 15(3) uuca and the Rules m not rzsnicuvc of me pLa.\I\nf[s' nghls no the zxtmt oi momng Amclc 10 of Lhe Federal Consnluurm and the mere rm 111:1 Lhe hehnvxox of 1h: students vmhm and outsldc an Unrvcxsnies 1s regulzvrd by mm mm, xecnon 15(1) UUCA and me R1115. dues not mum mm mm consnmuunal nglus m curtailed Fmnll). 1 mk: me view 11.11 sccuon 15(3) LUCA mu Lhr: Rule.» run not 111 Vlulauon of Axuclc 10 ofthc 1‘cden.l Consuzuuou 1:... mm 1>;.I.1m p:r1<.\r semen 1s(1>(1;) .\ku Umxn 4;... Kale) L'm\ usuu 197x Dan D.\lum puku: Pr.-(kn: 5 Jun 10 Prllcmlmgnan Pcrstlumlan mm mm perkaxa Kacdah 3 am _» Kzgdalrkacdalx L'n|versm \Ia.\la} (T.-mucmb I-gimp Pd 1)‘) I779 Dan Dalam pclkara Tmdakzn ‘rmzuuh I[nl—LZlx\\al Ptlzuar an-Iangicndnn Pcnnmzl zuhadap Plmnuf-Plaxnuf mu Dulzm bldangkuasn Mahkamah scdu ml: Amm ANIS SYAFIQAH BT MD YUSDF (No K/Pv*7ZI4J3lr0é—51Jk£) MDHAMAD LUQMAN NUL HAQIM BIN ZUL RAZALI (N0. K/P ‘)3l020—(J5r5Ul3) MUHAMMAD LUQMAN HAKIM BIN MOI-ID FAZLI (NO K/P 94100370 ‘ 13) ».g.;ma I3‘ 44. 45 Ultimately, me quuuun hm .5 wrmh.~. Lhc xrudcnts or Lhe pubhc unnmmucs no bound [0 comply mm zhz uum ma the Rules. 1 have no doubts am they axe bound. lndezd. when (hay bzczme students of the umvemms, rhey agmd m abide by mmaa. d1: Rules 111: plzumffs mnntam um rJ1<}‘ an nothing illegal [mm 15 the me, then Lhcs: studtnu mu luv: m defrnd thcrnsclv accomng; and make me point dunng dlsuplmary pmceedIng< it me oulcumc m an d;scIp|.In:|r\* pmcccdmgs ,5 puvcnc than men remedy .5 m ukt ]ud.4c1:l m‘ pxocaedxngs La quzsh any unrcasonnbl: or uuuonal dczismn, am .5 mm by 111: ..mmm,- wncemed 1 am not conwnced am a university’: dssclplu-mry rulzs which xeqmxes .1 snxdcnt whflsr oulsxdc me umvtrstty. to hchavc m such a way as not to bnng dlsxzpum In me university, can xx (nn.<rru:d .1‘ Lwing ... mum,“ nfAm:lr: (O at the Fcdnml Cousmuuon. To my mind, if [I12 stuxluu am nu! mpg: m any dlzgnl acurily, and does not connmvcm: the law am he is unlnkcly [D bzing dlsrepute [0 due nmvuslzy. On um analysu, I zm of me View um secnon 15(3) was ma mg Ruin can be humnmlously leoomzlkd ma. Amcle 1n om; mm: Consnmuun. mumza Oulcomc M. For lhc vcaéons as slated Abmu, 1 hold that (hue 15 no menl and 05503 and 052110 m accozdsngiy zhsn-usstd As mu is : pubhc innrlcsr miner, 1 excrclscd n1ydAsc(cuun ma mad: no (min 25 to costs Urdu accordingly. Dm: 23 August 2017 Mario 5. Nanmu Balan judgt mg». court Kuala Lumpur Counsel: Suxcndn Anantha, Marcus Tm Kmn Hm, Vmre Tm Hon Sch, Cyrus ‘I'm Foo \)Co¢x, \’1m:|7m Ramanmhzn (Mt.m.r1‘aa mm 0 Ca) [01 [ht plmnm m rm the plmuurrs m nssmi and Os 2130. Arnsn mmodmu Naldu (.mm.v. Mm/4», Wan ¢~ Ca) for rmvumu Kebangsaan n«1ah»'su (ossmx; Dale’ Muhnmmad Adam .\bdu1lah together mm Adhm Aukah BL Zmml Abmxn <.\m.u:. Adam Alrdu/lab vuam) fox Umvtrsm Malaya msznsm Firdaus BL Hum. [.\/Imvzr Dzzrml @‘ Wm; walthmg bnef so: an Ear Cuund]. vageualza Stnnue .\zuc1c no of 111: ram: Cunsumuon Sccnon us (3) llxuvclslues and Emverslry Collegrs Act 197: Stcunn mc Umvelslues ma Umvelslry Collzgts Ac. 1971 Ru]: 3 ummu Kebangsazn Malnysn fl3|sc1p|.In¢ of Students) Rulcs 1997 (1’U(r\)2U‘)/1799) Rule 13 Umvemn Kebangsazn Mzlnysu (Dlsciphnc of Smdrnrs) Rules 1999 (PU(A) 209/1999) Rule .1 Umrcmu Blah}: (Discipline of Sludcmsj Rum 1-799 a>u(,\) 257/1999) Rul: 13 umvmm Malaya (Disuplme or Students) Rulcs 1999 (PL'[A) PlV(.-\) 21.7/wvv) Case: Afmadjr/51 Mabrl Mm y Prvrgarab 1<»m.;;m as» Ktmriarr [mar a~ Orr [2010] 5 CL] 865 [2010] 3 ML] 145 rc M u n1 1; SUHAIL BIN WAN AZAHAR (Mu K/P 94110341 »—5'16S) ...PLAINTIF-PLAINTIF Dan UNIVEIISITI MALAVA MENTEIU PENDIDIKAN TINGGI KERAJAAN MALAYSIA ...DEFENDAN- DEFENDAN Inlmduclinn These are my gmumls of Judg-mvtm m respect of ()ng1naung §ummons No. \X’ArZ4;\"C\'Cr5US—03/201‘ ("0§508") and ()nyn:r.|ng Summons I\u \VAr24_\‘C\v'02l30—12/'2U16 (-‘os213o*'; nhxch wnrc hem Ioguhcr. In lmrh 0530:; and 052130, me pmnnrrs are sacking declnmuonv w1\‘h regard rn the crxnmmruollahr} nf the d1.~:Ip11lI.1(\, rules nf than m<pcclivr I\nx\\'r.«1ucs 'lhc factual mum rm bod; maucrs .5 um: um and R zcftxtnoc [0 [m rm (0. one zpphcxuon “m be deemed as 1 referent: w m: facts arm: other 05503 concerns the dasupllnarg zmon mm was mm by L'mVcmu Kcbanpsaan Malaysia (“UKM") against one or \u undug-mduatc studerm 052130 cmlusms me dlxnpllnarv acnon mm W r:\1<:n luv l‘nxvL-xstn Malaya rum”, against fuur ni us undcrgndunrt smdcnrs IIKM and m mu mummn lw n>fn-(red no as “the L'nivcnitiux" P4: 4 all} 11.11 111:1 L'Kl\| 111 111111111 1111111111115 \vh|c1'1 11: gnvunied 111» the pxovmuns nf the U11n'ezs11|cs 111-111 L'111ms111- Collcgcs Act 1971 wccx). D1sc1pl.1n:xy Acuon 1-:11 111:1. 11,1 CM 1111 UKM 19111.1 me 111111111111 1.1 05503 11111 032130 zcsptcmdy p11m1m1 to Rules 3 and 13 Unnvemu Kebangsam Malzysm (D1sapI.1n: 11; 5111111115) 11111:: 1999 (PU(A) 209/1999) Rules 3 11111 13 lIn1vcxs1n M11111 (D1sc1p|m: 31 5111111111) 1111111 1909 (1=u(.1\1 2r.‘/1199) (collscnvrly rcfcrred 10 as “me 11111u") -111. 12111:: were 111111: 111111111111 11 M11011 1t1c ucm. T11: dc1'1n111g M111 1111 bod: 111111111 15 111: pa111c.,11111111 of 1111 111.111.1111 111 1 P1111111; mlly 11111 was 111.1 1.1 1:11.111 11111111111 on 27 August 1111:. 11111111 is “}":rtvmp14/1am Gabtwgmt Tangkap 11111911.: 0512”; 1" @111: tally") Th: rally 1-» orgamsed by 1 coa.|.1uun 111 11111v¢11111~ 11111111115 known as “Gahm1ga»1 Tmtgkap Ma/zyrtan 1217111111 I" T11; 111111111115 11 05503 and 052130 are put of me coahnon On 26 .\u1zust 21114. L'KM 1:111:11 1 c-m:uIar to 111 1.: 1111111115, 11111111,; 1111111 11.11 1:) 3:1 111 rflvcd 111 1111 iH:g11l 1.1111-111 any 111111-1-1111.1. 11v111:11 can ycupmdlsc P111111: nrdcl 91 P111111: snfnry. Ev am 11111 1111:1111; 111: 11111111011 01' 1111 ,»111..1:11.1 of u1;1v1 Wm’: d.1-awn L0 xccnion 15(3) ucca .1111 11111: 3111,01) and 12111; 13 ofthe 111111.: The 11111111111: were Inlcrvlcwed by 111: pollce 1111: were 1101 charged 1111 111:1} pzmclpauon 111 [ha 1a1Iy. No coun has found 1112 1111111111.: 10 1111-: 110111.11 any law. However. .11: l7111v=rs11-1:5 111.11 ¢111:1p1111.11- ncuon 13111111 1111 111111111111 101- p:1rnc1paung 111 1111- 11111. T11: 911111111111 were s111m1um111- found g1.u.Iz_v 111.111. 111.115 2(1) 1111 (111 and 13(1) of due Rm Pardon: 11.. (int ,.1.......£r ... 03:130. (k-A..a.") .... lhc .p..1.....-pcm... I... L... cmhuon. Sh: gave . nouuc d.....1 17 August zom p-...: nou'.fic2Iion") of ...: rally to lhe ..\. Am: smfiqzl. B...-. Md Yusof Ponce 0...... 1.1.12.5... (...: police") for pnrpcsts ofsccnon 10 of .... Peaceful A.se...bJ. Ac. 2012 (“thr PAA") The rally was ... b: orgnmud no... soco shoppmg complcx along M... Tuznku Abdul Rzhman, Kmla L.....p... .5 D....... Mexdeka, K...I.. L.....p.... 11... nmificanon was ..«.«..ea m D.<..... Police ma... ..r .1.. Dang \V.1ng\ vol... s....i..... 0.. 1-. August 20m. .1.. police ...ro.....a 1...... .1... .... noufluuon was Ancumplelc as mm ...... no penmsslon from .1.¢ ownu of Damun Metdrka On .1.. Sam: dam. Ams wxole to the D....1. H....d.. 1<...1.; Lumpur seeking pm......o.. .0 ...: Dam... Memlekz for the .au_.- On 19 August 2015, the Datul. Bandax Kunla Lump... refused ptnnlsslon for D......... Merdcka .o be .....1 I... .... .111.-. Howrusr, .I.. ...n. pmctcdcd .. pI......d. ..\.... and .1.. ...»... p1.....m. mi. F... ... .... mu. that 1...: ...=...|.1..1 .. the 5060 sltoppmg complex. Ar... one event, 0.. 7 Septcmbu Z016. .... pohct wrote .0 UM, um was mforrmzd .1... an p1....m'rs .001. put ... .... assembly wnhom me pmmssion offllc owner ofDzmmn Mexdeka. v...s..m UM W infnrrncd um iuvcsngznnn papers were upcnnd agmnsl um plnnriffs whcrcby they wtm buing mvesngmcd under sctuun 9(5) of an FAA, secuon 1240;) at due Penal Code and secuon seam; of due 1-ms Code, fox mu. m\'ol\'zmzI|( m an (ally. wmd. is m cnnmvcnuon ofsecnon 10¢) of the FAA. Addmonally. th: second and flurd plunuffs m 052130 vrcr: also “mud under auction 44" of Lh: Pm: Code for a stpzrale madam where u 1.: allegcd am they ma ncsymssenl mm the UiT.\1 Cnmpul xn Petal: on zu ,‘\ug|l§l 2016 Upon Inquiry by EM, ma Damk Bzndu Kum Lumpur cunfin-ncd mu no pczmxgsxon was granted rm Kh: plmum In use Damnn Mexdelm UM mm Issued show cause Iemrs to ma plmnuffs. A; ngmns: at me plaintiffs, me chugcs welt, Mt" aim, bnngmg dismpurz to due good mme of the Umvttsmu by («lung pan m the rally mnhoux pemussmn from Kh: nuthonues In 052130. the clmrgc agamsx the am plainnffwas also far. mlrv ala, rm bringing dlslepule (0 km gnod name uf um by orynmng me rally whxle ngamsr em» second and thud plmnuti, 1. Charge Wu pmmmi {ax lrcxpzsslng me me mm mmpus, On 9 Dmmbu 201.5, upon a heanng by rh: Dxsupumry Eoaxd uf UM, me plmnnffs were found guilty and subscqucndy sc-ntcnced mm wunmg, fines and wspenslml for 3 period of one semestex Upon appul, mg Dwaphnary \ppenI.< Commiue: of UM allowed the nppca] against suspcnsxwn. but mama rhc wnmmgs and fines Pqevnfn 101 11. 11.: plmnnffx m OS2130 rhmug. um Ong-1m1Lmg Summons an now seeking for . declzmuon um sctuon l5(3)(b), UUCA nnd/or Rule 3 and/ox 13 of ma lfnivusnu Malnyz(D1scIpl|n: 01' Srudcnts) Rulns 1999 (PU(A) PL‘(A) Z67/1999) do not pttdude rhe nghxs of 11.: sludcnw .0 issemblt pracefully as pxondrd under mud: 1U(1)(n) and (5) of me Fcdzml Consuluuon. Alremarxvcly. the relief sought .5 for 2 dcclanuon [hat Szcnon I5(3)(b) UUCA and/M Rules 3 and/or 13 cnnmwcncs Amclc 1U(I)(a) and (1.) of 11.: Fedrml Cwnmmlxon 1.. Sn rm 1: .. .»upcn'1xcx rl-1c mam of undelgmdunlcs ufxnnizuuons m up undcx UUCA uul ufcampus Conscqucnrly. 1 declarauun 11.21 (he show cause 1mm Issucd by UN Ku due plaxnuffs m 11:311. The same xd.|e[s m sought 1.. 05503. Th: 101: issue 1,» whuher 11.: Rules can be Imzxprurd m a manual so as m pkdud: me fundnmnnml nghts of students tnmllcd in un1\'¢mn':s =m.b1.s1.=a under 11.: uum .0 1-mm um; nglu m in-cdnm of speed: and uprcsslnn, and to assemble peacefully Axucle 10(1)(a) um (11) of me Fenkul Consumuon 0.115111: 11.: campus old-1: unlvcxnly, savc where such wuhcut arms under students have been dzteunincd by : cumpclcm mun m hm conmmtnad my law made undcr Amclc 10(2) of me Fedml Censunmml. meluns 12‘ Funhcr. the plaintiffs seek rluv. in the am thxs Cuun finds am the Rm dc Fxcclwdr (hr ma rights uumd: me cnmpus, then an plmnuffs’ altzrmuve argument 1: am the Rules should be slxuck down for conmzvenlng Azucks lU(l)(a) and (b) of ch: mm] Consumnon. Disciplinary rules I}. 14. The relevant lnglslnunn or sulzsldlzry legislation afznd conccmlng the d1sc1pl|n:m' mlcs for UM ma UKM m :s follows. 15(3) UUCA deal. mm “ms ':cuon cs o[ uudenls or smdnnls‘ society, organization, body ul gmup" and plovldcs dun “A slndrm nflhe Umvcmly and -my many. ovganlnuun bod) orgmup cf iludmux er the um..s..; mu. 1. cmbhsb-<4 By. under nr in mm-m wnh uh: Consnlmmn. shall as expuls .7: tin znylhmg wmch may mmvubly be mmmu 1; txplzumg xuworl (or nr xympalhy wuh « (vprpwsnmn m. m an; ....x.wrm xncmly‘ nlgnmlntwn. Indy Dr gnu; ..: y-«suns, v-.h:1h.:r a.. M mnsm: Mlllyxxx. m (In my way. Wganlzaum. my a gwup al prisons mm. IJK Bond dclenuumi m be Inn: mg m an ...mm m wclhbemg rrl K)»: sludenu IVY um Umvclslly. rm um smmmry provision uflmponznct .5 secuon mc urca whzch deals mm the Umversmes dxsuplnnsuy jurisdiction and powmn rvsprct ofstudmvs ofxhe university Sctnnn mc urm provides am am board of ch: public nni\‘r.-rslzy mu have pmvcr m mnlvc tlu: rclevnnl disciplinary mm 1: was as fo|IL7w1r- mew 1: 15 -m‘ IN-rinlinlry ruln m 42: I‘) m zsx Th: Baud mu luw (Ix poucr u. mnh: mu dunplmaly Me: n u them: lKb:fifl|’V0l txpedvzm m pmmu fur lhc disnplmc nfdx amdenm at \>..- um: - the dmwlnuly mlas mud: unrkr Llus xubsauicm shafl hrplvbllshtd m mzfiumm Th: scxplwury mks mud: under um srclmn may wchmc pmusmm mm: susprnswn nfn mam uflh: Uruvnusny dvnng lhc pmamy aldlxcuplmnry pms'c<mI)y m an phnuy ml-1: mad: wulzl mu smm. smu am such diicirhnary ollencex and vwvldl: Fm mt. am,m...._. pumsmnmu 1‘ IDK mm mm; am lupmprnav: mud ms mu.nme..:. .» Mkvvxdld ma) gm“: In cxylulsmn ax Ihr sludcnl [mmlhtUn|v:ml) The disuyly ._v mm mad: under ms mam. shafl vmsuibc Lkc prutxdufc: mu mscxplmary pmmamp ma dxmpluury iyyul vrowrdlngs m pamculanly al (Inc m.um lclrrml m m ;..r..=cnom :2». oz mam mu b< wuhwm pneiudxcrmlhcgentmlnlynilln poms of H1: mm umkuuhscclml tn" Hmce pmsuznt to stcuon 16C UUCA UN and UKM have esrabhshed mm (mm dlsaplxnzry rulcs. or pzmcnlnr xmponznct m :11: pxcsenr conlcxx m lluks 3 and 13 of the xupecnvc dxscxplmary ml: mu: 3 of me tum. i Kr.-bangnnn Mnlavm (Dlsclpltnc of Students) Rulc~ 1999 (PU(A) 209/1999) (“Rule 3") rcadx zs:— cm... pmikhllinm. A uuni<n| mu um- m u.n.:.m mama, -mm: w‘ A. m. c...p.u ur mnulnk nu cm...-.w. ..., 1......» -«baa. um-.—v...¢..n.| ur pnjud a) tu m. ........u. wama... I11 ma nun :1! Im- U-wenuy, my o[ In: mm..n. mu. Irfiren. nr .-....:..,m ullh: liniunng; ..r am 1-: at 2.:

Pytesseract-0.3.10

JA-11B-24-10/2016

PERAYU 1. Shuren Raaj a/l Amburusam 2. Kesavan a/l Muthukrishnan ...Perayu-Perayu/Defendan-Defendan RESPONDEN 1. Rarameswari a/p Subramaniam (sebagai wakil diri dan/atau Pentadbir kepada harta pusaka MUTHUSAMY A/L SUBRAMANIAM simati, di bawah Seksyen 8 Akta Undang-Undang (Pindaan) Sibil, 1984 (menurut Perintah Mahkamah Tinggi Johor Bahru, Saman Pemula No. 31NCvC-282-10-2015 bertarikh 24.11.2015) 2. Krishnan a/l Soleh (sebagai wakil diri dan/atau Pentadbir kepada harta pusaka MUTHUSAMY A/L SUBRAMANIAM simati, di bawah Seksyen 8 Akta Undang-Undang (Pindaan) Sibil, 1984 (menurut Perintah Mahkamah Tinggi Johor Bahru, Saman Pemula No. 31NCvC-282-10-2015 bertarikh 24.11.2015 ...Responden-Responden/Plaintif-Plaintif

27/08/2017

YA DATO' DR. CHOO KAH SING

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=f02f6680-6a37-43bc-82fd-f180ec199489&Inline=true

DALAM MAHKAMAH TINGGI DI JOHOR BAMRU DALAM NEGERI JDHOR DARLIL TAKZIM 5A1 Augv Mn a1_q1Au;m2n1s ANTARA 1. SHUREN RAAJ A/L AMEURUSAM 2. KESAVAN AIL MUTHUKRVSHNAN PERAYUFERAVU DAN 1. RARAMESWARV A/P SUBRAMANIAM (sebagal wakwl dun darn/alau Peiabir kenada hana Dusaka MUTHLISAMV AIL SUBRAMANIM sunau ax bawah Seksyen 5 Akla Um1ang»Undang (Pmdaan) s. , 1934 (menurut Penmah Mahkamah Tmggu Johnr Eahm, saman Pemma No 3INCvC—282—1D—2D15 benankh 24 11 ms; 2 KRISHNAN A/L SOLEH (sehagai mm: dm dan/a'au Peiabir kepada harla pusaka MUTHUSAMY A/L SUBRAMANVAM man, di bawsh Seksyen 5 Am Undang-Undang (Plndaan) SM, 1984 (menuml Penman Mahkamah Tinggl Joker Eahru. Samar: Famma N0.31NCVC—2B2—1Ul2015 henankh 24 11 2015) RESPONDEN-RESPONDEN Fags 1 are (Dahm Mahkamnh Mnflsvel m mm Eahru Dnlam Nagefl John! Daml Takzm Gunman swn A73K.t326E>OY—Tanun 2015) Amarn u RARAMESWARIAIF suamxmmmm (sebagal mu mm flanlalau Palahu um. um Dusaka Mumusmv AIL SUBRAMANIM imalh .1: am» Sukn/In8AklzUnda!‘E~UndaH9 ‘ wqsxn. wao (mlnunn Permuh Mahkamnh mm. Jam! Eanru‘ Snman Pemula No. 31NCvCr2a2—1Dr2D15 barvarikh 24112015) 2 KRISHNAN All SOLEH qunagn-mm: mu din/alau Fe|abwkarp3d.I ma pusaka MUTHUSAMV AIL SUERAMANVAM s\malL m harwah Saksyun 5 Am Umlxng-Undnng (Flndeanj sum. wean {menurm Permuh Mahkamah mug: Johbv Baum. samm Pemma No 31Nmr;2a24o«zn15 bmankh 24.11.2015) a|a.nm—pmmn Dun 1. snunsn mu A/L AMEURUSAM 2. KESAVAN A/L MUTHUKRVSHNAN nevsnasnoarenaan JUDGMENT cHoc KAH SING ial cummissxuner High Courl Johuv Bahru DaIe.27.8.2017 ma 2 an Iltlloductlon [1] The parties in this Judgment will be reierred to in their pesitiens as at the lower Conn The delehdanls were nm satistied with the decision or the Magistrate dated 6 9 2016 and tried an appeal to the High court. Likewise. the ptainlms were rttflsalisfisd with the Magistrates decision and med a cross appeal. [2] Both parties have appealed against the Magistrate‘: decisions on liability and quantum. The Magistrate decided that the delehdants were 90% liable and the deceased. represented by the plaintitls as administrators at the estate at Muthusamy all Subramattlam. was 10% liable in the ancldent that occunsd on t2 8 2014 [3] with regards to the quantum. the general damages awarded was RM51,uuo.on, and special damages awarded was RM5,293.25 based an 100% tia try. [4] on 6.4.2017. this Court held the award tor general damages awarded by the Magistrate shall be reduced |a halt and the special damages awarded by the Magistrate shall be maintained. Further. this court ordered no order as to costs tor either party. The reasons ter the decision are as set down below Brief Facts [5] The findings uttacis are luund in the Magistrate's written grdtmds at tudgtnent (see Rekad Rayuah Tambahan. PD 29- at t. Pwlluii [3] Al llre nearing onlre pmceedlrlgs dime appeal proper. lne ddunsea lor me respective aarlies wrlndrew lneir appeals ag ' tliahlllly They men pmoeeded wiln lneir appeals only on quantum. m wlln regard |0 lhe duanlunr oi damages, lire parties’ counsels agreed to wilndraw Inair appeals respeclively aga sl lne auanlurn or special damages. The psr\ias' eounsels proceeded only on «no appeals againsl me quantum drgeneral damages. [la] The decision nflhis coun was based on what lransolred during ine nearing. Prlono me wilndrawal d1 lne appeals on llablllly. lhls coun was minded IO lnleflena with ma llndlng nl Iiahllliy by the Magislrale. B00! counsels men deerued la drop lnerr appeals on lraalllry and agreed ldrznis Court ID narrow down its decision only on the appeal agalrlsl lhe quarllum oi general damages. [9] The parlles' edunsels had urged Ihls cdurl ID adlusl llre arridunl |o he paid to me alalnllll my a reduellon oi lne amounl oi general damages as an amicable ccimpmmlse lallewrng lire wilhdlawal oi lhe appeals on llablllly [10] The cmmsals (or the names‘ respectlvely suhmilled lo reduce the amnunl an general damages without reference In case law or any principles or law. The counsel «or me delerldants submilled man are awarded general damages ougnl la be reduced by 55%, wnlen rnaans me delsndanl augnl only no pay 15% or me general damages wnsreas. me P1904045 dounsel tor the otaintill pleaded In this calm to consider reducing by 35%! which means the defendant ought to pay 65% dlihe general damages. [t 1] in view that hati oi the awarded damages had already been paid to the plaihntls. the pla‘intifis' oounsel requested im the nadu n at the general damages not to be greater than what was already paid to the plaintms, i.e. hall or the damages awarded, otheivnse the plaintiffs would have in retund any sum which was ever paid based on the High ceuna decision This request was not opposed by the deteridants' Dounsel. [12] in view dt the suturiiaaidns oi the parties during the hearing this court, attar onnsideralion of the pdaiiiari at the pla'lnl't1'1s‘ and aied the laet halt ml the awarded damages had already paid. decided to reduee by halt the awarded genanal damages to the olainurrs, The redueed amaurlt of general damages was sulneierit to meet the payments which had been received by the alaiiitms. as siren there was no excess amount to be ratuiidad to the delertdants [13] The parties’ counsels requested that no edats should be ordered against eimer parry. This cotin acceded to me cmtrlsels’ requests and ordered that there he no order as to costs to either party. Conclusion [14] Based on what had transpired during the proceedings. this Court allowed the defendants’ appeal only and ordered the general damages to be reduced by hall, with no order as to costs. masors . -Signed» (cuoo KAH SING) Judicial Commissioner High Court Johor Eahm counsel var me oeienuanis/Appetiams : Aidan Mohamed Tamar: omman Hashim & Co. Cmmsal (or Ihe piaimms/Rsspondems . S.Shanmi\aIhery Tainan TED Ex Associates Pagesmi

Pytesseract-0.3.10

22NCvC-279-06/2014

PLAINTIF NEWLAKE DEVELOPMENT SDN BHD DEFENDAN ZENITH DELIGHT SDN BHD (Company No.: 393185-D) 2. KUMAR JASPAL QUAH & AISHAH (a firm) 3. HOW CHEE HONG (STEVEN) (NRIC No.: 680728-10-6345) 4. THIAN MUNG CHING (NRIC No.: 680408-10-5597) 5. HABANOS DIVAN SDN BHD (Company No.: 608571-H) 6. HABANOS CLUB SDN BHD (Company No.: 608675-A) 7. HCG MARKETING SDN BHD (Company No.: 758524-W) 8. PEARL VANTAGE SDN BHD (Company No.: 929391-D) 9. PYRAMID PRESTIGE SDN BHD (Company No.: 741299-W) 10. SUCCESS FOUNTAIN SDN BHD (Company No.: 1014160-K) 11. DYNAMIC CODE SDN BHD

25/08/2017

YA DATUK S. NANTHA BALAN

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=13c5d00d-2308-41b9-a482-329a047efb0c&Inline=true

lN'lI[1-_ HIGH LUL RT 01- MAL\\A \'I l\'L',\LA LU\fl’|.‘R IN THF. R \L YEILRITORY. I\L\L \v.~IA (CIVIL IJI\'IsIn CIVIL $111 No zzugvc Z79—06[lQ 4 mi I\‘< Elllx NEWLAICE DEVELOPMENT SDN BHD (Company No- zn2fi3r:—l\l‘, (. PLAINTIFF AND ZENITH DELIGHT son EHD (Campnnv No. 393135 In KUMAR JASPAL QUAH A AISHAH ’n firx-n7 HOW CHEE HONG (STEVEN) (NIUII I\u l»‘!U"2Brl0 THIAN MIJNG CHING mun M; - (:S0408—lU—5S‘}7j HABANOS DIVAN SDN BHD (compmy M - é08S"LH] HAEANOS cum SDN arm <CnmIun\ No v rmrrs. \7 HCG MARKETING SDN BHD 'CnInp:IIl» M. '5R5l4r\V) PEARL VANTAGE SDN BHD \'C(:IIIpuII\ x.. . uzrn-n D7 Val! I .7. as 9 PYRAMID PRESTIGE SDN nun (Compiny Nn. mzowxxg 10 SUCCESS FOUNTAIN SDN BHD (Colnpzny No: 1014150 K) 11. DYNAMIC con: SDN mm (Compmy I\'o.. smusnr; DEFENDANTS Immduclion 1 Tim: an my gmunds or mdgrncn: m mpm of :11: pLu1'1ufl'.~ zppllcauun Jam! 10 jznuuy 2017 (Encluauzt 159) for d.|scu\'rz\‘ or pnrutulal documents (‘me aiscomy applic-man"). "rm dhcuvery apphtanon 1; mm: undcx um: 24, Rule * of me Rules of Court 2012 (“ROC") and was flied appxuxxinately 51x (0) wneks beioxe Lhe mal whnch M. .<ch:duIed L0 Mk: place on 1. 2 and 3 March 2017 Before 1 dual mm m: dI<(oVcryappl.1cm1nn, I .1mu1c1 bnefly nfcr to 11...» hmory of 111.; llugznon whmh has a mm chnquuzd h1sIory. Th1s .-1.11 was mig1m1Iy rewstekd In NCvC 9. ma W admIr11m-mvclxj {Iansfrncd m 111.; rm." (Nam 10) .m 16 Nnvcmbcr ZIHS Fm KEIFEIHK which art 113! relevant. Bcfurc I took nvcr me cm. the xml 11:4 been pIL’\'|uus|y [Inn for um] on 4 and 5 D1-cunbu 2014, 5 and 0 Fcbrunry 21115 and 13, 19 and :0 Augual 2015 and I“ .11.“ emhu .m1 dares mg Vacated by rezwn or Intcxluguxuny appeal; whmh woe pendmg In :11: Cum! r>fAppuL »...z.m 11 12 13 According :0 :11. plnnulfs nun-auv:, m or around udy 20:0, D3 mfonned an plxunuff ltgzrdmg :11: land 11.. rcglsltrcd ownets of due land welt/ax: Low Hock my and my Huck Tuck (acting as zamnumm), Lxrn Tmng Tu... hm Checng Ltong (acting as rxeculors) and ax Hang Kmuz & Shanghax Bank (Malaysia) (acting as mm) (collccuveiy “mg landnwners") Th: pxmurrwm vtry ...m.ma m zcqumng an land for dcrcltipmmt. Th: p|.1mufl'd\d not know at the «am am .1“ land wax me subitct .-mm nf an adn-umslnuvc zcnun filed m me Kualn Lumpur Hugh Cmxrt xdznuflud ax Cm] Suit No.1 S7—22—l4Br2D05 :\cc4mlIng [U the pmnuir, D3 mud: npzcsenuumus Iu um plan-mil’ um am: to due dict: mu h: ms m . pom,“ m pmcurr duz had for me plmnuff due. (0 ch: rm um he wn Lhc wllcttor for the Izndownexs. 1: 1! zllngcd um D} Anfunmd (J1: pmnurr nu; ma acqulsmon exuclse ma (0 be don: Lhmugh D1 bv man: or "back to back" mmsncuons. The plmnuffs \|«'E{< gvrn [0 undusnnd am D3 would be mngjng for the prtpznuun ufthe sale and purchase zgzctn-Amt between the lnndownetx and D1 as wrll as m: salt and purthn: agrtnncnr berwun D1 and me plnmuff. D2 and D3 acted as ch: solicitors for D1 m (aspen of the sale of me land mm DI tn the pmnuir. The plmnulf Wu: also mpxestmud by D2 and D3 is snlmlmrs unn] zrv Dcmnlm '.’0\l,w|1(-xcupun Mcssrs Amal Jmlzm 54 Co were engngnd m rcprcsznf me pmnurr, nppnmnlly (In th: Inwszcnce ni Dz Ind D3 mu :1 ma 14 I5 11.. 17 Dunng negonauons and pending cxttuuun or me 52k and pulcluse zgmuncnl belwcm me plmnuffand D1, rhr. plmnnff pm me deposit monlcs m D2 for ma aoqumuon of the land. mm pnyrnenls wcre made by the plamufl befnzz any agmemtnrs w:re executed rm mg salt of mg land whxdu ma ya: to In ztquued hy D1 1. Is allegrd am D3 mad: fraudulrnl mxsrepxtsenmnons m the plaxnK|fi"s dxrccmr, Dam’ A; ,; Bin Yarn mmu ma gcncxal mmngn, 0.1,; Km Cunt whuch induccd mg plaintiff m mm m: p.Iy1'ncm nf me deposit rnrvnws fur me purclunc of \‘h: lnnd to D2 In mm the supposnd nx.1u1n:1'nnnLK0(lhc ljndux-mrnx The plnmuff :\l.\L-gas (Inn in mun rm, .11: Inmluwnrzx of the land had nrvtr .4“: lo cnlcx mm mm‘ nungcmrnl to am: that mum. ... an land :0 my party Andudmg me pumnxr. Cunnnumg um-uh Lhz nnrrauvu, rh: pllnnufl zllrgts dam on 22 December 2011, . 5.1..» and pulcluse ngmtrncnr was mgntd re: the purchase of me lmd berwccn or .5 vendor and the plmnnifl as purchasu. The ptamurr ugncd um md agrumcnt on me am undezsundmg um um depnslr rnumes were deposited wm. D2 us smkzholder pending mg zxecuuon of a bad: In back ngzrtmenr W}. m: lzndownus and DI van :1 ma 13. Accordmg (CI me plalnuff. 0.. 21 Dccunber zun, my d.LsL'cv:k,d am me Llzpom meme: ma almndx been relused by D2 m D1 wuhou: the consent of Lhe pl:.L-Luff In any evmi. no agmemznt was mncludgd brtwecn me and owncxs and D1 ma me plamnif has new rtcouptd the deposit memes dm wcrt unlawfully eelema by D2 m Dl 19 The plmnnfffilrzd zh: dxscavery Ipphcnnun m acck dx5:m'u'y "ml, D2 and D33 rupucuvc bank srnwmcnza, payment vuuthuls, mvoxccs. chcquca, mu. mu any other Fuunual Anxuurncnns for me pemd btlwezn 27 Deoembe; zmu (being we data mu D2 /vmnert /befirrt /Dqwlmt mm: lb; r/{paw mmzu 7 prrparugmpb :2 gm tlaltrrmrt a/rlam) unul 5 June 2014 (bung 2;). data 0/_/Y/mg :1/(bu ma mlanng [O the aepm menus made by A11: plunnff .0 D2 rm me «uqumuon ofvh: and The documents sought m the apphrauon shall he cnL1:<n\'ely' xcfex-Nd lo is "me document 20, In to far as (ha dI.<cnv=n' application u con:cm:d.1r was submmcd for an plunuff rim Ike dcfcndm-:5 have m mm poxscsnon, custudy nr powcr lhc Llncumcnu whuch mu zhuw me mummm of the depom numm bczwcen D1. D2 nml D3 [ux zhz Acqumnon of me ms. >\c:uxd|ng :0 me plsmuff. the d0(\.un:nLs ax: mntemd and relevant rm me purpost or pmvmg me pnamuzrs case and me documems may nd\<xs:ly zffur me de{mdanzs' em :0: the following zezmnss v...u..m (E) m plainuifs am ign1ns[Dl, D2 ma D3 :1: [oz Intululu-Al nnsrcpxnnnxauon rcglldmg uh: luml ncqumunn, bmazh of xlakchtvldcfs duuzs, breach of mm, breach of fiduciary duty, bunch of duty m ntghgencz and/or auntmct and conspiracy m dzfnud and 5mm :1“ plalnufl. (b) n ,. wu mnphsu: for me dnfcndznu m uv mu Lhc pilymnnz and/nr rtcnpt nf Ihc monies x..— not 3 mm; Issue m dispute. (c) In rm 1: 15 one of Lhe mam lsxuts to L»: Lmd or um-m.n=.1 1., Lhe Cuun beuausr. 11 I5 ztlrvznt m csublzsh um plmnuffa vznuus clurns Ignnsl the deknxlanrs (:1) The documzms sought by an plan-mff zgzlnsr me dtfendanu arc um own xecords and an rdcvznt m ndvance me pumm cas¢,"fl1=1r. .5 no mm for the nlcflndzlxvs m xufust u. pxodutn um documcnu r... rh: mal unlrst lhtg hm .Iom:\‘hmg m nm. (e) mane mm .5 no cvldtnc: m suggest Lha1D2 and D} had acruzlly reJ:2s:d mg manic: to D1. Th: fnluxu uf m and D2 m produce on documents mum rhu um nu Infnxrnnlmn In aw document; which am dznugmg m mm cm. (9 Th: documnms xnlatgd m ['15 main: m qucsuun ... um acuon Lsecnusc :2 mu show the alleged mnvunmt of th: memes [mm D2 and D3 to D1. am 10 ms 21. (,5 The documenls m xr1:\'an( to detenmne me m1 Issucx m dxspum bcnvecn due punks, whxch as wnmm m and D5 ma hxcnched am. vanuus fiducnly. znntracmal mu mnwuv dung: which they owed me plmnufifor mg land acqnxsluon (h) ‘rm document: at: mlzvnnz [0 show em D1 to D! had conspxzcd to dcfrlmland/01 myurc the phmufl I7, unlawful I-nuns by devlxmg n Iwcclumsm Io Vlphnn mg mom which wen: trust mnxurs ltudercd by (11: plzmnff fm ch: ma zcqumnon. 1.. oppmmg me duscovcry zpphciflon. the dtfmdnnts 1-axsed, ..mm, an xssuc or delay. The defendants med mu the zpplicznml xx too Lu: in ()1: day and is pzryudmal m mm. In mpnm, (hr plamnff relied an m: deci on ofrhc Hxgh Court in mm Rlrezmh wmmnyu IPA W‘.-1flflVM Ha Tar/5 Jun 29' 0': [2010] B ML] 753 where Mah Wm; Kwxu ]C (as Ins Lordship than wnx) hclsl 2| pm-:gx'ap11 20. F 740:- ‘Thecmm mu) mg. m: p. a mu olmy dowmnll n my mg: Mm: urneredinu um lhlx would Includ: file ms my In m can the ylaumln. aflhnugh hlvmg czlled men mums . um um alarm mar (Ix: Whxkix\A4m|dh:v=h:cnu\uur:« lnnhep Nimhnvrfledlhalt Ippl wan bafan the w1nmuI::mnmA7fI!IaLme mm, ma dupvxal of the -ppnmm. duunlh: m..xa.m..n pvtjudwe xbcd:l’a1d-rm‘ pluhnmu m p\nInI4fl‘s um «um me u-ul Ind bzfme me filing nl lhrappliuuon uqunled mu a.r:..a....s ll! severe‘ \K:IA4uni m pmdmx m: aer:.m.m.- mmtx 3. but ll: .mm.1...m.n..u mama.» mqmu v... Is an: 22. 23. 24 In the pmxunz cause, an pmnum present sollmurs, Mcsszs. Azfllzn, Davidson 8: 00 took om xfus mine: from (he plmum prcnous solicnoxs and mm mm Notice of Chang: or Solmtors on ex around 5 januaxr 2017. According m the plunuff, upon perusing an mal documcnls, .\ks:rx. Aznuzn, Davidson & Co. advised on plaxnnff am an dncumtms m hum xflzvznt m advzntc me plaintiffs use and m damage um dzfendmrs‘ case. Thcxcfnre. the phlntlffcunkcndx am am, xhould not B: pcnnllscd by the rmm at .5 puvxnns sulxcxxun .0 ndvxsc thu plmnufl m Flo chm cllscovcry npphcnuon 1; was zxgued rm Kh: plalnufl am the filing of (his nppllmubn mu not pmymho: rh: defcndmts since on ma! has not wmrnenttd and the documcnts sought at: an defendants’ own rctordx wmh us already m um. possession. Even .; the dzfmdants sum any prqudstt, this can be compcnsamd 1,) (tasks Cmlnxel for the plan-mff rmphasxzed man an purpme of me dlxclrwure of pnmculalr dncunwm: umlcr Order 24 Rulr 7 ROC is "111 M114/! mg: m pary um rm nya} HI! ../mmg. at W», M mm M we mm» ,1; rm mm yd» da;1m.m/ m bah; y/mlumi/nr m;m.m" (see: Mm; cm aka Ngynng cm. uqm Trader ¢~ 011 v 1-mo Emrpfixe ma ¢~ Or: [2009] 5 NJ.) 40 at paragraph [12], ex mu Y:/mu/buran 1/antmmm uMah_7mIIala J‘m1BIm'[l9‘)4] 2 CL) 581 .2 535) p... 15 an: 25 Acwtdmg ID Lhc plaintiff 111: Km: Fm rdcrnnq ufdocuments ..— ma: .5 mm 1.1 11.; High Conn :25: of Y:/mnbnmrt 1/1 »1mm». 1, A124;-,mm xmzsmd [1994] 2 CL] 581 Counsel refuted .9 me 1,155.3: up ass whue E.d.gnr]r>s.:ph_Ir SC] 1.11.1. an 10 “n¥:1«:n19e". -.1 Runs of (V1: Hvgh Cam hm! dummy 1., .1m..m. WW6‘! .. mm.“ 1., mm mm: -1.» ma m....1 13014:: 1.. dispute Mme pm1.1..1,. 11. dxwuvcry nblngulnm wnacm a«..m=..u 1.¢1.1.,.. m mums 111 qn-=s||an VI In: .11 ..-11:11:; nrflhe High ca...-1 o 2:, 1 1m 1.: -mum. 1.1 ...,v mm ... ...=.1m. ... 1m...1. BF .1. 11.. .1=..11..g. 11111.» . 11 .1. 1.. . pawn. rm -..«u 14 1.. 1.1.1 u.1a1........1s::1-n.11..m 1>1.111..x[1117~;1<u1.1-115.121‘ 25. And as for zdevznce, counsel also mfnrxcd to cw.pmg.u Fmamm .11 Paqfiqu: 1-1>:mm(;.m C0. [1832] 11 QED 55 when mm 1.} ma (p. 63) — ~11 Item: .1 ma llrm way do¢I1mu||Ie\1(:Hame munus "1 mm. .1 the rum: mm ".1 nnly wwld 1. evnlzntx upon 1..., Issue, an .11. which, 15r:am1ubV=|u Wm, mnlnmx mfunnalzon winch ml: - mx wmch nun! —<1Il1crdnwl\y of mm mm L‘: pmy m..m.; 11.1 Imdlvix "mu m -lvnnm 1... Whil G a. 11 mm lh: mu nf hm nlvnslry IhmeplllmIh:wmds“:11h:rd1mclly m1nd1Iecxlr' hams: .1 11 rem; 11, ml, . dncunmnl an pmpul» 10.11111 wv1Ln|n1nfL7m|lHo1I Huh]: me pmy umn[ 1»: aifidavxl ewhu In am.“ ms .1. 1» 11.11.“ 1111 :. ..: 1... mmmy, m. .1 ndunum2n|whi:h may r...1_1 ma mm m a Inm ormq ry. winch nu, haw ewhrr o! 11.1.. um n :13! 27 Cuunsel rm mg plmnuff also keferxcni to (ht Singapore High Court case of Mwuhl c» rm (Pu) LM 1/ Hbupoldru K] mm [1990] 3 CL] (Rap) 785 at p.796 what: :1“ Com hdd am» --um . gmm alder at lhz mun for dixoavery. . my .5 abhged m mm dxxauvnr} uflll m..m=..x. menu: m It»: mum ... question m (It: am. A dmumml mm; m the mute qmm. u. m. acnon .: u wumns ...-.......u... Wm nu) not u. must . cum! dummy al mdvrrcdyenablc the p|ll_V rcwv Lhtdlsnvvcry Cuba m mum hn awn cast nr to Ilxmng: 01¢ an AIM usury orwmch n. fmrly lad In . lrain I\Hnq|Hr) Wm m m gm.“ Mllmr xwn mnsmucnten Damlnemx mm in mm” m qn-‘snot -.. n. .u..... .1 long .. may .».u.m-, AnIhruw1n¢lflhn- mum.- [Emphuu mm} 23 1. was snbxmucd am mg docuumnu must be or hav: ban .n ma posszauorn, custody ox power of D1, D2 ma D} as me documents rrqursted m the finnncml records of the defcndins Ihemxzlves D1. D2 and D3 hm ncvzr amma am they an m pm..«_<..m of me dnmmznlx. 11.: defendants’ only axgummt IS that am dncumcnls are um rzlevmt 29. 1.. nppnflng me nppllcanon, rh: dcf¢ne|:n:x« conlcnd um :11: duzumunu mughr M. Krclnvznl m Lhc Issue: m tlm atlmn axe mu plzmufrx plradcd use Igtmsl D1 u for bmach uf zh: ml: and pumluse agxeunrnt ("the sum") by m rm pmnurr. ax: .5 am duty had validly ttmnmlrd mg sm and an umrm sedung um “mm or an dcposll monms whnch WCXE paid for m: purpose of acquiring the land. v=..u.:u; 30. 31 The pmmr {cnnuuzzd th: SPA on an gxounds of fnudulnm lmsrtpresenuuon whnch was allegedly commumd by 123 u. colluswn mm D1 and D4 n was argued for thc dzfendams am u 5 not disputed um D: had zrcelvcd me deposit monks in nu. m has adnuued x::uv1ng me rnomcs fmm D2 :5 waxed m pnmgmphx 23.4 and 32 nf DI and rm Amended Deana. on ma: pmmlsz. n W argued for the acr:..a..u.« am the dncumcms m not r:lc\'2n| :4. dclermim: n rm in um or m zdvzncc :1‘: pin.-mm use or 2:.» dnmlgc D1 and D45‘ cm when the {nu rrlaung to many: of I11: dcpunt momcs b\' D! In no. dxsputed hut ls m rm zdnutued by on I: was pnmlzd out am the pzrmtm of on deposit monlts and due xtuipr am by 13:, ms .150 expmsxy acknowledged and adrmnad by ch: plmnuif whm Lh: plzu-ml‘? uecumd Lhc 3 A on 22 December Z011 Thur. an mu: m be u-ml is nut whether me drpnsur monks wert paid out by m; plmurr nor whether DI hm Iucrlwd u but wheclmr mm Wm fnnudulcm mxircpxexenlnuan and/nx breach of the sm pcnunlng m the land Thcrelhu-, \‘|-1: documum snughl m an Ll.I<cn\'ery .ppuc.uun :1: mlmm to dam-rmn: Lh: sole qucsuun 1:: Issue, wmlm mm was a breach of uh: sm. 1: was oonscquenrly argued am am dxsclosum of lhc documens would not zdvnncz dus scuon a. u 15 already zdmnmd the deposit monies mg pm out by due plxunuif and ztizased by D2 to D1. musvua 32. 33 34 35. 35 Funhcr, D1 xs nu: :\'cn dxspuung th: monies winch were rcoewtd m dzfcndznts tonrznd am Lhc plmnnif ma rum to show my yusuficnnnn why D1, D2 and my xespemve hank srziuncms for all am. my accounts for me pmod bzlwem 2: Dnumbzx 2010 mm] 5 jun: 2m m sough: by me plaxnuff. 1: ms zugued um 1f the plamnrr W25 duqmus of knowmg m whom uh: dcpnslr rnnmcs were rrlznsed. they mule have nmply zdmlnlszucd mmrmgaluncs. On mu pmnuc. :2 win cmucndcd um din npplicnuun h mum] mm Irwin/in'¢. rm dcfendanzs concend am reonpk or rht: nvamzt wcrt not dmzed m the Lkfenoe And, in so in 1.; D: and D3 are canczmcd. am took the posmon m an menus weze pm m DZ m in capzuty as :11: mllulors for D1. Funhrx, mg sllbsequmt forwndmg of the drposu rnmuts m D1 was done mm me full knrvwlcdgt and a7 nftl-m Dcftnce)‘ * he pIzn1liff(.<<: pangnphs 31, 32 On the nuns a delay, zh: defendant: cmilcndzd um dw pln|1u{fh:s mm m cwdxblg. explun um: delay m filmg (hm: d.\stuv(ry lpphrauwn The dxscovrrv npphcnuon was rum on 14 jnnuary 2017 whutas the plamnff filed mg sun npmst (ha: defendmts on 1. jun: 2014. humus: u 1 mu say no mm: mu. due rvcnks winch Lmnspxrzd in NCVC 9, Whm um file was nansferrud {mm NCVC 9 :0 this Court, me um dates namely, 14, 15 md 16 Dcccmber 2015 had alxndy he:-n fixed by me lmmed _]ud.ic1z1 Ccrnxlusslonci ofuh: other Court Indeed, mg ml dares vine and by uh: _Iudu:i2l CommL<slont1 nfNCvC 9 when m: mam: cam: up for case mzmgzmrm befnrc hm: run 23 Auguxr 2015 All counsel Weft prtscm durmg the case manngemrnr when the mul dares wcxc fixed. Aim Ihc 5:: was umrumx lu lhu Court, uh: me wls callud up (or casz manage:-nznt an 20 Nnvember 2015. Counsel my .u she pawn wcru pmm before mL:. Aim dxscussum W1; counsd on m Issue: xc ‘Jug to me my: and d1: possibility of an anncablx: srxdemau. 1 mnhmwd to counsrl um um uni am mu no! be vacalcd and am my should mhzr sud: ch: mzwer or gel Lhzmselves rtady for mal Counsel mfoxrnzd me am m coral um; would ht caumg 14 \vIm(ss:s. The plmum usnvhzle counsel Mr. c.x< LN ofhlesszs. SI-nice 5. Co. who zpptnvd before me, we mm :11: plamnff had 4 mam wlmcssrs and a subpoena Mlncxxcs mm‘ Vuzy Kumnr Nannian. cnunsel for m; am defmdzm (“D1") ma fnunh defendant ("no") said he he 1 Mcncss m.. Adeline counsel {or am Sccnnd dcfcndim M32") and zlurd dufcndallr (“D3”), mu sh: ma I wuncssz I Lhcn gave um ful.|n\vIng pmmal use mzmgumcnl (--zrrcwa duc4:uons‘— vmaous 35 mm» u an xnunln-mu delay oi mus; 25 ‘ us before flu: pxmurr tiled {he Llxzcovery appllmuon Fuvthex. m mm; of nxnehnes, me ducovnrr apphcanon was nude zftu um um. szhedulad for Mm. 2017 had mm fund It was pmnttd ml: that me dlscnvzry apphcancn was aka a mu: 6 weeks brfiwr: (ml. And n’ m dvczwery 15 alluwcd, u .5 Iughly pwbmblz um mg m: mu be scuttlul Tn balm-r mm argument mg defendant». mngd an m: mm: nf my zmg r»m;;(mpn.). whcrr nxmx held u ralhmr "Nul |~lh< .....n... ..r......:. nun-Ily |ry -ne.s.z...:...n n.. ...m.; In; ..,,.»am mm In am. rm yr . belnnd nxge r...» . whole wrlu nfllnculn-nu M... We mm. ha been K! nlmon fov |n‘.I me: (luck of pludingi And .u hln-Ha nfdnwmwn mom‘; um hurl man ...u .m...;..: Inn: 5...‘ m wmmzmcd wxy mu ... the ya: man and m: yv¥mmiW<crv:-d .:« mm M 0.: a=r...a.m, IVI 5 Dnxembcr zuu No rusanahle or plumhlz txphnnnan m pvnffnmd My (M dnmuhnn Vnr Ih: umvnmnume and ..mm. am, ... m.... um mu mmm.. furdwscrrvrrynnlyan m fzbmary mu mmclhzm IWB murum n/\rr rnuslung the ,.m.y...:r. nob an x Dun-mb mu An lump {or diwwen u.. 3 ....a..:, oppreuvlrl n prajudxhlmlhu .,:.mm in punllng n. 1110- expeII|:nx|v mu m. In principk. he gr-nml. Under ... mu....¢..... cu. ..«....-m n ... lluvm mu Ahv .p..:.(.m.. .1 mn . Inc Kluge . bun: rm um mg», m: (nu-an oliu um fur dhpmnlohh ...“... ynvtwdlux" hxnphnsnsnddadl ‘nu; L‘L -mum nlso punucd nut mm... pmvers (vi), (xvx) and (xx) at an .«tzn;m2¢1\( of clmm. mg plamuff 1m in cflect prayed fur (J1: urn: documents as nsquzsled m an.» dwcovery npphcauon -rm, u was ngued ma: b_\ allowing mu dxscovcry zpphczunn, {hr phmnff mu m efftu chum mm ulumnlc pngu :. pa the statement of am bcfmc n ma! or the mum: v... n alz: 39. 40 41. 42. This wm rmuy or subsunnzlly dzrcunme .1.. cm... of .1.e p1....u:r 5.10.. Lb: mzl commanocs and mu thcrcfurc stnously p.....a.c: D1 2nd 134. At any rate. ... pmwn 0.). (IV), (V), (xvm) and 1...) of the statement ofclmm, 11.. p1:.....r£ 1... sought r... z. o.a.. 1... pzymtnt of .1.. dq-1051: 1-names. -n....=, .. was argued .1... .1.. a..cnv...; appllcntlnn dcnxly xe=k: 1.. circumvzut .1.. mal process ....1 4.... .1....1 m P... of me n...1 ..-1..r. .4...» .. wholly .. 0.1.1. wnh the 1...: v;.....1=.. .......g upon the ,.1......r;. 1. w... suesscd Lhaz .. .. ....I.- .r.y.u phmnffxs .1.1. .9 snmfy the zequxsme 1.g.1 burden mu my be enuded .1» .1... ..»J.¢i.\ wught. 1. was s..1.......ed for me defuulznu .1... mg s.....1..........1 .55....- a...a.........g ....s 5.... am .ss......u. w1...1... .1.. pmnurr. ...y...a zllegnuons o[m1sr:pI:xan£at|on. {.....1. bmd. of trust ... home out. On .1.. part of 112 and D3. .1.. cemml .<.... .. whnhex an .u.;...1 .....1....:... .....«...e... wt; ........1 ...... 5...“... me plunliff ....1 D3 rm ... m....a 231.1. 1013 ..—1...1. 1.... .1.. :f|’::r of .<uperscr.l|ng zny pnnx .11.g....o... and/or ......,.1........ -1...... .. W... zrgwgd .1... the .1.,........... mg... by du: p|a1nm'ianc .....1... xtlcvant ..o. ...c...-... 1... .1.............,. ulhcr .1.. p1......rr.- ux: or due d:A'endams' Page 1: cl!) 43 44. :\ccon!uI.g m the defendants, the dncumcnts sought do no! mm to 1 emua Issue m dispute as u comparison of (h: plmnuffs plendzd use xgmnst dlc defence of mo ddcndants clurly show: um pnymenl of the deposxt rnomes by D2 20 m u not n mm: Issue m d.\spute. Counsel slxexezl the im am u 15 nor dxspumd am D1 ttctifld mo monks [yycpwu/graph 22.4 mi 32 a[D1mm'D4’/lmur/2d 171,51/r]. Thus, on an. bans. n was axjzucd that me documuou wught am no. Inunzttnal m mum or mzcnmnlng mo mu: or the plzmuffx ms Is mu In rm nlrczdy been pmuul, pnrucuhnszd mu qnnnuficd in due sntcnwnl ufclnun. Th: defmdxnts you also mum. umbragt \I1Ih the pluourrs propcsmcn um D2 ma D3 are rcfusmg to product me documtnrs hzcnusr. “Mg m mare)/rug /0 ma‘ mo m mm, am an fanluxc to produce mo docummrs means um (here is “ogmm. M the a’nz14m0vt.r um an [sic] dnwqg/ng tn mm mm" Thus. counsel for me defmdams ngued am ch: plmnnfl ms consmntd D2 and my refusal to pmdllzc dncumerus as being zummnllzally unmmounring u. . mncluxlnn ma: um documcnlx soughrar: dImag1ng|n|he|rc1s: Yul .1 the name umc, the plaumrr has oomplewlv fnikd lo cxphln how am documcnls sought would b: rzlu-znx ll) lfld/OK ulvclsely iffrct my part)": rm. mums: 45 45. 47. In rsscntr, u um argued me: there 15 nmhmg m Lh: plamurrs plmdmgs and/oz affidavu :vId:nce that yusufies how Lh: documents sought mu arm. an pleaded case of nm of Lhe pnmrs mvolted In Lhxs legnd, zuunnl refund to the dtcbxnn oflow Hop mngj (n. he Lhen W) In Mnhfar/Ib»tr v /nmnww Iain M d‘/imzv mm] 7 cu ms n p.123 wl-me Ih: Izamcd judge dechncd to Urdu discovery as the plnnnffwas not nble In Show "m1wnnc:" Hm] u H «.. he mm mm lh: mcmnum ~n..ns.- n; III: nv...m.m.. I-hsswlully dncnmznxi Iwmicfl nnnn me n 1v[mr\In:|. mu unhlc In find -n, rtlm-not af Inn: .1 -......n. whrn nu plalmvffx 1-Ink of nlmn m -M rn...n.a comma but an nannuy dullu unl unnm mu. m pl-In|Ill"V Ipplicumn n u.nn¢n.n wmmm any m:-nl ‘ [emplusk Ihlod] Thus. .2 \\‘Z|)( Irguzd rm (kc dcfcndnm am the cum uA'.MaA/fir/1/wt: xs apphcnble m m prcscnl sun n the Llucumunls xuughl by the pbunuff huran Irv cmnnlmu IrtclL'\'1n| :0 L11: allmg:-I times of acuon plcudnd and mm m plannuffhzs ram 10 mm my cogent azgumrnt to conncu the sum The next Bsut dm wax amzulmd for the defendants was due xssue of “n<ctssIry" In (1115 xegixd. counsel fax the deftndants refund :0 Ordtr 24 Ru]: 3 ROC which mds as:— m. n M 31 48. 49 5!! "Dmovuy labs mm anly .1 mammary (0 2» 1 n x. on-m¢..amra...ppnmm.. formorvlsrundcrmlc3,7ar7A,lh: Cnun. umma llul dwcuvuvy m ml ncolxsry. W nul nccsuvy .. mu sing: mg cause at malur, may am.“ or ldwum «.2 lpplw .9“ am mu. ...yn.,. nfuuclnmlkc mu m. order u...a mlnrm mum. apmmn mu dwcnvcry vs alnecsar) mixer Iordwspwsmg fnlflyolme cw: m mnllcrnl (aruv .¢m.,-> On the Inn: of mmny, tnumel sum rei:rx:r.l In aw caie nf ngmm Pb;-o M4 Vm.m»g..z /(C w mm m r Brrwmu (:mg.¢m; Pu Luv’ anrin/by a;;zu.m.; [2004] scuc 155 what am High Court uf51l\gapolc 1: puragxnph 37 szaml a. a.u..w.- "fix u:m..=..u ., wlmncrdurmmr) xsnrxusnly lm dlxposmg nun, ..r m. procacdmp or for mg m An usmlon mu m. mm‘ In: ,...m. ml! N)! :,¢.m.my.. z....au,_, "mm M lhedacumalu I‘! nrcnmzry Ivccluxthn ... relrvam WI” mmm,..v- Furthu. xzfcknce wzs made to paragraph 32 of Lhe ...¢,zp.m«. when m: Hxgh com had considered Order 24 Rule 7 which xs pmxmarma wuh our Ordcx 24 Rule 8 and st:-lkd mm: mm can u. by u 24 r 7 oanxvmud WWW lh: dwscruim m an“. muw. 0. . documcnl ,.,. 5; 3: ........g :9. m..b..... .. may kllflflulfl [:vnphJs|5 -m urdrrlming men} cuuml for Lhe defendants emphasized radux meuphodczlly am when the d.1sco\'<ty apphunan 1: nevmd through me “lens of necessity", n 1: am am me plnmnff has completely {am to zddxxx dus mqulxzment um 15 ms 51. 1. was unpmua um uh: p|aInu|Ts ai£'1dzvu(s) showx am uh: plzinuff has rntrtly assured um um documents are purpnrttdly xrlzvmt wnhour dunmlsrnung m what way am an relevant. Furthet, xr ms conzmded am an}: anzmpl to szusfy d1e candmon of necessity by recourse to relevznc: is also and; ms..mc.m.. I mm now :0 my decxsion Dtcnnon 52 In um cue. Ih: dtsc-1ven* app||cazinn [Endolure us) we filed M1 14 Jammy 2017 whereas rhc mu was filul 0x16 June 2011 Th: dclly W appmxnnnucly 2 s yam-5 The ducuvcn applmnuun mm m ubmn dxscuvcry ui .u/mm, m, 02, D3‘: bmk summrnts fur Lhu: peuud bctwten 27 Decembnr 2010 to 5 June 2014 mcludmg pavmcnt voudmi. Invoices, cheques, mus and oduu financial Ansmu-nznu relating :0 me pnyrnent of RM‘).US6,l24D0 Qnm: obviously, mm has hm comxdmbk and mmdmm delay on due pmnum pan m making mus npphcauon. 53. According to the plzmuff, they W511 not advwtd bv me pmvmus snlncimrs um rlxgcnvcry wzx mmmy A. mch. the pxmuir axgwes xhnz they xhnuld nm be peunllzcd for me [ndum ..r Rh: plzvluus sn|.ItImrs to 4.; the nccdful m nuke Any zpplkzunn fur umm-«xv 50L-m:r >..,.n..uz 54. For my pm, x 2m unzblc w zcczpl me cxcuse mu .5 proffnrul by I11: pmnurr 111 (ha: ztrtmpt at explmung the delay Thcy me rcpnsenled by n firm(s) of w1.:mm who hm pmper conduct of the cm .n=1.ru was apparent (0 um um Lhey netdcd dues: dnnlmznls then (her ought m have made an zppkczunn rm dficnvzxy dunng the ml, stagu nfkhc nut. An Ippllcannrn for! discovery ofduis "am ..< mac ranging and deeply Inlmswz mm :11: banking muturs nfD1,D1 and us 1: should have mm find very mnzh cnhcn m 11.. guuuzm of Hus use. An apphcanun [or d.ucuvcry whzch .x made M. bu-It-re sun ul eh: um M11 qua: nbvmuwly he umupzwc to flu: ml pmcuss u say nurhlng 0! dlsrupuun of lhc Courfx nm¢—mbl: for only and nn-mly duposabl: ofihe as: The prnznl solmtms took over around 5]muar}'20l7 ma Endnsune 139 was filed on mmm, 2017, 1. 1: Arnportant in ms name not .0 luos: mg)“ of d1: hrsmxy of ms case and me pemnent rm that various luncl-us ofprevious m.1 dates ma been vacattd. -rm.»- 1: mgmacm: and relcvam and .11: pauun of am and dxxnlpnon (0 mg disposal of mg cast wexgaed hemlx; on {ht decislnn making pmcess m ...- mg Issue ofdclzy. The Inn: of-lclzv cinnnl bc viewed ... Iwlnuun mu has m be looked at h01lé‘lI(nU}'m\£I all surmundxng rm Ind urcumsuncu nucndml upon me cue must be oomxsmd. mdwl, merdy bccause the case hns been remmod by me Conn ofA\ppml to the Hugh Court does no! man am am am has him Mpzd dean and mu arhu chxonnlognal zvmts m Court my be Ignored and dxscalded. me 11 at as so On me conLrszy,|t1s m, vntw um Lhe mm cl-nonolugy of the past I111] datzs and K110 futum uul dztn n-ma: fzzlurc In Lh( basket of consldeurjons my": me Isme ofdelay. A: the moment. mm .3 nod-ung to ;how am an plamnif had uelzukcd am. rum: mllzimrs for um: alleged rum .0 advic: :11: plmnrr Indeed. K may b: ml 1;: aw me am n way thought m be unntussan‘ lay me prtvwus mlxcnrnrx, No me really knows beam me plzunuff ncrcl wmxe to than (ox-rnzr snliclmrs dclnnndmg m know why Lhcy am not zdvxcc that Lhc dncuvzry nppllcnuon bc rnndc. And so, .: mks mm. cunvtmem zu nuw say um um fommx soL\c|t0xs never advised me plamnff 53 At aw um: whcn am dlscovnry nppficanon was {led on 14 January 2017, an an: (rial am ware z.I.rndy am 7 namely 1 lo 3 Much 2017 1 must ofcouxse emphzslzz mm the pvesent mumon Is not the ms: of the present solxcimm. Kathe: mg fault, 1f at an, may posnbly he rm me prznnui mlmmrs 59 w».....m may be the mic .; be-rwucn mg p1.marr mu their pmmu. .<o|1cm)x, m my new, u is ]un nu! fur ur yusx to lhe dufcmlnnu or nu ma pmpu :d.mAn.\sLunm\ of pusuct zhu dz: pmnurr be al.|A.-wed to make mg dlswvzry zpphcnuun belatedly Pg: mm so On I1-Aempn: of the pzzuous sohcxlnrs lzdure (U ad\1cr. me plamuff on me need for me Lhscovcry apphcnuon, it 1; zpvposnt to refu (D the Iollawmg pumgz. from me uudgment ofAbdul V/nhzh Pam! JC.-\ m Mm. (mm x, xmgfijma (rm. KAain1d"Cn} [2015] 4 CL] oss at I-. 453 m 4.59, whm ha saxd:— am k ix :¢n='Il\y «um that a mun snouva no! me: hum Ilw nnghgmcc m ....sxm oh»: whcmw But in mm Inquires m be nubhihed Ihanh: ..=m=..m.m.x¢ 1; mm nflhc ,.,w.=nw 0Ih:r\-tie, an wnll am": mmm:-A pncurz Lo mm. mm hit: a! lhc may by shulgvnn znunid, and Naming um mm. m In: an snmn Ilunn me pm/Ian: mlxmmr wmam my cml mu hm wmmmuad and mnnuaimd .¢..m. flux Isuzu: mum in u\1u\d muktlmrxkrrynflhe syslan ofiusllce mu u u um mu m . ;m.¢.m.na than m....mmp, uh: chm! .: m: rmpd Ind Ihc awn. . lhrngenl. In the MM nfngeney. Ihe pmmw-A .5 mm a» the urumu of ms amsan mu wnhm me peaflhunppmllmnl :.. -mrwcva, Ihc ,.m.,,xmr finn gllwu and mum: sulwcllar mu. um 0! I11: clvenl mu: mun mu m: gmax yrmclplz max . chem xhrnfld nal xulfu from In: nnglwgmot UV m. u: 07 In: wlwcmzr V5 confirvrd Io . ham ngphanon what ms wuuaxcz 1: nu: ma clmml :1: nmudwed hy .. nclwn .mmm mum mhdmr oumwug, m mm . nua-d hm M Ih: chuvy nu a pm... hi: to .4.» .5 Lo zn;mn| nu» m||:um:.r1d Mum: In: <Iu1¢Io!d|:mmu| ofnn nppenhchwmnr defmcz up.» (In: pmrmua wlxxlms. or amuse ma clnnm be .1».-‘~ m. Thus, on an gmunds at am; nlnne. I am crvnsrnlned m am.» me dxxcnvcry ipphcanon (Enrlr-sur: 130) But, for cnmp1:n:ncs$, x wdl prncccd In consider an rnena oft]-m dismvuy my-nplicatvon as mu. van: 2: was .32. 53. 1.. ......s of ......._.-, .. .5 ..1m... .0 ..o.. u... .. .... p1......rr. case .—...........-, .. .5 5...... .1... on 27 Dzcembu 201., 4.. .........sr duscovzned .1... .... dcposxt ...o..... w...... wcre P... by the p1.......£i .0 D2, had slxezdy bcm released by D2 .. n: w......... .1.. c......... of me ..1......;(. 11... n....... ...¢ case, .. Iums of .|.. .1...» ..r........... .r.= ............. .. .....a .. merely .0 d.......a... ..|...1... me ... .r ..x...s. of .... ...,...... ........e. by DZ .0 D.,w..<1....¢..1..... ..1.... 1.. .1... .¢.y.d. .. .. «..;...r.c.n. ... ...... 9... ..1..:.....1_. W»... .... ..I......rr .. ..e1....g pcr ....- mu... ... .1.. ............ ..r .L..... .. due .¢............ of [he drposu murm.’ which are In the hands of D1. Indeed, R 15 elm: [rum th: .... .. ... ...c .....e....... of dam that .1» .........rr. cast; .3 ..... .|.. deposit memes were .......gr..u.v ,....1 .0 D1 and .... p1......tr .. szekmg .0 recover the mnmts .‘......, .....m.9.., D1 Thus, .. begs .... qucsuun — wl... .5 2.. ncussxly for .1.. ..............s. pamcuhrly 5.... am ,.1......s.~. Vltzdcd en: .5 .1... am am... .......... W... .....a .. D1 and .I.. d:f:nce of the d.£e..d...... .. u... .|.. ..q.....-.. .......... wet: ... 5... .¢1e...d 1.; D2 .0 D1, During .................. .. m. ...gg¢<..a by ........¢1 r... .|.. ..1..n..r: ..... .5... .. '2... cvldencc ..... D2 .....1 D3 fl¢l'|1l“\'KU1L'iI.«l.‘d the dcpum .........s .. Dl". or c..u...», .r .1... .3 .1.. p1......11‘. ......1.4 am am. (hr .1............. ....,~ 5. ..1....... ...a nI.'cr.'sun'. Bu: hnvmg e...........: u.. .....:..e... of claim, 1 find ...... .1... .. ..... P... of me pJ......:r. ,.|c.a:a us: »...:o..m -‘r-um-I c... m.....,.m. Dlrculun .... zn Novemhtr mu n :4 wulnen xuwnenls ..= 1.» he nlmumad on : bencmhu zms. falling winch nu. t-iduw u! the m...... um... unemnl mu .m mm. 2; Farms m we-da mm; m be ma and cndavmt m file mmrrwn am. ... hnlvied by I nmmxmznws 1. mamnll m file wnnmm dnmnnlogy gr rVEll|A by I Dwemba ms 1» mum mmm ulwn .5 mm — vnluzsx m be crv\v<xmur-ud .mm..uI, 57 Fmzlmtmmugm:ru—4|koemhwZU\5.xlH.}0xm—mfinA|ar pm-mil pm» Beforr I pmreed funhn. I should add mm mm m nnly rm (4) defendants xzrnalning in am mu namel, D1, D1. D3 and DA and H1: (lawns against dw nlher drfcndznnx have been mud: nu! [vm urdcr dated 2:; Nuwzmbu znn) lluwu ., dac plamufi rm not uncndml the pleading [0 mm out or am: uh: reiumcc :0 (ha dcfnmhnls who :1: no Jungu pames to rhI.~ acuon. 1 mm nuw (0 me mm; mu look pm before me dunng use nmnzgcnlent on 4 Dtcember 2015. On that day’, counsel for the plamnff, an. Edwin Nans (“Mr Edwin") of an firm of Mtssrs Edwm Nam: 5: .\.s.m..=s, who rm Noncr. of Change or Snlxutors on as Novcmber 2015, Ippzalrd and ma: an oral nppllcannn rm leave to vII\tl-Adraw :11: sun with hbcrry m 51: armh. Vgelnlxi so No dam, the statement of am .5 hzteml mu. plus of fund». mlsztprcsanurjon, breach of duly, branch of fiduwnrv duly, ncgllgzuce and suggtsunns of . nefarious plan by D3 nu sxphon (J1: dzposxt mounts. bu: that of me]: does not |usufy disclosure of mg documents. Indend. band on mg pnmucrs pleaded use. and Ih: rm mu that .3 "0 dltpute [ptr the plcndmgs of ms pmm) aw me dcnnslr moms wet: mlmcd by D2 m D1, uh: di.«:nv=q apphcannn .5 ckmlg an ::x:Iu.~'c ln Ionk rm nnnhmg musk-K, which 1: a palm- euplwmlsm for a “fishing zxpmJ.\L|un". (:3 Thus, having wnsxdertd me nmmn. of me pnruzs and um submlmon of counsel, 1 an-A plainly unconvinced dnz an doazrncnu wlnch are sought m :11: dxswvzry zpphcauan are zclzranl or necessary rm an duurrunzuor. of n [act m issue ma gtnexzllt for rim exptdmuux mspml of rh: suit rm In me xesulr, fox I11: mmm :5 <r:1r:d above. Enclosurc n9 .; dxsnnssed and Khc plmnnff ..« m my total cnsls unu\I3,500.00 m D1. D4 and total costs or RM3,5o0.oo up D2, D3 (bath gm of costs m subptct m 4% nllocnmr). om: ncco2d.\nglv. »...amax um 251\ugust zun (51/1:0ML) S.Nantlu Ezlzn Judge ' n.g,1. Cnun Kum Lumpuz Coulnelz Mr Wbng Hm lnnng together “.1. My man Nagzuynn (Mm./:z.m. Duuviwn 4,‘ Cu] fur (ht plzmnfl. Duo’ Vxyay Kumu Naumaym lugclhtr \\/llh M: N. Nadmn (Mum 7\1,«.m.m) for D1 and D4‘ M. Vllhc Ncdu (M:.vrr.vLw Km Lmg vca) In: D: and D3 sum-e: Order 24 Rule 7 Rules or com 2012 Ordrr 24 Ru]: 3 Rum nfCnun 2012 Can: Raw xm,.rm1.mnmonm:PA 2-/mm». nu Tme Sim av Orr [2010] 5 ML} 733 HC Agym cm alau Ngualg cm. bqwu-‘l'mder ¢ 0/: 1‘ mm £..m,m: aw 2-0:: [1009] 3 ML] 40 C.-\ 3'./mm»; 1 / a .NrlumawI}y4 1/ Aluhyuuuzlu rm BM [1994] 2 CL] sxn HC rmnecaz Cunpalgnaz rumm an paw». » :».nm. em.» Co. [1352] 1 1 QED 55 Mnmbzl ¢~ Ian: (m; M 11 mpmm K] sag. [mo] 3 CL} (Rep) 7236 HC .’\»la};fnA/me: . Ig/aka Mug» Id» BM t’/I/mv [2507] 7 CL] 115 HC B15/truth: Hypo-um! Vzmmlmnh A6 a /Lvm Pun/71 Brrwnu (J/mm») P1; Lm' and Wm mp/im/iu.v [2004] SGHC 135 HC Mm: [mm u. xmqy Eflxmjy (Tmrmv mm: z~ Co} [2013] 4 CL] 453 ca meunm Mr Edwin ma um n: ma just barn mama by pmnnrr and was msrnwtzd to wnhdnw um ~u.K wuh hbcrzy no file nfxesh. A: max |uncmle, an plllnuff hm mt comphed \V|Lh rh: PTCM dnczuons gzven on 20 Novcmben zms Indmd. mux-15:1 candidly ma he was not rezdr [O pmcecd ma. the mm on 14, 15 and 16 Dcccmbu 2015. Counsel for me respecnvt dcfvndams had rm obyccnons m the wxthdmvml of the .\\.\II but they vchcmcnxly and vocifrmusly objected m m: wuhdnwnl “wnh hbcrn; "1 {lo nl'u~'|-1" Arm h::u-mg mm: for all khc piruei, I ruled that me plalnnffwn m hbum; In wuhdnw the mat but wul-uuul Ltbu , m file nfrcsh 1 gnvc my xusotb. Th: plunuffappczled tu me Cour! u[Appml On 4 Novembtx zm, me Court oA'x\pp:zJ allowed the plmum apprzl and msmud me sun and duocmd that At 1.»: mmtxed m the Hugh com far mu uni. Th: Court of Appeal dnrecxzd am mm In an “earlx mar‘. Pamex zppuxed before m an I8 Ncrvembct 20m and mal dates on 1, 2 ma 3 Mmh zzm wrrz mm fixed accordingly. In me munwhllc, pamcs had 2 dxsputc .5 m me sums of dug czse.rhatIs,wl1edI<K the status ..< that which nhcamed on 4 Drambzr 2015 or whether I shnuld give mm cm management dlrccuonx m m on use M.» an mal F.sm.:i»11,—, lhz dcfendnnu wk the pmunon um um plnmnfl was m an bum posluun dun tlncy ‘mg on u Dztrrnbex 2013 and um they um mil m non—cornpL1znC( mu. m PTCM duccuons ama zu November 2015 Purim); But tuumel for die pmnufl sand am sxncz an mm ma been mum by the Court of Appezl, rhe Hugh Court was 2! mm :0 give fresh dncznuns. Thus, panic: decxdnd :0 seek clnnficanon on um mane: [mm Rh: Court nf Appcd. Th: plaintiff in rm mm a Manon m an Court o{Appn1 seeking clzniicntion of mg Coun of r\ppt1l’$ Urdu dmd 4 Nnwmber zone. In the mranwlnlr. the .1=r<..a.-..u.- rm: appllcahnnx for Icav: m zppcal m the F=dn:r:| Court. The applxcalmns rm 1:; v. WEI! posrpunzd 1:: order for the Conn nr 4\pp:AI'.< glounds of |udgmL-nl m be Nxucd In ncw uf dwm: events and cucurnsunccs. I zuuk uh: new YJHL d-Ab (aw should Ln slund uvcr mil the ground: at wdgmenl by Conn of Appcal an 15,»-ml or dug Order of me Conn ofAppez\|1s d:z1fi<d.Th: mzl am ... Mmh 2017 were um. vzcalzd bnsad on Lhe undertaking by .11 coumzl am am sdyoummznt W15 zgzced no by all sxdes nolwllhstzndmg me daemons by Lhe Court of Appexl an an tarly run] The dxsmvtry npplxcznon \n.\ put Dn hold and ncw ml dates on 6. :2 and 13 October 2017 wcxe fixed In (11: rnnnwhxle. me Court of .xp,.e..1 made no ruling on .1“ clxrlficnnnn and 14: me matter cnnxel) m the handx at m: mad yudgz. On l-I August 2017. ch: Federal Conn dlsmtsxcd mg dcfmd:nu' Iuvc npplxcauuns. Thnxcnfrcr, I111. dummy npphcauun (uncmwm I39) my hard on 25 August 21117 ma dxsnnsxrd by um com. 1: plunuff nppeakd m mg Cuun or Apptal and Ipphcd :0 ms Conn fur an order m slay the ma]. 1 dasmlxxcd ma plzrnuffs zppllmnon for smy ofpxocetdnngs r...s..m 7 Un 25 August 2017, me Court of Apptnl gamed a my 0! procacdmgs pmmng dxsposal of me plau1uf£'s appeal zgalnsl me dmrussal of the dxscovezy npphrznon (Euclasux: 139) The next set of um am; 3:: now la. 17 ma :5 April 2015 and these dams um’: fixed nownlhsmndxng me stay or ptoccedlngs by me Cnun of(\p}):al as panic: agreed um smcc am wek sevual counsel mvolvnd, \‘|1: mnl dates bascd nn counsels rm dnrcx shnuld be “locked m" pending dupnsal of [he appcnl. Thar. .n a nulshcll 1x the current <\‘:\m$ ..r.1u- cm, 1 turn nnw m lhc dHcu\'er\'appl1::n.on. I mu sum mm mu Lvzckgnmnd hm. Background 3 The plmnuff IS in me xmsmm unma development D1 Is a loufly mtorporzred company. Th: plamuffs case 5 am u .11 matcml nmcx the directors om: m persons under an employment ofD2 and who am supcrvised and conlmllrd by D3 D4 ,5 the Mmapng Duumr nr DI ind Ihc fignirtnrr of all bank Icmunlx hzld By DI. D2 .5 I am Hf :\d\ucilcx ma .s.,1mm. m .« in “Imam ind mhcnrnr nnhc High Cum: nfMnl:y7| practising under me nun: :m.l xlylu urm. D4 u an accuuluanl by prufmxmn and a mcmbcr um: MaL\rsun Inautulc uA'A:¢uunu1'n.\ (MIA) Accuxdung Io mu plunuff, D4 .5 closely associated \.\-uh D3 m am D4 manages and zdvucs D3 m uhuon (0 L11: bumnus owncd mu, 1:, D3 and D4. D4 .15., hold; me posmon as the rum cfkewvery m D2. »..1.m 9. Th: plmnuff was inleresmd m zcqulrmg 2 piece of ma whsch is known as Gcmn No 45303, Lm mo. Muku-n Kualz Lumpur xwmh Perszzkutuan (“the land") for dewclopmcnt, According [0 mg pmnurr, D3 mrmduced the xdea rm am acqulsmon of the land somenrn: m early 2010. 1: :5 allqznd by the plzxnnff um (ha land acqulsmon was handled by D3 by nnhzmg D2 :0 prepare all lhr Kqumle agreements. Th: plunuff n-mdc mm piyments as agpnqu towards lhr: Inml ncqmimnn, mulling m.I9.n5e,I24.o0 (cull;-:u\:ly xefcrrvd m MK --me depusil monies’). D2 ., l.“l:gt'1J :0 luv: “w1‘ungl'\fl.ly" min.» .1 :h.- d.-pom mumcs to D1. Amuumg to me pumurr. my mu acqumuon A5 2 mm created by D). mmd/n7. m conspuacy Md: mg emu defmdzntx. 10 The mbtis sought b\ the plan-mff pct the statement of mm )5 as In-|.lows.— »A.,...m mug"; ‘ A a.».—u.,.......r..m. Pmmxlnm vahdly lammaxtd 5& M, “ Al Inn mu Dy mm ..m.. mm m........... as a. H by n..n.u.. vows... a. ..m..: ... ..n....: In n. hr drum-x Aux Wt?! .. u.. n.....n .. m r' Ikluulam hr 1.. ,....,m rrl an. ........... mm». ... Upon VVr11DCl1m|n)~\ «am m m mi (in Mm: um .,.n...< View s x pr: VS wwmngw mnmkd W A: ..m.. .u.. n. 1-‘ o.r..a. do refund 1. mu m. mm ..r nm.ns¢.Iunu .....n..,... 11 mm.-.1. ....«..-1 m m :- n-«.m..........:m.:..:m.. nanulsnr-2. V A.n.¢..:......y........m.u.... ..m...x :.......,..,,. nvulsove. P: was V| n.m.m .um.mny. .n Iununl uul ....W, .. mu H»: tum nflhn Hxmllflmmued K» 01! -‘ mum Tmnm:1'“Drfrnfinn~m>ch ... um m_.x.s um-:h VNN ‘mm M . mu am» .5. .r...w.m a! m: 2"‘um/cu)" Ddawmm phded m pm.» zszm Zfiubnv:-ndl «mum» Hm me m.....rr.. mm..4 w mu: .,.4x...m.., nymxl .n. :- mrmm ax mly be nrvaur) m ...x lkvmlkfmt mg mm rm... .1‘... my. cu; N All mu. mum: 1- llefcndnm ma ply mm: n.mmr.m,u... rm-1 wbe due on an ukmg oft»: Iwuml pumnnl hplh_vtr(viY.IDmt Aumnu:anu:IMmdnn. Vm Anwdulhu In: 2-‘....s x~ Defend-:1: =.r.w...;....mu. m mm, mm y-r-nymph 94 .m.¢. .n... ‘X An azmnm ..r .u 5...“ hdmxglng m ». awn m. VWVV mvsaylywwpulmt by 1... rum 1'‘ mam Aunmalmnuammu x A a.=:...m .n.. a. shaman: Ananmm am :21: 2 v .. duly moment M An m1mmmuy.u:,m:.;g;... Mtg: cum Dcvdapnunl Sam and W.» M been u...:=...1 tn: the 3- n.r.mm yumuanl w and HIIXY mu m. am: sruumwm Agvrnrvml am zuzwn .1 regmaui m m: nIw=uID~1uAz.ILIBwvVwn Ahmul. xu An am IN: :1! ram nvtvsu. Iva. my ummmuh. mm...“ Gun: and kwes Ior me vtlpnxunlliz .mgmm..4m mm;..m.. u-mu-umw khnmby IV: :~ mm". Anl||LIkA1In|.|_D|[|M:|.I.nnlx xm ;m.»x...u.».a... 1». my 'n.r.na.m»...¢..v»muy...<...<.>. v- 2~ and/M1“ D<4'=vdm§1nbIu(hoIlh:|rfnauc\aly am arvddunu ....a.m. M ‘mu .mm.....: mm mm >.W n-mu mm. ... ms nlbevmuve. . dudalllnun M lhr w m m mama mmnudy lmewud vlynncms M mum. Ind pmpeny M m. Hum /vymm My m. w, 2“ nndlur :~ Dekmnnn n mun .4 II-zwrdun-sm~¢dmm:Hn ML xv A .mu..m..um II: o 3 w Dckvwilm an mm: m aumm m n. m nufincmulluz euunew DI-mun|vaph:IvAn\v|xw7-b.:y:. “. ~...=....n. mdmu-any .. m mnmr... n..mmmw=.: hyov mg own new alum - In m Defendant: ma me. am... Ind lat m .,..m ondan .. my pg necquwy m .4 Hymn! htfmr m. ow, Rqmrar. v;.,.m;: xvfl Anufl-<nlu|xh:A‘w w Derwmanlsdav-yluII-eflmmuvllnumm rum m be m: an we mun: ml the Atmunl pursuml m pnvlr pm’) me m n.......:m»,uo.mm, m A..m...:.v...yu.....u .u sunupunuumm p:ngqfln(xvm)1bo'u§, xx um ... by my 1'“ .«.,(...p Ilclnfllx a... an nmm u. n. bl-In ... n......:.: vmmu... ... mmm nnncm n. .u mm ...um um um u. n.y....1..u mu... ...a.. n. n. m u 9.. ..... .7 .... ..a mu... mun mm, 4|! .w.....: u, m n.:....:.... lmm 17.1z.2mon Aui.|y.[I(luI1lngna<ounId¢|n|hIhal n... be» ch-ad 4...... .. m.«..uu. xx: An mwulry um um mun Mm: o.r:.m- mavnbl: .. xmrwvnhrk. W6: Inqmlnd am or II»: pmxcflx nl mom ..m ml of IA: nmms :m.y.: ms I13/II: perm... .. mnvlnxnvemnveu MI): m. ‘n XAH An m..m..u mm.» M. mm mm: Dzicnd-ux ..m..:mm |nmccsIoIx4<Iwaed win n. P\nwmlT. xxm Duna§fi:r(vIud:nduunpu1cyagvmIh¢1".3":mA‘D:fnwdmK harm: me nerw Iuuxnn LKW (im:u\ danngps. .w.m1 ...1 exnmplan dunugzs. xxv Pmilndylmn mleresl on M II: amounts mag» m be dis! lo a: mm»: pun:-m .. Iodmn u at Ih: om Ln» Acl less .4 on awhumc ....a pm. ng aux .~mn ms: for fix «Wm .| o. ....mm mm: Vl\V:n1u(h mm; IEIC .1.,..w »., we n.,...m...n= 2' mm.“ urmi 01: .x..m.ump~.m m. )'u3l_yudgneu|mA::v.1lwu .u nllhe Imam; .a_1,,..a .. 5. dxxm II: u-:.‘....«rm....m mom“ 4: we «: wflhc R-1.; oY(mll 201: mm me an: n1 juflgnmn mml M um final cm‘:/uwm mnanfzl an mm uuarsss pmnm xxvu Cm: xxvw Sud! m.n.«..on.. 1:|\r/ mu Ims Nmvmu:h\zCound::ms fix Jud M w rum ~ ;.....m.; .m; pm in am

Pytesseract-0.3.10

BA-24-1383-12/2016

PLAINTIF AMGENERAL INSURANCE BERHAD DEFENDAN 1. PENTADBIR TANAH PUSAKA RAJENDRAN A/L SUBRAMANIAM (SI MATI) 2. SUBRAMANIAM A/L PASUMPON 3. MUNISAMY A/L KANNIAH 4. SAROJA A/P VEERIAH NAIDU 5. SAMUEL A/L RAJAN

25/08/2017

YA DATUK AZIMAH BINTI OMAR

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Failed Extraction

BA-24NCVC-49-06/2017

PLAINTIF AMGENERAL INSURANCE BERHAD DEFENDAN 1. SATESH KUMAR A/L K. PACKIHASAMY 2. MUHAMMAD MOKHZANI FIRDAUS BIN MAMAT 3. TOO SIONG FAT

25/08/2017

YA DATUK AZIMAH BINTI OMAR

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1 DALAM MAHKAMAH TINGGI DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA SAMAN PEMULA NO. BA-24NCVC-49-06/2017 Dalam Perkara Seksyen 96 (1) dan (3) Akta Pengangkutan Jalanraya 1987 DAN Dalam Perkara Seksyen 41 Akta Relief Spesifik 1950 DAN Dalam Perkara polisi insuran No. JVD 0696084 yang melindungi kenderaan No. NAV 3501 bagi tempoh dari 14/08/2015 hingga 13/08/2016. DAN Dalam perkara kemalangan jalanraya antara motorkar No. WEQ 8136 dan motorkar No. NAV 3501 pada 01/05/2016 di KM 49.5 Jalan Kuala Lumpur- Ipoh, Batang Kali, Selangor. DAN Dalam perkara kes sivil Mahkamah Sesyen Kuala Kubu Baru A53KJ- A53KJ-141-09/2016 ANTARA 2 AMGENERAL INSURANCE BERHAD … PLAINTIF DAN 1. SATESH KUMAR A/L K. PACKIHASAMY 2. MUHAMMAD MOKHZANI FIRDAUS BIN MAMAT 3. TOO SIONG FAT ... DEFENDAN- DEFENDAN ALASAN PENGHAKIMAN (Kandungan 1 – Saman Pemula) A. PENGENALAN [1] Plaintif (AmGeneral Insurance Berhad) telah memfailkan Saman Pemula (Kandungan 1) ini pada 20.6.2017 terhadap Defendan Pertama (Satesh Kumar A/L K. Packihasamy,) Defendan Kedua (Muhammad Mokhzani Firdaus Bin Mamat) dan Defendan Ketiga (Too Siong Fat) untuk mendapatkan perintah-perintah berikut: i. suatu deklarasi bahawa Polisi Insuran No. JVD 0696084 yang melindungi motorkar No. NAV 3501 dari 14.8.2015 sehingga 13.8.2015 adalah tidak sah (void) atau tidak boleh dikuatkuasakan termasuk tetapi tidak terhad bagi suatu kemalangan yang didakwa berlaku 3 pada 1.5.2016 yang melibatkan motorkar WEQ 8136 dan motorkar NAV 3501 di KM 49.5 Jalan Kuala Lumpur-Ipoh, Batang Kali Selangor. ii. suatu deklarasi bahawa Plaintif tidak bertanggungan (‘not liable’) terhadap sebarang perintah dan/atau penghakiman Mahkamah di bawah Seksyen 96 Akta Pengangkutan Jalan 1987 yang mungkin diperolehi dalam tindakan sivil di Mahkamah Sesyen Kuala Kubu Baru No. A53KJ-141-09/2016 atau mungkin diperolehi oleh Too Siong Fat dan/atau mana-mana individu dalam mana-mana tindakan lain yang akan dan/atau telah difailkan berikutan kemalangan jalanraya tersebut dan/atau yang melibatkan motorkar No. NAV 3501. B. LATAR BELAKANG KES [2] Latar belakang kes yang membawa kepada pemfailan Kandungan 1 oleh Plaintif adalah seperti berikut; 2.1 Defendan Kedua adalah pemilik berdaftar motorkar No. NAV 3501. Satu polisi insuran kereta persendirian No. JVD0696084 (polisi insurans tersebut) telah diisukan oleh Plaintif ke atas nama Defendan Kedua untuk melindungi motorkar No. NAV 3501 bagi tempoh 14.08.2015 sehingga 13.8.2016. 4 2.2 Pada 15.6.2016, satu kemalangan jalanraya telah berlaku pada 15.6.2016 yang melibatkan motorkar NAV 3501 yang dipandu oleh Defendan Pertama dan motorkar WEQ 8136 yang dipandu oleh Defendan Ketiga di KM 49.5 Jalan Kuala Lumpur-Ipoh, Batang Kali Selangor (kemalangan tersebut). 2.3 Lanjutan daripada itu, Defendan Ketiga telah memfailkan satu tuntutan sivil di Mahkamah Sesyen Kuala Kubu Bharu No.A53KJ-141-09/2016 terhadap Defendan Pertama selaku pemandu motorkar NAV 3501 menuntut gantirugi am dan khas (“tuntutan sivil tersebut”). 2.4 Plaintif telah menerima laporan-laporan polis yang telah dibuat oleh Defendan Pertama dan Defendan Ketiga berhubung dengan kemalangan tersebut. 2.5 Walaupun Kandungan 1 dan afidavit sokongannya telah diserahkan kepada Defendan-defendan Pertama, Kedua dan Ketiga, namun Defendan Pertama dan Defendan Kedua telah 5 tidak memasukkan kehadiran mereka untuk menentang permohonan Plaintif. Hanya Defendan Ketiga telah memfailkan afidavit jawapan bagi menentang permohonan Plaintif. Afidavit jawapan Defendan Ketiga (Kandungan 5) telah diikrarkan oleh Manickam Avadiar yang merupakan peguambela dan peguamcara yang mengamalkan perkhidmatan guaman atas nama firma Tetuan Manikam Avadiar. 2.6 Setelah Plaintif diserahkan dengan tuntutan saman oleh Defendan Ketiga, Plaintif telah melantik Penyelaras Loss Adjusters (Adjusters) untuk membuat siasatan kemalangan. 2.7 Hasil siasatan yang dijalankan oleh Adjusters telah mendapati bahawa pada sekitar bulan Julai tahun 2013 motokar tersebut telah dijual oleh Defendan Kedua kepada seorang bernama Salim bin Cik Idris (Salim) yang nama samarannya Mahyee dengan harga RM3,000.00. Selepas beberapa bulan Salim telah memberi motokar tersebut kepada abang kandungnya Suhaizan Bin Cik Idris (Suhaizan) bagi kegunaan peribadi beliau. 6 2.8 Selepas setahun Suhaizan pula telah menjual motokar tersebut kepada Defendan Pertama melalui pengurus beliau. 2.9 Plaintif telah menegaskan bahawa walaupun semasa kemalangan berlaku, polisi JVD 0696084 telah dikeluarkan oleh Plaintif, dengan penjualan-penjualan yang tidak melibatkan pertukaran nama pemilik motokar tersebut telah berlaku “transfer of interest”, maka pada semua masa material tiada ‘insurable interest’ oleh Plaintif ke atas motorkar No. NAV 3501 memandangkan motorkar tersebut tidak dimiliki dan/ atau tidak berada di dalam kawalan Defendan Kedua yang merupakan penanggung polisi insurans bernombor JVD0696084 tersebut. 2.10 Justeru itu Plaintif telah memohon perintah-perintah deklarasi di dalam Kandungan 1. C. BANTAHAN DAN HUJAHAN DEFENDAN [3] Di dalam membantah permohonan Plaintif, di Kandungan 5 (Afidavit Jawapan Manikam Avadiar), Defendan Ketiga telah menegaskan 7 bahawa Plaintif tidak boleh mengelak tanggungannya terhadap kemalangan yang berlaku atas penggunaan motokar NAV 3501 tersebut. Menurut Defendan Ketiga, beliau adalah pihak yang tidak bersalah yang terlibat di dalam kemalangan tersebut dan Plaintif tidaklah boleh menafikan tanggungannya atas kemalangan yang melibatkan motokar NAV 3501 atas alasan-alasan berikut: i. Plaintif adalah terikat kepada Motor Insurers’ Bureau of West Malaysia (MIB) Agreement (Memorandum of Agreement) iaitu perjanjian antara MIB dengan syarikat-syarikat insurans Malaysia. Plaintif adalah terikat dengan Memorandum of Agreement yang dimasukinya dan telah bersetuju secara kontrak untuk memberikan perlindungan insurans di dalam situasi-situasi yang berikut: a. Jika polisi insurans diperolehi secara “fraud, misrepresentation, non disclosure of material fact atau mistake”. b. Jika motokar tersebut berada di dalam milikan pemandu yang tidak dibenarkan (unauthorized driver). c. Jika pemilikan (ownership) dan kepentingan di dalam motokar telah bertukar tangan. 8 ii. Plaintif adalah tidak berhak untuk mendapatkan deklarasi yang dipohon atas dakwaan terdapat pertukaran tangan ke atas motorkar NAV 3501. Untuk dakwaan ini, Plaintif hanya bersandarkan kepada Surat Akuan Berkanun Defendan Pertama dan Defendan Kedua. Adalah menjadi tegasan Defendan Ketiga bahawa kedua-dua Surat Akuan Berkanun Defendan Pertama dan Defendan Kedua tersebut adalah tidak cukup bagi membuktikan bahawa wujud pertukaran tangan akan motokar NAV 3501 tersebut. Kedua-dua Surat Akuan Berkanun Defendan Pertama dan Defendan Kedua telah tidak disokong dengan sebarang keterangan lain. Hujahan Defendan bagi alasan i: [4] Adalah menjadi hujahan peguam Defendan Ketiga bahawa menurut Memorandum of Agreement tersebut, Plaintif sebagai syarikat penanggung insurans telah bersetuju untuk tidak menafikan perlindungan pihak ketiga atas alasan penukaran hakmilikan kenderaan tersebut. Menurut peguam Defendan lagi, Memorandum of Agreement tersebut adalah suatu perjanjian antara kesemua pihak Insurans (syarikat-syarikat insuran) bagi melindungi hak mangsa yang terlibat dengan kemalangan jalanraya atas polisi insurans yang telah dikeluarkan oleh syarikat-syarikat insurans. 9 [5] Menurut peguam Defendan Ketiga lagi, berdasarkan klausa (vi) (a) dan (b) Memorandum of Agreement, Plaintif adalah terikat pada “Memorandum of Agreement” yang diakui dan dipersetujuinya sejak 1.1.1992. [6] Peguam Defendan Ketiga juga telah merujuk kepada klausa 1 Memorandum of Agreement yang memperuntukkan berikut: “Insurer concerned means the insurer who at time of the accident which give rise to ability required to be insured by Compulsory insurance... An insurer is concerned within the meaning of this Agreement notwithstanding that:- There was a transfer of interest in the vehicle which the insurance purports to cover UNLESS:- (a) A subsequent insurance has been effected to cover OR (b) The insurance was cancelled at the request of the [7] Menurut peguam Defendan Ketiga lagi, melalui Memorandum of Agreement tersebut Plaintif sebagai syarikat insurans atau penanggung insurans (Insurer) hanyalah terhenti menjadi insurer 10 concerned walaupun terdapat penjualan motokar HANYA apabila dua situasi timbul yakni samada terdapatnya atau wujudnya insurans yang baru atau pemegang polisi insurans sendiri membatalkan insurans tersebut. Hujahan Defendan bagi alasan ii: [8] Peguam Defendan Ketiga selanjutnya menghujahkan bahawa sebagai penginsuran berdaftar bagi nombor pendaftaran NAV 3501 pada masa yang material, Plaintif “was at risk” dan mempunyai “insurable interest” terhadap Defendan Ketiga kerana selagi tidak ada pembatalan insurans, perlindungan insurans di bawah polisi tersebut adalah sah dan tidak terbatal dari 14.8.2015 sehingga 13.8.2016. [9] Peguam Defendan Ketiga telah menghujahkan bahawa ‘insurable interest’ tidak semestinya berpindah daripada Defendan Kedua kepada Encik Mahyee kerana Plaintif tidak dapat membuktikan terdapatnya satu penjualan yang sah melalui perjanjian jual beli di antara kedua-dua mereka. Memandangkan ‘insurable interest’ masih tidak berpindah ini bererti Encik Mahyee telah menerima kenderaan motokar No. NAV 3501 dengan persetujuan pemilik untuk 11 menggunakannya. Untuk hujahannya ini, peguam Defendan telah merujuk Mahkamah ini kepada kes Nanyang Insurance Co. Ltd. V Salbiah & Anor [1967] 1 MLJ 94. D. HUJAHAN PLAINTIF [10] Adalah menjadi hujahan Plaintif bahawa hasil siasatan Adjustersnya, Plaintif telah mendapati bahawa telah berlakunya “transfer of interest” dan apabila “transfer of interest” berlaku maka polisi insurans yang dikeluarkan oleh Plaintif adalah terbatal dan tidak boleh dukuatkusakan lagi. [11] Menurut Plaintif, Defendan Pertama telah pun membuat satu Surat Akuan Berkanun bertarikh 05/06/2017 bagi menegaskan fakta bahawa beliau telah pada Januari 2016 melalui pengurus beliau membeli motokar No. NAV 3501 daripada Encik Suhaizan bin Cik Idris iaitu abang Encik Salim bin Cik Idris dengan harga RM3,500.00 dan beliau telah diserahkan dengan semua dokumen-dokumen yang relevan. Beliau tidak menukar nama pendaftaran ke atas motorkar tersebut kerana beliau ingin berbuat demikian selepas tamatnya tempoh polisi insurans. 12 [12] Selanjutnya, Defendan Kedua pula telah pada 09/05/2017 membuat satu Surat Akuan Berkanun dan menegaskan bahawa pada bulan Julai tahun 2013, beliau telah menjual motokar No. NAV 3501 yang didaftarkan diatas nama Defendan Kedua pada harga RM3,000.00 kepada kawan beliau yang bernama Encik Mahyee. Beliau juga telah mengesahkan bahawa beliau tidak pernah terlibat dalam apa jua kemalangan jalanraya di KM 49.5, Jalan Kuala Lumpur – Ipoh, Rasa, Hulu Selangor pada 01/05/2016 dan motokar No. NAV 3501 telah dijual oleh beliau kepada kawan beliau Encik Mahyee sebelum kemalangan tersebut. [13] Adalah menjadi tegasan Plaintif bahawa sekiranya fakta-fakta ini didedahkan dan/atau diketahui, ianya akan mempengaruhi keputusan Plaintif untuk mengeluarkan polisi insurans tersebut dan/atau menerima risiko di bawah polisi insurans tersebut. [14] Bagi membalas hujahan peguam Defendan Ketiga yang mengatakan bahawa Surat Akuan Berkanun Defendan Pertama dan Defendan Kedua tidak cukup membuktikan bahawa berlakunya pertukaran tangan kepada motorkar NAV 3501 dan berlakunya “transfer of 13 interest”, Peguam Plaintif telah menghujahkan bahawa fakta-fakta pertukaran tangan motokar NAV 3501 telah cukup dibuktikan oleh Plaintif. Pertama; surat-Surat Akuan Berkanun tersebut merupakan keterangan yang mencukupi bagi membuktikan fakta bahawa terdapatnya pertukaran tangan motokar NAV 3501. Kedua; saman pemula (Kandungan 1) dan Afidavit Sokongannya telahpun diserahkan kepada Defendan Pertama dan Defendan Kedua, namun Defendan Pertama dan Defendan Kedua tidak memfailkan sebarang afidavit bantahan. [15] Adalah menjadi hujahan Plaintif bahawa dengan kegagalan Defendan Pertama dan Defendan Kedua mencabar atau menafikan pengataan fakta- fakta tersebut, maka ia dianggap sebagai pengakuan ke atas fakta-fakta tersebut. Bagi menyokong hujahannya, peguam Plaintif telah merujuk kepada kes-kes berikut: i. Ng Hee Thoong & Anor v Public Bank Bhd [1995] 1 MLJ 281,“…When on a party makes a positive assertion in affidavit on a material issue, failure of the opponent to contradict by averment, also in affidavit, is usually treated as an admission of the fact so asserted…” 14 ii. Sunrise Sdn. Bhd. v First Profile (M) Sdn Bhd & Anor [1996] 3 MLJ 533 “…The material averment s contained in the appellant’s affidavits filed in support of the application were never answered and hence must be taken to have been admitted…” [16] Ketiga; Defendan Ketiga tidak mempunyai pengetahuan dan/atau kapasiti untuk mempertikaikan isu ‘transfer of interest’ yang dibangkitkan oleh Plaintif. Menurut peguam Plaintif, isu “transfer of interest” berlaku di antara Defendan Pertama dan Defendan Kedua, maka Defendan Ketiga yang tidak mempunyai sebarang pengetahuan mengenai isu tersebut (‘do not possess primary and/ first-hand knowledge of the transfer of interest and/or the said insurance claim) tiada hak/bukan dalam kapasiti untuk mempertikaikan isu tersebut. Untuk itu, peguam Plaintif telah merujuk kepada kes Sun Life Malaysia Takaful Berhad v Noorulasmiah Sulong @ Mohd Nasir & Ors [2015] 1 LNS 160 yang telah memutuskan seperti berikut:- 15 [13] The alleged breach is in letting out the insured vehicle for hire to a 3 r d party in breach of Item 7 of the Certificate of Insurance and also contrary to General Exception 3(c) of the Policy. The breach by the 1st Defendant is not disputed by the 2n d - 8t h Defendants (D2- D8). However, they are opposing the application on the ground that they are not privy to the contract of insurance between the contracting parties and should not be prejudiced by any declaratory order sought to be made to their detriment. On the other hand, the Plaintiff’s stand is that they have no capacity or locus standi to oppose the application on the ground of privity of contract and that, it is only the 1st Defendant (D1) who is clothed with the legal capacity to oppose Enclosure (1). D1 has not opposed Enclosure (1), nor has he filed any affidavit in reply to contradict the facts deposed to by the Plaintiff. Hence, the said facts are, in this case deemed to be admitted. [17] Peguam Plaintif turut menghujahkan bahawa kegagalan Defendan Kedua selaku pemilik berdaftar motokar tersebut untuk memaklumkan kepada Plaintif mengenai isu ‘transfer of interest’ yang dinyatakan di atas bercanggah dengan prinsip asasi undang-undang kontrak insurans iaitu konsep ‘utmost good faith’ (‘uberrimae fide’) kerana Plaintif telah mengeluarkan sijil polisi tersebut di atas nama 16 dan/atau kepada Defendan Kedua untuk melindungi motokar tersebut dengan kepercayaan bahawa motorkar tersebut dimiliki oleh Defendan Kedua dan untuk penggunaan persendirian Defendan Kedua. Maka, sebarang pemindahan kepentingan (‘transfer of interest’) tidak boleh dibuat tanpa pengetahuan Plaintif. [18] Bagi menyokong hujahannya, peguam Plaintif telah merujuk kepada Mahkamah ini kepada beberapa kes sebagai otoriti. i. ROSLAN BIN ABDULLAH v. NEW ZEALAND INSURANCE CO. LTD [1981] 2 MLJ 324. Mahkamah Persekutuan telah memutuskan berikut: “(1) In this case, once ownership of the truck changed the insurance policy lapsed unless there was novation of the policy, which was not alleged. The driver of the truck was not covered by the insurance policy as there was no insurance policy at the same of the accident.” (2) the claim... 17 ii. KURNIA INSURANS (MALAYSIA) BERHAD v. PERSONAL REPRESENTATIVE OF ZENOL SAAD & ORS [2013] 1 LNS 239. Dengan merujuk kepada kes-kes Peters V General Accident & Life Insurance Corpn. Ltd [1937] 4 AER 628, Roslan Bin Abdullah V. New Zealand Insurance Co. Ltd [1981] 2 MLJ 324 dan Bibendum Sdn Bhd v. Amanah Scott Properties (KL) Sdn Bhd [2011] AMCR 792, Yeoh Wee Siam H telah menyatakan berikut: “...it is clear that upon the sale of the car by the Deceased to R2, and in the absence of any evidence of novation of the Policy, the insurable interest of the Deceased ceased. The policy automatically lapsed. The Deceased could not assign his Policy to R2 or any third party. Therefore, the insurers or the Applicant cannot be held responsible in respect of the third party such as R3 and R4.” iii. PETERS V GENERAL ACCIDENT & LIFE INSURANCE CORPN. LTD [1937] 4 AER 628 di mana Mahkamah telah memutuskan seperti berikut:- 18 “(i) When the vendor sold the car, the insurance policy automatically lapsed. (ii) at the time of the accident, the purchaser could not be said to be driving the car by the order or with the permission of the vendor, as the car was then the purchaser’s own property. (iii) the insured is not entitled to assign his policy to a third party. An insurance policy is a contract of personal indemnity, and the insurers cannot be compelled to accept responsiblility in respect of a third party who may be quite unknown to them.” iv. Goh Chooi Leong v Public Life Assurance Co Ltd [1964] 30 MLJ 5 .Yang Arif Hakim Gill (pada ketika itu) telah memutuskan bahawa kontrak Insurans tidak sah apabila tidak diperbaharui oleh pihak yang diinsuranskan sebaliknya diperbaharui oleh orang lain untuk kepentingan dan kegunaan orang lain tersebut, dan dengan berbuat demikian telah bergantung kepada penghakiman Scruttan LJ di dalam kes Rozanes v Bowen, sebagaimana yang dicerminkan dibawah:- "As the underwriter knows nothing and the man who comes to him to ask him to insure knows everything, it is the duty of the assured, 19 the man who desires to have a policy, to make a full disclosure to the underwriters without being asked of all the material circumstances, because the underwriters know nothing and the assured knows everything. This is expressed by saying that it is a contract of the utmost good faith – uberrima tides." [19] Plaintif juga telah bersandar kepada seksyen 96(1) Akta Pengangkutan Jalan 1987 (APJ) yang memperuntukkan berikut: “96.(1) Jika, setelah suatu perakuan insurans diserahkan di bawah subseksyen 91(4) kepada orang yang kepadanya sesuatu polisi telah dikuatkuasakan, penghakiman berkenaan dengan apa-apa liabiliti yang dikehendaki dilindungi oleh sesuatu polisi di bawah perenggan 91(1)(b) (iaitu liabiliti yang dilindungi oleh terma polisi itu) diberi terhadap mana- mana orang yang diinsuranskan oleh polisi itu, maka walau apa pun penanggung insurans berhak mengelak atau membatalkan, atau telah pun mengelak atau membatalkan polisi itu, penanggung insurans tersebut hendaklah, tertakluk kepada seksyen ini, membayar kepada orang yang berhak mendapat faedah penghakiman ini, apa-apa jumlah wang yang kena bayar di bawah polisi itu berkenaan dengan liabiliti tersebut, termasuk apa- apa amaun yang kena dibayar berkenaan dengan kos dan apa-apa jumlah wang yang kena dibayar berkenaan dengan bunga bagi jumlah wang itu 20 menurut kuasa mana-mana undang-undang bertulis yang berhubungan dengan bunga bagi penghakiman.” [20] Di samping itu, Plaintif juga telah menghujahkan bahawa polisi insuran tersebut adalah untuk melindungi si diinsurans dan penanggung yang dibenarkan sahaja. Maka, bagi kemalangan yang berlaku antara Defendan Pertama dan Defendan Ketiga, Plaintif adalah tidak bertanggungan atau tidak mempunyai apa-apa liabiliti kerana polisi insurans tersebut tidak memberikan perlindungan terhadap Defendan Pertama yang merupakan pemandu motorkar NAV 3501 tanpa kebenaran [“unauthorized driver”] Defendan Kedua. [21] Untuk hujahan ini, peguam Plaintif telah merujuk kepada kes United Malayan Insurance Co. Ltd v Lee Yoon Heng [1964] 1 MLJ 453, di mana di dalam kes ini Mahkamah dalam membenarkan deklarasi yang dipohon oleh penanggung insurans telah membuat pemerhatian berikut:- “An accident occurred on 7th May, 1961, when the defendant was driving the said vehicle, in consequence of which injury and loss were caused to certain passengers in the vehicle including one Chang Chow Tai (spinster) 21 who on or about 7th November, 1962 commenced in the High Court at Kuala Lumpur in Civil Suit No. 871 of 1962 an action against the defendant for damages in respect of the injury and loss sustained by her. The defendant claimed to be entitled to indemnity against the plaintiffs under the provisions of the said policy of insurance in respect of the claim made by Chang Chow Tai and any other liability arising out of the said accident, whereupon the plaintiffs commenced this suit on 22 January, 1963. Thus the suit has been brought within the period stipulated in the Ordinance. On the authority of the above statement of the law the plaintiffs are entitled to avoid the policy of insurance dated the 10th December, 1960 bearing No. MC/02018 on the ground that it was obtained by the non-disclosure of material fact or by a representation of fact which was false in some material particular, and I make a declaration accordingly with costs against the defendant. E. DAPATAN DAN KEPUTUSAN MAHKAMAH [22] Plaintif di dalam menafikan atau mengelak liabiliti atau tanggungannya terhadap kemalangan yang berlaku kepada motokar NAV 3501 telah memohon kepada Mahkamah ini satu deklarasi bagi mengelak tanggungannya menurut seksyen 96 APJ 1987. 22 [23] Adalah satu kedudukan undang-undang yang jelas dan mantap bahawa hubungan atau pertalian pihak-pihak di dalam satu polisi insurans adalah hubungan kontraktual yang berlandaskan kontrak insurans yang dimasuki antara pihak-pihak. Namun di dalam perihal insurans bagi kenderaan, terdapat pengecualian di dalam doktrin privity of contract melalui undang-undang statutori iaitu Akta Pengangkutan Jalan 1987 (APJ 1987). [24] Seksyen 96 APJ 1987 pada amnya memperuntukkan mengenai kewajipan penanggung insurans untuk menunaikan hukuman terhadap orang-orang yang mengambil insurans berkenaan dengan risiko pihak ketiga. Seksyen 96(1) APJ 1987 telah memperuntukkan bahawa apabila penanggung insurans mengeluarkan atau menyerahkan perakuan insurans di bawah subseksyen (4) kepada seksyen 91 iaitu kepada orang yang kepadanya sesuatu polisi yang telah dikuatkuasakan, maka penanggung insurans adalah bertanggungan terhadap apa-apa penghakiman berkenaan dengan apa-apa liabiliti yang dikehendaki dilindungi oleh sesuatu polisi di bawah perenggan (b) subseksyen (1) seksyen 91 (iaitu liabiliti yang dilindungi oleh terma-terma polisi itu) diberi terhadap mana-mana 23 orang yang diinsuranskan oleh polisi itu dan juga membayar kepada orang-orang yang berhak mendapat faedah penghakiman itu, apa- apa jumlah wang yang kena bayar di bawah polisi itu berkenaan dengan liabiliti tersebut, termasuk apa-apa amaun yang kena dibayar berkenaan dengan kos dan apa-apa jumlah wang yang kena dibayar berkenaan dengan bunga bagi jumlah wang itu menurut kuasa mana- mana undang-undang bertulis yang berhubungan dengan bunga bagi penghakiman. [25] Namun, seksyen 96(1) APJ 1987 ini juga memperuntukkan bahawa penanggung insurans berhak mengelak atau membatalkan, atau telah pun mengelak atau membatalkan polisi itu atas jumlah wang kena dibayar oleh seseorang penanggung insurans yang dinyatakan di perenggan 15, di dalam keadaan-keadaan yang dinyatakan di bawah seksyen 96(2) APJ 1987 yakni: (a) berkenaan dengan apa-apa penghakiman, melainkan sebelum atau dalam masa tujuh hari selepas bermulanya prosiding dalam mana penghakiman itu diberi, penanggung insurans itu telah mengetahui mengenai prosiding tersebut; 24 (b) berkenaan dengan apa-apa penghakiman, selagi perlaksanaannya digantungkan sementara menunggu rayuan; atau (c) berkaitan dengan apa-apa liabiliti, jika sebelum berlakunya kejadian yang menjadi sebab kematian atau kecederaan tubuh badan yang menimbulkan liabiliti polisi itu dibatalkan dengan izin bersama atau menurut kuasa apa-apa peruntukan yang terkandung di dalamnya dan sama ada – (i) sebelum berlakunya kejadian tersebut, perakuan itu telah diserahkan kepada penanggung insurans atau orang yang telah diserahkan perakuan itu telah membuat suatu akuan berkenaan menyatakan bahawa perakuan itu telah hilang atau musnah; (ii) selepas berlakunya kejadian tersebut, tetapi sebelum habisnya tempoh empat belas hari dari berkuatkuasanya pembatalan polisi itu, perakuan tersebut telah diserahkan kepada penanggung insurans atau orang yang telah diserahkan perakuan itu telah membuat suatu akuan berkanun seperti yang tersebut dahulu; atau (iii) sama ada sebelum atau selepas berlakunya kejadian tersebut, tetapi di dalam tempoh empat belas hari tersebut, penanggung insurans telah memulakan prosiding di bawah 25 Bahagian ini berkenaan dengan kegagalan menyerahkan perakuan. [26] Manakala seksyen 96(3) APJ 1987 pula memperuntukkan bahawa tiada apa-apa jumlah wang kena dibayar oleh seorang penanggung insurans di bawah subseksyen (1) jika, sebelum tarikh liabiliti ditanggung, penanggung insurans telah mengambil penetapan daripada mahkamah bahawa insurans itu tak sah dan tidak boleh dikuatkuasakan. [27] Namun, hak untuk mendapat penetapan Mahkamah ini adalah dengan syarat bahawa seorang penanggung insurans yang telah memperolehi sesuatu penetapan seperti yang tersebut dahulu dalam sesuatu tindakan adalah tidak berhak mendapatkan faedah subseksyen ini berkenaan dengan apa-apa penghakiman yang diperolehi dalam prosiding yang dimulakan sebelum bermulanya tindakan itu melainkan, sebelum atau dalam masa tujuh hari selepas bermulanya tindakan itu, dia telah diberi notis mengenainya kepada orang yang menjadi plaintif dalam prosiding tersebut menyatakan apa-apa alasan-alasan yang mana dia bercadang untuk 26 mengasaskan, dan mana-mana orang yang diberi notis mengenai tindakan itu adalah berhak jika difikirkannya patut menjadi pihak kepada tindakan tersebut. [28] Plaintif di hadapan Mahkamah ini walaupun telah mengeluarkan polisi insurans tersebut terhadap motokar NAV 3501 bagi tempoh 14.8.2015 hingga 13.8.2016 telah menafikan kebertanggungannya atas kemalangan yang berlaku pada 1.5.2016 di antara Defendan Pertama dan Defendan Ketiga atas alasan bahawa pemegang insurans atau orang yang diinsuranskan adalah Defendan Kedua. Pada masa polisi insurans tersebut dikeluarkan Defendan Kedua telah tidak memaklumkan kepada Plaintif bahawa motokar tersebut telahpun dijualnya kepada Defendan Pertama sejak tahun 2013 lagi. Penjualan motorkar tersebut hanya diketahui oleh Plaintif apabila Adjusters menjalankan siasatan atas kemalangan yang berlaku tersebut. [29] Bagi transaksi penjualan motokar NAV 3501, Defendan Pertama dan Defendan Kedua telah membuat Surat-Surat Akuan Berkanun. Surat-Surat Akuan Berkanun Defendan Pertama dan Defendan 27 Ketiga adalah seperti di Eksibit “M-4” dan Eksibit “M-5”, Kandungan 2. Untuk lebih jelas kedua-dua Surat Akuan Berkanun diperturunkan: Eksibit “M-4” SURAT AKUAN BERKANUN “Saya, Satesh Kumar a/l K.Pachihasamy, No. Kad Pengenalan: 811115-06-5007, yang beralamat di No. 109, Jalan Meranti 3A/9, Sek 3, Bandar Utama, 44300 Batang kali, Selangor, dengan sesungguhnya berikrar bahawa kenyataan yang diberi di bawah adalah benar: 1. Dengan ini saya mengesahkan bahawa, saya adalah bekas pengguna kereta nombor pendaftaran NAV 3501 terus daripada pemilik kereta sebenar iaitu Encik Muhammad Mokhzani Firdaus bin Mamat. 2. Dengan ini saya mengesahkan bahawa, saya telah membeli kereta tersebut melalui seorang kawan pengurus saya iaitu bernama Encik Suhaizan bin Cik Idris dengan harga sebanya RM3,500.00 tunai. Sejak saya beli kereta tersebut saya juga tidak menukar nama kerana ingin menukar selepas tamat polisi insuran. 3. Dengan ini saya juga mengesahkan bahawa Encik Suhaizan bin Cik Idris adalah abang kepada kawan pemilik kereta iaitu Encik Muhammad Mokhzani Firdaus bin Mamat. 28 4. Pada mulanya Encik Muhammad Mokhzani bin Mamat (pemilik kereta tersebut) telah menjual kereta nombor pendaftaran NAV 3501 kepada kawan beliau iaitu Encik Salim bin Cik Idris tanpa menukar nama. 5. Disini saya juga dimaklumkan bahawa, selepas beberapa bulan kemudian Encik Salim bin Cik Idris telah memberi kereta tersebut kepada abang kandungnya iaitu Encik Suhaizan bin Cik Idris untuk kegunaan peribadi. 6. Dengan ini saya mengesahkan bahawa, selepas setahun kemudian Encik Suhaizan bin Cik Idris telah menjual kereta nombor pendaftaran NAV 3501 kepada saya dengan harga sebanyak RM3,500.00 melalui Pengurus saya. Beliau juga telah serahkan semua dokumen-dokumen pada saya dan juga tidak membuat apa-apa perjanjian. 7. Dengan ini saya mengesahkan bahawa, saya telah membeli kereta tersebut pada bulan Januari 2016 (tarikh beli tidak pasti) tanpa menukar nama. Pada 1hb Mei 2016 kereta nombor pendaftaran NAV 3501 telah terlibat satu kemalangan jalan raya iaitu di KM 49.5, Jalan Kuala Lumpur – Ipoh, Batang Kali, Selangor. 8. Saya mengesahkan, kereta nombor pendaftaran NAV 3501 telah mengalami kerosakan teruk pada bahagian hadapan dan kereta masih berada di sebuah bengkel di Rasa, Hulu Selangor. Eksibit “M-5” SURAT AKUAN BERKANUN 29 “Saya, Muhammad Mokhzani Firdaus bin Mamat, No. Kad Pengenalan: 821205-11- 5003, yang beralamat di 18-A, Kampung Dendang, 23000 Dungun, Terengganu, dengan sesungguhnya berikrar bahawa kenyataan yang diberi di bawah adalah benar: 1. Dengan ini saya mengesahkan bahawa, saya adalah bekas pemilik sah kereta nombor pendaftaran NAV 3501 jenis Proton Iswara. 2. Dengan ini saya mengesahkan bahawa, saya telah jualkan kereta nombor pendaftaran NAV 3501 pada bulan Julai tahun 2013 (tarikh tidak pasti) kepada kawan saya bernama Encik Mahyee (nama samaran). 3. Disini saya juga mengesahkan bahawa menjual kereta nombor pendaftaran NAV 3501 dengan harga RM3,000.00 dan menyerah semua dokumen-dokumen berkaitan dengan motorkar tersebut kepada kawan saya Encik Mahyee. 4. Dengan ini saya mengesahkan bahawa, kawan saya bernama Encik Mahyee (nama samaran) berjanji, beliau akan menukar nama pemilik dalam kad pendaftaran kenderaan secepat mungkin. 5. Disini saya juga mengesahkan, bahawa saya tidak tahu penukaran nama belum dibuat dan pada masa yang sama juga saya tidak pasti bila kereta telah dijual semula oleh abang Encik Mahyee kepada kawannya. 6. Pertukaran tangan kereta nombor pendaftaran NAV 3501 kepada kawan abang Encik Mahyee, berlaku tanpa pengetahuan mahupun kebenaran dari saya. 30 7. Pada 3hb bulan Mei tahun 2017 saya juga terima panggilan daripada Encik Nazir Penyelaras Insuran mewakili Syarikat Insuran AmGeneral Insurance Berhad dan diberitahu berkenaan kemalangan kereta bernombor pendaftaran NAV 3501, pada 1.05.2016 di KM 49.5, Jalan Kuala Lumpur – Ipoh, Rasa, Hulu Selangor, Selangor, dan nama saya masih didaftar sebagai pemilik di JPJ. 8. Disini saya juga mengesahkan bahawa saya tidak terlibat dalam apa-apa kemalangan jalanraya di KM 49.5, Jalan Kuala Lumpur – Ipoh, Rasa, Hulu Selangor, Selangor, pada 1.5.2016 dan saya juga tidak pernah melalui di kawasan Daerah Hulu Selangor, Selangor sebelum ini. 9. Saya juga mengesahkan yang kenderaan motorkar nombor pendaftaran NAV 3501 telah pun dijual kepada kawan saya Encik Mahyee (Julai 2013) sebelum kemalangan tersebut. [30] Berhubung dengan Surat Akuan Berkanun Defendan Pertama dan Defendan Kedua, Mahkamah ini berpandangan bahawa Surat-Surat Akuan Berkanun ini adalah satu pengakuan bersumpah Defendan Pertama dan Defendan Kedua berkenaan penjualan dan pembelian motokar tersebut untuk tempoh dari tahun 2013 sehingga tahun 2016. Surat-Surat Akuan Berkanun ini selagi ia tidak dicabar kesahihannya dan kebenarannya, pengataan-pengataan yang 31 terkandung di dalamnya adalah pengataan-pengataan yang sah dan masih berdiri. [31] Defendan Pertama dan Defendan Kedua telah tidak memfailkan apa- apa afidavit bagi menafikan pengataan Plaintif mengenai fakta-fakta pertukaran tangan motorkar NAV 3501 berdasarkan Surat-Surat Akuan Berkanun Defendan Pertama dan Defendan Kedua. [32] Di dalam kes ini, hakikat yang nyata dan jelas adalah Defendan Pertama dan Defendan Kedua telah tidak memfailkan apa-apa afidavit bagi menentang permohonan Plaintif dan Defendan Pertama dan Defendan Kedua juga tidak mempertikaikan /menafikan akuan bersumpah mereka mahupun pengataan-pengataan fakta yang telah dinyatakan oleh Plaintif di dalam afidavit sokongannya. [33] Justeru itu, dengan ketiadaan sebarang penjelasan/penerangan dari Defendan Pertama dan Defendan Kedua, maka pengataan- pengataan fakta berlakunya pertukaran tangan motorkar NAV 3501 itu dianggap telah tidak dicabar. 32 [34] Adalah menjadi prinsip undang-undang yang jelas dan mantap bahawa berhubung penilaian keterangan afidavit apabila terdapat pengataan-pengataan positif terhadap fakta-fakta yang dideposkan di dalam afidavit, kegagalan pihak lawan untuk menyangkal atau mencabar pengataan-pengataan atau fakta tersebut akan dianggap sebagai pengakuan akan pengataan-pengataan kepada fakta tersebut. (Sila lihat: i. Ng Hee Thoong & Anor v Public Bank Bhd [1995] 1 MLJ 281 ii. Sunrise Sdn. Bhd. v First Profile (M) Sdn Bhd & Anor [1996] 3 MLJ 533) [35] Di samping itu, Mahkamah ini bersetuju dengan hujahan Plaintif bahawa Defendan Ketiga yang bukan pihak-pihak di dalam transaksi- transaksi pertukaran tangan motokar NAV 3501 tersebut adalah merupakan pihak asing berkenaan perkara-perkara penjualan motokar tersebut, maka pastinya Defendan Ketiga adalah di dalam posisi/kedudukan tidak mempunyai pengetahuan langsung mengenainya. Oleh itu, mana mungkin beliau mempunyai keupayaan untuk mempertikaikan kewujudan transaksi-transaksi tersebut. 33 [36] Mahkamah ini juga merujuk kepada peruntukan seksyen 91(1)(b) APJ 1987 yang memperuntukkan berikut: “(b) menginsuranskan bagi seseorang atau kumpulan orang sebagaimana dinyatakan dalam polisi itu berkenaan dengan apa-apa liabiliti yang ditanggung olehnya atau oleh mereka berkenaan dengan kematian atau kecederaan tubuh badan terhadap mana- mana orang yang disebabkan oleh atau yang timbul daripada penggunaan kenderaan motor itu atau perkakas tanah yang ditarik olehnya di jalan:” [37] Undang-undang mengenai polisi insurans yang diambil bagi sesuatu kenderaan adalah jelas. Bagi maksud sesuatu polisi insurans bagi mana-mana kenderaan, seksyen 91(1)(b) APJ memperuntukkan bahawa sesuatu polisi insurans mestilah yang dikeluarkan oleh penanggung insurans yang menginsuranskan bagi seseorang atau kumpulan orang yang sebagaimana yang dinyatakan dalam polisi itu “persons or class of persons as may be specified in the policy”. 34 [38] Polisi insurans yang dikeluarkan oleh Plaintif kepada Defendan Kedua adalah dengan jelas menyatakan bahawa polisi insurans berkenaan hanya melindungi “any other persons who is driving on the Policyholder’s order or with their permission” dan “Use only for social, domestic and pleasure purposes and by the Policy holder in person in connection with his business” [39] Mahkamah ini bersetuju dengan hujahan Plaintif di dalam kes ini bahawa polisi insurans yang dikeluarkan oleh Plaintif sebagai penanggung insurans dan Defendan Kedua iaitu pihak yang diinsuranskan adalah satu kontrak persendirian yang nyata tidak boleh dipindahmilik dan / atau diganti nama. Ini jelas berdasarkan otoriti-otoriti yang dirujuk oleh peguam Plaintif. (Sila lihat : i. Peters v General Accident & Life Insurance Corpn. Ltd [1937] 4 AER 628. ii. New India Insurance Co Ltd v. Simirah [1966] 2 MLJ 1. iii. Roslan Bin Abdullah v. New Zealand Insurance Co. Ltd [1981] 2 MLJ 324. iv. Kurnia Insurans (Malaysia) Berhad v. Personal Representative Of Zenol Saad & Ors [2013] 1 LNS 239.) 35 [40] Memetik apa yang diputuskan di dalam kes Peters v General Accident & Life Insurance Corpn. Ltd [1937] 4 AER 628 apabila seorang tuanpunya kereta menjual keretanya, polisi insurans secara otomatik telah luput kuatkuasanya dan tidak lagi boleh dikuatkuasakan. Undang-undang berkenaan polisi insurans di dalam hal penjualan mana-mana kenderaan adalah jelas dan jitu. [41] Atas alasan ini sahaja, Mahkamah ini berpandangan bahawa Plaintif adalah berhak mendapat deklarasi yang dipohon. [42] Peguam Defendan Ketiga telah berusaha untuk menyakinkan Mahkamah ini atas kebertanggungan Plaintif dengan cuba bersandarkan kepada perjanjian MIB (Memorandum of Agreement) yang mana telah dihujahkan bahawa Plaintif adalah insurer concerned di dalam Klausa 1 (iv) yang dibacakan seperti berikut: “Insurer Concerned means the Insurer who at the time of the accident which gave rise to a liability required to be insured by the Compulsory Insurance Legislation was providing in insurance against such liability in respect of the vehicle arising out of the use of which the liability of the 36 Judgment Debtor was incurred. An insurer is concerned within the meaning of this Agreement notwithstanding that – (i) ... (ii) ... (iii) ... (iv) ... (v) ... (vi) there was a transfer of interest in the vehicle which the insurance purports to cover unless:- (a) subsequent insurance has been effected to cover the vehicle, OR (b) the insurance was cancelled, at the request of the policy- holder. Strictly in accordance with the provisions of the Road Transport Act. ...” [43] Mahkamah ini sedar kewujudan perjanjian MIB atau Memorandum of Agreement ini di mana perjanjian MIB ini adalah satu perjanjian dalaman (Domestic MIB Agreement/ Memorandum of Agreement) di antara MIB dan syarikat-syarikat insurans Malaysia. Namun penelitian Mahkamah ini atas perjanjian MIB ini, “Insurer Concerned” di dalam perjanjian MIB telah ditakrifkan seperti berikut: 37 “Insurer Concerned” means the Insurer who at the time of the accident which gave rise to a liability required to be insured by the Compulsory Insurance Legislation was providing an insurance against such liability in respect of the vehicle arising out of the use which the liability of the Judgment Debtor was incurred. [44] Di dalam erti kata lain, penanggung insurans berkaitan bermaksud penanggung insurans pada masa kemalangan yang menimbulkan atau menyebabkan kepada satu tanggungan yang diinsuranskan oleh undang-undang insurans (Compulsory Insurance Legislation). [45] Di dalam kes ini, pihak Plaintif apabila mengetahui bahawa motokar NAV 3501 telah dijual tanpa pengetahuannya, telah membuat permohonan ke Mahkamah ini untuk mengelak atau menafikan liabilitinya menurut undang-undang. [46] Di dalam kes ini, Mahkamah ini berpandangan bahawa Plaintif tidak boleh diletakkan tanggungan atau liabiliti dalam kes tuntutan Defendan Ketiga kerana polisi insurans yang dikeluarkan adalah 38 kepada Defendan Kedua secara peribadi (personal) yakni pemegang polisi dan bukannya Defendan Pertama yang telah membeli motokar tersebut daripada Defendan Kedua sejak tahun 2013 lagi. (Sila lihat: New India Assurance Co. Ltd v Simirah [1966] 2 MLJ 1). [47] Di samping itu, di dalam perjanjian MIB( Memorandum of Agreement) itu sendiri terdapat Circular Resolution bertarikh 6hb Jun 1994 yang telah memasukkan kriteria-kriteria seperti berikut: A. CRITERIA FOR INSURER CONCERNED CLAIMS TO BE UNDERTAKEN BY MIB 3. PROOF FOR TRANSFER OF INTEREST CASE (a) To prove transfer of interest, an insurer MUST provide the following to the Bureau :- (i) Statutory declaration of the insured affirming the sale of the vehicle prior to the accident; AND 39 (ii) sale and purchase agreement or any proof of sale (e.g. receipt for down payment or full payment) confirming the transaction prior to the accident. OR (i) statutory declaration of the insured affirming the sale of the vehicle prior to the accident; AND (ii) statutory declaration of the buyer and/ or subsequent buyers confirming the transaction prior to the accident. UNLESS BOTH criterion in either of the above instances are provided, the claim remains the responsibility of the insurer to handle. (b) Police reports lodged by the insured and/or buyer on the alleged transaction may also be provided to the Bureau, if available. (c) … 4. CUT-OFF DATE FOR TRANSFER OF INTEREST CASE TO BE UNDERTAKEN BY MIB (a) Claims arising from accidents occurring on 1.1.1992 and thereafter involving transfer of interest can be referred to the Bureau 40 immediately upon ratification of the amendments to the Domestic Agreement by members. [48] Di dalam hal ini, daripada kriteria yang dinyatakan di atas adalah jelas bahawa MIB telah bersetuju bahawa sekiranya terdapat sebarang pemindahan kepentingan (‘transfer of interest’) apabila kenderaan yang diinsuranskan oleh Plaintif telah dijual, Plaintif boleh merujuk perkara ini kepada MIB dan/atau MIB akan mengambil alih kes ini daripada pihak insurans. [49] Di dalam kes ini, telah jelas dibuktikan oleh Plaintiff melalui Surat- Surat Akuan Berkanun oleh Defendan Pertama dan Defendan Kedua bahawa motokar NAV 3501 itu telahpun dijual oleh Defendan Kedua kepada Defendan Pertama sebelum kemalangan berlaku dan Plaintif langsung tidak mengetahui transaksi ini sehingga kes tuntutan kemalangan difailkan di Mahkamah Sesyen Kuala Kubu Bharu dan satu penyiasatan dijalankan oleh Plaintif. [50] Di dalam hal ini, makanya, apabila kenderaan yang diinsuranskan oleh Plaintif bagi kepentingan Defendan Kedua itu telah dijual oleh 41 Defendan Kedua kepada Defendan Pertama, Plaintif bukanlah lagi ‘insurer concerned’, atas sebab polisi insurans adalah peribadi (personal) kepada pemegang polisi iaitu Defendan Kedua dan Defendan Pertama tidak boleh mendapat sebarang keuntungan atau kepentingan dalam polisi insurans yang dikeluarkan kepada Defendan Kedua oleh Plaintif. [51] Justeru, di dalam kes ini, Plaintif sebagai penginsurans Defendan Kedua hanya bertanggungjawab untuk menginsurans Defendan Kedua sahaja, dan pemandu yang dibenarkan sahaja yang menunggang “on the Policyholder’s order or with their permission” dan digunakan “only for social, domestic and pleasure purposes and by the Policyholder in person in connection with his business” [52] Di dalam kes ini, motorkar NAV 3501 yang diinsuranskan oleh Plaintif telah dipandu oleh seorang yang tidak mendapat kebenaran (non- authorised driver) dan oleh itu, Plaintif sebagai penginsurans Defendan Kedua tidak mempunyai apa-apa tanggungan kerana Defendan Kedua tidak bertanggungan dalam kejadian kemalangan 42 dengan Defendan Ketiga memandangkan motokar tersebut telah dijual oleh Defendan Pertama sebelum kemalangan tersebut berlaku. [53] Kes Nanyang Insurance Co. Ltd yang dirujuk oleh peguam Defendan Ketiga adalah tidak terpakai di dalam kes ini kerana di dalam kes tersebut Mahkamah Persekutuan telah memutuskan bahawa pemilik motorkar masih mempunyai ‘insurable interest’ kerana telah menyewakan kenderaan beliau dan pembeli pula mempunyai persetujuan untuk menggunakannya daripada pemilik sehingga segala bayaran ansuran telah selesai. Di dalam kes ini ia tidak melibatkan isu penyewaan kenderaan. Alasan / isu lain yang telah dibangkitkan oleh Defendan Ketiga di dalam Hujahan Bertulisnya tetapi tidak diplidkan di dalam Afidavit Jawapannya [54] Mahkamah ini perlu menekankan bahawa peguam Defendan di dalam hujahan bertulisnya telah juga membangkitkan satu alasan lain yang tidak dipilidkan beliau di dalam afidavit jawapannya di 43 Kandungan 5. Oleh itu, isu atau alasan tersebut tidak dibalas oleh Plaintif ataupun peguam beliau. [55] Alasan/isu yang dibangkitkan oleh peguam Defendan Ketiga hanya di dalam hujahan bertulis adalah Plaintif telah dikatakan lewat di dalam memohon perintah deklarasi bahawa polisi insurans JVD 0696084 tersebut adalah tidak sah dan “voidable”. Menurut peguam Defendan, permohonan sepatutnya dibuat oleh Plaintif sebelum kemalangan berlaku atau sebelum liabiliti timbul dan bukannya selepas kemalangan berlaku. Adalah dihujahkan selanjutnya oleh peguam Defendan Ketiga bahawa tanggungan / liabiliti di dalam seksyen 96(1) Akta Pengangkutan Jalanraya 1987 (APJ 1987) ini merujuk kepada kemalangan yang berlaku dan bukannya pada tarikh mahkamah memutuskan liabiliti atau tanggungan. [56] Di dalam perkara isu yang tidak dibangkitkan di dalam pliding/keras kausa, pertamanya, undang-undang adalah jelas dan mantap bahawa pihak-pihak adalah terikat kepada plidingnya atau terikat dengan kertas kausanya. Oleh itu, tidak ada keperluan untuk Mahkamah ini untuk menentukan dan menimbangkan isu ini. 44 [57] Namun bagi tujuan kesempurnaan, Mahkamah ini akan menyentuh secara ringkas mengenainya. Di dalam hal liabiliti atau tanggungan ini, Mahkamah ini tidak boleh lari dari merujuk kembali kepada peruntukan seksyen 96(1) APJ berkenaan “judgment in respect of any such liability” sebelum pihak Plaintif boleh didapati bertanggungan. Takrifan perkataan liabiliti “liability” atau tanggungan ini telahpun dinyatakan dengan jelas oleh Mahkamah Persekutuan di dalam kes Malaysia National Insurance Sdn Bhd v. Lim Tiok [1997] 2 CLJ 351 seperti berikut:- “It is therefore not unfair to say that “liability” in law, unless the context otherwise requires, means a duty owed to another enforceable by sanctions. However, when used in the context of liability insurance ordinarily means liability to pay a definite sum imposed by a final judgment against an insured or by an award or a settlement by way of an agreement”. (penekanan oleh Mahkamah) 45 [58] Justeru, telah diputuskan oleh Mahkamah Persekutuan bahawa liabiliti yang ditanggung oleh penanggung insurans adalah tanggungan membayar jumlah yang dikenakan oleh penghakiman terhadap orang yang dinsuranskan atau awad ataupun perjanjian penyelesaian. Di dalam kes ini, Plaintif telah menafikan liabilitinya dengan pemfailan permohonan ini untuk mendapat penetapan Mahkamah atas ketidakbertanggungannnya atas apa-apa tuntutan oleh Defendan Ketiga atas kemalangan yang berlaku antara motokar yang dipandunya dan motokar NAV 3501 dipandu oleh Defendan Pertama kerana Defendan Pertama bukanlah orang yang telah dinsurans di dalam polisi insurans tersebut dan pemanduan motokar NAV 3501 oleh Defendan Pertama bukan dengan kebenaran Defendan Kedua. Defendan Kedua sebagai pemegang Polisi insurans tidaklah bertanggungan secara vikarius terhadap Defendan Pertama yang memandu motokar tersebut apabila kemalangan berlaku. Di dalam kes ini, adalah dapatan Mahkamah ini bahawa tidak ada liabiliti wujud ke atas Defendan Kedua untuk ditanggung oleh Plaintif. 46 [59] Mahkamah ini suka merujuk kes Ahmad Sandara Lela Putera & Anor v. Queensland Insurance Co. Ltd [1975] 1 MLJ 269. Mahkamah di dalam kes Ahmad Sandara Lela Putra telah memutuskan bahawa pihak insurans tidak bertanggungan terhadap liabiliti yang mungkin diperolehi terhadap non-authorised driver seperti Defendan Pertama. Di dalam kes Ahmad Sandara Lela Putra ini, Ajaib Singh H telah merujuk kepada peruntukan seksyen 80(1) Road Traffic Ordinance 1958 yang sama dengan peruntukan seksyen 96(1) APJ . Antara lain telah diputuskan oleh Ajaib Singh H di muka surat 270 seperti berikut: “The Plaintiff claim against the defendant company must fail. A policy of insurance in respect of a motor vehicle is a contractual agreement between the parties concerned and subject to the statutory provisions in Part IV of the Road Traffic Ordinance 1958, relating to compulsory insurance against third party risks, the parties are absolutely free to decide on the terms and conditions that they wish to incorporate in the policy provided that those terms and conditions are not otherwise illegal or contrary to law. Section 79 of the Road Traffic Ordinance contains a list of restrictions which can have no application on the scope of policies relating to third party 47 risks but a stipulation restricting the driving of a vehicle to the insured himself is not one of the matters listed therein. In the present case the insured and the defendant company were in no way infringing any provision in the Road Traffic Ordinance by agreeing between themselves that the defendant company should not be liable in respect of any accident while the motor cycle was being driven by any person other than the insured himself. At the time of the accident the motor cycle was being driven not by the insured but by some other person and, therefore, as the motor cycle was being used outside the limits of the policy the defendant company was well within its right in repudiating liability. The defendant company was not under any risk in respect of the motor cycle within the terms and conditions of the policy at the time of the accident so that the judgment which the plaintiffs obtained against the insured was not a judgment in respect of a liability covered by the terms of the policy within the meaning of section 80(1) of the Road Traffic Ordinance, 1958.” [60] Di dalam hal ini Mahkamah ini perlu merujuk kepada seksyen 96(2)(a) APJ 1987. Seksyen 96(2)(a) APJ 1987 yang telah memperuntukkan bahawa: 48 “Tiada apa-apa jumlah wang kena dibayar oleh seseorang penanggung insurans di bawah subseksyen (1) – berkenaan dengan apa-apa penghakiman, melainkan sebelum atau dalam masa tujuh hari selepas bermulanya prosiding yang penghakiman itu diberi, penanggung insurans itu telah mengetahui mengenai prosiding tersebut; ……”(Penekanan Mahkamah ini) [61] Di dalam kes ini, apabila dibaca perenggan 4 afidavit Mohamad Iqbal bin Yahya (Afidavit sokongan Plaintif, Kandungan 2), Mohamad Iqbal telah menyatakan bahawa pihak Plaintif telahpun diserahkan dengan notis statutori menurut seksyen 96(2) APJ 1987 tetapi tidak dinyatakan bila. Manakala, di perenggan 5 Kandungan 2, Mohamad Iqbal telah menyatakan bahawa tuntutan sivil di Mahkamah Sesyen tersebut telah difailkan oleh Defendan Ketiga pada bulan Jun 2016. [62] Di dalam kes ini, notis statutori menurut seksyen 96(2) APJ 1987 telah diserahkan kepada pihak Plaintif oleh Defendan Ketiga. Fakta ini tidak disangkal oleh mana-mana pihak pun dan bukannya isu yang dipertikaikan. Oleh itu tidak ada dapatan perlu dibuat oleh Mahkamah ini mengenainya. 49 [63] Berdasarkan alasan-alasan di atas, Mahkamah ini telah membenarkan Kandungan 1 Plaintif. Memandangkan di dalam kes ini Plaintif tidak menuntut kos, maka tidak ada perintah kos diberikan oleh Mahkamah ini. ..................................................... (DATUK AZIMAH BINTI OMAR) Hakim Mahkamah Tinggi Shah Alam Selangor Darul Ehsan Bertarikh 25 Ogos 2017 Peguam Plaintif - Tetuan Kenneth William & Associates Encik Ang Boon Chong Peguam Defendan - Tetuan Manikam Avadiar & Co. Encik Mahendran

Tika 2.6.0

22C-28-07/2015

PLAINTIF Keller (M) Sdn Bhd DEFENDAN 1. Ong Leong Chiou; 2. PS Bina Sdn. Bhd. 3. Perfect Selection Sdn. Bhd. 4. Bina Puri Holdings Sdn Bhd

25/08/2017

YA DATO' LEE SWEE SENG

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=4910c457-7662-454c-9d61-1731fb5f3f20&Inline=true

1 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF WILAYAH PERSEKUTUAN, MALAYSIA (CIVIL DIVISION) CIVIL SUIT NO: 22C-28-07/2015 BETWEEN KELLER (M) SDN. BHD. (COMPANY NO. 24057-T) … PLAINTIFF AND 1. ONG LEONG CHIOU (I/C NO. 741009-14-5475) 2. PS BINA SDN. BHD. (COMPANY NO. 1064980-U) 3. PERFECT SELECTION SDN. BHD. (COMPANY NO. 622301-K) 4. BINA PURI HOLDINGS BERHAD (COMPANY NO. 207184-X) … DEFENDANTS THE JUDGMENT OF Y.A. LEE SWEE SENG [1] The main issue in this trial is whether the First, Second and Third Defendants (“D1, D2 and D3”) are liable jointly and severally to the Plaintiff for what the Plaintiff said is the amount due for work done with respect to the Empty Bore Works (“EBW”) as part of the contract 2 entered into with D2 when D2 and D3, under the control of D1, knew that they would not be paid for these Works by their respective principals. [2] This Court would have to unravel the relationship between the parties and the role played by D1 and another Defendant under its control i.e. D3 in what on the surface, based on the concept of separate legal entity, appears to be a case of merely a breach of the contract by D2. The stand of D1 and D3 is that any fall out should be confined to just D2 as the contracting party. [3] Like all allegations of fraud, both actual and equitable and even the use of devices and entities to evade one's contractual obligations, this Court would have to probe deeper beneath the surface. Is there something more sinister beneath the smooth veneer of separate legal entities and the privilege of arranging one's business and managing risk such that any financial exposure cannot be limited to the contracting entity but be extended to other related entities in the web of deceit dressed up to deflect any suspicion of something amiss? Parties [4] The Plaintiff is part of the Keller Group, an independent ground engineering specialist. They have a considerable presence in Malaysia, 3 having being involved in a few mega projects with respect to designing and delivering geotechnical solutions for projects carried out by the Government of Malaysia, namely, RAPID project, the SMART tunnel system, Ipoh Rawang Double Track Project, Pahang Selangor Raw Water Transfer Project, East Coast Expressway PH11, Penang Sewage Treatment Plant and Tun Razak Exchange Project. [5] D1 is Ong Leong Chiou, a businessman, also known as Tony Ong. He held himself out as having a close relationship with the controlling shareholders of Bina Puri Holdings Berhad, the 4th Defendant (D4). He is the Managing Director and the controlling shareholder of D3, Perfect Selection Sdn Bhd, holding 70% of its share. The other 30% of its shares is held by the other director Mr Liew Pok Boon. In its filing with Companies Commission of Malaysia, D3's nature of business is stated as “General Building Sub-Contractor”. [6] D2 is PS Bina Sdn Bhd. It was incorporated by D1 on 4.10.2013. D1 is the Managing Director and the largest shareholder in D2 and the other directors are Mr Chang Sin Fei and Mr Liew Pok Boon and their shareholdings are 40:30:30 respectively. D2 has the same registered address and company secretaries with D3. It did not have a business address. In its filing with Companies Commission of Malaysia, D2’s nature of business is stated as “Construction of Buildings”. 4 [7] D4 is a development and construction company listed in the Malaysian Stock Exchange. It is the main-contractor of a construction project known as the ‘Melawati Mall Project’. The Project [8] The Melawati Mall Project is a project to construct a 10 storey shopping mall and business complex in Pusat Bandar Melawati, Kuala Lumpur (“the Project”). The owner of the Melawati Mall Project is a joint venture between Capita Malls Asia and Sime Darby Property. [9] The Plaintiff's involvement with this Project is with respect to Contiguous Bore Pile ("CBP") Works, Foundation Bore Pile ("FBP") Works and Ground Anchors ("GA") Works (collectively called “the Works”). [10] Sometime around 13.9.2013, the Plaintiff received a facsimile from Mr Chang Sin Fei on behalf of CTF Build Sdn Bhd, enclosing an ‘Invitation to Quote’ inviting the Plaintiff to quote for the CBP Works and FBP Works also known as "Bored Cast In Situ Piling" Works for the Project. For this purpose the Plaintiff received 2 blank bills of quantities attached, i.e. Bill No. 2 for the CBP Works (“Blank Bill No. 2”) and Bill No. 4 for the FBP Works (“Blank Bill No. 4”). 5 [11] After meeting Mr. Chang Sin Fei at D3's office, sending and revising quotations with a company known as CTF Build Sdn Bhd, a Letter of Award was issued by D2 to the Plaintiff on 21.10.2013 for a provisional sum of RM17.6 million. [12] D2 had never before this been mentioned at any discussions or exchanges. The Plaintiff was rather puzzled and uncomfortable. They did a company search on D2 and noticed that D2 had just been incorporated on 4.10.2013. Clearly it was a company with no track record. [13] The Plaintiff was thus put on inquiry and they decided not to return the Letter of Award for CBP Works to D2 until after they had met the persons behind D2. As matters transpired, PW1 Ir Yee Yew Weng, the Plaintiff’s Managing Director, met D1 on 4.11.2013. According to the Plaintiff, D1 spoke words of reassurance and represented to them that he knew Tan Sri Tee (“TST”) very well, a major shareholder of D4. He had organised a lot of youth activities for the ‘Hokkien Association’ for TST. That was how he got the job for the Melawati Mall. D1 held out TST as having a vested interest in D2. D1 spoke of D2 as a company under his control and that there was no cause for worry. To further allay the Plaintiff's fears, he assured the Plaintiff that he could secure a guarantee from D4 to guarantee payment for the Works. 6 [14] Their fears were kept at bay with those representations and in particular, the assurance that D1 would secure a guarantee from D4. [15] After that meeting, the Plaintiff returned the signed Letter of Award for CBP Works to D2. The Plaintiff then proceeded on the same day to send its quotation ‘Commercial Proposal Nr 21.181.2418 dated 04 November 2013’ to D2 for the attention of D1, having known by then that D1 is the managing director of D2. [16] The quote was based on the information of the Works contained in Blank Bill No. 4 that the Plaintiff had previously received. The quotation for FBP Works was revised on 9.11.2013 from RM13,627,510.40 to RM13,125,000.00 via ‘Final Commercial Proposal Nr 21.181.2418 dated 09 November 2013’ (“the 9.11.2013 Proposal”). [17] D2 issued a Letter of Award on 12.11.2013 accepting the 9.11.2013 Proposal and appointing the Plaintiff to carry out the FBP Works for a provisional sum of RM13,125,000.00 (“the FBP Contract”). [18] The Plaintiff was careful to ensure that the representation of D1 on 4.11.2013 that D4 would provide the guarantee found its way into the FBP Contract in clause 23 as follows: “This Letter of Award pursuant to the terms and subject to the conditions set out in this Agreement, shall in all respects be 7 conditional upon the Main Contractor depositing with the Sub- Contractor a guarantee from Bina Puri Holdings Berhad to the satisfaction of Sub-Contractor (“the Conditional Precedent”) within 14 days from the date of this Letter of Award (“Cut Off Date”). In the event the Condition Precedent is not fulfilled or satisfied by the Cut-Off Date, Sub-Contractor shall be entitled to terminate this Letter of Award by giving notice in writing to Main-Contractor.” [19] After the FBP Contract, D2 issued a Letter of Award dated 7.2.2014 to the Plaintiff appointing them to carry out Ground Anchors works (“GA Works”) for a provisional sum of RM7,200,000.00 (“GA Contract”). Similarly, the GA Contract also provided for D4’s guarantee for the Plaintiff. Problem [20] There is a peculiar clause in the FBP Contract which later proved to be problematic and indeed the fodder that had fueled the present feud. In the 9.11.2013 Proposal, which was part of the FBP Contract, it was inter alia, provided that: “the empty bore quantity is not captured in the attached Bill of Quantities. However, our soil drilling length shall be measured from the toe of bored pile to top of Working Platform e.g. Existing 8 Ground Level (at point of boring) and payable at soil boring rate respectively”. (emphasis added) [21] These works are hereinafter known as “Empty Bore Works” (“EBW”). [22] The Plaintiff in their previous proposal Nr. 21.181.2400 dated 19.9.2013 had also made clear at paragraph 7 as follows: “…our basis of offer is as follows…Soil drilling will be measured from the toe of bored pile to top of working platform” (emphasis added) [23] The FBP Works proceeded rather expectedly with the Plaintiff being paid against D2's certification of the Works done submitted in the form of Interim Progress Claim ("IPC"). It was the calm before the storm that was brewing. [24] Problem began to precipitate with IPC No. 6 for period ending 25.6.2014, and the corresponding Certificate, which was supposed to be Certificate No. 8 but was late. The Certificate was contractually to be issued by D2 within 15 days after IPC. When it was received only on 5.9.2014 a whopping sum of RM4,520,824.21 for EBW had been reversed out! The FBP Works had already been completed by 22.7.2014. The Plaintiff submitted that it was not sheer coincidence that 9 the decertification continued until the whole of the EBW of RM7,462,720.19 were completely reversed out only after the completion of the FBP Works. It was so timed such that the EBW had to be completed first for otherwise it might be stalled or stopped and that would be of no benefit to D2 and D3. [25] Upon further inquiry it was discovered that in D4's contract with D3, it was stated that D3 would not be paid for the EBW. The effective part of their contract with the heading “Unconcreted (Empty) Bore” reads: “The unit rate of the pile shall be deemed to include whatever empty bore above the cut off level of the pile. No claim will be considered for any empty bore due to its sequence of construction” [26] The Plaintiff in putting the pieces together, could not escape the conclusion that fraud had been perpetrated by D1, D2 and D3 on them, in that whilst D3 was fully aware that the EBW would not be paid by D4 to D3, yet D3 under the control of D1 arranged for another of its newly incorporated company in D2 to enter into the FBP Contract wherein D2 had agreed to pay the Plaintiff some RM7 million plus of EBW under the FBP Contract. 10 [27] The Plaintiff's question is how is it that D2 could have so agreed to pay the Plaintiff when as it is, it has no other projects and further that under the control of D1, it was fully conscious that it would not be paid by D3, also under the control of D1? [28] Their fear of having been defrauded was further heightened when a search done on D2 soon after the completion of the FBP Works revealed that the shares of D1 and the other shareholders had been transferred to a Bangladeshi worker and another local Chinese, both of whom had disclosed only their workplace address in their filing with CCM. All the directors of D2 i.e. D1, Mr Chang Sin Fei and one Mr Liew Pok Boon had resigned as directors of D2. None of the new Directors of D2 came to Court to testify. [29] There were also other factors discussed below which caused the Plaintiff to pursue a claim for the losses suffered for not being paid for the EBW against D1, D2 and D3 jointly and severally in making out a claim for fraud, whether actual or equitable or that the said Defendants had conspired to unlawfully avoid and evade their contractual obligations and so justifying a lifting of the corporate veil where D1, D2 and D3 are concerned. 11 Prayers [30] Briefly the Plaintiff claimed against the Defendants as follows: (a) that D1, D2 and D3 be, jointly and/or severally, liable for RM7,462,720.19 for the Empty Bore Works; (b) that D1, D2, D3 and D4, be jointly and/or severally, liable for RM1,913,080.25 for the retention sum under the 3 contracts, i.e. CBP Contract, FBP Contract and GA Contract; (c) that D4 be liable for RM717,721.96 being the remainder sum agreed under the undertaking of RM3.5 million. [31] D2 also have a Counterclaim against the Plaintiff for RM1,324,868.11 for defective works. Principles Whether D2 is liable to the Plaintiff for the Empty Bore Works [32] The Plaintiff’s contract with D1 is clear in that the EBW will be paid. This is clear from the Proposal given by the Plaintiff and finally incorporated in the Letter of Award from D2 to the Plaintiff. There is thus no room for D2 to say that since they were not paid by D3, then they need not pay the Plaintiff. This is not a “Pay When Paid Contract.” As it now transpires, D3 would in turn not be paid by D4 because the 12 contract between them is such that EBW would not be payable. At the end of the day D2, down the chain, is not going to get paid for the EBW. D2 cannot import into its contract with the Plaintiff the terms of its contract with D3 where the non-payment of the EBW is concerned and cannot contend that payment would only be for the FBP from the toe to the base and not to the ground level. [33] The fact that D2’s contract with D3 and correspondingly D3’s contract with D4 provides that EBW would not be paid has no bearing on the contract between the Plaintiff and D2 which provides for such payment. [34] The Plaintiff has proved on the balance of probabilities, based on the evidence adduced, the sum claimed of RM7,462,720.19 as the amount outstanding based on the various Interim Progress Claims and Certificates before the unilateral reversal out or decertification by D2. Whether D2 has proved its counterclaim against the Plaintiff [35] D2 has a counterclaim mainly for rectification works and on the whole D2 has proved this on the balance of probabilities. There was no dispute or objection raised by the Plaintiff on this sum claimed by D2 at the material time. On the other hand there are contemporaneous documents produced by D2 to substantiate their counterclaim. I would 13 hold that on the balance of probabilities D2 has proved the counterclaim of RM1,324,868.11 and I would allow this to be deducted from the Retention Sum of RM1,913,080.25 that should be released by D2 to the Plaintiff as all the CBP, FBP and GA Works have been completed. Pronouncement [36] The net result is that D2 is liable to pay the Plaintiff the sum of RM8,050,932.33 and so I had allowed judgment to be entered by the Plaintiff against D2 for the said sum. This shall carry interest of 5% per annum from date of writ to realization. [37] As both the Plaintiff and D2 are not appealing against this order made and judgment given, I would not labour further on the analysis of the evidence adduced by the Plaintiff and D2 with respect to the Plaintiff’s claim for the EBW and D2’s counterclaim for the rectification works done. [38] I shall now focus on whether D1 and D3 can be made jointly and severally liable with D2 for the amount that is owing by D2 to the Plaintiff. Whether D1 and D3 knew that D2 would not be paid by D3 and D3 would not be paid by D4 for the EBW 14 [39] What is of critical importance is for this Court to determine if D1 and with him, D2 and D3 knew as a matter of fact that in D3’s contract with D4, the EBW would not be paid. If it can be shown on the balance of probabilities that D1, D2 and D3 knew as a matter of fact that D3 would not be paid for the EBW and that is for a sum of over RM7 million, what did they do when they discovered this? Did they immediately alert and advise the Plaintiff about this? Or did they continue with the hope that it would be paid somehow and so the Plaintiff would be paid so that the EBW would be completed? [40] The Plaintiff’s proposal and contract with D2 is clear. In the Proposal of 9.11.2013 that forms part of the FBP Contract with the Plaintiff it is expressly stated as follows: “…the empty bore quantity is not captured in the attached Bill of Quantities. However, our soil drilling length shall be measured from the toe of bored pile to top of Working Platform e.g. Existing Ground Level (at point of boring) and payable at soil boring rate respectively.” (emphasis added) [41] It is telling that D2 had never objected, rebutted or disputed this term of the contract between them and the Plaintiff. Throughout the negotiations, D1 gave many assurances to the Plaintiff that there was 15 nothing to worry because of his close connection with D4 and its key shareholder TST. [42] What then is the term in the contract between D3 and D4 where the EBW is concerned? The effective part of their contract with the heading “Unconcreted (Empty) Bore” reads: “The unit rate of the pile shall be deemed to include whatever empty bore above the cut off level of the pile. No claim will be considered for any empty bore due to his sequence of construction” [43] As explained by the Plaintiff the FBP Works requires the Plaintiff to excavate bore holes from the Working Platform which is the platform that was given to the Plaintiff to work on, to a certain designated depth (“Pile Toe”). Concrete would then be poured into the bore holes up to a certain designated height as (“Cut-Off Level”) to form the bore piles as per the design given to the Plaintiff. The length of the bore hole from the Working Platform to the Cut-Off Level is known as empty bore in that it is not filled by concrete. [44] The Plaintiff managed to take a photograph of 3 pages of the contract between the using a mobile phone in October 2014 during a meeting with the Defendants over the non-payment of the EBW. 16 [45] The fact that this is true is not disputed by the Defendants. Learned counsel for D1 and D3 said that the contract between D3 and D4 was dated 9.12.2013 but that between D3 and D2 was dated 12.12.2013 whilst the FBP Contract between D2 and the Plaintiff was much earlier, being dated 12.11.2013. [46] In essence what D1 and D3 are attempting to give, by way of impression, is that they did not know at the time of entering into contract between the Plaintiff and D2 that D4 would not be paying D3 for the EBW under the FBP Contract. [47] It is of course only too true that no one enters into a sub-contract without knowing the terms, specifications and the Bill of Quantities under the main contract and more especially the price. Otherwise how would D2 in this case know how to price the contract that it would eventually enter into with the Plaintiff at the behest of D1 who had held himself out as having secured the contract with D4 because of his close relationship with D4 and persuading the Plaintiff to accept contracting with D2, another company set up by him and Mr Chang Sin Fei, to execute the sub-structural works of the Project? [48] Evidence was led that D2 had claimed against D3 on 30.10.2013 for the period ending 25.10.2012 for a substantial sum of 17 RM2,734,204.40 suggesting that the Plaintiff had commenced work for D2 end of September or early October 2013. [49] D3’s purported first certificate to D2 was dated 4.12.2013 for period ending 31.10.2013. This shows that the rates were known to D3 before 9.12.2013 because the valuation of the works were done on 4.12.2013. [50] D3’s first claim to D4 was dated 31.10.2013 for period ending 31.10.2013 amounting to RM2,738,417.40. Pages 1263-1280 D1/3 BOD3. It enclosed D2’s claim to D3 dated 30.10.2013 including Bill of Quantities at pages 1264-1280 D1/3 BOD3. The Bill of Quantities enclosed showed at page 1274 of the same Bundle that D2 and D3 knew as early as before 30.10.2013 that “bored length shall be measured from the cut off level to pile” i.e. EBWs would not be paid. D4’s first certificate to D3 was dated 30.11.2013 for period ending 31.10.2013. In fact DW1 who is D1 reluctantly admitted that he knew of the terms of the contract between D3 and D4 before the FBP Works were awarded to the Plaintiff on 12.11.2013. [51] It would be stretching to incredulity to suggest that for a RM88 million contract D3 did not know the rates and terms of the contract and yet D3 could enter into a contract with D2 and D2 could enter into a contract with the Plaintiff for the agreed rates and terms. If anything it 18 underscores the fact that D1 was more than confident that even though the contract between D3 and D4 had not been inked until 9.12.2013, D1 through the instrumentality of D2 had no problem entering into the FBP Contract with the Plaintiff which expressly stated that EBW would not be paid. [52] If indeed the terms between D3 and D4 was initially that D4 had agreed to pay D3 for the EBW, then surely D3 could have called TST as witness. The witness that came on behalf of D4, one Mr Png Choon Yam as DW 4. did not testify to this effect. [53] On the balance of probabilities I would say that D3 knew of the terms of the contract with D4 that the EBW would not be paid, even before the execution of the contract between the Plaintiff and D2 on 12.11.2013 and with that, D1 too, for it was D1 that leveraged his influence with TST to secure the contract between D3 and D4 and who persuaded the Plaintiff to accept D2 as the contracting party for the FBP Contract. [54] D1’s fingerprints and footprints are all over D2 and D3, being companies and vehicles controlled by him in the overall scheme of executing the works for this Project. D1 is effectively the Managing Director of both D2 and D3 and a substantial and major shareholder as well in both D2 and D3. In the business card given by D1 to PW1, D1 19 described himself as the Managing Director of D3. See page 30 PBOD 4. [55] Even assuming for a moment that D3 was unaware of this before the execution of the contract with D4, D3 certainly knew about this that the EBW would not be paid by D4 when the contract was executed on 9.12.2013. As pointed out by learned counsel for Plaintiff that was the same date when the Plaintiff had started work on the EBW. See page 149 of PBOD1. On 30.12.2013 the Plaintiff had written to say that there would be around RM4.8 million worth of empty bore estimate and that EBW are payable (pages 566-68 PBOD3). There was surprising silence from D2 and by extension D1 and D3 as well; the kind of silence that speaks volume of D2’s culpable conduct, with full knowledge of D1 and D3. [56] The observation made by the Court of Appeal in David Wong Hon Leong v Noorazman bin Adnan [1995] 4 CLJ 155, CA at page 156 would resonate with the above matrix of facts: “There are cases – business and mercantile cases – in which the Courts have taken notice that, in ordinary course of business, if one man of business states in a letter to another that he has agreed to do certain things, the person who 20 receives that letter must answer it if he means to dispute the fact that he did so agree.” [57] It is not the version of D1 and D3 that they did not read the contract or that they were labouring under the impression that it would be paid nevertheless though contractually D4 is not obliged to pay D3 for the EBW. Whether D1, D2 and D3 having knowledge that EBW would not be paid by D4 to D3, are liable to the Plaintiff in the circumstances of the case where D2 is contractually obligated to pay the Plaintiff for EBW [58] The action and response of a genuine businessman would be to alert the Plaintiff about this and so sort out the problem of no payment for the EBW. At least 3 parties knew about this, D3 that signed the contract with D4, D1 who was instrumental in securing the contract for D3 from D4 and D2 that had entered into a total sub-contracting with D3 for a 2% commission fees to be paid by D2 to D3. D2’s knowledge is by virtue of D1 being the Director responsible for putting together D2 and D3 for the Project, being a common director and common controlling shareholder of D2 and D3. None of these 3 parties informed the Plaintiff of the predicament they were in i.e. How to pay the Plaintiff when they would not be paid by D4 for the EBW? 21 [59] That vital information was concealed from the Plaintiff by D1, D2 and D3 and for good reason. The Plaintiff might have cold feet proceeding for unless D2, a company incorporated just a month before the contract was entered into, had alternative sources of funds or are prepared to be out of pocket for RM7 million plus, the Plaintiff would not be paid or cannot reasonably be expected to be paid for the EBW. The Plaintiff would not want to proceed without ensuring that D4 would guarantee the total sum due under the whole contract between the Plaintiff and D2. [60] Already the Guarantee from D4 that D1 had represented that he would secure in favour of the Plaintiff for the whole of the contract sum in the FBP and the GA contracts was not forthcoming other than a limited Undertaking for the total sum of RM2 million. [61] Of course with both feet already placed and positioned at the site with the workers and machineries as well as the piles, it was too late to demobilize when the Guarantee from D4 that D1 had wanted to secure was not forthcoming other than for a total sum of RM2 million. [62] D1 is now trying to put the blame on the Plaintiff for not having stopped work when the Guarantee/Undertaking from D4 was not forthcoming. In other words D1 is in effect saying that it was a risk that the Plaintiff took and they only have themselves to blame. 22 [63] However the evidence led by the Plaintiff was that there was the plea and persuasion from D1 that the Plaintiff should not slow down or stop work altogether and that he would iron out whatever hiccups there might be for the late issuance of the Guarantee/Undertaking from D4. [64] The SMS between the Plaintiff’s Managing Director PW1 Mr Yee Yew Meng and D1 was clearly a representation from D1 reassuring the Plaintiff to carry on with the Works as payments would be forthcoming together with the Guarantee/Undertaking from D4. The relevant SMS are reproduced below and not disputed by D1: SMS dated 13.2.14 @ 9.01: “Gong Xi Fa Cai bro, need ur help. I heard Chang said your CFO is chasing the undertaking letter from BP and reluctant to mobile in new machine. The letter is just pending for Tan Sri Tee signature. I hope u can trust me and ask them to move forward” SMS dated 20.2.14 @ 5.55: “Bro, u back to KL? FYI I m very unhappy with ur man here as they bypass our company to deal with Bina Puri directly. Ur man not satisfy with the undertaking letter Bina Puri issued; if they not satisfy, come back to me instead of go directly to BP. Pls help ask ur man don’t do this la! Tqvm bro” SMS dated 25.2.14 @ 6.25: 23 “Dear Mr Yee, I understand that there is a problem at site; everyone is having a hard time waiting for ur bg36 to arrive. I was told that u make the decision not to deliver the bg36 until ur side get the undertaking letter from Bina Puri. FYI I was told we r working together to draft a new undertaking letter according to ur need. I deeply appreciate that u have constantly helping us, pls advise me while we r waiting for the letter, is there any other option so that the bg36 can be delivered? When u will be in KL bro? I can arrange a meeting with Tan Sri Tee if u think it is necessary. Tqvm” [65] D1 concealed from the Plaintiff that the guarantee that it wanted would not be given until the Plaintiff had incurred an amount owing of RM11 million in works. D1 peddled his influence and friendship with TST to lull and lure the Plaintiff into trusting him that all payments for the Works would be honoured. [66] It would have been different and the Plaintiff would only have themselves to blame if D1 had told the Plaintiff that the Undertaking from D4 is not forthcoming and that D4 is not paying D3 for the unconcreted bored piles or the EBW. D1 either on his own behalf or on behalf of D2 and D3 of which he is the Managing Director and controlling shareholder cannot in all honesty and fairness conceal this from the Plaintiff. To do so would be fraud on the Plaintiff! 24 [67] In fact the requirement of D2 having to procure a Guarantee for payment of the whole sum of the FBP Contract of over RM13 million was stated as a condition precedent such that if it was not procured then the Plaintiff may terminate the contract. The fact that such a Guarantee was not so procured is not so much a reflection that the Plaintiff had waived this requirement but more of the fact that D1 had breached his representation to the Plaintiff that he was in a position to procure the said Guarantee. [68] Finally instead of a Guarantee/Undertaking from D4 to pay the whole of the contract sum of the FBP Works and the GA Works of RM20.325 million there was an Undertaking to pay the Plaintiff limited to the sum of RM2 million by D4’s Letter of Undertaking dated 7.3.2014 to pay the Plaintiff direct up to a limit of RM2 million. [69] Very interestingly, DW4’s evidence on behalf of D4 was that D1 did not ask D4 to provide a direct undertaking or Guarantee to pay the Plaintiff for the whole sum of the FBP and GA Contracts. [70] I agree with the Plaintiff that strictly speaking there was no obligation for D4 to guarantee the Plaintiff any amount whatsoever because at the end of the day when the various contracts down the chain were signed, it transpired that D4 was contracting with D3 and D3 with D2 and then D2 with the Plaintiff. The Plaintiff was not even a sub- 25 contractor of D4 but instead a new company, had been interposed in between D3 and the Plaintiff i.e. D2 and that can only be at the behest of D1 who was negotiating with the Plaintiff on the one hand and D4 on the other. [71] There was no evidence of D2 and D3 writing to D4 for this Undertaking from D4 to pay direct to the Plaintiff for the whole of the FBP and GA Works. The representations made by D1 can thus be treated as being made on his own behalf to entice the Plaintiff into commencing the Works and continuing with it even when the Undertaking from D4 was not forthcoming until much later and even then for a limited sum or RM2 million. [72] Even if one were to believe that D3 through D1 was hopeful of persuading D4 to pay for the EBW of RM7 million plus and so saw no need to disclose this risk to the Plaintiff, one cannot run away from the fact that this was not a risk that the Plaintiff was aware of and which the Plaintiff had undertaken. [73] Starting from this knowledge of D1, D2 and D3 that D4 would not be paying for the EBW and that D1, D2 and D3 knew of the fact that contractually D2 had to pay the Plaintiff this shortfall of RM7 million plus for the EBW, are there other circumstances which when taken together with this knowledge would prove on the balance of probabilities the 26 intention of D1, D2 and D3 to defraud the Plaintiff or that of D2 to avoid its contractual obligation to the Plaintiff in that D2 was nothing but a mere fiction and facade where the EBW are concerned as from the very start of the Contract, there was no funds coming into D2 for payment to the Plaintiff for the EBW? This knowledge was possessed by D1 and the question is whether D1 had D2 interposed as another layer of company to shield D3 from the oncoming implosion in the making. The complete reversal of the payments due for the EBW only after its full completion. [74] As work progresses for the FBP, the Plaintiff would issue Interim Progress Claims (“IPC”) to D2 seeking payment from D2. D2 would then issue Certificates of Payment to certify the claims made in the IPCs. Learned counsel for the Plaintiff has summarized in their Main Submission the various IPCs from No. 1—17 for the period 27.1.2014 to 28.5.2015 and the corresponding Certificates issued by D2 for the relevant period and the relevant pages in Plaintiff’s Bundle of Documents 3 (“PBOD 3”). [75] As can be seen there was no problem with IPC No.1 for the period ending 25.1.2014 until IPC No. 5 for the period ending 26.5.2014. The corresponding certificates are Certificate No. 3 for 27 period ending 25.1.2014 to Certificate No.7 for period ending 25.5.2014. Throughout this period the EBW were paid. [76] Problem surfaced with IPC No. 6 for period ending 25.6.2014, the certificate, which was supposed to be Certificate No. 8 was late. Although the FBP Contract provided that certificates ought to be issued within 15 days after IPC, none was forthcoming. The Plaintiff issued reminder on 3.9.2014 to chase for it as the FBP Works were completed on 22.7.2014 but they did not receive the Certificate No. 8 until much later. [77] It hit the Plaintiff like a thunderbolt when Certificate No. 8 for IPC No. 6 for period ending 25.6.2014 was received on 5.9.2014. Lo and behold, a sum of RM4,520,824.21 for Empty Bore Works had been reversed out! In other words what had been previously certified and paid was now being ‘reversed’ or ‘decertified’. [78] This reversal continued in Certificate No. 9 for period ending 25.7.2014 received on 22.9.2014 when all the EBW previously certified and paid were completed reversed out. The amount of work done that had decreased in Certificate No. 9 together with the claim in IPC No. 7 that were not certified, amounted to RM7,448,384.68. [79] The amount of EBW in respect of the FBP Contract then outstanding was RM7,462,720.19 (“Unpaid EBW”) as shown by IPC No. 28 14 for period ending 25.2.2015 and Certificate No. 14 for the same period. [80] Very significantly this reversal only happened when the FBP Contract had been performed and completed on 22.7.2014. The Plaintiff submitted that this was planned with the sinister intention that when the Plaintiff discovered it, it was too late to stall or stop the EBW altogether for the simple reason that it had already been completed. [81] What is even more disturbing is that when there was a reversal out from the Certificates for the EBW in the Certificates between D4 and D3, these reversals were not correspondingly effected between D2 and the Plaintiff. [82] The reversal started around Certificate No. 5. Instead D2 actually certified for increase works being done with respect to the EBW and the reversal came suddenly with Certificate No. 8 onwards, by which time the FBP works had been completed. [83] Though there were variance even from Certificates No. 1-7 this was more in the nature of under-certification rather than decertification or reversal of prior certification. [84] D1 and D3 submitted that the Plaintiff actually knew about the reversal earlier but pleaded with D1 not to reverse out so drastically and 29 sharply until a solution could be found. I find that it is to no benefit to the Plaintiff to have suggested this as it would only postpone the problem of payment with no solution in sight. Moreover if the Plaintiff had known about the fact that they would not be paid for the EBW they would in all probability stop work unless there were convincing assurance given them that these EBW would be paid. On the balance of probabilities I would find the Plaintiff’s version more believable as it is consistent with the timing of the reversal of the payment for the EBW such that it was only put into motion after the completion of the FBP Works. [85] Even if I were wrong there, it does not change a jot that reversal of the EBW payments were made with objections by the Plaintiff and if at all the Plaintiff continued to complete the EBW even with knowledge that D3 had reversed out payment made to D2 because D4 had reversed payments to D3, it is that they had wanted to honor their FBP Contract with D2 which is to complete the FBP Works and with that the EBW for the agreed sum. The Plaintiff would then have to seek legal advice as to what are the options available to them now that D2 cannot pay as it was not paid by D3. It must not be forgotten that Plaintiff did not know that the contract between D3 and D4 expressly provided that EBW would not be paid until much later in the October 2014 meeting 30 with the parties to sort out the problem of payments; way after the EBW had already been completed. [86] I find on the balance of probabilities that there was a concerted effort to clandestinely conceal and delay the reversal of the certification for the EBW so as not to arouse suspicion on the part of the Plaintiff until the EBW were completed such that the Plaintiff could no longer stall or stop the said EBW for the simple reason that it had already been completed. [87] D1, D2 and D3 were trying to paint a picture of matters beyond their control in that the employer Sime Darby Property had reversed out the payment, presumably on discovering that contractually EBW would not be paid under the Contract and that they were labouring under the misconception that they would be paid, which was why they did nothing to alert the Plaintiff until the physical reversal took place and when it did, it had to cascade down to the Plaintiff that ultimately did the EBW. [88] D1 and D3’s explanation is that they were hopeful that in spite of this provision in D3’s contract with D4 that the EBW would not be paid, D4 will somehow pay D3 the sum of RM7 million over for the EBW. This must be something so presumptuous as to be unbelievable. D4 being a public listed company and also the Employer, being part of a public listed company in the Sime Group would be acting in breach of basic 31 corporate governance principle and even fraud if such payment can be done when contractually they are not obliged to make such a payment. [89] DW4 for D4 said that as soon as they realized the overpayment, they immediately reversed the payments out. [90] However D1, D2 and D3 in this context, cannot suffer the FBP works not being completed, and so all acted in concert to conceal this from the Plaintiff until the works were completed. [91] Even if they were hoping against hope that somehow they would be paid for the EBW, this is not a matter that they should conceal from the Plaintiff. [92] Without doubt, that was a very convenient way to explain and excuse a very inconvenient truth which is that, D1, D2 and D3 knew for a fact that D4 was not contractually obliged to pay D3 for the EBW when D2 at the behest of D1 agreed to pay over RM7 million for the EBW in their contract with the Plaintiff. Whether page C/4/1 that states that “Bored length shall be measured from the cut-off level to pile toe” was not faxed over to the Plaintiff . [93] After the complete reversal of the payment for the EBW, the Plaintiff realized that the Blank Bill No. 4 that was sent to Plaintiff for the Plaintiff’s quote for bore pilling works for the FBP Contract in September 32 2013 has a particular page missing, i.e. page C/4/1. Page C/4/1 states “Bored length shall be measured from the cut off level to pile toe”. When read with the clause under “Unconcreted (Empty) Bore” it would mean that Empty Bore Works would not be paid for! The Plaintiff stated in its Statement of Claim that this page was not given to the Plaintiff. [94] The defence of D1 and D3 at paragraph 50 of their Amended Defence was that it was a clerical error. That being the case it was not open to D1 and D3 to then assert at trial that it had actually been faxed over. It was not for Chang Sin Fei as DW3 to testify that the whole of Bill No.4 had been faxed over to the Plaintiff, contrary to what had been pleaded. All that D1-D3 needed to do was to produce the fax transmission report. [95] It was of course difficult for the Plaintiff to prove a negative but the Plaintiff’s conduct is consistent with not having received that page. Had the Plaintiff received page C/4/1 the Plaintiff would not have in the 9.11.2013 Proposal said as follows: “The empty bore quantity is not captured in the attached Bill of Quantities. However, our soil drilling length shall be measured from the toe of bored pile to top of Working Platform e.g. Existing Ground Level (at point of boring) and payable at soil boring rate respectively”. (emphasis added) 33 [96] D2 had never pointed out or rebutted that this was not the case. Despite the Plaintiff’s reminder that the EBW would run into millions on 30.12.2013, D1-D3 chose to remain silent and to conceal from the Plaintiff that in the contract dated 9.12.2013 between D3 and D4, it was stated that D3 would not be paid for the EBW. [97] I can accept that Submission of the Plaintiff that had the Plaintiff knew that they would not be paid for the EBW then their pricing for the soil boring rates would be different as they would then have to price differently for the length of the pile not from the existing ground level but from the excavated ground level or Cut-Off Level to the toe pile. [98] Neither can the D1-D3 say that there was no benefit to them to have to pay for the boring of the piles through the Existing Ground Level (“EGL”) or Working Platform to the excavated ground level corresponding to the Cut-Off Level of the piles as ultimately the whole of the bored length which is the Unconcreted Empty Bore had to be excavated for the underground 3-storey car park which car park and Melawati Mall structure of 13-storey would sit on the Foundation Bored Piles. [99] The CBP Works commenced on 13.11.2013 and the FBP Works commenced on 9.12.2013. As explained by PW1, the FBP Works also involve boring through a layer of soil measuring more than 50 feet to 34 reach Cut-Off Level i.e. the top of the piles and the boring then continue further to reach where the pile is to end or toe level of the piles or the bottom of the piles (“Pile Toe”). Reinforced steel and concrete will fill up the bored holes from the Pile Toe to the Cut-Off Level to create a concrete pile. In short the boring will exceed 50 feet in depth. [100] The boring through the 50 feet of soil is the EBW. They are known as empty bore because the holes created will not be filled up with reinforced steel and concrete to make a pile. Once the piles were constructed, the earth above the Cut-off Level would be excavated, together with the empty bored holes. [101] Excavation would be layer by layer. Simultaneously with each layer taken away, ground anchors were installed. Ground anchors are a steel strand that holds the contiguous bored pile wall together. It is to prevent the wall from collapsing. [102] The GA Works are to construct these ground anchors. I agree with the Plaintiff that this is the sequence of work provided to the Plaintiff by D2 and that the Plaintiff was contractually obliged to follow this work sequence. [103] It cannot be gainsaid that the sequence of work as the Plaintiff had been instructed was that the FBP Works had to be done by boring 35 through from the existing ground level to the toe pile to save time and complete the Works within time for otherwise no piling works can be done until the ground has been excavated to the requisite depth and the CBP and GA Works done to prevent the excavated portion from collapsing before the FBP Works can begin, this time from the excavated ground level or Cut-Off Level. The semblance created of a genuine sub-contracting between D3 and D2 when both companies were in fact operating as a single economic entity under the directions of D1. [104] From the evidence adduced by the Plaintiff, it was clear that D1 was the alter ego of both D2 and D3. Many a time when payments were delayed, the Plaintiff through its Managing Director PW1 would text D1 and D1 would arrange for payments direct from D3 to the Plaintiff. [105] The incontrovertible evidence adduced by the Plaintiff and which was not disputed by D1 and D3 was that D2 and D3 shared the same office and staff, company secretary and having common directors and shareholders in D1 and one Mr Liew Pok Boon. The same accounting staff was in charged of the accounts of D2 and D3 and even D1’s wife Miss Angie as DW2 also admitted under cross-examination that though she was later made a Director of D3 on 8.10.2015, yet she was also on the payroll of D2, being overall in charged of D2’s accounts as well. 36 [106] To create a semblance of genuine sub-contracting there were exhibited Interim Claims submitted by D2 to D3. However the signatures on D2’s claim to D3 purportedly signed by a Mr Chua Hock Seng, were entirely different from the same Mr Chua Hock Seng’s signatures on undisputed documents like the Minutes of Meeting prepared by D4. [107] These mysterious differences do not just end with one set of signatures. It continues with that purportedly of one Mohd Hanif on D2’s claim to D3 which were entirely different from the same Mohd Hanif’s signature on undisputed documents in the certificates issued by D2 to the Plaintiff or on debit notes, invoices or even on dump truck records. [108] Indeed there seems to be a pattern here as there was another set of signatures on D2’s claim to D3, purportedly signed by one Wan Azila, which had was entirely different from the same Wan Azila’s signatures on undisputed documents in the Minutes of coordination meetings or invoices or certificates from D2 to the Plaintiff. [109] These staff was not called as witnesses to explain how their signatures could be different for different sets of Interim Claim from D2 to D3 purportedly checked and verified by the same persons. [110] The only reasonable conclusion is that one set of documents, that of D2 claiming against D3, was created after the event to give a semblance of an arms-length genuine subcontracting relationship 37 where as D1 testified, D3 did a total sub-contracting of the entire Works to D2 for a 2% commission on the contract sum. [111] Even the Certificates of Payment from D3 to D2 appear fake and D1 himself admitted not signing these Certificates. It was likely to be a reproduction of a computer ‘cut and paste’ job with the tracks not properly covered as they refer to another project as follows: “…balance of building and external works for the proposed service apartments and retail space at Newgate Avenue…” [112] That has nothing to do with the Melawati Mall Project. [113] That is another convenient way of explaining away documents created after the event to give a semblance of a genuine sub- contracting when in reality it was D1’s strategy to immunize D3 from claims from the Plaintiff for the Unpaid EBW. The fact that the contract of the Plaintiff was with D2 and not D3 would mean that contractually the Plaintiff could not sue D3. It was all right to D1 and D3 that D2 should be allowed to go down under should the Plaintiff sue. [114] The Plaintiff has introduced more than sufficient evidence by way of SMS messages between PW1 and D1 that showed that D1 has virtually treated D2 and D3 as interchangeable and as companies under his stable to do his urgent bidding when necessitated by the exigencies of the moment where payments for the work done and expediting the Work is concerned. 38 [115] D1, DW3 Chang Sin Fei and Liew Pok Boon were Directors of D2 at the material time before all of them resigned en-block. Their shareholdings are in the proportion of 40:30:30 respectively. As for D3, D1 and Liew Pok Boon are the 2 Directors before D1’s wife DW2 became a Director on 8.10.2015. The shareholders of D3 are D1 and Liew Pok Boon in the proportion of 70:30 giving D1 effective control of D3. At any rate D1 has held himself out as the Managing Director of both D2 and D3. Mr Chang Sin Fei on the other hand, though a Director of D2, would hold himself out in his business card as a Project Director of D2. For the record the Plaintiff is not suing Chang Sin Fei or Liew Pok Boon. It is for the Plaintiff to decide who to make personally liable in terms of degree of culpability. [116] D3 had paid the Plaintiff direct the following sums for work done as follows, namely, RM456,690.49, RM6,125,292.87 and RM1,000,000.00. Strangely it was D3 and not D2 that issued Debit Notes to the Plaintiff despite alleging there was no privity of contract. In the heat of the moment and the hustle and bustle of hurrying up the work and getting business done D1 gave the Freudian slip as to the legal personalities of D2 and D3 being literally subsumed into his personality. Learned counsel for the Plaintiff catalogued conversations by SMS as follows: 1. In response to the Plaintiff’s request for payment from D2, D1 said on 27.5.2014 @ 3.55pm that “Ready for collection 39 at my office 6.1m. Tq”. This RM6.1million cheque was issued by D3; 2. In response to the Plaintiff’s request for payment, D1 said on 9.9.2014 @ 9.08am that “Sorry for late reply. I just received a new payment from Bina Puri, the latest by next week I can settle the 1m payment. I did ask my account to keep ur account informed about this. Tqvm”. This RM1 million cheque was issued by D3; 3. In response to the Plaintiff’s request for payment, D1 said on 4.2.2014 @ 4.05pm that “I just bank in Bina Puri payment to me, ur side can collect chq on Friday and bank in. Tqvm”. This RM2.8 million cheque was issued by D2; 4 In response to the Plaintiff’s request for payment, D1 said on 24.7.2014 @ 1.22pm that “Boss, payment only can come in first week of August…My side really cant at this moment…”. This RM1 million cheque dated 8.8.14 was issued by D2. 5. In seeking the Plaintiff to speed up work despite non- payment, D1 said on 7.5.2014 @ 8:30pm that “Tq. I understand this delay on steel bar this time, I apologize for 40 this. However more effort need to be put in in order to catch up the delay. My contract to u is only 30mil, but BP to me is 90mil, different LAD incurred…” (emphasis added) [117] The Court of Appeal case of Epic Quest Sdn Bhd v Sheila Eleanor De Costa [2011] 8 CLJ 518 comes to mind. The facts are quite similar to the present case and the dicta of the Court of Appeal there is summarized below in the case of Mayland Development Sdn Bhd & Anor v Tanjung Teras Sdn Bhd [2016] MLJU 901 as follows: “[80] Learned counsel for the Plaintiff further referred to the case of Epic Quest Sdn Bhd v Sheila Eleanor De Costa [2011] 8 CLJ 518 (COA). In that case, Shiela, a lawyer exercised a lien over documents that belonged to her clients, Epic Quest. Epic Quest was part of the Titijaya Group of companies and Shiela had rendered services to the group in particular Titijaya (M) Sdn Bhd, Prestine Valley Sdn Bhd and Titijaya Hotel Sdn Bhd. There were unpaid bills in respect of the 3 companies and Shiela proceeded to obtain judgment against the 3 companies. She then exercised her lien over the documents of Epic Quest on which she did not have a judgment. The Court held that it is not open to the Courts to disregard the corporate veil purely on the ground that it is in the interest of justice to do so. Something more 41 must be shown such as special circumstances which would include cases where there is either actual fraud at common law or some inequitable or unconscionable conduct amounting to fraud in equity. [81] Based on the evidence, the court held that the plaintiff had laid sufficient evidential foundation to support the contention that special circumstances had existed for lifting the corporate veil of the Appellant and the 3 companies at the Titijaya Group of companies. Having themselves ignored the fact that they operated as one group enterprise when dealing with the Respondent, the Appellant could not be allowed to insist on their separate corporate personality to defeat the Respondent’s general lien whereby it would be inequitable or unconscionable to do so. The corporate veil could not be used as an instrument to evade a contractual obligation. Unconscionable or inequitable conduct amounts to fraud in equity. [82] In that case, the evidential trail revealed that the deponents of all affidavits were filed by one Bay Nut Soo - “Setiausaha Syarikat Titijaya Group of companies. It also revealed that SP Lim was a director of almost every one of them or through companies controlled by him or by close family of business associate. 42 Further, instructions from one company came from another. There was use of letterheads by Titijaya in respect of bills issued to Epic Quest. Existence of a letter from Titijaya (M) Sdn Bhd stating that Titijaya had made payment for bills issued to Logic Marine. The payment of legal charges for Sheila being paid by the group companies. It was in that context that the Court of Appeal held that: “[9] From what is set out above it was evident to us that when dealing with the respondent, the Titijaya Group of Companies including the appellants and SP Lim had deliberately ignored the separate corporate personalities of the companies, and operated as one group enterprise. The payment of the respondent’s legal charges also reflected this where it can be seen that when the respondent rendered her charges to a company within the group, the respondent’s charges would be paid by any one of the Titijaya Group of Companies even though the paying company did not directly receive the respondent’s services. Having themselves ignored it when dealing with her, the appellants cannot now be allowed to insist on their separate corporate personality to defeat the respondent’s general lien. In Sunrise Sdn Bhd v First Profile (M) Sdn Bhd & Anor 43 [1997] 1 CLJ 529 Chong Siew Fai (CJ Sabah & Sarawak) said that the corporate veil cannot be used as an instrument to evade a contractual obligation.” (emphasis added) [118] This brings me to the next series of strange events that happened in quick succession. The resignation of D1 and the other directors from the board of D2 and the transfer of the shares to third parties soon after the completion of the EBW. [119] No sooner had the EBW Works been completed by the Plaintiff in July 2014 and hardly 3 weeks after the complete reversal of RM7,448,384.68 on 22.9.2014 there was the sudden resignation on 17.10.2014 of both D1 and Chang Sin Fei and one Mr Liew Pok Boon who were the Directors of D2 when D2 was incorporated in Oct 2013 for the purpose of executing contracts secured by D3 for the Project. [120] D1’s explanation is too far-fetched to be true and more consigned to the realm of fables and fiction. It was said that the purchasers had a change of mind after this suit was filed by the Plaintiff. In other words the transfer of the shares was aborted. If that be so then why was D1 so keen to vacate his directorship even before the purchase price was made and why aren't the directors reinstated after the transaction proved abortive? 44 [121] Indeed if the shareholders had been transparent about the disposal of their shares, they should have disclosed to the prospective purchasers that there is a current liability of over RM7 million due to the Plaintiff for some construction work done for the EBW. Was this a case where D1 was trying to conceal the liability and exposure of D2 until a suit was filed or more a case where D1 were trying to get his nominees to be the front for him as Directors? [122] Who are the supposed new Directors and shareholders? One is a Mr Manik Maria who D1 admitted is a Bangladeshi national who entered Malaysia with a construction worker visa. He is also a labourer listed in the minutes of meetings for the Project under CTF Build Sdn Bhd. Mr Chang Sin Fei confirmed in his evidence under cross-examination that Mr Manik is a labourer. He has an address at Lot 153 Kampung Datuk Harun, 48200 Serendah which is similar to Liew Pok Boon’s address. The Plaintiff checked and this address is not a residential address. [123] The other Director is Mr Lee Fook Choy who is a local. He has at address at No. 73 & 74 Jalan Besar, 48200 Serendah. The Plaintiff checked and this address is not a residential address. He is also a director of another company where D1 and Liew Pok Boon are shareholders. [124] The 2 new directors and shareholders were not called to testify and corroborate D1’s explanation. This is a proper case for the application of the principle encapsulated in section 114(g) Evidence Act 1950 of adverse inference that the Court would draw. As was held by 45 the Court of Appeal in Wong Kar Juat & Anor v S7 Auto Parts (M) Sdn Bhd [2015] 9 CLJ 590, at page 607, para 43: “[43] Needless to say, our careful analysis of the evidence had exposed the trail of failures by the respondent to call these material witnesses and such manifest failure in our view would attract the presumption of adverse inference under s. 114 illustration (g) of the Evidence Act 1950 against it. It is trite law and, indeed, a fundamental tenet of the rule of law that whoever alleges facts must produce the necessary evidence in proof of such facts” [125] The same applies to the D1, D2 and D3 in not calling Mr Liew Pok Boon, another Director and shareholder of D2 to testify. [126] D1’s story is more consistent with that of the directors fleeing from a sinking ship and leaving the shell of a company in the hands of directors who know neither head nor tail as to what is happening. This is another attempt by D1 to distance and dissociate himself from D2. In the event that D2 is wound up he would not be around to submit the Statement of Affairs of the company nor be required to answer questions or attend meetings summoned by the Liquidator. It was clearly an attempt to wash his hands clean of any possible liability that might attach to him in spite of incorporation of D2 as a separate legal entity and using it to be a shield to immunize D3 against any fall out. 46 [127] If the share transaction was genuine, surely there must be draft sale and purchase of shares agreement prepared and the final version executed by the parties. The fact that these were not produced is not so much a concern to preserve confidentiality of the purchasers but that it would be embarrassingly obvious that the so-called transaction was a sham. To call them would be disastrous as they would be perplexed and puzzled by what D1 had bequeathed to them as directors and shareholders of a company laden with liabilities. [128] There is every reason to believe that D2 was created to interpose the link with D3, that has substantial assets and funding as well as track-record, and the Plaintiff so that contractually the Plaintiff could not touch D3. D1, D2 and D3 tried to explain away the uncomfortable truth of D2 having no track record and other projects but was created as a buffer to absorb losses that was anticipated from the inability to pay for the EBW. D2 said it has a contract from D3 for works from GA Land (See pages 2317-2319 D1/3 PBOD4). However in that letter of 4.10.2013, D3 wrote “…with reference to your tender”. That would mean that the tender must have been submitted before 4.10.2013 but that was the date D2 was incorporated! See pages 603-614 PBOD 5. It must be a case of the tender having been submitted even before D2 had come into being! [129] Another give away can be gathered from the reference no: PSSB/CTFBSB/2014 and the reference to a letter of instruction to commence dated 18.12.2014. This must have been manufactured in 47 2014 and bears no signature. It must have been created recently to camouflage the truth. It proceeded from a guilty mind for there was no need to justify one’s existence by creating documents! [130] Looking back then in retrospect, the actions of D1, D2 and D3 taken together as a whole, is such that they were acting in concert to try to avoid and evade their legal obligation to pay for the EBW. In doing so they acted fraudulently. The veil of incorporation of D2 must be lifted and when so lifted, it exposed D1 as the master of the various moves to structure a deal where D2 would be allowed to fall but that the Works are completed nevertheless and D3 would be distanced from the fall out as it is not a contracting party with the Plaintiff. By that time the remaining Works had not been completed yet and CPC had not been issued. [131] Learned counsel for D1 and D3 had also advanced the proposition that if they had wanted to deceive the Plaintiff they would not have made any payments at all and that D2 would have defaulted from the first Interim Certificate. That I must say is not how an elaborate fraud is committed. Surely if even the first Certificate is not honoured then the Plaintiff would have stopped work altogether and D2 and D3 would not have the benefit of the completed Works done for which they could get payment from D4. In other words they would not have pulled through the fraud. [132] Fraud in reality would have to involve the element of enticing the Plaintiff to accept the Contract on terms that D2 has to pay for the EBW 48 but would not be able to honour this payment. In this case it is the payment for the EBW, as D3 was not contractually required to pay D2 and that stems from the fact that D4 was not contractually required to pay D3 for the same. The one person that knows this is D1, the Managing Director of both D2 and D3. [133] Indeed the payments, until Certificate No. 8, were made, though with some delay, so that the Plaintiff is lulled into a sense of complacency before the full reversal out of the EBW payments by Certificate No. 9 by which time it is too late to protest as the EBW would have already been completed. [134] Learned counsel for D1 and D3 also said that the conduct of D1 and D3 to try to arrange for meetings with D4 and also the employer Sime Darby Property is indicative of their bona fide intention to resolve the problem that had arisen. I must say these are post-event conduct borne more out of guilt rather than sympathy. There was no detriment but every advantage to be derived in looking cooperative and concerned that the anticipated and even intended implosion had erupted. [135] Likewise no credit can be given for what learned counsel for D1 and D3 said is the loss that D3 and D2 suffer because of this Project because whatever sums that D2 and D3 had received from D4, they had paid out to other contractors including the Plaintiff and so they are honest and above board in their conduct save for their inability to pay the Plaintiff for the EBW which they now blame D4 and Sime Darby 49 Property for not paying. If D1-D3 had caused their costs to overrun, that is not the fault of the Plaintiff. [136] That is to gloss over the issue as in the first place D4 was not contractually required to pay D3 for the EBW and that is because Sime Darby Property was not contractually required to pay the same. One can be quite sure if Sime Darby Property had been required to pay for the EBW from the very commencement of this Project, the Defendants would have called Sime Darby Property to explain their fault in not paying. [137] Authorities are clear in that a director cannot hide under the shell of incorporation to escape liability when fraud has been perpetrated and neither can a director use a company under his control and command to shield another company controlled by him from liability for a fraud engineered by him. When this happens the veil of incorporation would be lifted to expose the action of the mastermind and to find him and the vehicle used by him fully liable for the loss suffered by the victim. [138] I need not go further than to cite the Federal Court case of Gurbachan Singh s/o Bagawan Singh & Ors v Vellasamy s/o Pennusamy & Ors [2015] 1 MLJ 773 where the Federal Court expounded on the law as follows: “[96] But in the event that we should, we are of the view that it is now a settled law in Malaysia that the court would lift the corporate veil of a corporation if such corporation was set up for http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.1346866302016706&bct=A&service=citation&risb=21_T24812679073&langcountry=MY&linkInfo=F%252523MY%252523MLJ%252523vol%2525251%252525sel1%2525252015%252525page%252525773%252525year%2525252015%252525sel2%2525251%252525 50 fraudulent purposes, or where it was established to avoid an existing obligation or even to prevent the abuse of a corporate legal personality (see; Prest v Petrodel Resources Limited and others [2013] UKSC 34). [97] As to what constitutes fraudulent purposes it has been described as to include actual fraud or fraud in equity (see Law Kam Loy & Anor v Boltex Sdn Bhd and others). And fraud in equity occurred in '... cases where there are signs of separate personalities of companies being used to enable persons to evade their contractual obligations or duties, the court would disregard the notional separateness of the companies...' (see Sunrise Sdn Bhd v First Profile (M) Sdn Bhd & Anor [1996] 3 MLJ 533 per Chong Siew Fai FCJ (as he then was). [98] Quite recently this court also discussed on the issue of lifting a corporate veil. It said this: … As for principle, the starting point is no doubt the doctrine of corporate personality. The general rule is that a company has an existence that is separate and distinct from its shareholders. It finds expression in the seminal case on the subject, Salomon v A Salomon & Co Ltd [1897] AC 22. Lord Halsbury LC there stated the rule thus: http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.712923245447098&bct=A&service=citation&risb=21_T24812879635&langcountry=MY&linkInfo=F%252523MY%252523MLJ%252523vol%2525253%252525sel1%2525251996%252525page%252525533%252525year%2525251996%252525sel2%2525253%252525 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.712923245447098&bct=A&service=citation&risb=21_T24812879635&langcountry=MY&linkInfo=F%252523MY%252523MLJ%252523vol%2525253%252525sel1%2525251996%252525page%252525533%252525year%2525251996%252525sel2%2525253%252525 51 ... once the company is legally incorporated it must be treated like any other independent person with its rights and liabilities appropriate to itself, and that the motives of those who took part in the promotion of the company are absolutely irrelevant in discussing what those rights and liabilities are. The Lord Chancellor however provided for cases in which the veil of incorporation may be lifted. He said: If there was no fraud and no agency, and if the company was a real one and not a fiction or a myth, every one of the grounds upon which it is sought to support the judgment is disposed of. The proposition when inverted states that if there is fraud or an agency relationship or if the company is a myth or fiction, the doctrine of corporate personality does not insulate the shareholders or directors from being assailed directly. [22] A more recent statement of the doctrine of corporate personality is to be found in the case of Woolfson v Strathclyde Regional Council 1978 SLT 159 which is authority for the proposition that a litigant 52 who seeks the court's intervention to pierce the corporate veil must establish special circumstances showing that the company in question is a mere facade concealing the true facts (see Takako Sakao (f) v Ng Pek Yuan (f) & Anor). [99] The phrase 'a mere façade concealing the true facts' was recently elaborated by the Supreme Court of the United Kingdom in the case of Prest v Petrodel Resources Limited and others [2013] UKSC 34. The leading judgment of the court said this: The concealment principle is legally banal and does not involve piercing the corporate veil at all. It is the imposition of a company or perhaps several companies so as to conceal the amount identity of the real actors will not deter the courts from identifying them, assuming that their identity is legally relevant. In these cases the court is not disregarding the 'façade' but only looking behind it to discover the facts which the corporate structure is concealing. The evasion principle is different. It is that the court may disregard the corporate veil if there is a legal right against the person in control of it which exists independently of the company's involvement, and a company is 53 interposed so that the separate legal personality of the company will defeat the right or frustrate its enforcement. Many cases will fall into both categories, but in some circumstances the difference between them may be critical. This may be illustrated by reference to those cases in which the court has been thought, rightly or wrongly, to have pierced the corporate veil” (emphasis added) [139] Reference must also be made to the Court of Appeal judgment in Tenaga Nasional Bhd v Irham Niaga Sdn Bhd & Anor [W]- 02(NCC)(W)-2339-10/2012. The Court of Appeal, after examining the authorities, held that: 1. the corporate veil could be lifted in exceptional circumstances; and 2. those exceptional circumstances must involve: (a) actual or equitable fraud and (b) the use of the company whose corporate veil was to be lifted as the means to conceal the true facts behind the facade of the company. [140] Time and again the Courts have displayed their willingness to debunk the notional separateness of companies when these have been woven into an interlocking web of deceit where the mastermind would 54 taunt the unsuspected with the teaser of “catch me if you can” because one cannot generally go behind the face of incorporation. Facade and fiction whether it be by way of shielding behind the shell of incorporation or the use of one or several layers of companies to shield the schemers would have to be exposed with the perpetrator being ferreted out from their furrows of refuge. The Courts would not allow the valid separate legal entity of a company to hide the culprit or to be hijacked to evade one’s contractual obligations. [141] Again in Prest v Prest and others [2013] 4 All ER 673 the Supreme Court presided over by Lord Neuberger held: “Where a person was under an existing legal obligation or liability or subject to an existing legal restriction which he deliberately evaded or whose enforcement he deliberately frustrated by interposing a company under his control, the court could pierce the corporate veil for the purpose, and only for the purpose, of depriving the company or its controller of the advantage that they would otherwise have obtained by the company's separate legal personality. If it was not necessary to pierce the corporate veil, it was not appropriate to do so, because on that footing there was no public policy imperative which justified that course. However, the recognition of a small 55 residual category of cases where the abuse of the corporate veil to evade or frustrate the law could be addressed only by disregarding the legal personality of the company was consistent with authority and long-standing principles of legal policy...” (emphasis added) [142] Learned counsel for the Plaintiff also referred to the case of Hotel Jaya Puri Bhd v National Union Of Hotel, Bar & Restaurant Workers & Anor [1980] 1 MLJ 109 where it was observed as follows: “It is clear therefore that the approach taken by the President of Industrial Court is not without any legal support when he placed an emphasis on the essential unity of group enterprise which in this case consists of the Hotel and the Restaurant, especially when Datuk N.A. Kularajah who is the Managing Director of the Hotel was also the Managing Director and later a Director of the Restaurant and had the ultimate authority over the employees. Thus, the practice of treating the employees of the Restaurant as being separate from the employees of the Hotel such as the Union having been told that they were so, their salaries, their E.P.F. and SOCSO contributions being paid by the Restaurant, does not detract from the fact that the employees in question were in fact working in one group enterprise. In my judgment, by giving 56 recognition to this fact, the President did not cause any violence to the sanctity of the principle of separate entity established in Salomon v Salomon & Co [1897] AC 22 but rather gave effect to the reality of the Hotel and the Restaurant as being in one enterprise. I find nothing unreasonable in the finding of the President by by-passing this principle. He did no more than to comply with the wishes of the Legislature that in the making of an award substantial merits of the case, the public interest and any matters which are necessary or expedient for the purpose of settling the dispute are among the factors which should be taken into consideration by the court. In my view, the finding by the President is in no way against the principle of separate entity and I am therefore not prepared to interfere with the award on this account.” [143] Human nature is the same everywhere and many cases have come before our Courts challenging the limits of liability of incorporation and inviting our Courts to lift the veil of incorporation lest it becomes the veil of invidious intrigues for that would be inimical to ethical business. Learned counsel for the Plaintiff has assembled an array of cases in assisting the Court to unravel the facade of incorporation in D2 and D3 with D1 being the face in the forefront of this legal fiction, as follows: 57 Law Kam Loy & Anor. v Boltex Sdn Bhd & Ors [2005] 3 CLJ 355, Sunrise Sdn Bhd v First Profile (M) Sdn Bhd & Anor [1997] 1 CLJ 529, Takako Sakao v Ng Pek Yuen & Anor [2009] 6 MLJ 751, Epic Quest Sdn Bhd v Sheila Elenor De Costa [2011] 8 CLJ 518, CIMB Bank Bhd v Maybank Trustees Bhd and other appeals [2014] 3 MLJ 169, DHN Food Distributors Ltd and others v London Borough of Tower Hamlets [1976] 3 All ER 462 and Lim Kar Bee v Duofortis Properties (M) Sdn Bhd [1992] 2 MLJ 281. [144] Whilst incorporation has the effect of containing risk which all businessmen have to take, that is poles apart from one where there is active concealment of the fact of non-payment for the EBW to the tune of more than RM7 million and yet enticing the Plaintiff to execute the EBW knowing that the Plaintiff would not be paid and thus evading the responsibility to pay. Pronouncement [145] For all the reasons given above I had allowed judgment to be entered for the above sum that D2 has to pay the Plaintiff, against D1 and D3 in that all of them i.e. D1, D2 and D3 shall jointly and severally be liable to the Plaintiff for the sum of RM8,050,932.33 together with interest at 5% per annum from date of writ to realization. 58 Whether D4 is liable to the Plaintiff for the balance sum under the increased Undertaking to Pay of RM3.5 million and for the release of the retention sum [146] Next I deal with the claim of the Plaintiff against D4 under the Undertaking given by D4 to the Plaintiff where the Guarantee limit of RM2 million direct payment to the Plaintiff, had been increased to RM3.5 million after the series of meetings with all the parties to resolve the problem of reversal of payment for the EBW. [147] The context of this increase cannot be ignored. It was when a meeting was held after the completion of the FBP works and after this problem of the Plaintiff not going to be paid at all by D2 had arisen with the reversal of certified amounts for the EBW. It was at the meeting to try to solve this problem on 16.10.2013 where the PW 1 told TST of D4 that the Plaintiff would not have taken in the jobs if not for the promise of D4’s Guarantee by D1. I can believe PW 1 who strikes me as being a candid witness and conscientious director discharging his duties when he testified that TST broke the silence by offering to make payment up to RM3.5 million to convince the Plaintiff not to suspend the GA Works but to complete it. [148] In fact it was after several rounds of meetings with all the Defendants on 12.9.2014, 25.9.2014 and 1.10.2014 and 16.10.2014, 59 that the RM2 million limit was increased to RM3.5 million as the Plaintiff was being owed more than RM14 million then. [149] Therefore when D4 agreed to the increase, it must be understood that D2 can no longer use the ground of the payment must be one not disputed by D2, before direct payment can be made by D4 to the Plaintiff. At any rate I had held that contractually D2 cannot dispute with the Plaintiff on the agreed rates and contract sum for the FBP Works which included the EBW of over RM7 million. [150] It was clear that any dispute involving the payment for the EBW is not a reasonable ground for D4 not to pay the Plaintiff in as much as D2 cannot validly contend that such a payment is not due to the Plaintiff. Correspondingly D3 also cannot take the same position that the payment from them to D2 or ultimately to the Plaintiff is being disputed. [151] The documents paving the way for such a direct payment from D4 to the Plaintiff are set out below. By a letter dated 7.3.2014 from D4 to the Plaintiff, D4 agreed to make direct payments to the Plaintiff provided that: 1. there is an amount that is certified as being due and payable by D4 to D3; and 2. the limit of the direct payment shall be in the sum of RM2,000,000.00. 60 As stated this limit of RM2,000,000.00 was subsequently increased to RM3,500,000.00. [152] This direct payment arrangement by D4 to the Plaintiff was authorised by D2 and D3 in their respective letters dated 6.04.2014. [153] In the letter dated 6.04.2014 from D2 to D3 it is stated that D2 has consented and authorised D3 to issue direct payments to the Plaintiff; and such direct payments are to be taken as partial payments of amounts that are due to D2 by D3. [154] Similarly in a letter dated 6.4.2014 from D3 to D4, it is stated that the D3 has consented and authorised direct payments to be made by D4 to the Plaintiff and that D4 “may not make any payment to Keller (M) Sdn Bhd if there is no amount due and certified to be owing” by D4 to D3. It was further provided that such direct payments to the Plaintiff shall be deemed as payments made to D3. [155] D4 submitted that there is no payment due from D4 to D3 and so there is no payment to be made other than what had already been made below. D4 had, in compliance with this Undertaking, paid the sum of RM2,782,278.04 for the following certified amounts: 1. RM2,145,360.35 pursuant to Certificate No. 10; and 2. RM636,917.69 pursuant to Certificate No. 11. 61 [156] Learned counsel for D4 submitted that since there are no amounts that are due and payable by D4 to D3 as D4 had paid to D3 in excess of the amount certified. See Progress Payment Certificate No.25 dated 20.1.2016 at page 1226 of D1&D3s’ BOD Volume 3. [157] Surely D4 cannot make payment in excess of what is due and now say that there is no amount to be paid to D3 and hence no amount to be paid direct to the Plaintiff under the Undertaking as all parties already knew by then that the Plaintiff had not been paid for the EBW. [158] Be that as it may, there is still the sum of RM1.9 million being the retention sum retained by D4 to be released to D3 which monies had been carved out by work done by D3 for D4 and so is due and payable from D4 to D3. This sum is found in the email of the Plaintiff to D4 dated 12.9.2014 and 26.9.2014. In the High Court’s Decision in Lee Kam Chun v Syarikat Kukuh Maju Sdn Bhd (Syarikat Perumahan Pegawai Kerajaan Sdn Bhd, Garnishee) [1988] 1 MLJ 444 at page 448 it was observed as follows: “In my judgment, the retention sum in this case is an existing debt and in fact an existing indebted sum that involves the payment, notionally and irresistibly pursuant to an interim certificate issued by the architect, by the garnishee to the judgment-debtor and the 62 latter's payment in turn back to the garnishee for retention for purposes already stated, with the garnishee holding the money as trustee for the judgment debtor. A debt in respect of such money began to exist in the circumstances and still does exist, and to contend otherwise would be to defy common sense and logic.” [159] The above principle propounded by the High Court was followed in the Court of Appeal case of Qimonda Malaysia Sdn Bhd (in liquidation) v Sediabena Sdn Bhd & Anor [2012] 3 MLJ 422. [160] The Plaintiff is claiming against D4 the remaining sum of RM717,721.96 under the Undertaking by D4 to pay the Plaintiff directly. Pronouncement [161] Therefore D4 shall pay this sum of RM717,721.96 to the Plaintiff together with interest at 5% per annum from date of writ to realization. As D4 shall pay this sum over to the Plaintiff, in the circumstances of the case, this Court would order D3 to pay over this sum with interest to D4 and so a judgment for this sum is entered by D4 against D3. [162] As this Court has held that D2 and D3 are operating as a single unit, there is no necessity for any order for Judgment for this sum to be entered by D3 against D2. 63 [163] In any event from the facts adduced both D2 and D3 are capable of sorting out their accounts as the position taken by D3 is that it has totally sub-contracted the Works to D2 for 2% commission. [164] As for the retention sum there is no evidence that the term of early release direct from D4 to the Plaintiff has been agreed upon i.e. the requirement that a bond be secured from Plaintiff to D4 in lieu of the early release. [165] Therefore there has been no concluded contract on this between the Plaintiff and D4 for the Court to enforce. The Plaintiff is not appealing against this part of the Court’s order and so there is no need for me to say further. [166] I had after hearing the parties on costs made the orders for costs below. [167] As between the Plaintiff and D1 I ordered costs of RM30,000.00 to be paid by D1 to the Plaintiff. [168] As between the Plaintiff and D2, I ordered costs of RM20,000.00 to be paid by D2 to the Plaintiff. As for Plaintiff and D3. I also ordered costs of the amount of RM30,000.00 to be paid by D3 to the Plaintiff. 64 [169] As for Plaintiff and D4, I exercised my discretion and ordered that each party shall bear their own costs. Dated: 25 August 2017. - signed - LEE SWEE SENG Judge Construction Court Kuala Lumpur For the Plaintiff : Richard Kok and Winnou Chung (Messrs Rhiza & Richard) For the 1st Defendant : Ben Lee together with Shafiehani and 3rd Defendant (Messrs Gan & Zul) For the 2nd Defendant : Jaqdip Singh and Karamjit Kaur (Messrs Karamjit & Jaq) For the 4th Defendant : J L Foo and Caryn Lye (Messrs Gan Partnership) Date of Decision: 26 January 2017.

Tika 2.6.0

WA-22NCC-326-09/2016

PLAINTIF 1. YONG TOI MEE (No. K/P: 531101-08-6935) 2. CHEANG KIM LEONG (No. K/P: 570522-08-6513) …PLAINTIF -PLAINTIF DEFENDAN 1. MALPAC HOLDINGS BERHAD (No. Sykt: 197424-V) 2. MALPAC CAPITAL SDN BHD (No. Sykt: 384869-U) 3. LIM HONG LIANG (NO. K/P: 590511-04-5681) 4. TAN CHON SING @ TAN KIM TIENG (NO. K/P: 381031-01-5435) 5. GAN TECK SHONG @ GAN KWAN CHONG (NO. K/P: 470424-01-5481) 6. CHEW LOY CHEE (NO. K/P: 360830-71-5005) 7. KAN AH CHUN (NO. K/P: 530806-07-5051) 8. MUHAYUDDIN BIN MUSA (NO. K/P: 621218-01-5443) 9. JOHARI LOW BIN ABDULLAH (NO. K/P: 501228-10-5649) 10. ANG POO GUAN (NO. K/P: 481029-07-5517) … DEFENDAN - DEFENDAN

24/08/2017

YA TUAN MOHD NAZLAN BIN MOHD GHAZALI

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DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR GUAMAN NO.: WA-22NCC-326-09/2016 ANTARA 1. YONG TOI MEE (No. K/P: 531101-08-6935) 2. CHEANG KIM LEONG (No. K/P: 570522-08-6513) …PLAINTIF-PLAINTIF DAN 1. MALPAC HOLDINGS BERHAD (No. Sykt: 197424-V) 2. MALPAC CAPITAL SDN BHD (No. Sykt: 384869-U) 3. LIM HONG LIANG (NO. K/P: 590511-04-5681) 4. TAN CHON SING @ TAN KIM TIENG (NO. K/P: 381031-01-5435) 5. GAN TECK SHONG @ GAN KWAN CHONG (NO. K/P: 470424-01-5481) 6. CHEW LOY CHEE (NO. K/P: 360830-71-5005) 7. KAN AH CHUN (NO. K/P: 530806-07-5051) 8. MUHAYUDDIN BIN MUSA (NO. K/P: 621218-01-5443) 9. JOHARI LOW BIN ABDULLAH (NO. K/P: 501228-10-5649) 10. ANG POO GUAN (NO. K/P: 481029-07-5517) …DEFENDAN- DEFENDAN [MELALUI TUNTUTAN UTAMA] ANTARA MALPAC CAPITAL SDN BHD (No. Sykt: 384869-U) …PLAINTIF DAN 1. YONG TOI MEE (No. K/P: 531101-08-6935) 2. CHEANG KIM LEONG (No. K/P: 570522-08-6513) 3. SRI GANDA OIL MILL SDN BHD (No. Sykt: 575998-V) 4. RADIANT RESPONSE SDN BHD (No. Sykt: 463879-D) …DEFENDAN- DEFENDAN [MELALUI TUNTUTAN BALAS] DI HADAPAN YANG ARIF TUAN MOHD NAZLAN MOHD GHAZALI HAKIM JUDGMENT Introduction [1] This is a writ action seeking damages under the tort of abuse of process and the tort of conspiracy. There is also a counterclaim for unjust enrichment and for the setting aside of an order of the High Court. After full trial, I allowed the main claim and dismissed the counterclaim. [2] This judgment sets out the full reasons for my decision and contains discussions on the scope of the tort of abuse of process and the torts of lawful means and unlawful means conspiracy. Key Background Facts [3] There is the long history to this dispute. It found its origin in the agreement entered into between the Plaintiffs and the Second Defendant in 2002 concerning the purchase of plantation lands by the former, which relationship eventually turned litigious in 2007. A series of court proceedings ensued, the decisions on some of which have also been reported. These include the Federal Court decision in Yong Toi Mee & Anor v Malpac Capital Sdn Bhd & Anor [2013] 8 CLJ 725 and the Court of Appeal decision in Malpac Capital Sdn Bhd v Yong Toi Mee & Ors and another appeal [2016] 8 CLJ 613. [4] A detailed narrative of the facts would therefore be neither necessary nor economical for the purposes of this judgment. But some background facts are essential, albeit chronologically stated in summary fashion in the following several paragraphs. [5] The Plaintiffs are business individuals who entered into the relevant agreement to purchase the plantation assets of the Second Defendant as part of the overall restructuring of the First Defendant under the auspices of Pengurusan Danaharta Malaysia Berhad. The First Defendant is a locally incorporated public company listed on the Main Board of Bursa Malaysia. It is an investment holding company. The Second Defendant is a private company which is wholly owned by the First Defendant. [6] The Third to the Ninth Defendants are all directors on the board of the First Defendant at the material time, with the Eighth Defendant being the chairman. The Tenth Defendant is the chief executive officer of both the First and Second Defendants. [7] In the counterclaim filed by the Second Defendant, reliefs were sought against the two Plaintiffs as the first and second defendants, Sri Ganda Oil Mill Sdn Bhd (“Sri Ganda”) as the third defendant, being a company controlled by the First Plaintiff (first defendant in the counterclaim), and Radiant Response Sdn Bhd (“RRSB”), as the fourth defendant, being the company which had been nominated to hold the subject plantation assets following the restructuring, which shares had been purchased by the Plaintiffs. [8] The crux of the case of the Plaintiffs herein, and the basis for their action under the torts of abuse of process and conspiracy is that the relevant Defendants refused to comply with the decisions of the Courts by continually, in their institution of subsequent and different proceedings, seeking, among others, to set aside the decree of specific performance on the purchase of the plantation assets against them granted on 5 May 2011 by the High Court in Ipoh High Court Suit No. 22-109-2007 (“HC Judgment Suit 109”). [9] A key decision of the HC Judgment Suit 109 is that the purchase of RRSB (which was to hold the plantation assets) by the Plaintiffs concerned the entire share capital of RRSB and was not only limited to 2 shares in RRSB which at the time of execution of agreement constituted the entire capital of RRSB. Thus the purchase by the Plaintiffs encompassed the subsequent increase in the share capital of RRSB (being a requirement of the relevant licensing authority) from 2 to 100,000 ordinary shares in RRSB. [10] The HC Judgment Suit 109 which was in favour of the Plaintiffs which then obtained the order for the specific performance for the completion of the purchase of the plantation assets was subsequently reversed by the Court of Appeal. [11] The Federal Court on 4 September 2013 however restored the HC Judgment Suit 109, and directed the Plaintiffs to make payment of the balance purchase price within one month (“the FC Judgment Suit 109”) (see Yong Toi Mee & Anor v Malpac Capital Sdn Bhd & Anor [2013] 8 CLJ 725 referred to earlier). Despite the Plaintiffs’ conduct towards compliance with the FC Judgment Suit 109, the Second Defendant refused to complete, and instead filed for a review application on 3 October 2013 to the Federal Court against the FC Judgment Suit 109. The review application was dismissed by the Federal Court on 4 March 2014 (“the FC Review”). [12] Efforts by the Plaintiffs to complete the purchase after the FC Review continued to be unsuccessful as the First and Second Defendants then sought legal opinions, despite the FC Judgment Suit 109 and the FC Review. The Board of the First Defendant on 23 April 2014 resolved to convene an extraordinary general meeting (EGM), to seek its shareholders approval for, among others, the disposal of the additional shares of 99,998 in the enlarged capital of RRSB, and the mill at the plantation lands to the Plaintiffs, whilst the board agreed to regulate an interim position with the Plaintiffs on the basis of their ownership of only the 2 shares in RRSB. [13] The Plaintiffs thus felt compelled to seek enforcement of the specific performance which, as had been decided by HC Judgment Suit 109, FC Judgment Suit 109 and the FC Review, concerned the entire share capital of RRSB, not just the 2 shares. The Plaintiffs filed a notice of application at the Ipoh High Court for orders to give effect to the specific performance (“Enclosure 62”). At the EGM held on 31 July 2014, the said proposed disposals to the Plaintiffs failed to secure the approval of the shareholders of the First Defendant. [14] On 22 September 2014, the Second Defendant filed a cross-application at the Ipoh High Court (“Enclosure 69”) requesting the Ipoh High Court to determine certain threshold questions and issues of law, but clearly to seek the discharge of the specific performance on the strength of the alleged absence of shareholders’ approval under Section 132C for the disposal of the additional shares in RRSB and the mill to the Plaintiffs. It also sought to set aside the same on the basis that the sum of RM36.7 million was due from the Plaintiffs in respect of the management of the plantation lands and the mill. [15] On 17 February 2015, the Ipoh High Court allowed enclosure 62 for the Plaintiffs and dismissed Enclosure 69 against the Second Defendant, who appealed against both these decisions. On 15 August 2015, the Second Defendant’s appeal was dismissed by the Court of Appeal (see Malpac Capital Sdn Bhd v Yong Toi Mee & Ors and another appeal [2016] 8 CLJ 613 referred to earlier). [16] The order of the High Court allowing Enclosure 62 included the appointment of the Plaintiffs as the directors of RRSB and removal of the latter’s then existing directors, the payment by the Plaintiffs of RM49 million inclusive of the additional shares of 99,998 and for the Deputy Registrar be authorised to execute relevant documentation, including the share transfer forms, to give effect to the orders, and thus the specific performance and completion of the purchase of the plantation assets. [17] Following the dismissal of the appeal by the Court of Appeal in respect of these Enclosures 62 and 69, the Second Defendant sought leave to appeal to the Federal Court. This was refused on 13 February 2017. [18] That was however not the end of the matter. [19] Enter the First Defendant, the Second Defendant’s parent, for the first time, officially. The dispute has now moved inter-state to Kuala Lumpur. The First Defendant filed on 15 April 2016 suit WA-22NCC-145-04/2016 (“Suit 145”) in this Court as plaintiff, and the Second Defendant claimed to be a nominal party as the first defendant. Suit 145 sought guidance from this Court on the legal implications of the absence of the Section 132C approval given the rejection of the proposal on the transfer of the 99,998 shares, to complete the purchase and give effect to what was first granted by the HC Judgment 109. [20] On 4 August 2016 subsequent to the filing of the Suit 145, the Plaintiffs commenced this instant proceeding, responded to by the Second Defendant by the filing of the counterclaim. [21] In the instant counterclaim, the Second Defendant as the plaintiff is seeking for various declarations and reliefs, including an account for profit share and rental for the plantation lands and the related mill from July 2011 for the sum of RM43,045,551.38, unjust enrichment on the part of the Plaintiffs in respect of the increased share capital in RRSB, the need for approval under Section 132C of the Companies Act 1965 for the transfer of 99,998 shares, that the same shares be restored to the Second Defendant, and that the High Court decision on Enclosures 62 and 69 dated 17 February 2015 granted to the Plaintiffs be impeached on the ground of fraud. [22] This Court 11 April 2017 dismissed the claim of the First Defendant in Suit 145. The Trial and the Witnesses [23] The instant case before me was originally filed by the Plaintiffs in the Civil Division of the High Court vide suit WA-22NCVC-486-08-2016. Following agreement of parties, the action was then transferred before me, by reason of the related proceedings then already pending in this Court in Suit 145. Following the transfer, this action was registered as WA-22NCC-326-09/2016 (“Suit 326”). I ordered that the instant Suit 326 be heard after Suit 145 which by then was already ready for trial, and that evidence in the latter should stand as evidence in the former. [24] The trial for this Suit 326 was held over three days in February 2017. [25] In the main action, the Plaintiffs called five witnesses, as follows:- (a) The First Plaintiff himself as PW1; (b) The Second Plaintiff as PW2; (c) Goh Ah Peng, director of Sri Ganda Oil Mill Sdn Bhd as PW3; (d) Sathianathan a/l ER Nair, an expert witness, as PW4; and (e) Yeo Chai Seng, also an expert witness, as PW5. [26] The Defendants, all 10 of them, called only one witness, namely Ang Poo Guan, the CEO of the First and Second Defendants, as DW1. DW1 is also the Tenth Defendant. [27] In the counterclaim, the Second Defendant, as the plaintiff, called two witnesses, namely Lee Chee Seong, the project and investment manager of the Second Defendant as PW1/CC and the Tenth Defendant or DW1 in the main action as PW2/CC. [28] All the four defendants in the counterclaim called the First Plaintiff/PW1 as their only witness as DW1/CC. The Summary of the Contentions of the Litigants [29] In the main claim, the Plaintiffs’ case of tort of abuse of process is brought against the First and Second Defendants only. The claim of tort of conspiracy is levelled against all the 10 Defendants. [30] The essence of the case of tort of abuse as advanced by the Plaintiffs is that the institution of the various proceedings, after the authoritative pronouncements by the apex Court in the FC Judgment Suit 109; specifically the FC Review, Enclosures 62 and 69 and Suit 145 was in truth done for the dominant purpose of refusing to accept the FC Judgment Suit 109, thus insisting on the discharge of the specific performance, restraining the Plaintiffs from enforcing their legal rights, demanding more money from them, as well as preserving the core business of the First Defendant and avoiding the imposition of the PN 17 company status under the listing requirements of the stock exchange. [31] The tort of conspiracy against all Defendants is anchored on the existence of a combination or agreement of the Defendants, given the proximity of their relationships, by the carrying out of acts with the object of injuring the Plaintiffs. The Plaintiffs submitted that there was sufficient evidence of the existence of the requisite intention to cause injury by reason of the acts in questions having been directed against the Plaintiffs to prove the tort of unlawful means conspiracy and there was additionally, as inferred from evidence, a pre-dominant motive to cause injury to the Plaintiffs, which included the denial to the Plaintiffs of the fruits of litigation by circumventing their right to enforce the various judgments and orders, that constituted lawful means conspiracy. [32] The First Defendant, in opposing the claim, submitted that principally, the tort action for abuse of process must require proof, in addition to the improper purpose, of the deployment of the relevant process, in furtherance of that purpose, by way of an overt act or threat distinct from the pursuit of the proceeding itself according to its ordinary use. This, according to the First Defendant, the Plaintiffs have failed to demonstrate, and that Suit 145 was pursued by the First Defendant in accordance with its ordinary course. Neither had the Plaintiffs proven that Suit 145 had been pursued by the First Defendant for the predominant improper purpose of securing any collateral advantage. The Suit 145, so the First Defendant argued, had been filed with the single and predominant purpose of seeking redress through the legal process, given the purported predicament encountered by the First Defendant on the implications of the absence of the Section 132C shareholders’ approval. Neither had the Plaintiffs suffered any injury in any event. [33] The First Defendant further asserted that in respect of the tort of conspiracy, in the main, the Plaintiffs have failed to establish any combination or agreement between the Defendants, failed to prove any overt act on the part of the Third to Tenth Defendants, did not show any unlawful means on the part of the First Defendant, and that there was no evidence that the intention of the First Defendant filing Suit 145 was to injure the Plaintiff. [34] The Second Defendant, in adopting the submissions of the First Defendant further emphasized that the facts did not support any collateral purpose but instead showed a genuine legal recourse with legal advice. The tort of abuse cannot be sustained without evidence of some overt act by the Second Defendant and of a predominant purpose to secure a collateral advantage outside of the court proceedings. The tort of conspiracy, according to the Second Defendant, cannot, based on case-law, succeed unless the requirements of the tort are strictly met by clear, positive and convincing evidence which was not the case herein. Importantly it was also argued that there was no agreement in the context of one between the Second Defendant and true outside parties, instead of the First Defendant’s own directors and CEO, who are the Third to the Tenth Defendants. [35] The Third to the Tenth Defendants, against whom the claim of tort of conspiracy was made, contended that unlawful means was not established, intention to injure not shown, alleged intention not in any event achieved, and no damages suffered. Their key opposition to the tort of conspiracy claim is that the Plaintiffs have clearly failed to fulfill the requirement of an agreement between two or more individuals since there were no multiple minds in play as between the First and Second Defendants on the one hand, and the Third to the Tenth Defendants, being their own directors and CEO, on the other hand. [36] In respect of the counterclaim, the Second Defendant as the plaintiff argued principally that the decision of the High Court on Enclosures 62 and 69 was obtained by fraud which subsequently came to light in the evidence of the First Plaintiff during his cross-examination in the Suit 145; and that there was new evidence in the form of admissions made in the accounting treatment recorded in the financial statements of the third defendant in the counterclaim. [37] The Plaintiffs in the main action and the other defendants in the counterclaim countered such contentions, submitting instead that the First Plaintiff did not make any admission about the absence of any agreement to for the enlarged share capital in RRSB and that the plaintiff in the counterclaim could have obtained the said financial statements to be tendered in earlier proceedings. Most importantly, it was argued that the reliefs prayed for in the counterclaim are in any event already res judicata. [38] I will now examine the issues. Evaluation & Findings of this Court The tort of abuse of process – the elements [39] The dissenting judgment of Lord Denning MR in Goldsmith v. Sperrings Ltd & Ors [1977] 1 WLR 478, often regarded as a good starting point for any discussion on this subject, held as follows:- "In a civilised society legal process is the machinery for keeping and doing justice. It can be used properly or it can be abused. It is used properly when it is invoked for the vindication of men's rights or the enforcement of just claims. It is abused when it is diverted from it is true course so as to serve extortion or oppression: or to exert pressure so as to achieve an improper end. When it is so abused, it is a tort, a wrong known to the law. The judges can and will intervene to stop it. They will stay the legal process, if they can, before any harm is done. If they cannot stop it in time, and harm is done, they will give damages against the wrongdoer." [40] It is an actionable tort, according to Lord Denning MR, if the legal process is abused in order to instead oppress or extort, or exert pressure to achieve an improper end. This formulation has since been adopted in Malaysia, in the leading authority on the law governing the tort of abuse of process in the Court of Appeal decision in Malaysia Building Society Bhd v Tan Sri General Ungku Nazaruddin bin Ungku Mohamed [1998] 2 MLJ 425 which in the judgment delivered by Gopal Sri Ram JCA (as he then was) held that the essence of the law is that it is an abuse of process where the process of the Court is invoked not for the genuine purpose of obtaining relief claimed, but for a collateral purpose, such as to oppress a defendant. [41] His Lordship in Malaysia Building Society Bhd v Tan Sri General Ungku Nazaruddin bin Ungku Mohamed had also set out the essential elements of the tort of abuse of process, as follows:- (1) The process complained of must have been initiated; (2) The purpose for initiating that process must be some purpose other than to obtain genuine redress which the process offers. In other words, the dominant purpose for which the process was invoked must be collateral, that is to say, aimed at producing a result not intended by the invocation of the process; (3) The plaintiff must have suffered some damage or injury in consequence. It is to be stressed that neither malice nor the termination of the proceedings in the plaintiffs favour are necessary elements of the tort. To put it plainly, a plaintiff in an action for abuse of process need not prove that the defendant had invoked the process of the court maliciously. Neither does he have to prove that the proceedings terminated in his favour." Overt acts separate from legal process not substantive element [42] The primary argument of the First and Second Defendants is that there can be no tort of abuse because, in addition to the improper purpose, the Plaintiff must also prove any overt act or threat distinct from the court proceedings in their ordinary course. The Defendants refer to various largely Australian authorities which were reviewed by the New South Wales Court of Appeal in Maxwell-Smith v. S & E Hll Pty Ltd [2014] 308 ALR 149 to support their argument that the party alleging the tort must show the overt acts or threats which are distinct from the pursuit of the litigation process. [43] Having reviewed the authorities on this issue, I am of the view that this contention of the Defendants is misconceived. Instead, properly formulated, such overt act or threat serves only to constitute evidence of the improper purpose of pursuing the legal process. It cannot be a substantive or separate legal element for the tort because it is clear from MBSB v. Ungku Nazaruddin and the Privy Council decision in Crawford Adjuster and others v. Sagicon General Insurance (Cayman) Ltd and another [2013] 83 WIR 257 as well as the ruling of the High Court of Australia in Williams v. Spautz 107 ALR 635, all of which held that the abuse may be the inevitable objective inference from the surrounding circumstances; and most fundamentally, the abuse can also be shown by the very steps being taken in the Courts. [44] As stated by Ungku Nazaruddin, in the judgment of Gopal Sri Ram JCA (as he then was):- “On the face of it, in any particular case, the legal process may appear to be entirely proper and correct. What may make it wrongful is the purpose for which it is used. If it is done in order to exert pressure so as to achieve an end which is improper in itself, then it is a wrong known to the law.” [45] This position is also entirely consistent with a much later decision by the Privy Council in Crawford Adjusters where Lord Wilson said thus:- “But, in so far as in some quarters the overt act or threat has taken route not just as having likely the evidential importance but as being a substantive requirement, whether for the defendant’s application or for the claimant’s tort, I struggle to understand the reason for it”. [46] Lord Sumption, in the same case similarly expressed the position, in the following terms:- “It is sometimes said, for example in Fleming’s Law of Torts (10th edn. 2011) p 708, that in addition to the extraneous purpose, it is necessary to prove some ‘overt act’ other than the proceedings themselves, such as the extraordinary threat in Grainger v Hill. The better view, however, is that this is not an additional requirement but merely evidence of the extraneous purpose. As Mason CJ and Dawson Toohey and McHugh JJ observed in William v Spautz (at paragraph 41), in practice ‘the conclusion which the court reaches is more likely to be founded upon objective evidence rather than subjective evidence of intention’. In the great majority of cases, an overt act may be the only way of proving the abuse. But it is not a legal element of the tort. The abuse may sometimes be the inevitable inference from the surrounding circumstances, as it was in Dr Spautz’s case.” [emphasis added]. [47] Thus, the essence of the law on the tort of abuse of process as it applies in this country, as pronounced by the Court of Appeal and consistent with other leading English authorities, is the fundamental test of whether the legal process was utilized for some improper or ulterior purpose other than to seek a genuine redress in respect of which the process offers. There is no additional legal element or substantive requirement of the tort of abuse of process which requires any overt act or threat be shown, which is separate from the legal process or the improper purpose. [48] But this is not to say that such overt acts or threats, if they exist, are irrelevant. After all, the cornerstone of legal proceedings in all justice system, ours is no exception, is the adequacy of evidence. The overt acts and threats instead constitute evidence towards proving the presence of the improper or collateral purpose. Their importance are evidentiary in nature vis-à-vis the element of improper purpose. [49] As for the meaning of improper purpose, the often quoted explanation is that of Isaac J in the High Court of Australia in Varawa v Horward Smith Co Ltd [1910] 10 CLR 382 who had helpfully described improper purpose in the following terms:- “…if the proceedings are merely a stalking horse to coerce the defendant in some way entirely outside the ambit of the legal claim upon which the Court is asked to adjudicate they are regarded as an abuse of process for this purpose”. [50] This description was referred to by Lord Wilson in Crawford Adjusters who further elaborated on the term of improper purpose as follows:- “The metaphor aids resolution of the conundrum raised by the example of a claimant who intends that the result of the action will be the economic downfall of the defendant who may be a business rival or just an enemy. If the claimant’s intention is that the result of victory in the action will be the defendant’s downfall, then his purpose is not improper; for it is nothing other than to achieve victory in the action with all such consequences as may flow from it. If, on the other hand, his intention is to secure the defendant’s downfall – or some other disadvantage to the defendant or advantage to himself – by use of the proceedings otherwise than for the purpose for which they are designed, then his purpose is improper....” ……..” [51] The following passage from the judgment of Lord Sumption in the same case on the point is no less instructive:- “The essence of the tort is the abuse of civil proceedings for a predominant purpose other than that for which they were designed. This means for the purpose of obtaining some wholly extraneous benefit other than the relief sought and not reasonably flowing from or connected with the relief sought. The paradigm case is the use of the processes of the court as a tool of extorting, by putting pressure on the defendant to do something wholly unconnected with the relief, which he has no obligation to do.” [emphasis added] Improper purpose established [52] Having reviewed the history of the litigation and the evidence relating thereto, in my judgment, there can perhaps be no clearer example of a situation, like presently, where, despite the appearance of legitimately pursued Court proceedings, the purpose underlying the pursuit thereof is nothing but proper. This, on the authority of Ungku Nazaruddin is sufficient to sustain a claim of tort of abuse of process. For it needs no reminding that the genesis of the instant claim for tort of abuse of process is Suit 109. That Suit 109, instituted by the Plaintiffs in 2007 concluded with the FC Judgment Suit 109 on 4 September 2013 reinstating the HC Judgment 109, principally, among others for the specific performance of the relevant purchase agreements and the purchase of the entire capital of RRSB. [53] Despite the finality of that decision of the apex court in this country, the First and Second Defendants chose to commence various other proceedings, one after the other, which predominant relief unmistakably included the setting aside of the decree of specific performance. It started with the FC Review, then the cross-application in Enclosure 69 and later the Suit 145. All sought to achieve the same objective. [54] In my view, they constitute, individually and collectively a clear collateral attack on the judgments of the High Court and the Federal Court in Suit 109. The Suit 145 had the additional design of attacking the High Court and the Court of Appeal judgments on Enclosures 62 and 69. [55] I cannot do better than reproduce parts of the grounds of judgment of the High Court and the Court of Appeal in respect of Enclosures 62 and 69 to show the extent of the finding of the sheer unnecessity of those proceedings in the first place. In the High Court in respect of Enclosure 62 “[44] The first defendant exhausted all avenues to appeal. It refused to accept the payment tendered for the balance of the purchase price after the Federal Court dismissed the review application. The first defendant chose to act in defiance of the decree of specific performance by disobeying the courts' judgment. In that situation, the plaintiffs have all the right to apply for further direction from the court to complete the purchase. The plaintiffs had been waiting for so long to reap the fruits of their fruitful litigation. The court can no longer deny or delay such right”. In respect of Enclosure 69 “[39] ...All avenues of appeal have been exhausted. Judgment of the Federal Court is final and conclusive. Therefore the Court had to agree with the plaintiffs’ counsel assertion that the first defendant is indeed flogging a dead horse…” “[40] All issues raised by the first defendant were taken up or supposed to be taken up before the Federal Court in the substantive appeal or on the review application. It needs to emphasise that the decision of the High Court had been affirmed by the Federal Court. It cannot be re-visited under any guise in any subsequent proceedings. The decision of the apex court is final and the losing parties should not try to manoeuvre around it, however unhappy they are. Due respect should be given to the High Court's decision which was affirmed by the Federal Court. The so-called threshold questions and related issues raised by the first defendant on which the court has to address are neither new nor noble”. [56] And these are some of the pointed observations expressed in the grounds of the judgment of the Court of Appeal, as delivered by Mohd Zawawi Salleh JCA, and also reported in Malpac Capital Sdn Bhd v Yong Toi Mee & 2 Ors (and Another Appeal) [2016] 5 AMR 73:- “[15] We have no difficulty in accepting the proposition above. However, on the factual matrix of the case before us, we agree with the JC's conclusion that the decision of the Federal Court had finally disposed of the rights of the parties. Therefore, the controversy in respect of the rights and obligations between the parties had ceased to have an independent existence because they "merged" in that final judgment pronounced by the Federal Court. Further, this merger has long been treated as equating to "res judicata" in the strict sense. [16] We disagree with the submission of learned senior counsel for the appellant that after the conclusion of the appeal proceedings, there are two broad subsequent issues to be resolved by the court, namely: (a) the issue of the subsequent additional 99,998 shares; and (b) the non-payment of profits to the appellant as owner of the plantation assets before actual completion of the agreement. [17] We are of the view that the above issues had already been adjudicated on the merits. Therefore, they ceased to have independent existence and merged in the final judgment of the Federal Court. The appellant should not be allowed to re-open the matter or to have the court re-consider its conclusion. This is because of the public interest in the finality of litigation. Without finality, the process and cost of litigation would be never-ending, as parties would forever be returning to the court to re-argue the case and for tactical advantage. [18] We agree with the written submissions of learned counsel for the first and second respondents that the present round of litigation is unnecessary and is brought about by the appellant refusing to accept the judgment of the Federal Court. This is a repetition of the same ground that the appellant advanced in the review application before the Federal Court. The doctrine of res judicata should be invoked”. [57] In the subsequent Suit 145 brought by the First Defendant which I had dismissed, by reason principally of res judicata, I had stated the following in my grounds of judgment:- “[119] The pronouncements of the High Court and the Court of Appeal as extracted above could not have been expressed any more clearly. Yet, notwithstanding these fairly strongly worded rulings, the same issues are re-introduced in the instant suit, this time by the first defendant’s parent, the plaintiff herein. As such, since the issue of the two shares against the entire issued capital had been judicially determined in Suit 109, the subsequent adjudication of the same issues in Enclosures 62 and 69 was unsurprisingly determined by the High Court and the Court of Appeal as very clearly articulated in the respective grounds of judgment to be prohibited by res judicata. [120] Accordingly, the fresh attempt by the plaintiff in this suit before this Court to raise and revisit the very same issue cannot succeed and must suffer the same fate. This is regardless of how the plaintiff in this instant suit sought to re-formulate and re-characterize its true complaints. [121] From the issue of the additional shares which was then resurrected in a different package as the Section 132C concern, all have been previously judicially addressed and determined. The grounds of judgment of the Court of Appeal are especially specific in the ruling on the non-relevance of Section 132C because of the finding, among others, that the holding company, being MHB or the plaintiff herein had earlier already given its approval for the substantial disposal of its assets then held by MCSB to the Purchasers in 2002. As such, it is so plainly not open for the plaintiff now to again seek a repeat re-litigation of the same issues. ………… [156] It seems clear to me that the plaintiff in truth sought to invalidate the entire transaction in order to retain the Plantation Lands and avoid the potentially adverse consequences of being a listed company without core business under the Main Market Listing Requirements. If the plaintiff had genuinely wanted to seek guidance and protection vis-à-vis the possible implication of a breach of Section 132C, instead of masquerading in this fashion, embarking on this perilous and circuitous journey purportedly to quell any potential Section 132C set back, the plaintiff could have for example resorted to a more direct approach, by getting its own directors to apply for relief from the Court under Section 354 of the CA in respect of any proceedings for negligence, default, breach duty or breach of trust. …………. [159] The present claim cannot be characterized as any other than an unmitigated form of a collateral attack of the earlier judgment of Suit 109 by the High Court, affirmed by the Federal Court not once, or even twice, but effectively a staggering three times given the review proceedings, inclusive of those on the Enclosures 62 and 69. In short, this suit by the plaintiff cannot succeed and must fail”. [58] I am satisfied that on the totality of evidence, these proceedings, in respect of the FC Review, and especially Enclosure 69 as well as the Suit 145, may even, by themselves, be construed as the overt acts and threats that evidence the abuse. By their conduct in instituting these various actions, the plain inference is that the First and Second Defendants decided not to comply with the judgments which did not go their way, knowing that in the process the Plaintiffs have been unjustifiably denied of their fruits of litigation. [59] For despite the FC Review, and the clear pronouncements of the High Court and the Court of Appeal in their respective judgments in respect of Enclosures 62 and 69 expressed in no uncertain terms against the Second Defendant’s refusal to accept the judgment of the Federal Court, the defendants initiated their latest, though not by any means the final installment in this series of unnecessary legal process, by finally featuring the First Defendant in the filing of Suit 145 which has also been dismissed by this Court. The process was invoked in installments. And the reliefs sought in these proceedings are for all intents and purposes a variation of the same thing. [60] At first, the focus of the Second Defendant was on the argument that their counterclaim was not considered by the High Court in Suit 109, which is absolutely untenable in light of the decision granted on the main claim against the Second Defendant. Then, the disputation morphed into the argument that the judgment concerned the transfer of only 2 shares in RRSB which was also wholly without merit; and finally on the need for the EGM approval for the First Defendant under Section 132C, which had also been held to be unsustainable. [61] All these had been raised, either directly or with a varying degree of emphasis, by the Defendants from the time of the Second Defendant’s review application to the Federal Court, and subsequently persistently and continually repeated in Enclosures 62 and 69 proceedings and then, yet again, the Suit 145. The final attempt, at least to date, is the counterclaim in the instant Suit 326 itself. [62] All these are no ordinary course of litigation. The First and Second Defendants in the main persisted in their contention that the HC Judgment Suit 109 concerned only 2 shares in RRSB and insisted that a further shareholders’ approval for the transfer of the 99,998 RRSB shares to the Plaintiffs was legally necessary; clear judicial pronouncements to the contrary notwithstanding. This is most plainly demonstrated, other than in various courts and other documents, in the testimony of the First Defendant’s main and only two witnesses in Suit 145 who claimed to respect Court decisions but for all intent and purposes refusing to accept them at the same time. Improper purpose to deny fruits of litigation [63] The design of these litigation is manifestly to achieve a purpose other than a genuine redress that the process actually offers. The dominant and collateral purpose for which these proceedings were initiated was to achieve a result not intended by the invocation of the process, which in this case had been to delay and altogether deny the fruits of the litigation to the Plaintiffs (therefore causing damage and injury to them, see further below), by using the court process which in the first place is intended to achieve justice, to instead attain the complete opposite, and more so at the same time in the process, openly refusing to obey the decisions of the Courts. [64] The purpose sought to be secured by the First and Second Defendants thus also included, as pleaded by the Plaintiffs, discharging the specific performance, restraining the rights of the Plaintiffs to give effect to FC Judgment Suit 109, preserving the core business of the First Defendant group and avoiding PN 17 status, as well as demanding more monies from the Plaintiffs allegedly due to the Second Defendant for the enlarged capital in RRSB and under the management arrangement re the mill on the plantation lands. Conduct and acts showing improper purpose [65] As correctly highlighted by the Plaintiffs, in furtherance of the improper purpose, the First and Second Defendants pursued the following conduct, despite the finality of the FC Judgment Suit 109, and not to mention the subsequent decisions on Enclosures 62 and 69, and the Suit 145, effectively denying the fruits of litigation to Plaintiffs:- (a) Refused to accept payments of the balance purchase price (by returning the bank drafts and not furnishing company books) to complete the purchase by the Plaintiffs; (b) Filed Court applications and suits one after the other, in installments; (c) Set the stage for further litigation by claiming to later having the benefit of legal opinions on issues already adjudicated on; and (d) Convened the EGM, and issued the Circular with a disclosure done in a fashion that led to the rejection of the proposal by the shareholders, yet again providing a pretext for further legal proceedings despite the matter, this time on Section 132C, having been adjudicated on earlier as well. Injury to Plaintiffs [66] All legal process was thus utilized with the improper purpose of denying the Plaintiffs the fruits of their litigation, thus causing injury to their interests. They had lost the opportunity to maximize yield and income from the plantations and the mill during the period that they should have been the true and lawful owner of the same, and had expended unnecessarily on inefficient infrastructure and machineries at the mill when they could have invested more cost efficiently early on instead (see further below on injury to the Plaintiffs, which is similarly relevant to the discussion on the tort of conspiracy). [67] I should reiterate that, notwithstanding that the abuse in this instant case could in my judgment as stated earlier be shown by the very steps being instituted in the Courts such that the proceedings themselves – the FC Review, Enclosure 69 and the Suit 145 are sufficient to found a successful action for the tort of abuse of process, having regard to the observations of Lords Wilson and Sumption in Crawford Adjusters, these facts and circumstances (as outlined in the preceding two paragraphs), which are strictly extrinsic to the legal process and originate from the First and Second Defendants’ refusal to accept the FC Judgment Suit 109, could, objectively evaluated, be validly construed to be the overt acts and threats that further fortify the evidential premise for the finding of the existence of the improper or collateral purpose, which had harmed the economic interests of the Plaintiffs. [68] This is plainly an unjustified and unlawful tortious conduct which constitutes the tort of abuse of process, pure and simple. I cannot envisage a situation more dire than the case now before me, which integrates in the tort of abuse of process, the terror twins of denial of fruits of litigation, and blatant refusal to respect the judgments of the Courts. These strike at the heart of the core of the justice system which the Court process seeks to promote, but unnecessarily attacked by the First and Second Defendants in the instant case. [69] None of the arguments presented by the First and Second Defendants in defending the claim by the Plaintiffs are in my view meritorious. Thus, it is not open to the First Defendant to contend that the failure or downfall of the Plaintiffs would in any event be a natural consequence of the former succeeding in the Suit 145 given the fact that the latter had actually won the FC Judgment Suit 109, and have repeatedly achieved similar success in the successive judgments in the FC Review and in respect of Enclosures 62 and 69. Reliance on legal opinions untenable [70] Much had been said by the Defendants about their alleged reliance on legal opinions to justify their commencement of Enclosure 69 and the Suit 145. In the first place I am not convinced of the genuineness of the concerns on Section 132C which led to the request for advice, since, as confirmed by DW1 himself in cross-examination, this issue had been raised, without success, as early as in the application for review at the Federal Court by the Second Defendant, and both Defendants were advised by the same lawyers. This thus suggests that the Defendants purposely and purportedly introduced a new issue for litigation when the very issue had already been adjudicated on. It was well and truly res, as further reaffirmed in my decision on the Suit 145. [71] More significantly, I struggle to fathom, let alone accept, how when faced with a clear judgment of the Court – pronounced on more than one occasion – on the one hand, and a belief to the contrary however honestly and earnestly felt to be genuine on the other hand, the Defendants being companies, directors and a CEO no less in a listed group, decidedly and persistently chose the latter. In my view the law must swiftly strike down any position of litigants which is premised on their refusal to accept the judgments of the Courts, more so if this could be detected in a tortious claim of abuse of process, where judgments are disregarded by, ironically the institution of further proceedings. Refusal to accept Court judgment clear evidence of abuse and is an abuse [72] As if the conduct of the First and Second Defendants in their filing of the various proceedings is not obvious enough an abuse of process, the evidence given by the chairman and CEO of the First Defendant more than abundantly corroborates this blatant abuse. I think it is therefore apposite that the relevant exchanges in cross examination involving the testimony of DW1 (the CEO of both the First and Second Defendants) in this Suit 326 and those of the same DW1 in the Suit 145 (also as DW1) and of the chairman of the First Defendant, as PW1 in the Suit 145, be reproduced hereunder to demonstrate the brazen audacity of their stance. “PGN (Plaintiffs’ Counsel) : Ok. So by filing this suit here you are raising the same issues that have been resolved by the Federal Court and which the Court of Appeal has now said have been resolved by the Federal Court. Am I right? MUHAY (Chairman) : Yes, but our position is that we still have to seek the shareholders’ approval based on the Listing Requirements. PGN : Ok. I am putting it to you that all of those issues and the issue that you say still requires shareholders’ approval have been matters that have been resolved by the Court of Appeal and Federal Court both in Suit 109 and the dismissal of your cross application. MUHAY: I am not disputing that. PGN : Absence of approval by the shareholders. I am just going to put it to you that the High Court and the Federal Court have decided this, that the fact that there was no need for a further approval by the shareholders. MUHAY: But I was advised by my lawyer to say that we need the shareholders’ approval.” ……………………………………………… PGN : My question is simple. Did the Court decide on these issues? That’s all. Did the Court dismiss all your applications? ANG (CEO): The Court made the decision but our threshold questions were not answered. PGN : But the Court did say that that was not important. Am I correct, Mr Ang? The CPs have been met. Am I correct? ANG : Well, for reason best known to the Court. PGN : Yes. ANG : Otherwise we won’t be here today, My Lord. PGN : Yes, so you are saying the Court was wrong? ANG : I cannot say the Court was wrong. I have to respect the decisions of the Courts. PGN : Thank you. Then we leave it as that. ANG : But we need not necessary agree.” ……………………………………………… PGN : Right. Now let’s look at your Question and Answer 5A.3. This is your answer to the question therein ‘the subsequent Enclosure 69, which is the cross application was thereafter filed by MCSB in September 2014 as a cross application to that Enclosure 62. ... Now what you mean by a continued limited jurisdiction had by the High Court? ANG : I take it to mean that the, in Enclosure 62. PGN : You take it to mean meaning, these are your own words, what does it mean? ANG : Ok. I rephrase my answer, what I mean here is that the Court had limited jurisdiction in the sense that it can only interpret what is stated in the Court Order and nothing more. PGN : So from your legal advice, you take it to mean that this judgment of the High Court and Federal Court in Suit 109 is only for two shares? ANG : Yes. PGN : Right. I put it to you, that it’s this sort of statement, Mr Ang, and the CEO of Capital and Holdings, which further demonstrates your defiance of the judgment of the Court.” ………………………………………………” [73] Their reliance on legal advice, even if true, is one striking example of why the conduct cannot be genuine or done in good faith, because what the legal position is has been made more than abundantly clear by the Federal Court no less, such that an opinion on what the legal position ought to be on the applicability and implications of Section 132C is clearly secondary if not entirely irrelevant in the context. [74] The conduct of the Defendants in this regard is plainly an abuse since it is engendering non-acceptance of judgments of the Courts that cannot be countenanced in any circumstances. I must stress that judgments of the Courts must be obeyed not merely for the sake of ensuring respect for the Courts. It is essential for the higher and larger purpose that it underpins the administration of the system of justice. Acts or conduct which serve to undermine the integrity of the system erode confidence in the judicial institution that would in the process harm the nation’s constitutional democracy, its governance by the rule of law and deny the fundamental tenets on the supremacy of the Constitution. [75] It is therefore no justification that the Defendants pursued the litigation, especially Enclosure 69 and the Suit 145 upon legal advice. This is not to mention that the relevant opinions themselves are not tendered in evidence to prove what the advice actually entailed. Respect for legal professional privilege notwithstanding, there is absolutely nothing in evidence to show what the recommended course of action was. Yet the Defendants are basing their main contention that their resort to the proceedings was to seek genuine redress on the overriding basis of the legal opinions. [76] Again, it bears repetition that the pertinent legal opinion referred to by the First Defendant, which concerns the issue of Section 132C approval was procured after the same argument had been raised and dismissed by the Federal Court in the FC Review. I do not think that this Court can simply accept the Defendants’ contention that the opinion was in fact rendered and the decisions made in reliance thereon are therefore business judgments. That is not how the law ought to be applied and neither does the argument promote good corporate governance and greater Board accountability. Issues with EGM circular [77] There are also concerns with the circular dated 8 July 2014 issued in conjunction with the EGM, the result of which was the overwhelming rejection by the shareholders of the transfer of the additional shares in RRSB. This conveniently became the pretext for the Second Defendant challenging Enclosure 62 and initiating Enclosure 69, and soon after, the First Defendant’s filing of the Suit 145. [78] First, the circular was prepared and issued as what is known as an exempt circular under the listing requirements of Bursa Malaysia Securities Berhad (“Bursa Malaysia”) which meant that shareholders’ approval was unnecessary. Yet the issue for consideration of the EGM was the disposal of the core business of the First Defendant which the listing requirements plainly stipulate the need for shareholders’ approval. [79] In the EGM Circular, the risk of the First Defendant being classified as a PN 17 company following completion of the proposed disposal (the purchase of the plantation lands and mill by the Plaintiffs) was highlighted, as was the risk of being de-listed altogether in the absence of any regularization plan to address the same. [80] And the insignificant business operations argument is the premise of its submission on the need for shareholders’ approval under Section 132C. The disclosure therein stated in no uncertain terms that the board of the First Defendant had not identified any suitable investments and that DW1 in the Suit 145 agreed that completion of the transfer of the additional shares and the sale of the mill on the plantation lands would result in the loss of its core business. This would consequently lead to the removal of the First Defendant’s listing status, mandating compliance with Chapter 10.11A of the listing requirements. Adherence to Chapter 10.11A required the appointment of a Main Adviser and an independent adviser, none of whom was appointed for the circular of the EGM. [81] Further, whilst I accept the argument of the First Defendant that under the new Chapter 8.03A, an insignificant or loss of business operations would not automatically result in a PN 17 classification or removal of listing status pending submission of a regularization plan, the evidence of DW1 in the instant Suit 326 confirmed that the company had not found a new business on immediate basis, and was still treating the plantations as its core business. [82] Unusually, the board also refrained from making any recommendations, said to be by reason of the HC Judgment Suit 109. Neither were the implications of the Federal Court judgments in the FC Judgment Suit 109 and the FC Review clearly disclosed. Yet the First and Second Defendants in the instant suit changed stance and now allege that the PN 17 status is due to the Plaintiffs’ failure to pay rentals and profits when clearly that was no longer an issue after the HC Judgment Suit 109. Improper purpose included retaining core business [83] Another contradiction is the disclosure in the consultation paper to Bursa Malaysia on the plan to regularize its lack of core business by way of the development of certain Johor Bahru lands which had been stated to have been conceptually advanced in status and ready for regulatory submission within a period of one year. But at the same time the shareholders were told in the EGM Circular of the absence of any regularization plans. [84] In short, on the one hand the circular sought to paint the bleakest of an outlook for the First Defendant on account of the loss of core business if the proposal before the shareholders was approved. Indeed it was not, thus providing the First Defendant the excuse on Section 132C issue, since a major transaction had allegedly not been approved by the shareholders. On the other hand, a proposal involving the potential of loss or change in core business would require shareholders’ approval in the context of Chapter 10.11A which mandated stricter regulatory oversight in terms of disclosures and appointment of two sets of advisers. This arguably applied to the EGM convened by the First Defendant but did not appear to have been adhered to. [85] Thus in my judgment it is manifest that the refusal to accept the judgments of the Court is consistent with what may be construed as the First Defendant’s overarching purpose of retaining the group’s core business, avoiding PN 17 status, and using the rejection as yet again raising the specter on the absence of Section 132C approval. I have also said the following in the grounds of judgment dismissing the Suit 145:- “[153] I cannot but agree with the Purchasers’ submission that MHB has sought to use the result of the EGM in 2014 as a “shield” on the spurious pretext to seek protection, but at the same time use the same outcome as a “sword” to continuously act in defiance of the judgments of the Courts. This, the Court cannot accept. It is totally unacceptable. [154] The key issues in contention, concerning the alleged absence of shareholders’ approval for the enlarged capital of RRSB under Section 132C (1A) had also been specifically raised and submitted by the first defendant herein in the review application and in Enclosures 62 and 69. [155] I would not endeavour to say much more on this issue of res judicata and estoppel other than concluding that attempts to re-litigate matters over and over again, and that too by instalments, are downright unconscionable and could potentially amount to equitable fraud (Rasiah Munusamy v Lim Tan & Sons Sdn Bhd [1985] 2 MLJ 291)”. [86] As such, in the instant case, since it has been shown that the various proceedings had been initiated by the First and Second Defendants for an improper purpose, resulting in injuries to the Plaintiffs, the tort of abuse of process has clearly been established. Tort of Conspiracy – elements [87] In dealing with the element of the tort of conspiracy, I can do no better than reproduce the pertinent passages from the judgment of Mohd Zawawi Salleh JCA in a recent Court of Appeal decision in Cubic Electronic Sdn Bhd v. MKC Corporate & Business Advisory Sdn Bhd and another appeal [2016] 3 CLJ 676, as follows:- “[10] To appreciate the submissions advanced by learned counsel for the defendants, we think it is relevant to deal with the law of conspiracy which is part of what are known as the "economic torts". There are four elements to a conspiracy claim: (i) a combination or agreement between two or more individuals; (ii) an intent to injure; (iii) pursuant to which combination or agreement, and with that intention, certain acts were carried out; and (iv) resulting loss and damage to the claimant. (See Khoo Teng Chye v. Cekal Berjasa Sdn Bhd & Anor, Civil Appeal No: P-02-542-03-2015 (CA) [2015] 6 CLJ 449 (CA)). [11] There are two kinds of conspiracy, the elements of which are distinct: (i) unlawful means conspiracy: a conspiracy in which the participants combine to perform acts which are themselves unlawful (under either criminal or civil law); and (ii) lawful means conspiracy: a combination to perform acts which, although not themselves per se unlawful, are done with the sole predominant purpose of injuring the claimant - it is in the fact of the conspiracy that the unlawfulness resides. (See Milicent Rosalind Danker & Anor v. Malaysia-Europe Forum Bhd & Ors [2012] 2 CLJ 1076 (HC); SCK Group Bhd & Anor v. Sunny Liew Siew Pang & Anor [2010] 9 CLJ 389; [2011] 4 MLJ 393 (CA)). [12] The distinction between the two was succinctly elucidated by Lord Bridge in Lonrho Plc v. Fayed & Others [1991] 3 All ER 303 as follows: “Where conspirators act with the predominant purpose of injuring the plaintiff and in fact inflict damage on him, but do nothing which would have been actionable if done by an individual acting alone, it is in the fact of their concerted action for that illegitimate purpose that the law, however anomalous it may now seem, finds a sufficient ground to condemn their action as illegal and tortious. But when conspirators intentionally injure the plaintiff and use unlawful means to do so, it is no defence for them to show that their primary purpose was to further or protect their own interests; it is sufficient to make their action tortious that the means used were unlawful”. [88] A conspiracy essentially consists in the agreement of two or more to do an unlawful act, or to do a lawful act by unlawful means (see Mulcahy v R (1868) LR 3 HL 306). The tort of lawful means conspiracy and unlawful means conspiracy both require evidence of the element of an agreement between two or more parties who take concerted action that causes injury to the claimant. [89] Lawful means conspiracy stipulates that the defendants’ predominant or overriding purpose is to cause loss or damage to the claimant but does not necessitate demonstration of any unlawful acts perpetrated by the conspirators or the parties to the agreement or in combination. [90] The distinct element of unlawful means conspiracy is that these defendants use unlawful means in pursuit of their objective. In this respect, two additional elements relevant to unlawful means conspiracy must be highlighted. First, the mandatory requirement is only to show an intention to injure, not that it must be the sole or predominant purpose to do so. [91] It could thus be one of the purposes of the agreement (see Lonrho plc v Fayed [1992] 1 AC 448). This can be satisfied where a conspiracy is targeted at another party and it can be reasonably foreseen that the conspiracy may cause damage or loss to that party. Once the use of unlawful means is established, it suffices if the injury to the claimant is one of their intended purposes. [92] Secondly, as was held by the House of Lords in SL v HM Revenue and Customs [2008] 2 All ER 413  the tort of conspiracy to use unlawful means does not require that the unlawful means must be independently actionable at the suit of the claimant. Both crimes and civil wrongs can constitute unlawful means. Combination and agreement established [93] In respect of the element for combination or agreement among conspirators, it has been long established that the agreement need not be express and may be inferred from overt acts, where several parties take steps towards one collective purpose, and where the participation in a conspiracy may be active or passive (see R v Siracusa [1990] 90 Cr App Rep 340 and The King and the Attorney-General of the Commonwealth v Associated Northern Colkieries & Ors [1911] 14 CLR 387). Directors can conspire with own company [94] I further find no legal basis to preclude the Third to the Tenth Defendants, being the directors and CEO of the First Defendant from being found to be acting in combination with other defendants despite the fact that the directors and CEO are the agents of the company. There is in my judgment no legal impediment to a finding that a company can conspire with its own directors (see for example, the decision of Vinelott J in Prudential Assurance Co Ltd v Newman Industries Ltd [1981] Ch 29). [95] There is no insuperable difficulty in holding that a company can conspire with its own director to cause harm to another party even if the director is the directing mind and will of the company. In this sense where a corporation is involved, a conspiracy can occur between two legal persons who share one and the same mind. This is also the position in Singapore, where Judith Prakash J in the case of Nagase Singapore Pte Ltd v Ching Kai Huat [2008] 1 SLR(R) 80 stated thus:- “…I am satisfied that in law, there can be a conspiracy between a company and its controlling director to damage a third party by unlawful means notwithstanding that the director may be the moving spirit of the company…” [96] The problems, as I have highlighted, associated with the Defendants’ heavy reliance on the legal opinions apply equally to the position taken by the Third to the Tenth Defendants. Another anomaly if not an outright flaw in their argument is that, as stated, the Second Defendant had already started to defy the order of specific performance in the proceedings prior to the receipt of the legal opinions. This more than abundantly suggests that the claim by the Defendants that they were merely discharging their duty or enforcing their legal rights to be as untenable as it is disingenuous. Similarly, any argument that the decisions taken by the directors amongst the Defendants to have been in the nature of business judgment and therefore protected is misconceived. Decisions not business judgment under Companies Act 1965 [97] Business judgments are protected under Section 132 (1B) of the Companies Act 1965. It reads:- Business judgment (1B) A director who makes a business judgment is deemed to meet the requirements of the duty under subsection (1A) and the equivalent duties under the common law and in equity if the director- (a) makes the business judgment in good faith for a proper purpose; (b) does not have a material personal interest in the subject matter of the business judgment; (c) is informed about the subject matter of the business judgment to the extent the director reasonably believes to be appropriate under the circumstances; and (d) reasonably believes that the business judgment is in the best interest of the company. [98] I find it difficult for any of the directors of the First Defendant to succeed on the argument that the decisions to continually litigate on issues already decided by the Courts were in the nature of business judgments. When the matters have already been adjudicated, even basic logic will tell a reasonable person that such matters cannot be continually be brought to Court for further litigation. What more in this case, where the Defendants include directors of a listed entity, an experienced CEO, and when the Courts had even expressed their clear disapproval of the re-litigation in Enclosures 62 and 69 which even preceded the Suit 145, as related to earlier in this judgment. [99] In short, the Defendants cannot pass muster the requirements of Section 132 (1B) that the decisions were made in good faith, for proper purpose, in the reasonable belief that they were appropriate and in the best interest of the company, and without any personal interest in the decisions, to benefit from the protection of the said Section 132 (1B). Parent can conspire with wholly owned subsidiary [100] Neither does the law not recognize the ability of the First and Second Defendants of conspiring with one another on account only of the identity of interest between the two (see the English High Court decision in Twentieth Century Fox Films Corporation and others v. David Harris and others [2014] EWHC 1568 (Ch)). They are separate legal entities but they are also related corporations under Companies Act 1965. [101] More pertinently the First Defendant is the holding company of the Second Defendant. They share a common CEO in DW1, and have common directors. The core business of the group helmed by the listed First Defendant at the material time, namely the plantation assets, were indirectly held by the Second Defendant, thus rendering matters concerning the Second Defendant to have an impact on the affairs of the First Defendant. Their relationship, as supported by evidence manifestly showed that they work in concert in the pursuit of the proceedings. [102] As stated, the preponderance of evidence showed the conduct and acts of the Defendants such as the filing of the FC Review, Enclosure 69 and the Suit 145 in seeking the re-litigation of matters already adjudicated on, frustrating completion, seeking further legal opinions, convening the EGM with the circular referred to earlier, all of which do nothing but reveal the true intention of the Defendants in not adhering to the decisions of the Courts, thwarting the enforcement of the decisions, and demanding more money from the Plaintiffs. [103] There can then be little doubt that the irresistible inference that must be drawn from the aforesaid conduct and acts of the Defendants in this Suit 326, is that the conspiracy of combination or agreement involving all 10 Defendants in their respective parts and roles consisted principally of their common agreement of objectives of persistently denying the Plaintiffs, despite the FC Judgment Suit 109, from enjoying the fruits of their litigation, continually refusing to execute specific performance, demanding for more payments from the Plaintiffs, and ensuring that the First and Second Defendants get to retain the plantation assets as the core business of the group. Intention of injuring the Plaintiff in concerted fashion established [104] The objective of the agreement in the aforesaid conspiracy was to injure the interest of the Plaintiffs, given especially the evidence on the repeated Court proceedings and their reliefs, as well as their timing, and pursued in instalments to boot, all further point inescapably to the presence of the intention to cause harm to the Plaintiffs. [105] This more than qualifies as the predominant intention in a lawful means conspiracy, which can be said to be had by each of the 10 Defendants, or at the very least a predominant or sole intention to injure in the nature of reckless indifference to the injury caused to the Plaintiffs, in so far as the Third to the Tenth Defendants are concerned. [106] In relation to lawful means conspiracy, the sole or predominant intention on the part of the Defendants in their conspiracy to injure the Plaintiffs is more than amply shown to be manifested in the former refusing to permit the Plaintiffs see through the completion of the purchase transactions, demanding more payments from them, thus benefiting the Defendants, more directly the First and Second Defendants, by their retention of the core business that was the plantation assets subject to the purchase. And for unlawful means conspiracy, such a predominant intention for lawful means is more than sufficient to satisfy the element of an intention to cause harm in an unlawful means conspiracy. [107] Furthermore there is no insurmountable difficulty in showing that the Defendants in a conspiracy had acted with a predominant intention to injure the Plaintiffs, because even though the Defendants may have done so to enrich themselves, the element of the intention to injure can nevertheless still be found against them, since a loss to the Plaintiffs is the flipside or opposite to the gain for the Defendants (see further discussion on injury and damages below). [108] The CEO for the First Defendant (DW1) had given evidence that all the directors (the Third to the Ninth Defendants) had the requisite knowledge and participated in the decision-making process of all issues in contention such as rejecting payment made by the Plaintiffs after the FC Judgment Suit 109, the institution of the various proceedings and even on instructing solicitors. [109] In accordance with case law authorities as referred to earlier, such an intention is also sufficient for purposes of establishing the tort of unlawful means conspiracy for it was directed at the Plaintiff and it could reasonably be foreseen that it may injure them and did in fact injure them. I agree with the argument of the Plaintiffs that the unlawful means employed by the Defendants is the continual re-litigation of the issues which are manifestly already res judicata, which is also a substantive rule of law, as well as engaging in an abuse of process in their incessant pursuit of the various proceedings. [110] As stated earlier, the concept of unlawful means in this tort of conspiracy admits of a wide scope. The following words of Lord Nicholls in OBG Ltd and others v Allan [2007] UKHL 21 are most apt:- “So understood the concept of “unlawful means” stretches far and wide. It covers common law torts, statutory torts, crimes, breaches of contract, breaches of trust and equitable obligations, breaches of confidence, and so on,” “…..In this context, the expression “unlawful means” embraces all acts a defendant is not permitted to do, whether by the civil law or the criminal law”. Director defendants chose not to give evidence or be cross-examined [111] It is worthy of emphasis that despite being the directing will and mind of the First Defendant, all the directors (being the Third to the Ninth Defendants) with the exception of the Chairman (even that only in the Suit 145, not in the claim against him in this Suit 326) chose not to give evidence, what more be available for cross-examination, despite each having been identified, named and sued for the tort of conspiracy. This certainly does little to bolster their defence. [112] And in any event, the evidence given by the CEO confirmed that the directors had authorized the CEO, who is not a member of the board, to give evidence on their behalf but who at the same time agreed that he could not possibly testify on the state of minds of the directors. And the reliance on the legal opinions argument has also been found to be more than wanting, earlier in this judgment. Authorities do not advance case of Defendants [113] The First and Second Defendants also submitted on a number of authorities to support their stance. I shall only deal with the ones I consider more relevant for present purposes. It was submitted that the Court of Appeal case of Formis Resources Bhd & Ors v Risk Management and Safety Systems Pty Ltd & Ors [2016] 6 MLJ 73 held that the Court should not infer any sinister intention when contemporaneous documents are capable of giving rise to other inferences such that in the instant case, the Defendants argued to have acted in good faith to protect the interests of the companies based on legal advice. [114] I do not see how this decision could truly advance the case for the Defendants. Documents in the forms of letters attributed to the Second Defendant, supported by testimony by DW1 showed refusal to complete despite Courts judgments since the FC Judgment Suit 109. The inference pointing to a conspiracy is irresistible. The argument on the purported reliance on legal advice, given the facts of the instant case and the history in litigation, and as has been discussed earlier, is simply difficult to sustain. [115] And crucially, it is basic as it is common sense that good faith cannot be an excuse not to obey decisions of the Courts. In truth, when one is aware of the nature of judgments of the Courts, and to their credit, none of the Defendants are pleading that the concept of Court judgments is alien to any of them, the refusal or failure to adhere to the same, unless stayed or set aside, cannot under any circumstances amount to any act or conduct premised on good faith. [116] Reliance was also placed on the English Court of Appeal decision in Meretz Investments NV v ACP Ltd [2008] Ch 244 which held that a person who sets out to protect his own interests in the belief that he has a lawful right to do what he is doing, based on legal advice, does not have the intention required for the torts of inducing a breach of contract or conspiring to injure by unlawful means, even though the inevitable result of acting in that way will be to cause loss to another. [117] In the leading authority of Belmont Finance v Williams Furniture [1980] 1 All ER 393 it was established that if parties have knowledge of the facts which made the relevant transaction unlawful, they could be liable for unlawful means conspiracy even if they did not appreciate that the transaction itself is unlawful. As submitted by the First Defendant, the English Court of Appeal in Meretz expressed the view that it is a defence to an action for unlawful means conspiracy if the defendant acted in a belief that he had the lawful right to act as he did. The First Defendant argued that in light of Meretz, the principle enunciated in Belmont Finance is therefore no longer good law. [118] But there is at least one English High Court decision, in the case of First Subsea Ltd v Balltec Ltd and others [2014] EWHC 866 (Ch) which rejected this view, on the basis that the relevant statements in Meretz were obiter and that despite Belmont Finance, on this point, having been referred to the House of Lords in OBG Ltd and others v Allan [2007] UKHL 21, a decision on the related tort of causing loss by unlawful means, the House of Lords in OBG Ltd did not in any manner discredit let alone overrule Belmont Finance. [119] In any event, it should also be emphasized that in Meretz, the defendants’ belief in their lawful right to do what they did was also, like in the instant case based on legal advice but which unlike in the instant case, the opinion in Meretz was produced to the Court as evidence. Not in the instant case. [120] The other reason why this case cannot support the position of the Defendants is plain. I cannot accept that the Defendants could be said to have held on to the belief that they had a lawful right to continually litigate matters which had been adjudicated on, especially when the Courts have even specifically pointed out in express terms that Enclosure 69 was wholly unnecessary and had been initiated due to the Second Defendant’s disobedience and defiance in its refusal to accept the judgment of the Court. [121] I therefore find that given there is no dearth of clear, positive and convincing evidence on the satisfaction of the elements of the Defendants having in combination and agreement colluded to injure the interests of the Plaintiffs and taken steps for that purpose in concerted fashion, resulting in loss to the Plaintiffs, the torts of lawful means as well as unlawful means conspiracy have thus been established by the Plaintiffs against all the Defendants. Damages [122] The crux of the claim in the instant case for the harm and injury inflicted on the Plaintiffs, arising from the torts of abuse and conspiracy perpetrated by the Defendants, concerns the loss of opportunity by the Plaintiffs, of maximizing the full potential of the plantation lands and the mill. [123] On damages, I find the claim for special damages related to the loss of opportunity to the amount of RM25,159,294.16 to the Plaintiffs from 2013 to the first six months of 2016 to develop the plantation lands to maximize potential to be supported by evidence. On loss of yield income, the Plaintiffs could have undertaken re-planting on the Ganda Plantation much earlier if not for the non-completion engineered by the Defendants. [124] The approach undertaken in proving loss of opportunity in maximizing yield was by comparing yield per hectare per annum derived from adjacent estates as against the actual yield recorded by the ageing trees of Ganda Plantation. The methodology also employed a projected yield per hectare per annum figure of 30 MT as derived from the actual yield of the neighbouring Cempaka Plantation estate based on fresh fruit bunches sales records, as tendered in Court. [125] I accept the evidence of PW4 and PW5, both the expert witnesses for the Plaintiffs. I do not find anything obviously indefensible or unsupported by basic facts in the reports tendered by the experts, more so when they were cross-examined (see the Court of Appeal decision in Majuikan Sdn Bhd v Barclays Bank Plc [2015] 1 MLJ 171). Crucially, no expert report was offered by the Defendants to challenge that of the experts for the Plaintiffs. In any event I find PW4’s explanation when challenged in cross-examination on the alleged wholly hypothetical premise of their report to be credible, convincing and therefore acceptable. [126] Although pursuant to the relevant management agreement, the Plaintiffs were in possession of the plantation assets, the all-important legal and registered ownership was denied to them, and as supported by the financial statements of the third defendant in the counterclaim (Sri Ganda Oil Mill) the Plaintiffs had thus far only largely expended on the maintenance of the plantation and not on replanting activities. The First and Second Defendants cannot validly contend that being in possession, the Plaintiffs were never prevented from developing the plantation lands and the mill. [127] This is because, again, legal ownership was denied and the management agreement was said by the Second Defendant to have been terminated when the Court of Appeal reversed the HC Judgment Suit 109. The First and Second Defendant cannot benefit in this fashion when they were the ones refusing to obey the judgments of the Courts. [128] In the case of Bank Simpanan Nasional v Rudysham Abdul Raof [2017] 4 CLJ 234, I had stated thus:- “No Benefit from Own Default [88] It is also my finding that the appellant is additionally subject to the trite principle of law that a party cannot benefit from his own wrong or default, which in this case, being the negligent mistake by the appellant. It is an established presumption in law that parties to a contract do not intend that either party should be able rely on its own breach of obligations to avoid a contract or obtain any benefit under it, unless the contrary is clearly provided for by the contract (see the House of Lords decision in New Zealand Shipping Co v. Société des Ateliers et Chantiers de France [1919] AC 1.” [129] On the claim for loss of savings which the Plaintiffs could have avoided if they had legal title of the mill, specifically the special damages in respect of maintenance savings for the mill, machinery replacement cost and reduction of labour costs, I find that these are all supported by the same contemporaneous documents relied on by PW5 in arriving at his conclusions in his expert report on the efficiency of the existing mill (not countered by any expert report by the Defendants) particularly on the savings if the mill had been upgraded to the cage-less sterilizer system. The claim for RM1,861,780.98 is therefore justified. [130] The other final claim of special damages for additional diesel cost of RM517.875.00 and additional labour costs of RM1,696,784.24 related to maintaining an inefficient mill operation in its current state is similarly supported by documentary records and the uncontroverted expert report by PW5, and thus should also be allowed. [131] Further, the presence of Sri Ganda Oil Mill (the third defendant in the counterclaim) who incurred the expenses for operating and maintaining the mill does not affect the claim of the Plaintiffs. It is irrelevant to the question on the liability of the Defendants in having caused damage and loss to the Plaintiffs. There can be no dispute that, on the evidence, including that of DW1, Sri Ganda was the agent appointed by the Plaintiffs to manage the plantation and the mill on their behalf. [132] This is because clearly the Plaintiffs are the contracting parties (with the Second Defendant) against whom the torts were committed, who should rightly be entitled to the legal ownership of the plantations, and crucially are the ones who had suffered the loss. An owner to a property damaged by another can claim damages even if the costs of repairs come from a third party source (see the English Court of Appeal decision in Jones and another v Stroud District Council [1988] 1 All ER 5, and the House of Lords decisions in Linden Gardens Trust Ltd v Leresta Sludge Disposal Ltd 36 Con LR 1 and in Hunt v Severs [1994] 2 AC 350). [133] I accept the basis for the grant of general damages for the loss of the short term lease in that if not for the torts, the Plaintiffs would have renewed the lease. The purchase price, transacted in 2003, of the plantation lands was RM30.6 million when the lease had 30 years more to run before expiry. This generally averaged to about RM1 million per year. The Plaintiffs’ claim for RM4 million in general damages for a claim period of 2013 to 2017, since the torts were committed in 2013 (after the FC Judgment Suit 109) is therefore not unreasonable and ought to be considered positively. [134] But I am of the view that considering the circumstances and the award of special damages, the award of RM1 million in general damages to be a more reasonable and appropriate sum. The Plaintiffs are entitled to be compensated for the harm done to their economic interests (see Deepak Jaikishan a/l Jaikishan Rewachand v Intrared Sdn Bhd & another [2013] 7 MLJ 437). [135] Further, given the continual, incessant and wholly unwarranted filing of proceedings which tantamount to a blatant refusal to accept the finality of judgments of the Courts, and unduly delaying what is rightly the entitlement of the Plaintiffs to enjoy, I am of the view that the grant of exemplary damages is justified, applying the principles enunciated in the leading House of Lords decision in Rookes v Barnard and others [1964] 1 All ER 367, particularly in respect of the second category of situations justifying the grant of exemplary damages (the conduct of Defendants was calculated to make a profit for themselves which may well exceed the compensation payable to the Plaintiffs) and the Court of Appeal decision in Lembaga Kemajuan Tanah Persekutuan (FELDA) & Anor v Awang Soh bin Mamat & Ors [2009] 4 MLJ 610. [136] I am of the view that the award of RM250,000 is reasonable and sufficiently demonstrates, in the circumstances of this case, and given the other awards of special and general damages, to use the words of Lord Devlin in Rookes v Barnard, the need “to teach the wrongdoer that tort does not pay”. I do not however allow the claim for aggravated damages which I consider unnecessary on the facts of the case and taking into account the other awards made by this Court. Counterclaim [137] As stated in the earlier part of this judgment, in the instant counterclaim, the Second Defendant as the plaintiff is seeking for various declarations and reliefs, including an account for profit share and rental for the plantation lands and the related mill from July 2011 for the sum of RM43,045,551.38, unjust enrichment on the part of the Plaintiffs in respect of the increased share capital in RRSB, the need for approval under Section 132C of the Companies Act 1965, for the transfer of 99,998 shares, that the same shares be restored to the Second Defendant, and that the High Court decision on Enclosures 62 and 69 dated 17 February 2015 granted to the Plaintiffs be impeached on the ground of fraud. [138] I find the reliance by the Second Defendant on the argument that the decision of the High Court on Enclosures 62 and 69 was obtained by fraud which purported evidence allegedly subsequently came to light in the testimony of the First Plaintiff during his cross-examination in Suit 145; and that there was new evidence in the form of admissions made in the accounting treatment recorded in the financial statements of the Sri Ganda or the third defendant in the counterclaim, to be wholly unmeritorious. [139] A review of the notes of proceedings did not reveal that the First Plaintiff agreed that the relevant agreement was for only 2 shares in RRSB since it was clear in the context that his position was that the agreement had always been for the entire share capital of RRSB. [140] The alleged new evidence in the financial statements of Sri Ganda cannot validly be construed as such since the Second Defendant could have obtained the purported evidence in the said financial statements to be tendered in any of the earlier proceedings. The Second Defendant failed to do so. [141] In any event, the counterclaim can achieve nothing but failure because the allegations and complaints as well as the reliefs pleaded in the same are, yet again, res judicata. The counterclaim is thus far the final instalment in the unmeritorious series of re-litigation mounted by the Defendants. It is an abuse of process by the Second Defendant pure and simple. [142] The same issues have thus far been raised for a staggering seventh time, in that they had been ventilated at and dismissed by the High Court three times, once at the Court of Appeal and three times at the Federal Court. I therefore dismiss the counter claim in its entirety. Reliefs against Prayers [143] Therefore in reference to the paragraph 53.1 and 53.2 of the Re-Re-Amended Statement of Claim, I order special damages against the First and Second Defendants jointly and severally in the sum of RM29,235,678.38 as pleaded under (a), general damages of RM1,000,000.00 under (b), exemplary damages of RM250,000 under (c), interest as pleaded under (e) which is 5% from date of judgment to full satisfaction. [144] I also find the all Defendants liable for tort of conspiracy jointly and severally; and order special damages for the same amount as pleaded in (a) and interest as pleaded under (d). For clarity the First and Second Defendants’ liability, jointly and severally, for special damages for both torts is limited to the single amount of RM29,235,678.38. Conclusion [145] In view of the foregoing reasons, I find that the Plaintiffs have succeeded in proving their case against the Defendants on a balance of probabilities. The reverse is not true for the counterclaim instituted by the Second Defendant. [146] I therefore allow the reliefs prayed for by the Plaintiffs in terms stated earlier, and dismiss the counterclaim in its entirety. I also order costs for the Plaintiffs. Dated: 24 August 2017 (MOHD NAZLAN BIN MOHD GHAZALI) Judge High Court NCC1 Kuala Lumpur Counsel Counsel for Plaintiffs P Gananathan with Olivia Loh, Ng Choo Beng and Yeoh Kai Ying Messrs Ng Choo Beng R. Naidu & Partners Teluk Intan, Perak Counsel for the First Defendant W T Low Messrs Weng & Co. Petaling Jaya, Selangor Counsel for the Second Defendant SH Leong Messrs Leong & Partners Petaling Jaya, Selangor Counsel for the Third – Tenth Defendants Tharminder Singh with Aravind Kumar Messrs Izral Partnership Kuala Lumpur Counsel for the Third Defendant in Counterclaim Brendan Siva with Aida Messrs Brendan Siva Kuala Lumpur Page 41 of 41

Tika 2.6.0

WA-22NCC-326-09/2016

PLAINTIF 1. YONG TOI MEE (No. K/P: 531101-08-6935) 2. CHEANG KIM LEONG (No. K/P: 570522-08-6513) …PLAINTIF -PLAINTIF DEFENDAN 1. MALPAC HOLDINGS BERHAD (No. Sykt: 197424-V) 2. MALPAC CAPITAL SDN BHD (No. Sykt: 384869-U) 3. LIM HONG LIANG (NO. K/P: 590511-04-5681) 4. TAN CHON SING @ TAN KIM TIENG (NO. K/P: 381031-01-5435) 5. GAN TECK SHONG @ GAN KWAN CHONG (NO. K/P: 470424-01-5481) 6. CHEW LOY CHEE (NO. K/P: 360830-71-5005) 7. KAN AH CHUN (NO. K/P: 530806-07-5051) 8. MUHAYUDDIN BIN MUSA (NO. K/P: 621218-01-5443) 9. JOHARI LOW BIN ABDULLAH (NO. K/P: 501228-10-5649) 10. ANG POO GUAN (NO. K/P: 481029-07-5517) … DEFENDAN - DEFENDAN

24/08/2017

YA TUAN MOHD NAZLAN BIN MOHD GHAZALI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=c4ccdb6a-045f-4e25-9abb-8387177ffeba&Inline=true

DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR GUAMAN NO.: WA-22NCC-326-09/2016 ANTARA 1. YONG TOI MEE (No. K/P: 531101-08-6935) 2. CHEANG KIM LEONG (No. K/P: 570522-08-6513) …PLAINTIF-PLAINTIF DAN 1. MALPAC HOLDINGS BERHAD (No. Sykt: 197424-V) 2. MALPAC CAPITAL SDN BHD (No. Sykt: 384869-U) 3. LIM HONG LIANG (NO. K/P: 590511-04-5681) 4. TAN CHON SING @ TAN KIM TIENG (NO. K/P: 381031-01-5435) 5. GAN TECK SHONG @ GAN KWAN CHONG (NO. K/P: 470424-01-5481) 6. CHEW LOY CHEE (NO. K/P: 360830-71-5005) 7. KAN AH CHUN (NO. K/P: 530806-07-5051) 8. MUHAYUDDIN BIN MUSA (NO. K/P: 621218-01-5443) 9. JOHARI LOW BIN ABDULLAH (NO. K/P: 501228-10-5649) 10. ANG POO GUAN (NO. K/P: 481029-07-5517) …DEFENDAN- DEFENDAN [MELALUI TUNTUTAN UTAMA] ANTARA MALPAC CAPITAL SDN BHD (No. Sykt: 384869-U) …PLAINTIF DAN 1. YONG TOI MEE (No. K/P: 531101-08-6935) 2. CHEANG KIM LEONG (No. K/P: 570522-08-6513) 3. SRI GANDA OIL MILL SDN BHD (No. Sykt: 575998-V) 4. RADIANT RESPONSE SDN BHD (No. Sykt: 463879-D) …DEFENDAN- DEFENDAN [MELALUI TUNTUTAN BALAS] DI HADAPAN YANG ARIF TUAN MOHD NAZLAN MOHD GHAZALI HAKIM JUDGMENT Introduction [1] This is a writ action seeking damages under the tort of abuse of process and the tort of conspiracy. There is also a counterclaim for unjust enrichment and for the setting aside of an order of the High Court. After full trial, I allowed the main claim and dismissed the counterclaim. [2] This judgment sets out the full reasons for my decision and contains discussions on the scope of the tort of abuse of process and the torts of lawful means and unlawful means conspiracy. Key Background Facts [3] There is the long history to this dispute. It found its origin in the agreement entered into between the Plaintiffs and the Second Defendant in 2002 concerning the purchase of plantation lands by the former, which relationship eventually turned litigious in 2007. A series of court proceedings ensued, the decisions on some of which have also been reported. These include the Federal Court decision in Yong Toi Mee & Anor v Malpac Capital Sdn Bhd & Anor [2013] 8 CLJ 725 and the Court of Appeal decision in Malpac Capital Sdn Bhd v Yong Toi Mee & Ors and another appeal [2016] 8 CLJ 613. [4] A detailed narrative of the facts would therefore be neither necessary nor economical for the purposes of this judgment. But some background facts are essential, albeit chronologically stated in summary fashion in the following several paragraphs. [5] The Plaintiffs are business individuals who entered into the relevant agreement to purchase the plantation assets of the Second Defendant as part of the overall restructuring of the First Defendant under the auspices of Pengurusan Danaharta Malaysia Berhad. The First Defendant is a locally incorporated public company listed on the Main Board of Bursa Malaysia. It is an investment holding company. The Second Defendant is a private company which is wholly owned by the First Defendant. [6] The Third to the Ninth Defendants are all directors on the board of the First Defendant at the material time, with the Eighth Defendant being the chairman. The Tenth Defendant is the chief executive officer of both the First and Second Defendants. [7] In the counterclaim filed by the Second Defendant, reliefs were sought against the two Plaintiffs as the first and second defendants, Sri Ganda Oil Mill Sdn Bhd (“Sri Ganda”) as the third defendant, being a company controlled by the First Plaintiff (first defendant in the counterclaim), and Radiant Response Sdn Bhd (“RRSB”), as the fourth defendant, being the company which had been nominated to hold the subject plantation assets following the restructuring, which shares had been purchased by the Plaintiffs. [8] The crux of the case of the Plaintiffs herein, and the basis for their action under the torts of abuse of process and conspiracy is that the relevant Defendants refused to comply with the decisions of the Courts by continually, in their institution of subsequent and different proceedings, seeking, among others, to set aside the decree of specific performance on the purchase of the plantation assets against them granted on 5 May 2011 by the High Court in Ipoh High Court Suit No. 22-109-2007 (“HC Judgment Suit 109”). [9] A key decision of the HC Judgment Suit 109 is that the purchase of RRSB (which was to hold the plantation assets) by the Plaintiffs concerned the entire share capital of RRSB and was not only limited to 2 shares in RRSB which at the time of execution of agreement constituted the entire capital of RRSB. Thus the purchase by the Plaintiffs encompassed the subsequent increase in the share capital of RRSB (being a requirement of the relevant licensing authority) from 2 to 100,000 ordinary shares in RRSB. [10] The HC Judgment Suit 109 which was in favour of the Plaintiffs which then obtained the order for the specific performance for the completion of the purchase of the plantation assets was subsequently reversed by the Court of Appeal. [11] The Federal Court on 4 September 2013 however restored the HC Judgment Suit 109, and directed the Plaintiffs to make payment of the balance purchase price within one month (“the FC Judgment Suit 109”) (see Yong Toi Mee & Anor v Malpac Capital Sdn Bhd & Anor [2013] 8 CLJ 725 referred to earlier). Despite the Plaintiffs’ conduct towards compliance with the FC Judgment Suit 109, the Second Defendant refused to complete, and instead filed for a review application on 3 October 2013 to the Federal Court against the FC Judgment Suit 109. The review application was dismissed by the Federal Court on 4 March 2014 (“the FC Review”). [12] Efforts by the Plaintiffs to complete the purchase after the FC Review continued to be unsuccessful as the First and Second Defendants then sought legal opinions, despite the FC Judgment Suit 109 and the FC Review. The Board of the First Defendant on 23 April 2014 resolved to convene an extraordinary general meeting (EGM), to seek its shareholders approval for, among others, the disposal of the additional shares of 99,998 in the enlarged capital of RRSB, and the mill at the plantation lands to the Plaintiffs, whilst the board agreed to regulate an interim position with the Plaintiffs on the basis of their ownership of only the 2 shares in RRSB. [13] The Plaintiffs thus felt compelled to seek enforcement of the specific performance which, as had been decided by HC Judgment Suit 109, FC Judgment Suit 109 and the FC Review, concerned the entire share capital of RRSB, not just the 2 shares. The Plaintiffs filed a notice of application at the Ipoh High Court for orders to give effect to the specific performance (“Enclosure 62”). At the EGM held on 31 July 2014, the said proposed disposals to the Plaintiffs failed to secure the approval of the shareholders of the First Defendant. [14] On 22 September 2014, the Second Defendant filed a cross-application at the Ipoh High Court (“Enclosure 69”) requesting the Ipoh High Court to determine certain threshold questions and issues of law, but clearly to seek the discharge of the specific performance on the strength of the alleged absence of shareholders’ approval under Section 132C for the disposal of the additional shares in RRSB and the mill to the Plaintiffs. It also sought to set aside the same on the basis that the sum of RM36.7 million was due from the Plaintiffs in respect of the management of the plantation lands and the mill. [15] On 17 February 2015, the Ipoh High Court allowed enclosure 62 for the Plaintiffs and dismissed Enclosure 69 against the Second Defendant, who appealed against both these decisions. On 15 August 2015, the Second Defendant’s appeal was dismissed by the Court of Appeal (see Malpac Capital Sdn Bhd v Yong Toi Mee & Ors and another appeal [2016] 8 CLJ 613 referred to earlier). [16] The order of the High Court allowing Enclosure 62 included the appointment of the Plaintiffs as the directors of RRSB and removal of the latter’s then existing directors, the payment by the Plaintiffs of RM49 million inclusive of the additional shares of 99,998 and for the Deputy Registrar be authorised to execute relevant documentation, including the share transfer forms, to give effect to the orders, and thus the specific performance and completion of the purchase of the plantation assets. [17] Following the dismissal of the appeal by the Court of Appeal in respect of these Enclosures 62 and 69, the Second Defendant sought leave to appeal to the Federal Court. This was refused on 13 February 2017. [18] That was however not the end of the matter. [19] Enter the First Defendant, the Second Defendant’s parent, for the first time, officially. The dispute has now moved inter-state to Kuala Lumpur. The First Defendant filed on 15 April 2016 suit WA-22NCC-145-04/2016 (“Suit 145”) in this Court as plaintiff, and the Second Defendant claimed to be a nominal party as the first defendant. Suit 145 sought guidance from this Court on the legal implications of the absence of the Section 132C approval given the rejection of the proposal on the transfer of the 99,998 shares, to complete the purchase and give effect to what was first granted by the HC Judgment 109. [20] On 4 August 2016 subsequent to the filing of the Suit 145, the Plaintiffs commenced this instant proceeding, responded to by the Second Defendant by the filing of the counterclaim. [21] In the instant counterclaim, the Second Defendant as the plaintiff is seeking for various declarations and reliefs, including an account for profit share and rental for the plantation lands and the related mill from July 2011 for the sum of RM43,045,551.38, unjust enrichment on the part of the Plaintiffs in respect of the increased share capital in RRSB, the need for approval under Section 132C of the Companies Act 1965 for the transfer of 99,998 shares, that the same shares be restored to the Second Defendant, and that the High Court decision on Enclosures 62 and 69 dated 17 February 2015 granted to the Plaintiffs be impeached on the ground of fraud. [22] This Court 11 April 2017 dismissed the claim of the First Defendant in Suit 145. The Trial and the Witnesses [23] The instant case before me was originally filed by the Plaintiffs in the Civil Division of the High Court vide suit WA-22NCVC-486-08-2016. Following agreement of parties, the action was then transferred before me, by reason of the related proceedings then already pending in this Court in Suit 145. Following the transfer, this action was registered as WA-22NCC-326-09/2016 (“Suit 326”). I ordered that the instant Suit 326 be heard after Suit 145 which by then was already ready for trial, and that evidence in the latter should stand as evidence in the former. [24] The trial for this Suit 326 was held over three days in February 2017. [25] In the main action, the Plaintiffs called five witnesses, as follows:- (a) The First Plaintiff himself as PW1; (b) The Second Plaintiff as PW2; (c) Goh Ah Peng, director of Sri Ganda Oil Mill Sdn Bhd as PW3; (d) Sathianathan a/l ER Nair, an expert witness, as PW4; and (e) Yeo Chai Seng, also an expert witness, as PW5. [26] The Defendants, all 10 of them, called only one witness, namely Ang Poo Guan, the CEO of the First and Second Defendants, as DW1. DW1 is also the Tenth Defendant. [27] In the counterclaim, the Second Defendant, as the plaintiff, called two witnesses, namely Lee Chee Seong, the project and investment manager of the Second Defendant as PW1/CC and the Tenth Defendant or DW1 in the main action as PW2/CC. [28] All the four defendants in the counterclaim called the First Plaintiff/PW1 as their only witness as DW1/CC. The Summary of the Contentions of the Litigants [29] In the main claim, the Plaintiffs’ case of tort of abuse of process is brought against the First and Second Defendants only. The claim of tort of conspiracy is levelled against all the 10 Defendants. [30] The essence of the case of tort of abuse as advanced by the Plaintiffs is that the institution of the various proceedings, after the authoritative pronouncements by the apex Court in the FC Judgment Suit 109; specifically the FC Review, Enclosures 62 and 69 and Suit 145 was in truth done for the dominant purpose of refusing to accept the FC Judgment Suit 109, thus insisting on the discharge of the specific performance, restraining the Plaintiffs from enforcing their legal rights, demanding more money from them, as well as preserving the core business of the First Defendant and avoiding the imposition of the PN 17 company status under the listing requirements of the stock exchange. [31] The tort of conspiracy against all Defendants is anchored on the existence of a combination or agreement of the Defendants, given the proximity of their relationships, by the carrying out of acts with the object of injuring the Plaintiffs. The Plaintiffs submitted that there was sufficient evidence of the existence of the requisite intention to cause injury by reason of the acts in questions having been directed against the Plaintiffs to prove the tort of unlawful means conspiracy and there was additionally, as inferred from evidence, a pre-dominant motive to cause injury to the Plaintiffs, which included the denial to the Plaintiffs of the fruits of litigation by circumventing their right to enforce the various judgments and orders, that constituted lawful means conspiracy. [32] The First Defendant, in opposing the claim, submitted that principally, the tort action for abuse of process must require proof, in addition to the improper purpose, of the deployment of the relevant process, in furtherance of that purpose, by way of an overt act or threat distinct from the pursuit of the proceeding itself according to its ordinary use. This, according to the First Defendant, the Plaintiffs have failed to demonstrate, and that Suit 145 was pursued by the First Defendant in accordance with its ordinary course. Neither had the Plaintiffs proven that Suit 145 had been pursued by the First Defendant for the predominant improper purpose of securing any collateral advantage. The Suit 145, so the First Defendant argued, had been filed with the single and predominant purpose of seeking redress through the legal process, given the purported predicament encountered by the First Defendant on the implications of the absence of the Section 132C shareholders’ approval. Neither had the Plaintiffs suffered any injury in any event. [33] The First Defendant further asserted that in respect of the tort of conspiracy, in the main, the Plaintiffs have failed to establish any combination or agreement between the Defendants, failed to prove any overt act on the part of the Third to Tenth Defendants, did not show any unlawful means on the part of the First Defendant, and that there was no evidence that the intention of the First Defendant filing Suit 145 was to injure the Plaintiff. [34] The Second Defendant, in adopting the submissions of the First Defendant further emphasized that the facts did not support any collateral purpose but instead showed a genuine legal recourse with legal advice. The tort of abuse cannot be sustained without evidence of some overt act by the Second Defendant and of a predominant purpose to secure a collateral advantage outside of the court proceedings. The tort of conspiracy, according to the Second Defendant, cannot, based on case-law, succeed unless the requirements of the tort are strictly met by clear, positive and convincing evidence which was not the case herein. Importantly it was also argued that there was no agreement in the context of one between the Second Defendant and true outside parties, instead of the First Defendant’s own directors and CEO, who are the Third to the Tenth Defendants. [35] The Third to the Tenth Defendants, against whom the claim of tort of conspiracy was made, contended that unlawful means was not established, intention to injure not shown, alleged intention not in any event achieved, and no damages suffered. Their key opposition to the tort of conspiracy claim is that the Plaintiffs have clearly failed to fulfill the requirement of an agreement between two or more individuals since there were no multiple minds in play as between the First and Second Defendants on the one hand, and the Third to the Tenth Defendants, being their own directors and CEO, on the other hand. [36] In respect of the counterclaim, the Second Defendant as the plaintiff argued principally that the decision of the High Court on Enclosures 62 and 69 was obtained by fraud which subsequently came to light in the evidence of the First Plaintiff during his cross-examination in the Suit 145; and that there was new evidence in the form of admissions made in the accounting treatment recorded in the financial statements of the third defendant in the counterclaim. [37] The Plaintiffs in the main action and the other defendants in the counterclaim countered such contentions, submitting instead that the First Plaintiff did not make any admission about the absence of any agreement to for the enlarged share capital in RRSB and that the plaintiff in the counterclaim could have obtained the said financial statements to be tendered in earlier proceedings. Most importantly, it was argued that the reliefs prayed for in the counterclaim are in any event already res judicata. [38] I will now examine the issues. Evaluation & Findings of this Court The tort of abuse of process – the elements [39] The dissenting judgment of Lord Denning MR in Goldsmith v. Sperrings Ltd & Ors [1977] 1 WLR 478, often regarded as a good starting point for any discussion on this subject, held as follows:- "In a civilised society legal process is the machinery for keeping and doing justice. It can be used properly or it can be abused. It is used properly when it is invoked for the vindication of men's rights or the enforcement of just claims. It is abused when it is diverted from it is true course so as to serve extortion or oppression: or to exert pressure so as to achieve an improper end. When it is so abused, it is a tort, a wrong known to the law. The judges can and will intervene to stop it. They will stay the legal process, if they can, before any harm is done. If they cannot stop it in time, and harm is done, they will give damages against the wrongdoer." [40] It is an actionable tort, according to Lord Denning MR, if the legal process is abused in order to instead oppress or extort, or exert pressure to achieve an improper end. This formulation has since been adopted in Malaysia, in the leading authority on the law governing the tort of abuse of process in the Court of Appeal decision in Malaysia Building Society Bhd v Tan Sri General Ungku Nazaruddin bin Ungku Mohamed [1998] 2 MLJ 425 which in the judgment delivered by Gopal Sri Ram JCA (as he then was) held that the essence of the law is that it is an abuse of process where the process of the Court is invoked not for the genuine purpose of obtaining relief claimed, but for a collateral purpose, such as to oppress a defendant. [41] His Lordship in Malaysia Building Society Bhd v Tan Sri General Ungku Nazaruddin bin Ungku Mohamed had also set out the essential elements of the tort of abuse of process, as follows:- (1) The process complained of must have been initiated; (2) The purpose for initiating that process must be some purpose other than to obtain genuine redress which the process offers. In other words, the dominant purpose for which the process was invoked must be collateral, that is to say, aimed at producing a result not intended by the invocation of the process; (3) The plaintiff must have suffered some damage or injury in consequence. It is to be stressed that neither malice nor the termination of the proceedings in the plaintiffs favour are necessary elements of the tort. To put it plainly, a plaintiff in an action for abuse of process need not prove that the defendant had invoked the process of the court maliciously. Neither does he have to prove that the proceedings terminated in his favour." Overt acts separate from legal process not substantive element [42] The primary argument of the First and Second Defendants is that there can be no tort of abuse because, in addition to the improper purpose, the Plaintiff must also prove any overt act or threat distinct from the court proceedings in their ordinary course. The Defendants refer to various largely Australian authorities which were reviewed by the New South Wales Court of Appeal in Maxwell-Smith v. S & E Hll Pty Ltd [2014] 308 ALR 149 to support their argument that the party alleging the tort must show the overt acts or threats which are distinct from the pursuit of the litigation process. [43] Having reviewed the authorities on this issue, I am of the view that this contention of the Defendants is misconceived. Instead, properly formulated, such overt act or threat serves only to constitute evidence of the improper purpose of pursuing the legal process. It cannot be a substantive or separate legal element for the tort because it is clear from MBSB v. Ungku Nazaruddin and the Privy Council decision in Crawford Adjuster and others v. Sagicon General Insurance (Cayman) Ltd and another [2013] 83 WIR 257 as well as the ruling of the High Court of Australia in Williams v. Spautz 107 ALR 635, all of which held that the abuse may be the inevitable objective inference from the surrounding circumstances; and most fundamentally, the abuse can also be shown by the very steps being taken in the Courts. [44] As stated by Ungku Nazaruddin, in the judgment of Gopal Sri Ram JCA (as he then was):- “On the face of it, in any particular case, the legal process may appear to be entirely proper and correct. What may make it wrongful is the purpose for which it is used. If it is done in order to exert pressure so as to achieve an end which is improper in itself, then it is a wrong known to the law.” [45] This position is also entirely consistent with a much later decision by the Privy Council in Crawford Adjusters where Lord Wilson said thus:- “But, in so far as in some quarters the overt act or threat has taken route not just as having likely the evidential importance but as being a substantive requirement, whether for the defendant’s application or for the claimant’s tort, I struggle to understand the reason for it”. [46] Lord Sumption, in the same case similarly expressed the position, in the following terms:- “It is sometimes said, for example in Fleming’s Law of Torts (10th edn. 2011) p 708, that in addition to the extraneous purpose, it is necessary to prove some ‘overt act’ other than the proceedings themselves, such as the extraordinary threat in Grainger v Hill. The better view, however, is that this is not an additional requirement but merely evidence of the extraneous purpose. As Mason CJ and Dawson Toohey and McHugh JJ observed in William v Spautz (at paragraph 41), in practice ‘the conclusion which the court reaches is more likely to be founded upon objective evidence rather than subjective evidence of intention’. In the great majority of cases, an overt act may be the only way of proving the abuse. But it is not a legal element of the tort. The abuse may sometimes be the inevitable inference from the surrounding circumstances, as it was in Dr Spautz’s case.” [emphasis added]. [47] Thus, the essence of the law on the tort of abuse of process as it applies in this country, as pronounced by the Court of Appeal and consistent with other leading English authorities, is the fundamental test of whether the legal process was utilized for some improper or ulterior purpose other than to seek a genuine redress in respect of which the process offers. There is no additional legal element or substantive requirement of the tort of abuse of process which requires any overt act or threat be shown, which is separate from the legal process or the improper purpose. [48] But this is not to say that such overt acts or threats, if they exist, are irrelevant. After all, the cornerstone of legal proceedings in all justice system, ours is no exception, is the adequacy of evidence. The overt acts and threats instead constitute evidence towards proving the presence of the improper or collateral purpose. Their importance are evidentiary in nature vis-à-vis the element of improper purpose. [49] As for the meaning of improper purpose, the often quoted explanation is that of Isaac J in the High Court of Australia in Varawa v Horward Smith Co Ltd [1910] 10 CLR 382 who had helpfully described improper purpose in the following terms:- “…if the proceedings are merely a stalking horse to coerce the defendant in some way entirely outside the ambit of the legal claim upon which the Court is asked to adjudicate they are regarded as an abuse of process for this purpose”. [50] This description was referred to by Lord Wilson in Crawford Adjusters who further elaborated on the term of improper purpose as follows:- “The metaphor aids resolution of the conundrum raised by the example of a claimant who intends that the result of the action will be the economic downfall of the defendant who may be a business rival or just an enemy. If the claimant’s intention is that the result of victory in the action will be the defendant’s downfall, then his purpose is not improper; for it is nothing other than to achieve victory in the action with all such consequences as may flow from it. If, on the other hand, his intention is to secure the defendant’s downfall – or some other disadvantage to the defendant or advantage to himself – by use of the proceedings otherwise than for the purpose for which they are designed, then his purpose is improper....” ……..” [51] The following passage from the judgment of Lord Sumption in the same case on the point is no less instructive:- “The essence of the tort is the abuse of civil proceedings for a predominant purpose other than that for which they were designed. This means for the purpose of obtaining some wholly extraneous benefit other than the relief sought and not reasonably flowing from or connected with the relief sought. The paradigm case is the use of the processes of the court as a tool of extorting, by putting pressure on the defendant to do something wholly unconnected with the relief, which he has no obligation to do.” [emphasis added] Improper purpose established [52] Having reviewed the history of the litigation and the evidence relating thereto, in my judgment, there can perhaps be no clearer example of a situation, like presently, where, despite the appearance of legitimately pursued Court proceedings, the purpose underlying the pursuit thereof is nothing but proper. This, on the authority of Ungku Nazaruddin is sufficient to sustain a claim of tort of abuse of process. For it needs no reminding that the genesis of the instant claim for tort of abuse of process is Suit 109. That Suit 109, instituted by the Plaintiffs in 2007 concluded with the FC Judgment Suit 109 on 4 September 2013 reinstating the HC Judgment 109, principally, among others for the specific performance of the relevant purchase agreements and the purchase of the entire capital of RRSB. [53] Despite the finality of that decision of the apex court in this country, the First and Second Defendants chose to commence various other proceedings, one after the other, which predominant relief unmistakably included the setting aside of the decree of specific performance. It started with the FC Review, then the cross-application in Enclosure 69 and later the Suit 145. All sought to achieve the same objective. [54] In my view, they constitute, individually and collectively a clear collateral attack on the judgments of the High Court and the Federal Court in Suit 109. The Suit 145 had the additional design of attacking the High Court and the Court of Appeal judgments on Enclosures 62 and 69. [55] I cannot do better than reproduce parts of the grounds of judgment of the High Court and the Court of Appeal in respect of Enclosures 62 and 69 to show the extent of the finding of the sheer unnecessity of those proceedings in the first place. In the High Court in respect of Enclosure 62 “[44] The first defendant exhausted all avenues to appeal. It refused to accept the payment tendered for the balance of the purchase price after the Federal Court dismissed the review application. The first defendant chose to act in defiance of the decree of specific performance by disobeying the courts' judgment. In that situation, the plaintiffs have all the right to apply for further direction from the court to complete the purchase. The plaintiffs had been waiting for so long to reap the fruits of their fruitful litigation. The court can no longer deny or delay such right”. In respect of Enclosure 69 “[39] ...All avenues of appeal have been exhausted. Judgment of the Federal Court is final and conclusive. Therefore the Court had to agree with the plaintiffs’ counsel assertion that the first defendant is indeed flogging a dead horse…” “[40] All issues raised by the first defendant were taken up or supposed to be taken up before the Federal Court in the substantive appeal or on the review application. It needs to emphasise that the decision of the High Court had been affirmed by the Federal Court. It cannot be re-visited under any guise in any subsequent proceedings. The decision of the apex court is final and the losing parties should not try to manoeuvre around it, however unhappy they are. Due respect should be given to the High Court's decision which was affirmed by the Federal Court. The so-called threshold questions and related issues raised by the first defendant on which the court has to address are neither new nor noble”. [56] And these are some of the pointed observations expressed in the grounds of the judgment of the Court of Appeal, as delivered by Mohd Zawawi Salleh JCA, and also reported in Malpac Capital Sdn Bhd v Yong Toi Mee & 2 Ors (and Another Appeal) [2016] 5 AMR 73:- “[15] We have no difficulty in accepting the proposition above. However, on the factual matrix of the case before us, we agree with the JC's conclusion that the decision of the Federal Court had finally disposed of the rights of the parties. Therefore, the controversy in respect of the rights and obligations between the parties had ceased to have an independent existence because they "merged" in that final judgment pronounced by the Federal Court. Further, this merger has long been treated as equating to "res judicata" in the strict sense. [16] We disagree with the submission of learned senior counsel for the appellant that after the conclusion of the appeal proceedings, there are two broad subsequent issues to be resolved by the court, namely: (a) the issue of the subsequent additional 99,998 shares; and (b) the non-payment of profits to the appellant as owner of the plantation assets before actual completion of the agreement. [17] We are of the view that the above issues had already been adjudicated on the merits. Therefore, they ceased to have independent existence and merged in the final judgment of the Federal Court. The appellant should not be allowed to re-open the matter or to have the court re-consider its conclusion. This is because of the public interest in the finality of litigation. Without finality, the process and cost of litigation would be never-ending, as parties would forever be returning to the court to re-argue the case and for tactical advantage. [18] We agree with the written submissions of learned counsel for the first and second respondents that the present round of litigation is unnecessary and is brought about by the appellant refusing to accept the judgment of the Federal Court. This is a repetition of the same ground that the appellant advanced in the review application before the Federal Court. The doctrine of res judicata should be invoked”. [57] In the subsequent Suit 145 brought by the First Defendant which I had dismissed, by reason principally of res judicata, I had stated the following in my grounds of judgment:- “[119] The pronouncements of the High Court and the Court of Appeal as extracted above could not have been expressed any more clearly. Yet, notwithstanding these fairly strongly worded rulings, the same issues are re-introduced in the instant suit, this time by the first defendant’s parent, the plaintiff herein. As such, since the issue of the two shares against the entire issued capital had been judicially determined in Suit 109, the subsequent adjudication of the same issues in Enclosures 62 and 69 was unsurprisingly determined by the High Court and the Court of Appeal as very clearly articulated in the respective grounds of judgment to be prohibited by res judicata. [120] Accordingly, the fresh attempt by the plaintiff in this suit before this Court to raise and revisit the very same issue cannot succeed and must suffer the same fate. This is regardless of how the plaintiff in this instant suit sought to re-formulate and re-characterize its true complaints. [121] From the issue of the additional shares which was then resurrected in a different package as the Section 132C concern, all have been previously judicially addressed and determined. The grounds of judgment of the Court of Appeal are especially specific in the ruling on the non-relevance of Section 132C because of the finding, among others, that the holding company, being MHB or the plaintiff herein had earlier already given its approval for the substantial disposal of its assets then held by MCSB to the Purchasers in 2002. As such, it is so plainly not open for the plaintiff now to again seek a repeat re-litigation of the same issues. ………… [156] It seems clear to me that the plaintiff in truth sought to invalidate the entire transaction in order to retain the Plantation Lands and avoid the potentially adverse consequences of being a listed company without core business under the Main Market Listing Requirements. If the plaintiff had genuinely wanted to seek guidance and protection vis-à-vis the possible implication of a breach of Section 132C, instead of masquerading in this fashion, embarking on this perilous and circuitous journey purportedly to quell any potential Section 132C set back, the plaintiff could have for example resorted to a more direct approach, by getting its own directors to apply for relief from the Court under Section 354 of the CA in respect of any proceedings for negligence, default, breach duty or breach of trust. …………. [159] The present claim cannot be characterized as any other than an unmitigated form of a collateral attack of the earlier judgment of Suit 109 by the High Court, affirmed by the Federal Court not once, or even twice, but effectively a staggering three times given the review proceedings, inclusive of those on the Enclosures 62 and 69. In short, this suit by the plaintiff cannot succeed and must fail”. [58] I am satisfied that on the totality of evidence, these proceedings, in respect of the FC Review, and especially Enclosure 69 as well as the Suit 145, may even, by themselves, be construed as the overt acts and threats that evidence the abuse. By their conduct in instituting these various actions, the plain inference is that the First and Second Defendants decided not to comply with the judgments which did not go their way, knowing that in the process the Plaintiffs have been unjustifiably denied of their fruits of litigation. [59] For despite the FC Review, and the clear pronouncements of the High Court and the Court of Appeal in their respective judgments in respect of Enclosures 62 and 69 expressed in no uncertain terms against the Second Defendant’s refusal to accept the judgment of the Federal Court, the defendants initiated their latest, though not by any means the final installment in this series of unnecessary legal process, by finally featuring the First Defendant in the filing of Suit 145 which has also been dismissed by this Court. The process was invoked in installments. And the reliefs sought in these proceedings are for all intents and purposes a variation of the same thing. [60] At first, the focus of the Second Defendant was on the argument that their counterclaim was not considered by the High Court in Suit 109, which is absolutely untenable in light of the decision granted on the main claim against the Second Defendant. Then, the disputation morphed into the argument that the judgment concerned the transfer of only 2 shares in RRSB which was also wholly without merit; and finally on the need for the EGM approval for the First Defendant under Section 132C, which had also been held to be unsustainable. [61] All these had been raised, either directly or with a varying degree of emphasis, by the Defendants from the time of the Second Defendant’s review application to the Federal Court, and subsequently persistently and continually repeated in Enclosures 62 and 69 proceedings and then, yet again, the Suit 145. The final attempt, at least to date, is the counterclaim in the instant Suit 326 itself. [62] All these are no ordinary course of litigation. The First and Second Defendants in the main persisted in their contention that the HC Judgment Suit 109 concerned only 2 shares in RRSB and insisted that a further shareholders’ approval for the transfer of the 99,998 RRSB shares to the Plaintiffs was legally necessary; clear judicial pronouncements to the contrary notwithstanding. This is most plainly demonstrated, other than in various courts and other documents, in the testimony of the First Defendant’s main and only two witnesses in Suit 145 who claimed to respect Court decisions but for all intent and purposes refusing to accept them at the same time. Improper purpose to deny fruits of litigation [63] The design of these litigation is manifestly to achieve a purpose other than a genuine redress that the process actually offers. The dominant and collateral purpose for which these proceedings were initiated was to achieve a result not intended by the invocation of the process, which in this case had been to delay and altogether deny the fruits of the litigation to the Plaintiffs (therefore causing damage and injury to them, see further below), by using the court process which in the first place is intended to achieve justice, to instead attain the complete opposite, and more so at the same time in the process, openly refusing to obey the decisions of the Courts. [64] The purpose sought to be secured by the First and Second Defendants thus also included, as pleaded by the Plaintiffs, discharging the specific performance, restraining the rights of the Plaintiffs to give effect to FC Judgment Suit 109, preserving the core business of the First Defendant group and avoiding PN 17 status, as well as demanding more monies from the Plaintiffs allegedly due to the Second Defendant for the enlarged capital in RRSB and under the management arrangement re the mill on the plantation lands. Conduct and acts showing improper purpose [65] As correctly highlighted by the Plaintiffs, in furtherance of the improper purpose, the First and Second Defendants pursued the following conduct, despite the finality of the FC Judgment Suit 109, and not to mention the subsequent decisions on Enclosures 62 and 69, and the Suit 145, effectively denying the fruits of litigation to Plaintiffs:- (a) Refused to accept payments of the balance purchase price (by returning the bank drafts and not furnishing company books) to complete the purchase by the Plaintiffs; (b) Filed Court applications and suits one after the other, in installments; (c) Set the stage for further litigation by claiming to later having the benefit of legal opinions on issues already adjudicated on; and (d) Convened the EGM, and issued the Circular with a disclosure done in a fashion that led to the rejection of the proposal by the shareholders, yet again providing a pretext for further legal proceedings despite the matter, this time on Section 132C, having been adjudicated on earlier as well. Injury to Plaintiffs [66] All legal process was thus utilized with the improper purpose of denying the Plaintiffs the fruits of their litigation, thus causing injury to their interests. They had lost the opportunity to maximize yield and income from the plantations and the mill during the period that they should have been the true and lawful owner of the same, and had expended unnecessarily on inefficient infrastructure and machineries at the mill when they could have invested more cost efficiently early on instead (see further below on injury to the Plaintiffs, which is similarly relevant to the discussion on the tort of conspiracy). [67] I should reiterate that, notwithstanding that the abuse in this instant case could in my judgment as stated earlier be shown by the very steps being instituted in the Courts such that the proceedings themselves – the FC Review, Enclosure 69 and the Suit 145 are sufficient to found a successful action for the tort of abuse of process, having regard to the observations of Lords Wilson and Sumption in Crawford Adjusters, these facts and circumstances (as outlined in the preceding two paragraphs), which are strictly extrinsic to the legal process and originate from the First and Second Defendants’ refusal to accept the FC Judgment Suit 109, could, objectively evaluated, be validly construed to be the overt acts and threats that further fortify the evidential premise for the finding of the existence of the improper or collateral purpose, which had harmed the economic interests of the Plaintiffs. [68] This is plainly an unjustified and unlawful tortious conduct which constitutes the tort of abuse of process, pure and simple. I cannot envisage a situation more dire than the case now before me, which integrates in the tort of abuse of process, the terror twins of denial of fruits of litigation, and blatant refusal to respect the judgments of the Courts. These strike at the heart of the core of the justice system which the Court process seeks to promote, but unnecessarily attacked by the First and Second Defendants in the instant case. [69] None of the arguments presented by the First and Second Defendants in defending the claim by the Plaintiffs are in my view meritorious. Thus, it is not open to the First Defendant to contend that the failure or downfall of the Plaintiffs would in any event be a natural consequence of the former succeeding in the Suit 145 given the fact that the latter had actually won the FC Judgment Suit 109, and have repeatedly achieved similar success in the successive judgments in the FC Review and in respect of Enclosures 62 and 69. Reliance on legal opinions untenable [70] Much had been said by the Defendants about their alleged reliance on legal opinions to justify their commencement of Enclosure 69 and the Suit 145. In the first place I am not convinced of the genuineness of the concerns on Section 132C which led to the request for advice, since, as confirmed by DW1 himself in cross-examination, this issue had been raised, without success, as early as in the application for review at the Federal Court by the Second Defendant, and both Defendants were advised by the same lawyers. This thus suggests that the Defendants purposely and purportedly introduced a new issue for litigation when the very issue had already been adjudicated on. It was well and truly res, as further reaffirmed in my decision on the Suit 145. [71] More significantly, I struggle to fathom, let alone accept, how when faced with a clear judgment of the Court – pronounced on more than one occasion – on the one hand, and a belief to the contrary however honestly and earnestly felt to be genuine on the other hand, the Defendants being companies, directors and a CEO no less in a listed group, decidedly and persistently chose the latter. In my view the law must swiftly strike down any position of litigants which is premised on their refusal to accept the judgments of the Courts, more so if this could be detected in a tortious claim of abuse of process, where judgments are disregarded by, ironically the institution of further proceedings. Refusal to accept Court judgment clear evidence of abuse and is an abuse [72] As if the conduct of the First and Second Defendants in their filing of the various proceedings is not obvious enough an abuse of process, the evidence given by the chairman and CEO of the First Defendant more than abundantly corroborates this blatant abuse. I think it is therefore apposite that the relevant exchanges in cross examination involving the testimony of DW1 (the CEO of both the First and Second Defendants) in this Suit 326 and those of the same DW1 in the Suit 145 (also as DW1) and of the chairman of the First Defendant, as PW1 in the Suit 145, be reproduced hereunder to demonstrate the brazen audacity of their stance. “PGN (Plaintiffs’ Counsel) : Ok. So by filing this suit here you are raising the same issues that have been resolved by the Federal Court and which the Court of Appeal has now said have been resolved by the Federal Court. Am I right? MUHAY (Chairman) : Yes, but our position is that we still have to seek the shareholders’ approval based on the Listing Requirements. PGN : Ok. I am putting it to you that all of those issues and the issue that you say still requires shareholders’ approval have been matters that have been resolved by the Court of Appeal and Federal Court both in Suit 109 and the dismissal of your cross application. MUHAY: I am not disputing that. PGN : Absence of approval by the shareholders. I am just going to put it to you that the High Court and the Federal Court have decided this, that the fact that there was no need for a further approval by the shareholders. MUHAY: But I was advised by my lawyer to say that we need the shareholders’ approval.” ……………………………………………… PGN : My question is simple. Did the Court decide on these issues? That’s all. Did the Court dismiss all your applications? ANG (CEO): The Court made the decision but our threshold questions were not answered. PGN : But the Court did say that that was not important. Am I correct, Mr Ang? The CPs have been met. Am I correct? ANG : Well, for reason best known to the Court. PGN : Yes. ANG : Otherwise we won’t be here today, My Lord. PGN : Yes, so you are saying the Court was wrong? ANG : I cannot say the Court was wrong. I have to respect the decisions of the Courts. PGN : Thank you. Then we leave it as that. ANG : But we need not necessary agree.” ……………………………………………… PGN : Right. Now let’s look at your Question and Answer 5A.3. This is your answer to the question therein ‘the subsequent Enclosure 69, which is the cross application was thereafter filed by MCSB in September 2014 as a cross application to that Enclosure 62. ... Now what you mean by a continued limited jurisdiction had by the High Court? ANG : I take it to mean that the, in Enclosure 62. PGN : You take it to mean meaning, these are your own words, what does it mean? ANG : Ok. I rephrase my answer, what I mean here is that the Court had limited jurisdiction in the sense that it can only interpret what is stated in the Court Order and nothing more. PGN : So from your legal advice, you take it to mean that this judgment of the High Court and Federal Court in Suit 109 is only for two shares? ANG : Yes. PGN : Right. I put it to you, that it’s this sort of statement, Mr Ang, and the CEO of Capital and Holdings, which further demonstrates your defiance of the judgment of the Court.” ………………………………………………” [73] Their reliance on legal advice, even if true, is one striking example of why the conduct cannot be genuine or done in good faith, because what the legal position is has been made more than abundantly clear by the Federal Court no less, such that an opinion on what the legal position ought to be on the applicability and implications of Section 132C is clearly secondary if not entirely irrelevant in the context. [74] The conduct of the Defendants in this regard is plainly an abuse since it is engendering non-acceptance of judgments of the Courts that cannot be countenanced in any circumstances. I must stress that judgments of the Courts must be obeyed not merely for the sake of ensuring respect for the Courts. It is essential for the higher and larger purpose that it underpins the administration of the system of justice. Acts or conduct which serve to undermine the integrity of the system erode confidence in the judicial institution that would in the process harm the nation’s constitutional democracy, its governance by the rule of law and deny the fundamental tenets on the supremacy of the Constitution. [75] It is therefore no justification that the Defendants pursued the litigation, especially Enclosure 69 and the Suit 145 upon legal advice. This is not to mention that the relevant opinions themselves are not tendered in evidence to prove what the advice actually entailed. Respect for legal professional privilege notwithstanding, there is absolutely nothing in evidence to show what the recommended course of action was. Yet the Defendants are basing their main contention that their resort to the proceedings was to seek genuine redress on the overriding basis of the legal opinions. [76] Again, it bears repetition that the pertinent legal opinion referred to by the First Defendant, which concerns the issue of Section 132C approval was procured after the same argument had been raised and dismissed by the Federal Court in the FC Review. I do not think that this Court can simply accept the Defendants’ contention that the opinion was in fact rendered and the decisions made in reliance thereon are therefore business judgments. That is not how the law ought to be applied and neither does the argument promote good corporate governance and greater Board accountability. Issues with EGM circular [77] There are also concerns with the circular dated 8 July 2014 issued in conjunction with the EGM, the result of which was the overwhelming rejection by the shareholders of the transfer of the additional shares in RRSB. This conveniently became the pretext for the Second Defendant challenging Enclosure 62 and initiating Enclosure 69, and soon after, the First Defendant’s filing of the Suit 145. [78] First, the circular was prepared and issued as what is known as an exempt circular under the listing requirements of Bursa Malaysia Securities Berhad (“Bursa Malaysia”) which meant that shareholders’ approval was unnecessary. Yet the issue for consideration of the EGM was the disposal of the core business of the First Defendant which the listing requirements plainly stipulate the need for shareholders’ approval. [79] In the EGM Circular, the risk of the First Defendant being classified as a PN 17 company following completion of the proposed disposal (the purchase of the plantation lands and mill by the Plaintiffs) was highlighted, as was the risk of being de-listed altogether in the absence of any regularization plan to address the same. [80] And the insignificant business operations argument is the premise of its submission on the need for shareholders’ approval under Section 132C. The disclosure therein stated in no uncertain terms that the board of the First Defendant had not identified any suitable investments and that DW1 in the Suit 145 agreed that completion of the transfer of the additional shares and the sale of the mill on the plantation lands would result in the loss of its core business. This would consequently lead to the removal of the First Defendant’s listing status, mandating compliance with Chapter 10.11A of the listing requirements. Adherence to Chapter 10.11A required the appointment of a Main Adviser and an independent adviser, none of whom was appointed for the circular of the EGM. [81] Further, whilst I accept the argument of the First Defendant that under the new Chapter 8.03A, an insignificant or loss of business operations would not automatically result in a PN 17 classification or removal of listing status pending submission of a regularization plan, the evidence of DW1 in the instant Suit 326 confirmed that the company had not found a new business on immediate basis, and was still treating the plantations as its core business. [82] Unusually, the board also refrained from making any recommendations, said to be by reason of the HC Judgment Suit 109. Neither were the implications of the Federal Court judgments in the FC Judgment Suit 109 and the FC Review clearly disclosed. Yet the First and Second Defendants in the instant suit changed stance and now allege that the PN 17 status is due to the Plaintiffs’ failure to pay rentals and profits when clearly that was no longer an issue after the HC Judgment Suit 109. Improper purpose included retaining core business [83] Another contradiction is the disclosure in the consultation paper to Bursa Malaysia on the plan to regularize its lack of core business by way of the development of certain Johor Bahru lands which had been stated to have been conceptually advanced in status and ready for regulatory submission within a period of one year. But at the same time the shareholders were told in the EGM Circular of the absence of any regularization plans. [84] In short, on the one hand the circular sought to paint the bleakest of an outlook for the First Defendant on account of the loss of core business if the proposal before the shareholders was approved. Indeed it was not, thus providing the First Defendant the excuse on Section 132C issue, since a major transaction had allegedly not been approved by the shareholders. On the other hand, a proposal involving the potential of loss or change in core business would require shareholders’ approval in the context of Chapter 10.11A which mandated stricter regulatory oversight in terms of disclosures and appointment of two sets of advisers. This arguably applied to the EGM convened by the First Defendant but did not appear to have been adhered to. [85] Thus in my judgment it is manifest that the refusal to accept the judgments of the Court is consistent with what may be construed as the First Defendant’s overarching purpose of retaining the group’s core business, avoiding PN 17 status, and using the rejection as yet again raising the specter on the absence of Section 132C approval. I have also said the following in the grounds of judgment dismissing the Suit 145:- “[153] I cannot but agree with the Purchasers’ submission that MHB has sought to use the result of the EGM in 2014 as a “shield” on the spurious pretext to seek protection, but at the same time use the same outcome as a “sword” to continuously act in defiance of the judgments of the Courts. This, the Court cannot accept. It is totally unacceptable. [154] The key issues in contention, concerning the alleged absence of shareholders’ approval for the enlarged capital of RRSB under Section 132C (1A) had also been specifically raised and submitted by the first defendant herein in the review application and in Enclosures 62 and 69. [155] I would not endeavour to say much more on this issue of res judicata and estoppel other than concluding that attempts to re-litigate matters over and over again, and that too by instalments, are downright unconscionable and could potentially amount to equitable fraud (Rasiah Munusamy v Lim Tan & Sons Sdn Bhd [1985] 2 MLJ 291)”. [86] As such, in the instant case, since it has been shown that the various proceedings had been initiated by the First and Second Defendants for an improper purpose, resulting in injuries to the Plaintiffs, the tort of abuse of process has clearly been established. Tort of Conspiracy – elements [87] In dealing with the element of the tort of conspiracy, I can do no better than reproduce the pertinent passages from the judgment of Mohd Zawawi Salleh JCA in a recent Court of Appeal decision in Cubic Electronic Sdn Bhd v. MKC Corporate & Business Advisory Sdn Bhd and another appeal [2016] 3 CLJ 676, as follows:- “[10] To appreciate the submissions advanced by learned counsel for the defendants, we think it is relevant to deal with the law of conspiracy which is part of what are known as the "economic torts". There are four elements to a conspiracy claim: (i) a combination or agreement between two or more individuals; (ii) an intent to injure; (iii) pursuant to which combination or agreement, and with that intention, certain acts were carried out; and (iv) resulting loss and damage to the claimant. (See Khoo Teng Chye v. Cekal Berjasa Sdn Bhd & Anor, Civil Appeal No: P-02-542-03-2015 (CA) [2015] 6 CLJ 449 (CA)). [11] There are two kinds of conspiracy, the elements of which are distinct: (i) unlawful means conspiracy: a conspiracy in which the participants combine to perform acts which are themselves unlawful (under either criminal or civil law); and (ii) lawful means conspiracy: a combination to perform acts which, although not themselves per se unlawful, are done with the sole predominant purpose of injuring the claimant - it is in the fact of the conspiracy that the unlawfulness resides. (See Milicent Rosalind Danker & Anor v. Malaysia-Europe Forum Bhd & Ors [2012] 2 CLJ 1076 (HC); SCK Group Bhd & Anor v. Sunny Liew Siew Pang & Anor [2010] 9 CLJ 389; [2011] 4 MLJ 393 (CA)). [12] The distinction between the two was succinctly elucidated by Lord Bridge in Lonrho Plc v. Fayed & Others [1991] 3 All ER 303 as follows: “Where conspirators act with the predominant purpose of injuring the plaintiff and in fact inflict damage on him, but do nothing which would have been actionable if done by an individual acting alone, it is in the fact of their concerted action for that illegitimate purpose that the law, however anomalous it may now seem, finds a sufficient ground to condemn their action as illegal and tortious. But when conspirators intentionally injure the plaintiff and use unlawful means to do so, it is no defence for them to show that their primary purpose was to further or protect their own interests; it is sufficient to make their action tortious that the means used were unlawful”. [88] A conspiracy essentially consists in the agreement of two or more to do an unlawful act, or to do a lawful act by unlawful means (see Mulcahy v R (1868) LR 3 HL 306). The tort of lawful means conspiracy and unlawful means conspiracy both require evidence of the element of an agreement between two or more parties who take concerted action that causes injury to the claimant. [89] Lawful means conspiracy stipulates that the defendants’ predominant or overriding purpose is to cause loss or damage to the claimant but does not necessitate demonstration of any unlawful acts perpetrated by the conspirators or the parties to the agreement or in combination. [90] The distinct element of unlawful means conspiracy is that these defendants use unlawful means in pursuit of their objective. In this respect, two additional elements relevant to unlawful means conspiracy must be highlighted. First, the mandatory requirement is only to show an intention to injure, not that it must be the sole or predominant purpose to do so. [91] It could thus be one of the purposes of the agreement (see Lonrho plc v Fayed [1992] 1 AC 448). This can be satisfied where a conspiracy is targeted at another party and it can be reasonably foreseen that the conspiracy may cause damage or loss to that party. Once the use of unlawful means is established, it suffices if the injury to the claimant is one of their intended purposes. [92] Secondly, as was held by the House of Lords in SL v HM Revenue and Customs [2008] 2 All ER 413  the tort of conspiracy to use unlawful means does not require that the unlawful means must be independently actionable at the suit of the claimant. Both crimes and civil wrongs can constitute unlawful means. Combination and agreement established [93] In respect of the element for combination or agreement among conspirators, it has been long established that the agreement need not be express and may be inferred from overt acts, where several parties take steps towards one collective purpose, and where the participation in a conspiracy may be active or passive (see R v Siracusa [1990] 90 Cr App Rep 340 and The King and the Attorney-General of the Commonwealth v Associated Northern Colkieries & Ors [1911] 14 CLR 387). Directors can conspire with own company [94] I further find no legal basis to preclude the Third to the Tenth Defendants, being the directors and CEO of the First Defendant from being found to be acting in combination with other defendants despite the fact that the directors and CEO are the agents of the company. There is in my judgment no legal impediment to a finding that a company can conspire with its own directors (see for example, the decision of Vinelott J in Prudential Assurance Co Ltd v Newman Industries Ltd [1981] Ch 29). [95] There is no insuperable difficulty in holding that a company can conspire with its own director to cause harm to another party even if the director is the directing mind and will of the company. In this sense where a corporation is involved, a conspiracy can occur between two legal persons who share one and the same mind. This is also the position in Singapore, where Judith Prakash J in the case of Nagase Singapore Pte Ltd v Ching Kai Huat [2008] 1 SLR(R) 80 stated thus:- “…I am satisfied that in law, there can be a conspiracy between a company and its controlling director to damage a third party by unlawful means notwithstanding that the director may be the moving spirit of the company…” [96] The problems, as I have highlighted, associated with the Defendants’ heavy reliance on the legal opinions apply equally to the position taken by the Third to the Tenth Defendants. Another anomaly if not an outright flaw in their argument is that, as stated, the Second Defendant had already started to defy the order of specific performance in the proceedings prior to the receipt of the legal opinions. This more than abundantly suggests that the claim by the Defendants that they were merely discharging their duty or enforcing their legal rights to be as untenable as it is disingenuous. Similarly, any argument that the decisions taken by the directors amongst the Defendants to have been in the nature of business judgment and therefore protected is misconceived. Decisions not business judgment under Companies Act 1965 [97] Business judgments are protected under Section 132 (1B) of the Companies Act 1965. It reads:- Business judgment (1B) A director who makes a business judgment is deemed to meet the requirements of the duty under subsection (1A) and the equivalent duties under the common law and in equity if the director- (a) makes the business judgment in good faith for a proper purpose; (b) does not have a material personal interest in the subject matter of the business judgment; (c) is informed about the subject matter of the business judgment to the extent the director reasonably believes to be appropriate under the circumstances; and (d) reasonably believes that the business judgment is in the best interest of the company. [98] I find it difficult for any of the directors of the First Defendant to succeed on the argument that the decisions to continually litigate on issues already decided by the Courts were in the nature of business judgments. When the matters have already been adjudicated, even basic logic will tell a reasonable person that such matters cannot be continually be brought to Court for further litigation. What more in this case, where the Defendants include directors of a listed entity, an experienced CEO, and when the Courts had even expressed their clear disapproval of the re-litigation in Enclosures 62 and 69 which even preceded the Suit 145, as related to earlier in this judgment. [99] In short, the Defendants cannot pass muster the requirements of Section 132 (1B) that the decisions were made in good faith, for proper purpose, in the reasonable belief that they were appropriate and in the best interest of the company, and without any personal interest in the decisions, to benefit from the protection of the said Section 132 (1B). Parent can conspire with wholly owned subsidiary [100] Neither does the law not recognize the ability of the First and Second Defendants of conspiring with one another on account only of the identity of interest between the two (see the English High Court decision in Twentieth Century Fox Films Corporation and others v. David Harris and others [2014] EWHC 1568 (Ch)). They are separate legal entities but they are also related corporations under Companies Act 1965. [101] More pertinently the First Defendant is the holding company of the Second Defendant. They share a common CEO in DW1, and have common directors. The core business of the group helmed by the listed First Defendant at the material time, namely the plantation assets, were indirectly held by the Second Defendant, thus rendering matters concerning the Second Defendant to have an impact on the affairs of the First Defendant. Their relationship, as supported by evidence manifestly showed that they work in concert in the pursuit of the proceedings. [102] As stated, the preponderance of evidence showed the conduct and acts of the Defendants such as the filing of the FC Review, Enclosure 69 and the Suit 145 in seeking the re-litigation of matters already adjudicated on, frustrating completion, seeking further legal opinions, convening the EGM with the circular referred to earlier, all of which do nothing but reveal the true intention of the Defendants in not adhering to the decisions of the Courts, thwarting the enforcement of the decisions, and demanding more money from the Plaintiffs. [103] There can then be little doubt that the irresistible inference that must be drawn from the aforesaid conduct and acts of the Defendants in this Suit 326, is that the conspiracy of combination or agreement involving all 10 Defendants in their respective parts and roles consisted principally of their common agreement of objectives of persistently denying the Plaintiffs, despite the FC Judgment Suit 109, from enjoying the fruits of their litigation, continually refusing to execute specific performance, demanding for more payments from the Plaintiffs, and ensuring that the First and Second Defendants get to retain the plantation assets as the core business of the group. Intention of injuring the Plaintiff in concerted fashion established [104] The objective of the agreement in the aforesaid conspiracy was to injure the interest of the Plaintiffs, given especially the evidence on the repeated Court proceedings and their reliefs, as well as their timing, and pursued in instalments to boot, all further point inescapably to the presence of the intention to cause harm to the Plaintiffs. [105] This more than qualifies as the predominant intention in a lawful means conspiracy, which can be said to be had by each of the 10 Defendants, or at the very least a predominant or sole intention to injure in the nature of reckless indifference to the injury caused to the Plaintiffs, in so far as the Third to the Tenth Defendants are concerned. [106] In relation to lawful means conspiracy, the sole or predominant intention on the part of the Defendants in their conspiracy to injure the Plaintiffs is more than amply shown to be manifested in the former refusing to permit the Plaintiffs see through the completion of the purchase transactions, demanding more payments from them, thus benefiting the Defendants, more directly the First and Second Defendants, by their retention of the core business that was the plantation assets subject to the purchase. And for unlawful means conspiracy, such a predominant intention for lawful means is more than sufficient to satisfy the element of an intention to cause harm in an unlawful means conspiracy. [107] Furthermore there is no insurmountable difficulty in showing that the Defendants in a conspiracy had acted with a predominant intention to injure the Plaintiffs, because even though the Defendants may have done so to enrich themselves, the element of the intention to injure can nevertheless still be found against them, since a loss to the Plaintiffs is the flipside or opposite to the gain for the Defendants (see further discussion on injury and damages below). [108] The CEO for the First Defendant (DW1) had given evidence that all the directors (the Third to the Ninth Defendants) had the requisite knowledge and participated in the decision-making process of all issues in contention such as rejecting payment made by the Plaintiffs after the FC Judgment Suit 109, the institution of the various proceedings and even on instructing solicitors. [109] In accordance with case law authorities as referred to earlier, such an intention is also sufficient for purposes of establishing the tort of unlawful means conspiracy for it was directed at the Plaintiff and it could reasonably be foreseen that it may injure them and did in fact injure them. I agree with the argument of the Plaintiffs that the unlawful means employed by the Defendants is the continual re-litigation of the issues which are manifestly already res judicata, which is also a substantive rule of law, as well as engaging in an abuse of process in their incessant pursuit of the various proceedings. [110] As stated earlier, the concept of unlawful means in this tort of conspiracy admits of a wide scope. The following words of Lord Nicholls in OBG Ltd and others v Allan [2007] UKHL 21 are most apt:- “So understood the concept of “unlawful means” stretches far and wide. It covers common law torts, statutory torts, crimes, breaches of contract, breaches of trust and equitable obligations, breaches of confidence, and so on,” “…..In this context, the expression “unlawful means” embraces all acts a defendant is not permitted to do, whether by the civil law or the criminal law”. Director defendants chose not to give evidence or be cross-examined [111] It is worthy of emphasis that despite being the directing will and mind of the First Defendant, all the directors (being the Third to the Ninth Defendants) with the exception of the Chairman (even that only in the Suit 145, not in the claim against him in this Suit 326) chose not to give evidence, what more be available for cross-examination, despite each having been identified, named and sued for the tort of conspiracy. This certainly does little to bolster their defence. [112] And in any event, the evidence given by the CEO confirmed that the directors had authorized the CEO, who is not a member of the board, to give evidence on their behalf but who at the same time agreed that he could not possibly testify on the state of minds of the directors. And the reliance on the legal opinions argument has also been found to be more than wanting, earlier in this judgment. Authorities do not advance case of Defendants [113] The First and Second Defendants also submitted on a number of authorities to support their stance. I shall only deal with the ones I consider more relevant for present purposes. It was submitted that the Court of Appeal case of Formis Resources Bhd & Ors v Risk Management and Safety Systems Pty Ltd & Ors [2016] 6 MLJ 73 held that the Court should not infer any sinister intention when contemporaneous documents are capable of giving rise to other inferences such that in the instant case, the Defendants argued to have acted in good faith to protect the interests of the companies based on legal advice. [114] I do not see how this decision could truly advance the case for the Defendants. Documents in the forms of letters attributed to the Second Defendant, supported by testimony by DW1 showed refusal to complete despite Courts judgments since the FC Judgment Suit 109. The inference pointing to a conspiracy is irresistible. The argument on the purported reliance on legal advice, given the facts of the instant case and the history in litigation, and as has been discussed earlier, is simply difficult to sustain. [115] And crucially, it is basic as it is common sense that good faith cannot be an excuse not to obey decisions of the Courts. In truth, when one is aware of the nature of judgments of the Courts, and to their credit, none of the Defendants are pleading that the concept of Court judgments is alien to any of them, the refusal or failure to adhere to the same, unless stayed or set aside, cannot under any circumstances amount to any act or conduct premised on good faith. [116] Reliance was also placed on the English Court of Appeal decision in Meretz Investments NV v ACP Ltd [2008] Ch 244 which held that a person who sets out to protect his own interests in the belief that he has a lawful right to do what he is doing, based on legal advice, does not have the intention required for the torts of inducing a breach of contract or conspiring to injure by unlawful means, even though the inevitable result of acting in that way will be to cause loss to another. [117] In the leading authority of Belmont Finance v Williams Furniture [1980] 1 All ER 393 it was established that if parties have knowledge of the facts which made the relevant transaction unlawful, they could be liable for unlawful means conspiracy even if they did not appreciate that the transaction itself is unlawful. As submitted by the First Defendant, the English Court of Appeal in Meretz expressed the view that it is a defence to an action for unlawful means conspiracy if the defendant acted in a belief that he had the lawful right to act as he did. The First Defendant argued that in light of Meretz, the principle enunciated in Belmont Finance is therefore no longer good law. [118] But there is at least one English High Court decision, in the case of First Subsea Ltd v Balltec Ltd and others [2014] EWHC 866 (Ch) which rejected this view, on the basis that the relevant statements in Meretz were obiter and that despite Belmont Finance, on this point, having been referred to the House of Lords in OBG Ltd and others v Allan [2007] UKHL 21, a decision on the related tort of causing loss by unlawful means, the House of Lords in OBG Ltd did not in any manner discredit let alone overrule Belmont Finance. [119] In any event, it should also be emphasized that in Meretz, the defendants’ belief in their lawful right to do what they did was also, like in the instant case based on legal advice but which unlike in the instant case, the opinion in Meretz was produced to the Court as evidence. Not in the instant case. [120] The other reason why this case cannot support the position of the Defendants is plain. I cannot accept that the Defendants could be said to have held on to the belief that they had a lawful right to continually litigate matters which had been adjudicated on, especially when the Courts have even specifically pointed out in express terms that Enclosure 69 was wholly unnecessary and had been initiated due to the Second Defendant’s disobedience and defiance in its refusal to accept the judgment of the Court. [121] I therefore find that given there is no dearth of clear, positive and convincing evidence on the satisfaction of the elements of the Defendants having in combination and agreement colluded to injure the interests of the Plaintiffs and taken steps for that purpose in concerted fashion, resulting in loss to the Plaintiffs, the torts of lawful means as well as unlawful means conspiracy have thus been established by the Plaintiffs against all the Defendants. Damages [122] The crux of the claim in the instant case for the harm and injury inflicted on the Plaintiffs, arising from the torts of abuse and conspiracy perpetrated by the Defendants, concerns the loss of opportunity by the Plaintiffs, of maximizing the full potential of the plantation lands and the mill. [123] On damages, I find the claim for special damages related to the loss of opportunity to the amount of RM25,159,294.16 to the Plaintiffs from 2013 to the first six months of 2016 to develop the plantation lands to maximize potential to be supported by evidence. On loss of yield income, the Plaintiffs could have undertaken re-planting on the Ganda Plantation much earlier if not for the non-completion engineered by the Defendants. [124] The approach undertaken in proving loss of opportunity in maximizing yield was by comparing yield per hectare per annum derived from adjacent estates as against the actual yield recorded by the ageing trees of Ganda Plantation. The methodology also employed a projected yield per hectare per annum figure of 30 MT as derived from the actual yield of the neighbouring Cempaka Plantation estate based on fresh fruit bunches sales records, as tendered in Court. [125] I accept the evidence of PW4 and PW5, both the expert witnesses for the Plaintiffs. I do not find anything obviously indefensible or unsupported by basic facts in the reports tendered by the experts, more so when they were cross-examined (see the Court of Appeal decision in Majuikan Sdn Bhd v Barclays Bank Plc [2015] 1 MLJ 171). Crucially, no expert report was offered by the Defendants to challenge that of the experts for the Plaintiffs. In any event I find PW4’s explanation when challenged in cross-examination on the alleged wholly hypothetical premise of their report to be credible, convincing and therefore acceptable. [126] Although pursuant to the relevant management agreement, the Plaintiffs were in possession of the plantation assets, the all-important legal and registered ownership was denied to them, and as supported by the financial statements of the third defendant in the counterclaim (Sri Ganda Oil Mill) the Plaintiffs had thus far only largely expended on the maintenance of the plantation and not on replanting activities. The First and Second Defendants cannot validly contend that being in possession, the Plaintiffs were never prevented from developing the plantation lands and the mill. [127] This is because, again, legal ownership was denied and the management agreement was said by the Second Defendant to have been terminated when the Court of Appeal reversed the HC Judgment Suit 109. The First and Second Defendant cannot benefit in this fashion when they were the ones refusing to obey the judgments of the Courts. [128] In the case of Bank Simpanan Nasional v Rudysham Abdul Raof [2017] 4 CLJ 234, I had stated thus:- “No Benefit from Own Default [88] It is also my finding that the appellant is additionally subject to the trite principle of law that a party cannot benefit from his own wrong or default, which in this case, being the negligent mistake by the appellant. It is an established presumption in law that parties to a contract do not intend that either party should be able rely on its own breach of obligations to avoid a contract or obtain any benefit under it, unless the contrary is clearly provided for by the contract (see the House of Lords decision in New Zealand Shipping Co v. Société des Ateliers et Chantiers de France [1919] AC 1.” [129] On the claim for loss of savings which the Plaintiffs could have avoided if they had legal title of the mill, specifically the special damages in respect of maintenance savings for the mill, machinery replacement cost and reduction of labour costs, I find that these are all supported by the same contemporaneous documents relied on by PW5 in arriving at his conclusions in his expert report on the efficiency of the existing mill (not countered by any expert report by the Defendants) particularly on the savings if the mill had been upgraded to the cage-less sterilizer system. The claim for RM1,861,780.98 is therefore justified. [130] The other final claim of special damages for additional diesel cost of RM517.875.00 and additional labour costs of RM1,696,784.24 related to maintaining an inefficient mill operation in its current state is similarly supported by documentary records and the uncontroverted expert report by PW5, and thus should also be allowed. [131] Further, the presence of Sri Ganda Oil Mill (the third defendant in the counterclaim) who incurred the expenses for operating and maintaining the mill does not affect the claim of the Plaintiffs. It is irrelevant to the question on the liability of the Defendants in having caused damage and loss to the Plaintiffs. There can be no dispute that, on the evidence, including that of DW1, Sri Ganda was the agent appointed by the Plaintiffs to manage the plantation and the mill on their behalf. [132] This is because clearly the Plaintiffs are the contracting parties (with the Second Defendant) against whom the torts were committed, who should rightly be entitled to the legal ownership of the plantations, and crucially are the ones who had suffered the loss. An owner to a property damaged by another can claim damages even if the costs of repairs come from a third party source (see the English Court of Appeal decision in Jones and another v Stroud District Council [1988] 1 All ER 5, and the House of Lords decisions in Linden Gardens Trust Ltd v Leresta Sludge Disposal Ltd 36 Con LR 1 and in Hunt v Severs [1994] 2 AC 350). [133] I accept the basis for the grant of general damages for the loss of the short term lease in that if not for the torts, the Plaintiffs would have renewed the lease. The purchase price, transacted in 2003, of the plantation lands was RM30.6 million when the lease had 30 years more to run before expiry. This generally averaged to about RM1 million per year. The Plaintiffs’ claim for RM4 million in general damages for a claim period of 2013 to 2017, since the torts were committed in 2013 (after the FC Judgment Suit 109) is therefore not unreasonable and ought to be considered positively. [134] But I am of the view that considering the circumstances and the award of special damages, the award of RM1 million in general damages to be a more reasonable and appropriate sum. The Plaintiffs are entitled to be compensated for the harm done to their economic interests (see Deepak Jaikishan a/l Jaikishan Rewachand v Intrared Sdn Bhd & another [2013] 7 MLJ 437). [135] Further, given the continual, incessant and wholly unwarranted filing of proceedings which tantamount to a blatant refusal to accept the finality of judgments of the Courts, and unduly delaying what is rightly the entitlement of the Plaintiffs to enjoy, I am of the view that the grant of exemplary damages is justified, applying the principles enunciated in the leading House of Lords decision in Rookes v Barnard and others [1964] 1 All ER 367, particularly in respect of the second category of situations justifying the grant of exemplary damages (the conduct of Defendants was calculated to make a profit for themselves which may well exceed the compensation payable to the Plaintiffs) and the Court of Appeal decision in Lembaga Kemajuan Tanah Persekutuan (FELDA) & Anor v Awang Soh bin Mamat & Ors [2009] 4 MLJ 610. [136] I am of the view that the award of RM250,000 is reasonable and sufficiently demonstrates, in the circumstances of this case, and given the other awards of special and general damages, to use the words of Lord Devlin in Rookes v Barnard, the need “to teach the wrongdoer that tort does not pay”. I do not however allow the claim for aggravated damages which I consider unnecessary on the facts of the case and taking into account the other awards made by this Court. Counterclaim [137] As stated in the earlier part of this judgment, in the instant counterclaim, the Second Defendant as the plaintiff is seeking for various declarations and reliefs, including an account for profit share and rental for the plantation lands and the related mill from July 2011 for the sum of RM43,045,551.38, unjust enrichment on the part of the Plaintiffs in respect of the increased share capital in RRSB, the need for approval under Section 132C of the Companies Act 1965, for the transfer of 99,998 shares, that the same shares be restored to the Second Defendant, and that the High Court decision on Enclosures 62 and 69 dated 17 February 2015 granted to the Plaintiffs be impeached on the ground of fraud. [138] I find the reliance by the Second Defendant on the argument that the decision of the High Court on Enclosures 62 and 69 was obtained by fraud which purported evidence allegedly subsequently came to light in the testimony of the First Plaintiff during his cross-examination in Suit 145; and that there was new evidence in the form of admissions made in the accounting treatment recorded in the financial statements of the Sri Ganda or the third defendant in the counterclaim, to be wholly unmeritorious. [139] A review of the notes of proceedings did not reveal that the First Plaintiff agreed that the relevant agreement was for only 2 shares in RRSB since it was clear in the context that his position was that the agreement had always been for the entire share capital of RRSB. [140] The alleged new evidence in the financial statements of Sri Ganda cannot validly be construed as such since the Second Defendant could have obtained the purported evidence in the said financial statements to be tendered in any of the earlier proceedings. The Second Defendant failed to do so. [141] In any event, the counterclaim can achieve nothing but failure because the allegations and complaints as well as the reliefs pleaded in the same are, yet again, res judicata. The counterclaim is thus far the final instalment in the unmeritorious series of re-litigation mounted by the Defendants. It is an abuse of process by the Second Defendant pure and simple. [142] The same issues have thus far been raised for a staggering seventh time, in that they had been ventilated at and dismissed by the High Court three times, once at the Court of Appeal and three times at the Federal Court. I therefore dismiss the counter claim in its entirety. Reliefs against Prayers [143] Therefore in reference to the paragraph 53.1 and 53.2 of the Re-Re-Amended Statement of Claim, I order special damages against the First and Second Defendants jointly and severally in the sum of RM29,235,678.38 as pleaded under (a), general damages of RM1,000,000.00 under (b), exemplary damages of RM250,000 under (c), interest as pleaded under (e) which is 5% from date of judgment to full satisfaction. [144] I also find the all Defendants liable for tort of conspiracy jointly and severally; and order special damages for the same amount as pleaded in (a) and interest as pleaded under (d). For clarity the First and Second Defendants’ liability, jointly and severally, for special damages for both torts is limited to the single amount of RM29,235,678.38. Conclusion [145] In view of the foregoing reasons, I find that the Plaintiffs have succeeded in proving their case against the Defendants on a balance of probabilities. The reverse is not true for the counterclaim instituted by the Second Defendant. [146] I therefore allow the reliefs prayed for by the Plaintiffs in terms stated earlier, and dismiss the counterclaim in its entirety. I also order costs for the Plaintiffs. Dated: 24 August 2017 (MOHD NAZLAN BIN MOHD GHAZALI) Judge High Court NCC1 Kuala Lumpur Counsel Counsel for Plaintiffs P Gananathan with Olivia Loh, Ng Choo Beng and Yeoh Kai Ying Messrs Ng Choo Beng R. Naidu & Partners Teluk Intan, Perak Counsel for the First Defendant W T Low Messrs Weng & Co. Petaling Jaya, Selangor Counsel for the Second Defendant SH Leong Messrs Leong & Partners Petaling Jaya, Selangor Counsel for the Third – Tenth Defendants Tharminder Singh with Aravind Kumar Messrs Izral Partnership Kuala Lumpur Counsel for the Third Defendant in Counterclaim Brendan Siva with Aida Messrs Brendan Siva Kuala Lumpur Page 41 of 41

Tika 2.6.0

WA-24NCC-59-02/2017

PLAINTIF ALLIANZ GENERAL INSURANCE COMPANY (M) BHD ...PLAINTIF DEFENDAN 1. RAJAH A/L BATUMALAI 2. MOHAMAD ERUDI BIN AB. MANAF ... DEFENDAN - DEFENDAN

24/08/2017

YA TUAN MOHD NAZLAN BIN MOHD GHAZALI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=33eeb84b-5e1d-47b1-bab9-04560d89cac2&Inline=true

Page 1 of 14 DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR (BAHAGIAN DAGANG) SAMAN PEMULA NO. : WA-24NCC-59-02/2017 Dalam perkara Seksyen 96(1) dan 96(3) Akta Pengangkutan Jalan 1987 Dan Dalam perkara Aturan 15 Kaedah 16 Kaedah-Kaedah Mahkamah 2012 Dan Dalam perkara Seksyen 41 Akta Relif Spesifik 1950 Dan Dalam perkara Polisi No.: 14VML091512 yang melindungi motorkereta No. WKQ 5082 bagi tempoh 28.10.2014 hingga 27.10.2015 Dan Dalam perkara kemalangan jalanraya yang berlaku pada 23.6.2015 yang melibatkan motorsikal No. WWM 1656 dan motorkereta No. WKQ 5082 Dan Dalam perkara kes sivil di Mahkamah Majistret Shah Alam, Malaysia Writ Saman No.: BA-A73KJ-2-01/2017 Page 2 of 14 ANTARA ALLIANZ GENERAL INSURANCE COMPANY (M) BHD ...PLAINTIF DAN 1. RAJAH A/L BATUMALAI 2. MOHAMAD ERUDI BIN AB. MANAF ...DEFENDAN- DEFENDAN DI HADAPAN YANG ARIF TUAN MOHD NAZLAN MOHD GHAZALI HAKIM JUDGMENT Introduction [1] The Plaintiff’s application, by way of an originating summons, is principally for a declaration pursuant to Section 96(3) of the Road Transport Act 1987 (“the RTA”) that Policy No. 14VML091512 which sought to provide insurance coverage for motor vehicle no. WKQ 5082 (“the Vehicle”) for the period between 28 October 2014 and 27 Octob er 2015 (“the Policy”) is void and unenforceable with respect to a road accident on 23 June 2015 involving the Vehicle and motorcycle no. WWM 1656 claimed to be driven by the Second Defendant. [2] At the end of the hearing of the originating summons, I allowed the application. This Judgment contains the full reasons for my decision. Key Background Facts [3] The First Defendant is the registered owner of the Vehicle which is covered by the Policy issued by the Plaintiff. The First Defendant did not file any affidavit to oppose this application, which is instead resisted by the Second Defendant. [4] The Plaintiff was served with a notice pursuant to Section 96(2) of the RTA in relation to an alleged road accident on 23 June 2015 involving motorcycle no. WWM 1656 ridden by the Second Defendant Page 3 of 14 and the Vehicle alleged to be driven by the First Defendant and/or his agent and/or servant (“the Accident”). [5] The Second Defendant, who suffered injuries as a result of the Accident had instituted a civil action in Shah Alam Magistrate Court against the First Defendant claiming for special and general damages as a result of the Accident (“the Writ Action”). [6] The Second Defendant had earlier, a few days after the Accident, lodged a police report on 26 June 2015. However, there were no police report lodged by the First Defendant and/or his agent and/or servant in respect of the Accident. [7] The Plaintiff then, as is standard, appointed loss adjusters (‘the Adjusters”) to investigate the circumstances of the Accident. In their investigations the Adjusters were informed as follows:- (a) The First Defendant was previously the registered owner of the Vehicle which had been involved in an earlier accident on 21 October 2010, as shown in a police report dated 22 October 2010 exhibited by the Plaintiff’s affidavit. (b) The First Defendant had sent the Vehicle to Eng Yap Motor Works workshop in Klang to make insurance claim in order to repair the same. Pictures of the condition of the damaged Vehicle were also exhibited by the Plaintiff. (c) In March 2011, Tokio-Marine Insurans Berhad, the insurer of the Vehicle then classified the Vehicle as total loss. (d) Significantly, upon signing of the Claims Discharge Voucher and following the handing over the documents of title of the Vehicle by the First Defendant to the insurer, the insurer then vide its letter dated 23 March 2011 paid the First Defendant compensation for the sum of RM12,000.00 on the basis of the Vehicle being beyond economic repair. Thus it is contended that the First Defendant had ceased to have any insurable interest in the insurance contract with Tokio-Marine. Page 4 of 14 (e) The First Defendant had following the more recent Accident, also lodged a police report dated 28 April 2016 and a statutory declaration dated 10 January 2017, stating that since cessation of his interest in the Vehicle in 2011, the insurance coverage and road tax for the said Vehicle had been renewed without his knowledge. It is argued that elements of fraud were involved in the renewal of the insurance coverage for the same. [8] It bears repetition that the key contention of the First Defendant is that he is no longer the registered owner of the Vehicle since executing the Claim Discharge Voucher in 2011 and as such did not have any insurable interest in the Vehicle at the time of the Accident. Contention of Parties [9] The Plaintiff in the main submitted that the relief sought against the First Defendant is based on the contract of insurance or the Policy purportedly entered into between the Plaintiff and the First Defendant. At all material times, the Second Defendant was never a party to the contract of insurance with the Plaintiff and is therefore not entitled in law to compel the Plaintiff to compensate for his loss and injuries under the contract of insurance. The Second Defendant has nothing to do with it. [10] The Plaintiff further reiterated that there were elements of fraud involved in the renewal process of the insurance coverage. [11] The Second Defendant’s opposition to the Plaintiff’s application is on the other hand, premised on three broad grounds:- A) First, the Plaintiff’s averments are entirely based on hearsay evidence in breach of Order 41 r 5 of the Rules of Court 2012, in that the pertinent averments were stated to be told by the First Defendant to the Adjusters, and not directly to the Plaintiff. B) Secondly, the Plaintiff had failed to discharge its burden of proof in respect of its averments; and Page 5 of 14 C) Thirdly, the proper forum to determine whether the Plaintiff ought to be allowed to repudiate liability is in the main suit of the Writ Action. Evaluation and Findings of this Court The issue of hearsay evidence not meritorious, as evidence not rebutted by First Defendant [12] It is not in dispute that affidavit evidence containing hearsay matters are inadmissible with the exception to interlocutory matters where it is admissible provided that the sources and grounds are disclosed (see Wong Hong Toy & Anor v Public Prosecutor [1988] 2 MLJ 553). The declarations being sought in the Plaintiff’s instant application is in the nature of a final and not interlocutory order as, if granted, it will finally determine the rights of the parties concerned. [13] The Second Defendant’s complaint is that if the averments of the deponent for the Plaintiff (one Sufaizah binti Abd Shukor, a claims executive of the Plaintiff) are examined, the key contentions of the Plaintiff are based on information furnished by its Adjusters, the police report by the First Defendant denying his involvement in the accident of 2 June 2015 and his statutory declaration dated 10 January 2017 to the same effect. Yet all these are not within the personal knowledge of the deponent for the Plaintiff; and neither the individual from the Adjusters who undertook the investigation nor the First Defendant himself affirmed any affidavit to support the instant application by the Plaintiff. Therefore the averments on the contents of the documents too is hearsay and devoid of any evidentiary value (see Lim Yew Sing v Hummel International Sports & Leisure A/S [1996] 3 MLJ 7). [14] I do not think the absence of what the Second Defendant refers to as direct evidence impairs the substance of the Plaintiff’s application. It cannot be disputed that the First Defendant had signed the Claim Discharge Voucher and furnished all documents of title of the Vehicle to the former insurer. He had made a police report denying any involvement of road collision with the Second Defendant, and even affirmed a statutory declaration to that effect. There is no suggestion by the Second Defendant that any of these documents is not genuine or authentic. The refusal by the First Defendant to affirm an affidavit to further confirm these documents cannot form a basis to deny the Plaintiff’s right to the declaration under Section 96(3) of the RTA. Page 6 of 14 [15] The Plaintiff had filed the requisite affidavit of service of the cause papers pertaining to the instant application to the First Defendant. At the hearing, the Counsel for the Plaintiff again confirmed that the First Defendant had also been informed of the hearing date. Clearly, the First Defendant chose not to attend to contest the application. [16] In any event, the First Defendant’s non-involvement in and non-contestation of the present application is entirely consistent with the essence and substance of the said documents. They quite categorically stated that the First Defendant no longer owned the Vehicle since 2011 and had nothing to do with the subsequent renewal of the policy coverage of the Vehicle with the plaintiff. In effect this unmistakably shows that as far as the First Defendant is concerned, he has absolutely no insured-insurer relationship with the Plaintiff. There was no contract of insurance between the two at the material time. The Second Defendant is not party to the insurance contract [17] This I think is most crucial. And for this same basis, the resistance of the Second Defendant will be shown to be plainly devoid of substance. It is as fundamental as the basic rule of the law of contract that the rights and obligations concerning the agreement do not concern a third party. A third party like the Second Defendant cannot benefit from nor sue on the contract of insurance which purportedly existed between the Plaintiff and the First Defendant. This Court cannot countenance a departure from the well-entrenched rule in the law of contract that a third party can neither benefit nor suffer from a contract executed by other parties. A contract cannot be enforced against or by a third party pure and simple (see the leading common law authority of Tweddle v Atkinson [1861] 1 B & S 393 and the Privy Council decision in Kepong Prospecting Ltd & Ors v Schmidt [1968] 1 MLJ 170). [18] Since the First Defendant confirmed that he had no longer owned the Vehicle which must therefore mean that he or his servant or agent has absolutely no insurable interest in the Vehicle, the Policy cannot continue to be effective vis-a-vis the First Defendant. In Bibendum Sdn. Bhd. v. Amanah Scott Properties (KL) Sdn. Bhd. [2011] AMCR 792, the High Court in citing Halsbury's Laws of Malaysia, Vol 4, Malaysian Law, Journal SB 2000 page 37, paragraph 60.034, stated: With regards to an insurable interest in property, the general principle for Malaysia would be that an insurable interest should exist at the time Page 7 of 14 the event causing the loss occurs. Thus, an owner of a car who has sold it, would not be able to recover from a motor policy which has not expired if the car is damaged in the hands of the new owner. [19] As such I agree that the cases cited by the Plaintiff on this point are supportive of the application by the Plaintiff. Thus in Pacific & Orient Insurance Co Bhd v Vigneswaran a/l Rajarethinam & 2 Ors [2013] 2 AMCR 736, concerning facts not so dissimilar to the present case, it was stated by the High Court that:- “A contract of insurance is between an insured and his insurer. Now the insured is telling the insurer categorically that I'm NOT involved in this accident. It is a scam! Why the insurers should not act on his statement and avoid the policy? The second and third defendants are not privy to the contract between the plaintiff and first defendant and therefore cannot dictate whether the insurers should indemnify the first defendant or not. This is a simple law of contract. b) No evidence to show that the first defendant was not involved in the accident with second and third defendants. In this originating summons (OS) filed by the plaintiff we are not concerned with proving whether the accident occurred or not. That is for the Sessions Court to decide. In this OS, the plaintiff is asking this court to grant an order that the insurers may avoid liability under the policy where the insured himself is saying categorically by way of SD (exh RS5), police report (exh RS6) and testimony in court (exh RS10) that he was never involved in an accident. Between the insurers and the first defendant (insured) there is overwhelming evidence that there has been a breach of the duty of good faith and false declaration of involvement in an accident has been made which allows the plaintiff (insurers) to avoid the policy”. [20] The same conclusion was arrived at by the High Court in Sun Life Malaysia Takaful Berhad (dahulunya dikenali sebagai CIMB Aviva Takaful Berhad) v Noorulsmiah binti Sulong @ Mohd Nasir & 7 Ors [2015] 3 AMR 703 where the declaration was granted and the arguments by third parties similarly rejected. [21] Upon signing of the Claims Discharge Voucher and handing over the documents of title of the Vehicle by the First Defendant to the Page 8 of 14 then insurer, the policy insurance had automatically lapsed. The Claims Discharge Voucher executed by the First Defendant states as follows: “In consideration of the abovementioned sum, We/I hereby surrender our/my vehicle Registration Card, Release Letter, Transfer Forms (JPJK3, JPJK8, Lampiran “A1” & JPJ TM-AB) duly signed and Original Certificate of Insurance of Policy No. W-V-BO-AG-017982 for cancellation.” Absence of insurable interest [22] The absence of any insurable interest on the part of the First Defendant cannot be any clearer. Authorities in support of the Plaintiff’s position is far from few. Thus in Roslan Bin Abdullah v New Zealand Insurance Co. Ltd [1981] 2 MLJ 324, the Federal Court held:- “In this case, once ownership of the truck changed, the insurance policy lapsed unless there was novation of the policy, which was not alleged. The driver of the truck was not covered by the insurance policy as there was no insurance policy at the time of the accident.” [23] A similar position obtains in a decision of the English High Court in Peters v General Accident & Life Assurance Corporation Ltd [1937] 4 All ER 628 where Goddard J held thus:- “(i) when the vendor sold the car, the insurance policy automatically lapsed; (ii) at the time of the accident, the purchaser could not be said to be driving the car by the order or with the permission of the vendor, as the car was then the purchaser’s own property; (iii) the insured is not entitled to assign his policy to a third party. An insurance policy is a contract of personal indemnity, and the insurers cannot be compelled to accept responsibility in respect of a third party who may be quite unknown to them.” [24] No less basic is the fact the insurance policy only covers the Policyholder or any other person who is driving on the Policyholder’s order or with his permission. The Certificate of Insurance in the instant case states as follows: (b) Any other person who is driving on the Policyholder’s order or with his permission. [25] As such, given that the Vehicle has been classified as total loss and the First Defendant had been compensated for the said loss, it is not possible for the First Defendant, as the alleged insured or any Page 9 of 14 other person with the permission of the First Defendant to have driven the Vehicle at the time of the accident or to have been covered by the Policy. Even if this indeed occurred, there was patently no insurable interest in the Vehicle in any event. What could likely have happened was that despite the total loss status, somehow the road tax and insurance coverage for the Vehicle had been renewed fraudulently. The Policy, between the Plaintiff and the First Defendant, given the facts, could not have validly existed in the first place. [26] As the contract of insurance governing the Policy between the Plaintiff and the First Defendant is so manifestly founded on a very questionable premise given the clear denial by the First Defendant that he had any ownership rights or in possession of any insurable interest in the Vehicle since 2011, the Policy, which must, to begin with, in any event be a contract of an utmost good faith, cannot be a valid contractual document between the Plaintiff and the First Defendant, and must as a consequence, be held to be void and unenforceable. Third party has right to oppose declaration under Section 96 of the RTA [27] This is not to say that a third party like the Second Defendant is entirely irrelevant to the proceedings before me on the application by the Plaintiff to declare the Policy to be void and enforceable under Section 96 of the RTA. This action by the Plaintiff under Section 96 concerns the contract of insurance to which the Second Defendant is not privy. But the very scheme of Section 96, whilst enabling an insurer to seek a Court declaration to avoid the relevant policy, also confers on the third party who claimed to have been involved in an accident with a vehicle insured with the insurer under the relevant coverage to apply to be made a party and to oppose the granting of such declaration. [28] It is apposite that I reproduce the relevant parts of Section 96 of the RTA, as follows:- 96. Duty of insurers to satisfy judgements against persons insured in respect of third party risks (1) If, after a certificate of insurance has been delivered under subsection 91(4) to the person by whom a policy has been effected, judgement in respect of any such liability as is required to be covered by a policy under paragraph 91(1)(b) (being a liability covered by the terms of the policy) is given against any person insured by the policy, then notwithstanding that the insurer may be entitled to avoid or cancel, or may have avoided or cancelled the policy, Page 10 of 14 the insurer shall, subject to this section, pay to the persons entitled to the benefit of the judgement any sum payable thereunder in respect of the liability, including any amount payable in respect of costs and any sum payable in respect of interest on that sum by virtue of any written law relating to interest on judgements. (2) No sum shall be payable by an insurer under subsection (1)- ……… (3) No sum shall be payable by an insurer under subsection (1) if before the date the liability was incurred, the insurer had obtained a declaration from a court that the insurance was void or unenforceable: Provided that an insurer who has obtained such a declaration as aforesaid in an action shall not thereby become entitled to the benefit of this subsection as respects any judgement obtained in proceedings commenced before the commencement of that action unless, before or within seven days after the commencement of that action, he has given notice thereof to the person who is the plaintiff in the said proceedings specifying the grounds on which he proposes to rely, and any person to whom notice of such an action is so given shall be entitled if he thinks fit to be made a party thereto. ..…….” [emphasis added] [29] Section 96(3) of the RTA plainly confers on the third party like the Second Defendant such right to contest the declaration despite the patent absence of any contractual relationship between the Plaintiff as the insurer and the Second Defendant as the third party (see also the Court of Appeal decision in Pacific & Orient Insurance Co Berhad v Rasip bin Hamsudi & Ors [2017] 4 CLJ 572). Second Defendant cannot defeat application on Policy never validly existed [30] But it is difficult to see in what manner the Second Defendant, even if it is assumed that he is a genuine claimant, can succeed in his claim for indemnity against the Plaintiff on the Policy which was never even valid from its inception. The First Defendant ceased to be the owner in 2011 after the execution of the Claims Discharge Voucher. There is however, no evidence that the ownership registration at the Road Transport Department had been effected. It appears that the First Defendant did not bother to do so, which was not too surprising, since the Vehicle had been certified to be a total loss anyway. [31] It was likely that somehow, fraudulently, another party had orchestrated for the Vehicle to continue to be used, its road tax renewed, as was the insurance policy, albeit with the Plaintiff as the new insurance Page 11 of 14 company. The Policy however has been existing invalidly because from the start of its purported relationship with the Plaintiff as the new insurer (post execution of the Discharge Claims Voucher in 2011), the First Defendant never had any insurable interest. In the absence of an insurable interest, there was never any valid Policy brought into existence between the Plaintiff and the First Defendant. [32] Given the documents exhibited by the Plaintiff which showed the First Defendant having nothing to do with the Vehicle since 2011, it is no less plain that the Plaintiff had no knowledge about the absence of insurable interest to create the Policy and must have been misled into effecting a purported renewal of the same. [33] I reiterate that the Policy is void ab initio since the person who was alleged to be insured, the First Defendant herein, ceased to have any insurable interest in the Vehicle subsequent to the execution of the Claims Discharge Voucher in 2011 which was a point in time prior to the “change” of insurer and when the “First Defendant” applied for the issuance of the new insurance contract, by the Plaintiff which had since been renewed by the Plaintiff resulting in the present Policy in contention. [34] In Allianz General Insurance Company (Malaysia) Bhd lwn Mohd Fauzi Abdul Manaf & Yang Lain [2016] 1 CLJ 587, the High Court similarly held thus:- “[26] Mahkamah ini bersetuju dengan hujahan plaintif di dalam kes ini bahawa polisi insuran yang dikeluarkan oleh plaintif sebagai penanggung insuran dan defendan ketiga iaitu pihak yang diinsuranskan adalah satu kontrak persendirian yang nyata tidak boleh dipindah milik dan/atau diganti nama….. [27] Di sini, adalah jelas bahawa defendan ketiga di dalam surat pengakuannya mengaku telah menjual motorsikal tersebut kepada defendan pertama dan telah juga mengaku bahawa tidak memaklumkan fakta ini kepada plaintif. Malahan beliau telah mengaku telah tidak menukar nama pemilik motorsikal tersebut kepada nama pemilik baru kerana defendan pertama sebagai pembeli ingin menunggu cukai jalan dan polisi insurans tamat tempoh. [28] Memetik apa yang diputuskan di dalam kes Peters v. General Accident Fire & Life Insurance Corp. Ltd [1937] 4 All ER 628 apabila seorang tuan punya kereta menjual keretanya, polisi insurans secara otomatik telah luput kuatkuasanya dan tidak lagi boleh dikuatkuasakan. Page 12 of 14 Undang-undang berkenaan polisi insurans di dalam hal penjualan mana-mana kenderaan adalah jelas dan jitu. [29] Atas alasan ini sahaja, mahkamah ini berpandangan bahawa plaintif adalah berhak mendapat deklarasi yang dipohon”. [35] In that case, the former insured did not inform the insurer of the change in ownership of the vehicle despite having sold the same to another party. Nor did the former insured effect the change in the registration of the vehicle. The insurer thus was granted the declaration that the policy with the former insured was void and unenforceable. [36] The situation in the case before me involves a much more serious violation of the principle of the insurance being a contract of the utmost good faith. The former insured party himself was not aware of the events subsequent to the cessation of ownership such as the renewal of the Policy which must have been made possible by fraud. [37] In the instant case before me the First Defendant was never the owner of the Vehicle at the time of the accident with the Second Defendant. He was never even the owner from the time the application for a coverage under a contract of insurance for the Vehicle was first made to the Plaintiff. [38] In Kurnia Insurans (Malaysia) Bhd v. Personal Representative of Zenol Saad & Ors [2013] 1 LNS 239, the High Court in dealing with the issue of avoidance of liability by the insurer on the ground of loss of insurable interest in the vehicle on the part of the registered owner causing the policy to lapse, granted the declaration avoiding the policy. It was held that there was a transfer of interest when the car was sold even though the ownership like in the instant case before me, was never formally transferred. [39] Again, the similarity in the background facts in that case with those in the application before me cannot be ignored. The High Court there held that:- “I am of the view that the documentary evidence or exhibits adduced by the Applicant are discovered as a result of the Applicant's investigations. They are all self-explanatory. R1 and R2 were served with the OS with all the exhibits but R1 and R2 did not file any Affidavit In Reply. Since there is no rebuttal evidence by R1 and R2, the Court accepts the documents exhibited by the Applicant in its Affidavits.” javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2947089025&SearchId=4hakim46','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2947089025&SearchId=4hakim46','_DisplayCase','');DispCase.focus() Page 13 of 14 [40] Section 96(1) of the RTA clearly enables any insurer to avoid or cancel an insurance policy. The policy, which is a contract between the insurer and the insured only is voidable at the instance of the insurer. Section 96(3) entitles the insurer to avoid or cancel any policy for breach of its express terms. Since an insurance policy is a contract of personal indemnity, an insurer cannot in law be required to accept liability in relation to a third party, more so one who is unknown to the insurer, as demonstrated in many of the cases highlighted in this judgment, including in the instant application before me. [41] These third parties, like the Second Defendant herein, not vested with the requisite contractual nexus, are therefore bereft of any basis in law to oppose the insurer's action, like the Plaintiff herein, for a declaration to avoid liability and cancel the Policy following the breaches entitling repudiation of the same. This is especially true in the instant case since in the first place, the Policy could not even have validly existed. It is void from the start. [42] I further agree that the Plaintiff would be prejudiced if this application for declaration is not allowed as the Plaintiff would otherwise be bound by Section 96(1) of the RTA to be liable for any third party claim notwithstanding the violation of the purported Policy. [43] As such, the Second Defendant’s argument on hearsay evidence, whilst not entirely without merit, cannot defeat the case of the Plaintiff in respect of the Policy with the first Defendant which does not contractually concern the Second Defendant. Similarly his submission that the Plaintiff had failed to discharge its burden of proof to escape liability in that the Vehicle had been written off or that the First Defendant was not the owner, or on the alleged failure to particularize fraud, are all misconceived given the true context of the proceeding of this application is on the validity of the insurance contact between the Plaintiff and the First Defendant supported by evidence which had originated from, and crucially not in any fashion rebutted by the First Defendant, as produced by the Plaintiff. [44] An insurer’s statutory liability arises when an insurer is legally bound under Section 96(1) of the RTA to pay a person who has died or who has suffered bodily injury in a motor accident, but such liability cannot arise if the insurer has obtained from the Court before liability is incurred (in the form of the judgment against the insurer) a declaration that the insurance was void or unenforceable. This was Page 14 of 14 what the Plaintiff herein sought to and did achieve before this Court for the reasons I have stated earlier. Conclusion [45] For the reasons that I have discussed in the foregoing, it is my judgment that the Plaintiff has successfully established its case for the declaration that the Policy with the First Defendant and concerning the Accident is void and unenforceable. I therefore allow enclosure 1, with no order as to costs. Dated: 24 August 2017 (MOHD NAZLAN BIN MOHD GHAZALI) Judge High Court NCC1 Kuala Lumpur Counsel: For the Plaintiff R Ratha with Yoshini Messrs S.G. Lingam & Co Kuala Lumpur First Defendant - Absent For the Second Defendant AK Dass with Gurdeep and Rashwen Messrs A.K. Das & Associates Seremban, Negeri Sembilan

Tika 2.6.0

62JS-42-10/2016

PENDAKWARAYAPUAN SUHAILA BINTI SHAFIUDIN PERAYU HAMID DULUP BIN KAMAL AHMAD

24/08/2017

TN KAMARUDIN BIN KAMSUN

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=d6fb24dc-c2d3-44c2-9a3b-3b82e704997e&Inline=true

1 DALAM MAHKAMAH SESYEN DI JOHOR BAHRU DALAM NEGERI, JOHOR PERBICARAAN JENAYAH NO: 62JS – 42 – 10/2016 ANTARA PENDAKWA RAYA LAWAN HAMID DULUP BIN KAMAL AHMAD ALASAN KEPUTUSAN A. PENGENALAN. 1. Di dalam kes ini, OKT telah dituduh dengan 2 pertuduhan sebagai mana berikut:- 2 Tuduhan Pertama; “Bahawa kamu pada pertengahan bulan Ogos 2016 lebih kurang jam 1830 petang, di dalam rumah alamat No. 03-04 Blok U, Jalan Camar 12, Taman Perling di dalam daerah Johor Bahru, di dalam negeri Johor, telah merogol (1) P/M Nama: Johara Bibi Binti Mohd Rofiq yang berumur 10 tahun 9 bulan. Oleh yang demikian kamu telah melakukan satu kesalahan di bawah seksyen 376 Kanun Keseksaan dan boleh di hukum di bawah seksyen 376 Kanun yang sama. Tuduhan Kedua; “Bahawa kamu pada 03/10/2016 jam lebih kurang 0459 pagi di No. 03-04, Blok U, Jalan Camar 12, Taman Perling, di dalam daerah Johor Bahru Utara, di dalam negeri Johor, di dapati tiada memiliki apa-apa pas yang sah yang dikeluarkan mengikut undang-undang kepada kamu untuk memasuki Negara ini. Dengan itu telah melanggar peruntukan di bawah seksyen 6(1)(c) Akta Imigresen 1959/63 dan dengan itu kamu telah melakukan suatu kesalahan yng boleh dihukum di bawah seksyen 6(3) Akta yang sama.” 3 2. Terhadap kedua-dua pertuduhan tersebut, OKT telah mengaku bersalah dan telah didapati bersalah dan disabitkan dengan pertuduhan dan dijatuhi hukuman penjara sebagaimana berikut;- Tuduhan pertama – penjara 10 tahun dari tarikh tangkap dan 6 kali sebatan. Tuduhan Kedua – penjara 3 tahun dari tarikh tangkap Kesemua hukuman penjara di jalankan serentak. 3. Terhadap keputusan tersebut pihak OKT telah tidak berpuashati dan membuat rayuan terhadap Hukuman dan Sabitan. B. SABITAN DAN FAKTA KES PENDAKWAAN. 4. Kesemua Pertuduhan dan Fakta kes telah dibacakan dan diterangkan kepada OKT di dalam bahasa ibunda OKT iaitu Bahasa Myanmar/Rohingya. 4 5. Pada peringkat awal kes ini dipertuduhkan di mahkamah, OKT telah minta dibicarakan ke atas kedua-dua pertuduhan yang dikenakan terhadapnya. Pada awalnya jurubahasa bernama Abul Kasim@ Maung Sen Win hadir memperterjemahkan prosiding. Selanjutnya ketika perbicaraan di jalankan, SP1 telah memberikan keterangan. SP1 ini adalah mangsa kepada OKT. Segala prosiding perbicaraan ini telah diterjemahkan dan diterangkan oleh jurubahasa Myanmar bernama Md Yusof Bin Md Sharif. 6. Setelah SP1 memberikan keterangan, kes telah ditangguhkan untuk sambung bicara dan pada tarikh 24.8.2017 iaitu ketika tarikh kes sambung bicara, pertuduhan telah dibacakan semula, dan OKT telah menukar pengakuannya kepada pengakuan bersalah dan kesemua prosiding ini telah diterjemahkan dan diterangkan oleh Jurubahasa Myanmar bernama Ahmed. 7. Pertuduhan itu adalah dibacakan dari bahasa Malaysia ke bahasa Myanmar dan telah diterjemah dan diterangkan akan sifat dan akibat pengakuannya dan kesemuanya ini telah difahami oleh OKT dengan disahkan oleh jurubahasa tersebut. 5 8. Begitu juga segala prosedur pengemukaan fakta kes dan ekhibit telah dilakukan dan diterjemahkan segalanya di dalam bahasa Malaysia ke dalam bahasa Myanmar dan telah difahami dengan jelas dan diakui oleh OKT segala maksud, kesan dan akibat dari pengakuan bersalahnya tersebut. 9. Rayuan sebelum hukuman oleh OKT juga telah diterjemahkan dari bahasa Myanmar ke dalam bahasa Malaysia dan kesemua pihak telah memahami kedudukan dan keadaan kes masing-masing. 10. Mahkamah ini dengan itu merasakan bahawa sabitan yang dikenakan ke atas OKT adalah selamat dan tidak pernah memprejudiskan OKT dimana OKT faham segala apa yang berlaku di dalam mahkamah dan faham sifat dan akibat dari pengakuannya, yang mana beliau telah diterangkan segala sebab, sifat dan akibat dari pengakuannya, bentuk hukuman yang menunggunya dan apa yang boleh dikenakan terhadapnya dan beliau sedia menghadapinya. Maka adalah tidak relevan untuk sekarang sekiranya beliau mempertikaikan sabitan yang telah dibuat keatasnya atas apa jua alasan lain melainkan beliau sendiri dengan rela 6 hati telah membuat pengakuan bersalah terhadap kesalahan yang telah dipertuduhkan ke atasnya. 11. Selanjutnya, sebagaimana yang telah disahkan dan diakui benar oleh OKT sepertimana yang dikemukakan oleh pihak pendakwaan menerusi ekhibit P2, fakta kes ini adalah sebagaimana berikut. 12. Pada pertengahan bulan Ogos 2016 jam lebih kurang 6.30 petang di rumah alamat No. 03-04 Blok U jalan Camar 12, Taman Perling, mangsa seorang kanak-kanak wanita berumur 10 tahun telah dirogol oleh seorang warganegara Myanmar iaitu OKT. 13. Pada 1/10/2016 semasa bapa mangsa berada di rumah telah diberitahu oleh anaknya tidak datang period selama 2 bulan dan telah membawa anaknya ke klinik dan didapati telah mengandung. Mangsa memberitahu tertuduh telah datang ke rumah mangsa semasa ahli keluarga tiada di rumah dan telah merogol mangsa. 7 14. Tertuduh telah menarik tangan mangsa ke katil dan telah membuka seluar mangsa dan telah menarik seluar dalam mangsa dan menyebabkan mangsa terbogel. Kemudian Tertuduh telah memasukkan kemaluan tertuduh terus ke dalam kemaluan mangsa dan mangsa berasa sakit dan menangis. 15. Mangsa telah dirujuk ke hospital pada 3.10.2016 dan telah menjalani pemeriksaan doktor dan mengesahkan mangsa hamil dan mangsa tinggal di hospital selama satu minggu dan semasa di hospital di dapati mangsa telah keguguran dan doktor telah mengambil sampel darah dari janin yang dibersihkan sepertimana dalam laporan perubatan yang dikeluarkan. 16. Sampel darah telah di hantar ke Jabatan Kimia bersama-sama specimen darah tertuduh dan mangsa. Laporan kimia bertarikh 1.11.2016 mengesahkan bahawa tertuduh adalah merupakan “biological father” dan mangsa adalah “biological mother” kepada janin tersebut. 8 17. Semakan daripada jabatan Imigresen mengesahkan OKT tidak mempunyai rekod pergerakan warga asing dan tidak mempunyai passport yang sah. 18. OKT telah mengaku sepertimana pertuduhan. C. FAKTOR DAN PRINSIP PENGHUKUMAN. 19. Undang-undang tidak pernah membuat suatu penetapan hukuman ke atas suatu kes tertentu tetapi hanya meletakkan suatu hukuman maksima terhadapnya dan ini tidak bermakna bahawa suatu hukuman maksima hendaklah sentiasa dikenakan di dalam setiap kes mengenainya ( Mohd Jalani bin Saliman v PP [1997] 5 MLJ 551), maka terpulanglah kepada mahkamah tersebut mengenakan suatu hukuman yang dirasakan sesuai dalam lingkungan julat hukuman yang dibenarkan tertakluk kepada fakta dan keadaan kes masing-masing. Adalah menjadi tugas mahkamah untuk mengenakan suatu hukuman yang mana hukuman tersebut dapat mencerminkan keseriusan suatu kesalahan yang telah dilakukan (PP v Khairudin [1982] 1 MLJ 331). Tujuan meletakkan budibicara kepada Penghukum adalah bagi membenarkan Penghukum memberikan hukuman 9 yang dirasakan paling sesuai di dalam setiap satu kes secara berasingan dan apa-apa kecenderungan untuk menyeragamkan hukuman bagi sesuatu kesalahan hendaklah dielakkan kerana itu bermakna pesalah tersebut dihukum bukan atas fakta kesnya tetapi disebabkan oleh jenis kesalahan yang telah dilakukannya ( Abdul Karim v R; Sundra Singh v R; Loh Kai Hoi v R [1954] MLJ 86). 20. Suatu pertimbangan yang adil perlu dilihat dan dibuat antara keperluan kepada suatu hukuman yang mencegah dan juga peluang kepada tertuduh untuk dipulihkan (Kesavan Senderan v PP [1999] 1 CLJ 343). Setiap penghukuman hendaklah bersifat ekslusif dan peribadi tergunapakai hanya kepada pesalah tersebut sahaja yang dilaras kepada keadaan moral dan kewangannya juga kepada sifat suatu kesalahan tersebut ( Low Oi Lin v R [1949] MLJ 210 ). 21. Di dalam menjatuhkan suatu hukuman, pertimbangan yang diambilkira sebelum hukuman dijatuhkan ialah kepentingan awam, keadaan suatu kesalahan tersebut dan juga latarbelakang pesalah berkenaan. Suka ditekankan bahawa menurut kes R v Sargeant (1974) 60 Cr App R 74, merumuskan bahawa “Society, through the courts, must 10 show its abhorrence for the occurrence of particular types of crime and the only way which the courts can show this is by the sentences they pass. The courts act as a vehicle to show abhorrence for particular types of criminal conduct. However, the courts do not have to reflect public opinion. On the other hand, court could not disregard it. Perhaps the main duty of the court is to lead public opinion.”(ulasan oleh penulis buku “The process of criminal justice”). Oleh itu, mahkamahlah yang sepatutnya melaraskan dan melakarkan apa kehendak yang patut dibentuk oleh masyarakat menerusi hukuman yang dibuatnya. 22. Prinsip klasik di dalam menilai suatu hukuman yang bakal dikenakan terhadap pesalah ialah sebagaimana diputuskan dalam kes R v Sargeant, supra, iaitu: “retribution, deterrence, prevention and rehabilitation.” Kes R v Sargeant, supra, juga turut mengariskan apakah panduan di dalam menentukan suatu tempohmasa pemenjaraan yang sesuai yang patut dikenakan terhadap pesalah yang mana antara lainnya ialah; sifat dan keseriusan suatu kesalahan tersebut, keadaan dimana kesalahan tersebut dilakukan, diskaun kepada keinsafan dan akhirnya imbangan diantara kepentingan awam di dalam mencegah kesalahan tersebut dan peluang pesalah memulakan kehidupan yang baru. 11 D. ANALISA DAN KEPUTUSAN MAHKAMAH. 23. Pada pendapat mahkamah, hukuman yang diberikan ke atas kedua- dua pertuduhan ini adalah setimpal dan wajar serta mengikut undang- undang. Seksyen 376 Kanun Keseksaan memperuntukkan; Section 376. Punishment for rape. (1) Subject to subsections (2), (3) and (4), whoever commits rape shall be punished with imprisonment for a term which may extend to twenty years, and shall also be punished with whipping. [Am. Act A1536/2017] (2) Whoever commits rape on a woman under any of the following circumstances: (a) at the time of, or immediately before or after the commission of the offence causes hurt to her or to any other person; (b) at the time of, or immediately before or after the commission of the offence, puts her in fear of death or hurt to herself or any other person; (c) the offence was committed in the company of or in the presence of any other person; (d) without her consent, when she is under sixteen years of age; (e) with or without her consent, when she is under twelve years of age; (f) with her consent, when the consent is obtained by using his position of authority over her or because of professional relationship or other relationship of trust in relation to her; [(f) Am.Act A1471/2014] (g) at the time of the offence the woman was pregnant; [(g) Am.Act A1471/2014] (h) when by reason or on occasion of the rape, the woman becomes insane; (i) when he knows that he is afflicted with the Human Immuno-Deficiency Virus (HIV)/Acquired Immune Deficiency Syndrome (AIDS) or any other sexually transmissible disease and the virus or disease is or may be transmitted to the woman; (j) when by reason or on occasion of the rape, the woman commits suicide; or (k) when he knew of the mental disability, emotional disorder or physical handicap of the woman at the time of the commission of the crime, [(h), (i), (j), (k) Ins.Act A1471/2014] shall be punished with imprisonment for a term of not less than ten years and not more than thirty 12 years and shall also be punished with whipping. [Am. Act A1536/2017]; [Am.Act A1471/2014] 24. Makala seksyen 6(3) Akta Imigresen memperuntukkan; Section 6 . Control of entry into Malaysia. (1) No person other than a citizen shall enter Malaysia unless- (a) he is in possession of a valid Entry Permit lawfully issued to him under section 10; [Am. Act A985: s.4] (b) his name is endorsed upon a valid Entry Permit in accordance with section 12, and he is in the company of the holder of the Permit; [Am. Act A985: s.4] (c) he is in possession of a valid Pass lawfully issued to him to enter Malaysia; or (d) he is exempted from this section by an order made under section 55. (2) (Repealed by Act 27 of 1963). (3) Any person who contravenes subsection (1) shall be guilty of an offence and shall, on conviction, be liable to a fine not exceeding ten thousand ringgit or to imprisonment for a term not exceeding five years or to both, and shall also be liable to whipping of not more than six strokes. [Am. Act A 1154:s.4] 25. Di dalam kes ini, kes ini telah diambilkira sebagai panduan; kes Mahkamah Agong ketika itu di dalam kes Mohd Abdullah Ang Swee Kang (1987) CLJ (rep) 209; yang mengatakan;- Held: http://www.lawnet.com.my/LawNet/Public/LawLibrary/SubDocumentDetails.aspx?SubDocumentID=25323 http://www.lawnet.com.my/LawNet/Public/LawLibrary/SubDocumentDetails.aspx?SubDocumentID=25323 http://www.lawnet.com.my/LawNet/Public/eGazette/Download.aspx?ID=10350 13 [1] The Supreme Court agreed with the principle laid down in Reg.v. Barrick that in breach of trust cases in general a term of immediate imprisonment would be inevitable, save in very exceptional circumstances or where the amount of money involved was small. This must be the current sentencing policy even if the accused pleaded guilty. In the Supreme Court's view, the approach of assessing sentence adopted by the learned Judge supposedly based on English authorities by harmonising them with the maximum sentence of 20 years in s. 409 of the Penal Code,was not only misleading but was wrong in principle. When the legislature fixed a maximum penalty for an offence, the discretion of the Court in determining the extent to which in a particular case the punishment should be awarded must be exercised judicially. [2] In assessing the length of custodial sentence, the Court must look at the overall picture in perspective by considering firstly, the gravity of the type of offence committed; secondly, the facts in the commission of the offence; thirdly, the presence or absence of mitigating factors, and fourthly, the sentence that have been imposed in the past for similar offences to javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1997_574&ActSectionNo=409&SearchId=7perpm05C','_DisplayAct','');DispAct.focus() javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1997_574&ActSectionNo=409&SearchId=7perpm05C','_DisplayAct','');DispAct.focus() 14 determine the trend of sentencing policy, if any. The fact that a sentence of imprisonment is imposed as a deterrence does not justify the sentencer in passing a sentence of greater length than the facts of the offence warrant. The gravity of the type of offence involved must be considered in the light of the particular facts of the offence. [3] A sentencer must give sufficient discount for all extenuating circumstances pertaining to the degree of culpability or criminality involved which must necessarily vary from case to case apart from other mitigating factors. Unless there is a proper reason for withholding such credits, failure to do so may result in the sentence not exercising his or her discretion judicially in assessing the level of custodial sentence. The sentence imposed on the appellant was manifestly excessive. It is generally accepted that the extent of reduction on account of a plea of guilty would be between ¼ and 1/3 of what otherwise would have been the sentence. In this particular case, apart from plea of guilty, the sentence must also be discounted to reflect the full restitution made and other mitigating factors. 15 [4] Although the learned Judge indicated in his judgment that he had given the necessary discounts they were not reflected at all in the sentence imposed, as it was imposed without regard to the particular facts of this case and without giving the appellant any or sufficient credit for all the mitigating circumstances. The recommended prison terms in Barrick were not meant for pleading guilty cases. If the learned Judge had not fallen into error in misreading the facts and the law in Barrick and Davies he would probably have found that a 4 year sentence would adequately fit the crime which by any standard was severe enough to satisfy the justice of this case. [5] Since full restitution had been made and the appellant had not enriched himself personally by the crime, the Supreme Court found no purpose in imposing a fine in addition to custodial sentence. 26. Kesemua faktor yang dicadangkan di dalam kes tersebut telah mahkamah ini ambilkira dan diselaraskan dengan Fakta kes di hadapan kita ini sebelum mahkamah ini menjatuhkan hukuman. 16 27. OKT telah mengaku bersalah dan pengakuan bersalahnya ini perlu diambilkira sebagai satu faktor peringanan utama. Namun demikian mahkamah juga harus melihat bahawa di dalam jenayah serius dan hina serta kejam seperti ini, pengakuan salah OKT juga tidak harus dipertimbangkan sebagai faktor peringanan sepertimana yang telah banyak diputuskan dalam nas-nas undang-undang. OKT juga tidak mempunyai apa-apa rekod lampau. Di dalam rayuannya, OKT memohon maaf di atas kesalahannya. Beliau telah kesal dan insaf. Datang ke Malaysia setelah rumahnya di bakar di Myanmar. Mempunyai 7 orang adik beradik dan membantu keluarganya dikampung. Berjanji tidak akan mengulangi lagi kesalahannya dan ingin balik ke Negara asalnya. 28. Hujahan pemberatan oleh pihak pendakwaan juga telah mahkamah ini ambilkira kesemuanya dimana faktor kepentingan awam adalah faktor utama di dalam pertimbangan untuk memberikan hukuman paling setimpal untuk OKT. Mahkamah juga diingatkan bahawa OKT mempunyai 2 pertuduhan yang serius dan satu hukuman yang berbentuk pengajaran perlu diberikan kepada OKT agar ianya dapat menjadi hukuman dan pengajaran kepada OKT dan mana-mana bakal pesalah lain. 17 29. Oleh yang demikian, Dari tempoh asal selama 30 tahun yang dibenarkan oleh undang-undang, tempoh pemenjaraan selama 10 tahun yang dikenakan terhadap OKT tersebut adalah dirasakan setimpal dengan jenayah kejam yang telah dilakukan oleh OKT (kos sara hidup OKT (yang bukan warganegara) selama tempoh pemenjaraan itu juga perlu dilihat dan diambilkira secara ekonomi) dimana disamping hukuman pemenjaraan itu OKT juga telah dikenakan hukuman 6 kali sebatan yang mana mahkamah merasakan cukup dan setimpal dengan kesalahan tersebut. 30. OKT seharusnya bersyukur kerana dapat menyelamatkan nyawanya dari diancam di Negara asalnya sendiri dan menumpang hidup di bumi bertuah Malaysia ini dan bukannya melakukan onar sepertimana yang terjadi. 31. Perbuatan merogol kanak-kanak gadis sunti yang berusia 10 tahun 9 bulan sehingga mangsa mengandung dan keguguran ini adalah satu perbuatan yang hina lagi terkutuk dan semestinya dibendung dan dicegah dimana suatu hukuman yang berat dan menginsafkan perlu diberikan bagi menampaikan mesej kepada OKT dan masyarakat bahawa pihak 18 mahkamah memandang serius dan berat untuk kes-kes jenayah yang melibatkan kesalahan seksual dan kanak-kanak seperti kes ini. 32. Tingkah laku OKT yang merupakan seorang Pendatang Asing yang datang dan masuk ke Negara ini secara haram dan kemudiannya melakukan kesalahan adalah suatu perlakuan yang tidak boleh diterima dengan langsung tidak menghormati dan meremehkan undang-undang tegas Negara ini dan oleh itu hendaklah dikenakan hukuman yang lebih keras dan sepadan sebagai ingatan dan amaran kepada mana-mana bakal pesalah lain. 33. Semoga tempoh pemenjaraan yang lama ini dapat manjadi iktibar kepada OKT dan mengubah OKT menjadi insan yang lebih baik dan mulia setelah dibebaskan kelak selain kesan parut dari luka libasan rotan di kulit punggungnya yang tersiat akibat sebatan nanti dapat mengingatkan OKT dan yang paling penting kepada mana-mana bakal pesalah lain dari melakukan kesalahan dan jenayah yang sama di masa hadapan. 19 E. KESIMPULAN. 34. Setelah mengambilkira prinsip undang-undang dan kesemua faktor yang perlu di dalam menjatuhkan hukuman, maka mahkamah ini berpendapat bahawa sabitan yang dikenakan terhadap OKT adalah selamat dan hukuman yang diberikan adalah adil, setimpal, wajar dan mengikut undang-undang. Sekian. Disediakan oleh; tt. KAMARUDIN BIN KAMSUN, Hakim, Mahkamah Sesyen Jenayah 1, Johor Bahru. Bertarikh: 24 Ogos 2017. Pendakwa Raya: Puan Suhaila. Timbalan Pendakwa Raya Johor. OKT mewakili diri sendiri.

Tika 2.6.0

62JS-42-10/2016

PENDAKWARAYAPUAN SUHAILA BINTI SHAFIUDIN PERAYU HAMID DULUP BIN KAMAL AHMAD

24/08/2017

TN KAMARUDIN BIN KAMSUN

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=d6fb24dc-c2d3-44c2-9a3b-3b82e704997e&Inline=true

1 DALAM MAHKAMAH SESYEN DI JOHOR BAHRU DALAM NEGERI, JOHOR PERBICARAAN JENAYAH NO: 62JS – 42 – 10/2016 ANTARA PENDAKWA RAYA LAWAN HAMID DULUP BIN KAMAL AHMAD ALASAN KEPUTUSAN A. PENGENALAN. 1. Di dalam kes ini, OKT telah dituduh dengan 2 pertuduhan sebagai mana berikut:- 2 Tuduhan Pertama; “Bahawa kamu pada pertengahan bulan Ogos 2016 lebih kurang jam 1830 petang, di dalam rumah alamat No. 03-04 Blok U, Jalan Camar 12, Taman Perling di dalam daerah Johor Bahru, di dalam negeri Johor, telah merogol (1) P/M Nama: Johara Bibi Binti Mohd Rofiq yang berumur 10 tahun 9 bulan. Oleh yang demikian kamu telah melakukan satu kesalahan di bawah seksyen 376 Kanun Keseksaan dan boleh di hukum di bawah seksyen 376 Kanun yang sama. Tuduhan Kedua; “Bahawa kamu pada 03/10/2016 jam lebih kurang 0459 pagi di No. 03-04, Blok U, Jalan Camar 12, Taman Perling, di dalam daerah Johor Bahru Utara, di dalam negeri Johor, di dapati tiada memiliki apa-apa pas yang sah yang dikeluarkan mengikut undang-undang kepada kamu untuk memasuki Negara ini. Dengan itu telah melanggar peruntukan di bawah seksyen 6(1)(c) Akta Imigresen 1959/63 dan dengan itu kamu telah melakukan suatu kesalahan yng boleh dihukum di bawah seksyen 6(3) Akta yang sama.” 3 2. Terhadap kedua-dua pertuduhan tersebut, OKT telah mengaku bersalah dan telah didapati bersalah dan disabitkan dengan pertuduhan dan dijatuhi hukuman penjara sebagaimana berikut;- Tuduhan pertama – penjara 10 tahun dari tarikh tangkap dan 6 kali sebatan. Tuduhan Kedua – penjara 3 tahun dari tarikh tangkap Kesemua hukuman penjara di jalankan serentak. 3. Terhadap keputusan tersebut pihak OKT telah tidak berpuashati dan membuat rayuan terhadap Hukuman dan Sabitan. B. SABITAN DAN FAKTA KES PENDAKWAAN. 4. Kesemua Pertuduhan dan Fakta kes telah dibacakan dan diterangkan kepada OKT di dalam bahasa ibunda OKT iaitu Bahasa Myanmar/Rohingya. 4 5. Pada peringkat awal kes ini dipertuduhkan di mahkamah, OKT telah minta dibicarakan ke atas kedua-dua pertuduhan yang dikenakan terhadapnya. Pada awalnya jurubahasa bernama Abul Kasim@ Maung Sen Win hadir memperterjemahkan prosiding. Selanjutnya ketika perbicaraan di jalankan, SP1 telah memberikan keterangan. SP1 ini adalah mangsa kepada OKT. Segala prosiding perbicaraan ini telah diterjemahkan dan diterangkan oleh jurubahasa Myanmar bernama Md Yusof Bin Md Sharif. 6. Setelah SP1 memberikan keterangan, kes telah ditangguhkan untuk sambung bicara dan pada tarikh 24.8.2017 iaitu ketika tarikh kes sambung bicara, pertuduhan telah dibacakan semula, dan OKT telah menukar pengakuannya kepada pengakuan bersalah dan kesemua prosiding ini telah diterjemahkan dan diterangkan oleh Jurubahasa Myanmar bernama Ahmed. 7. Pertuduhan itu adalah dibacakan dari bahasa Malaysia ke bahasa Myanmar dan telah diterjemah dan diterangkan akan sifat dan akibat pengakuannya dan kesemuanya ini telah difahami oleh OKT dengan disahkan oleh jurubahasa tersebut. 5 8. Begitu juga segala prosedur pengemukaan fakta kes dan ekhibit telah dilakukan dan diterjemahkan segalanya di dalam bahasa Malaysia ke dalam bahasa Myanmar dan telah difahami dengan jelas dan diakui oleh OKT segala maksud, kesan dan akibat dari pengakuan bersalahnya tersebut. 9. Rayuan sebelum hukuman oleh OKT juga telah diterjemahkan dari bahasa Myanmar ke dalam bahasa Malaysia dan kesemua pihak telah memahami kedudukan dan keadaan kes masing-masing. 10. Mahkamah ini dengan itu merasakan bahawa sabitan yang dikenakan ke atas OKT adalah selamat dan tidak pernah memprejudiskan OKT dimana OKT faham segala apa yang berlaku di dalam mahkamah dan faham sifat dan akibat dari pengakuannya, yang mana beliau telah diterangkan segala sebab, sifat dan akibat dari pengakuannya, bentuk hukuman yang menunggunya dan apa yang boleh dikenakan terhadapnya dan beliau sedia menghadapinya. Maka adalah tidak relevan untuk sekarang sekiranya beliau mempertikaikan sabitan yang telah dibuat keatasnya atas apa jua alasan lain melainkan beliau sendiri dengan rela 6 hati telah membuat pengakuan bersalah terhadap kesalahan yang telah dipertuduhkan ke atasnya. 11. Selanjutnya, sebagaimana yang telah disahkan dan diakui benar oleh OKT sepertimana yang dikemukakan oleh pihak pendakwaan menerusi ekhibit P2, fakta kes ini adalah sebagaimana berikut. 12. Pada pertengahan bulan Ogos 2016 jam lebih kurang 6.30 petang di rumah alamat No. 03-04 Blok U jalan Camar 12, Taman Perling, mangsa seorang kanak-kanak wanita berumur 10 tahun telah dirogol oleh seorang warganegara Myanmar iaitu OKT. 13. Pada 1/10/2016 semasa bapa mangsa berada di rumah telah diberitahu oleh anaknya tidak datang period selama 2 bulan dan telah membawa anaknya ke klinik dan didapati telah mengandung. Mangsa memberitahu tertuduh telah datang ke rumah mangsa semasa ahli keluarga tiada di rumah dan telah merogol mangsa. 7 14. Tertuduh telah menarik tangan mangsa ke katil dan telah membuka seluar mangsa dan telah menarik seluar dalam mangsa dan menyebabkan mangsa terbogel. Kemudian Tertuduh telah memasukkan kemaluan tertuduh terus ke dalam kemaluan mangsa dan mangsa berasa sakit dan menangis. 15. Mangsa telah dirujuk ke hospital pada 3.10.2016 dan telah menjalani pemeriksaan doktor dan mengesahkan mangsa hamil dan mangsa tinggal di hospital selama satu minggu dan semasa di hospital di dapati mangsa telah keguguran dan doktor telah mengambil sampel darah dari janin yang dibersihkan sepertimana dalam laporan perubatan yang dikeluarkan. 16. Sampel darah telah di hantar ke Jabatan Kimia bersama-sama specimen darah tertuduh dan mangsa. Laporan kimia bertarikh 1.11.2016 mengesahkan bahawa tertuduh adalah merupakan “biological father” dan mangsa adalah “biological mother” kepada janin tersebut. 8 17. Semakan daripada jabatan Imigresen mengesahkan OKT tidak mempunyai rekod pergerakan warga asing dan tidak mempunyai passport yang sah. 18. OKT telah mengaku sepertimana pertuduhan. C. FAKTOR DAN PRINSIP PENGHUKUMAN. 19. Undang-undang tidak pernah membuat suatu penetapan hukuman ke atas suatu kes tertentu tetapi hanya meletakkan suatu hukuman maksima terhadapnya dan ini tidak bermakna bahawa suatu hukuman maksima hendaklah sentiasa dikenakan di dalam setiap kes mengenainya ( Mohd Jalani bin Saliman v PP [1997] 5 MLJ 551), maka terpulanglah kepada mahkamah tersebut mengenakan suatu hukuman yang dirasakan sesuai dalam lingkungan julat hukuman yang dibenarkan tertakluk kepada fakta dan keadaan kes masing-masing. Adalah menjadi tugas mahkamah untuk mengenakan suatu hukuman yang mana hukuman tersebut dapat mencerminkan keseriusan suatu kesalahan yang telah dilakukan (PP v Khairudin [1982] 1 MLJ 331). Tujuan meletakkan budibicara kepada Penghukum adalah bagi membenarkan Penghukum memberikan hukuman 9 yang dirasakan paling sesuai di dalam setiap satu kes secara berasingan dan apa-apa kecenderungan untuk menyeragamkan hukuman bagi sesuatu kesalahan hendaklah dielakkan kerana itu bermakna pesalah tersebut dihukum bukan atas fakta kesnya tetapi disebabkan oleh jenis kesalahan yang telah dilakukannya ( Abdul Karim v R; Sundra Singh v R; Loh Kai Hoi v R [1954] MLJ 86). 20. Suatu pertimbangan yang adil perlu dilihat dan dibuat antara keperluan kepada suatu hukuman yang mencegah dan juga peluang kepada tertuduh untuk dipulihkan (Kesavan Senderan v PP [1999] 1 CLJ 343). Setiap penghukuman hendaklah bersifat ekslusif dan peribadi tergunapakai hanya kepada pesalah tersebut sahaja yang dilaras kepada keadaan moral dan kewangannya juga kepada sifat suatu kesalahan tersebut ( Low Oi Lin v R [1949] MLJ 210 ). 21. Di dalam menjatuhkan suatu hukuman, pertimbangan yang diambilkira sebelum hukuman dijatuhkan ialah kepentingan awam, keadaan suatu kesalahan tersebut dan juga latarbelakang pesalah berkenaan. Suka ditekankan bahawa menurut kes R v Sargeant (1974) 60 Cr App R 74, merumuskan bahawa “Society, through the courts, must 10 show its abhorrence for the occurrence of particular types of crime and the only way which the courts can show this is by the sentences they pass. The courts act as a vehicle to show abhorrence for particular types of criminal conduct. However, the courts do not have to reflect public opinion. On the other hand, court could not disregard it. Perhaps the main duty of the court is to lead public opinion.”(ulasan oleh penulis buku “The process of criminal justice”). Oleh itu, mahkamahlah yang sepatutnya melaraskan dan melakarkan apa kehendak yang patut dibentuk oleh masyarakat menerusi hukuman yang dibuatnya. 22. Prinsip klasik di dalam menilai suatu hukuman yang bakal dikenakan terhadap pesalah ialah sebagaimana diputuskan dalam kes R v Sargeant, supra, iaitu: “retribution, deterrence, prevention and rehabilitation.” Kes R v Sargeant, supra, juga turut mengariskan apakah panduan di dalam menentukan suatu tempohmasa pemenjaraan yang sesuai yang patut dikenakan terhadap pesalah yang mana antara lainnya ialah; sifat dan keseriusan suatu kesalahan tersebut, keadaan dimana kesalahan tersebut dilakukan, diskaun kepada keinsafan dan akhirnya imbangan diantara kepentingan awam di dalam mencegah kesalahan tersebut dan peluang pesalah memulakan kehidupan yang baru. 11 D. ANALISA DAN KEPUTUSAN MAHKAMAH. 23. Pada pendapat mahkamah, hukuman yang diberikan ke atas kedua- dua pertuduhan ini adalah setimpal dan wajar serta mengikut undang- undang. Seksyen 376 Kanun Keseksaan memperuntukkan; Section 376. Punishment for rape. (1) Subject to subsections (2), (3) and (4), whoever commits rape shall be punished with imprisonment for a term which may extend to twenty years, and shall also be punished with whipping. [Am. Act A1536/2017] (2) Whoever commits rape on a woman under any of the following circumstances: (a) at the time of, or immediately before or after the commission of the offence causes hurt to her or to any other person; (b) at the time of, or immediately before or after the commission of the offence, puts her in fear of death or hurt to herself or any other person; (c) the offence was committed in the company of or in the presence of any other person; (d) without her consent, when she is under sixteen years of age; (e) with or without her consent, when she is under twelve years of age; (f) with her consent, when the consent is obtained by using his position of authority over her or because of professional relationship or other relationship of trust in relation to her; [(f) Am.Act A1471/2014] (g) at the time of the offence the woman was pregnant; [(g) Am.Act A1471/2014] (h) when by reason or on occasion of the rape, the woman becomes insane; (i) when he knows that he is afflicted with the Human Immuno-Deficiency Virus (HIV)/Acquired Immune Deficiency Syndrome (AIDS) or any other sexually transmissible disease and the virus or disease is or may be transmitted to the woman; (j) when by reason or on occasion of the rape, the woman commits suicide; or (k) when he knew of the mental disability, emotional disorder or physical handicap of the woman at the time of the commission of the crime, [(h), (i), (j), (k) Ins.Act A1471/2014] shall be punished with imprisonment for a term of not less than ten years and not more than thirty 12 years and shall also be punished with whipping. [Am. Act A1536/2017]; [Am.Act A1471/2014] 24. Makala seksyen 6(3) Akta Imigresen memperuntukkan; Section 6 . Control of entry into Malaysia. (1) No person other than a citizen shall enter Malaysia unless- (a) he is in possession of a valid Entry Permit lawfully issued to him under section 10; [Am. Act A985: s.4] (b) his name is endorsed upon a valid Entry Permit in accordance with section 12, and he is in the company of the holder of the Permit; [Am. Act A985: s.4] (c) he is in possession of a valid Pass lawfully issued to him to enter Malaysia; or (d) he is exempted from this section by an order made under section 55. (2) (Repealed by Act 27 of 1963). (3) Any person who contravenes subsection (1) shall be guilty of an offence and shall, on conviction, be liable to a fine not exceeding ten thousand ringgit or to imprisonment for a term not exceeding five years or to both, and shall also be liable to whipping of not more than six strokes. [Am. Act A 1154:s.4] 25. Di dalam kes ini, kes ini telah diambilkira sebagai panduan; kes Mahkamah Agong ketika itu di dalam kes Mohd Abdullah Ang Swee Kang (1987) CLJ (rep) 209; yang mengatakan;- Held: http://www.lawnet.com.my/LawNet/Public/LawLibrary/SubDocumentDetails.aspx?SubDocumentID=25323 http://www.lawnet.com.my/LawNet/Public/LawLibrary/SubDocumentDetails.aspx?SubDocumentID=25323 http://www.lawnet.com.my/LawNet/Public/eGazette/Download.aspx?ID=10350 13 [1] The Supreme Court agreed with the principle laid down in Reg.v. Barrick that in breach of trust cases in general a term of immediate imprisonment would be inevitable, save in very exceptional circumstances or where the amount of money involved was small. This must be the current sentencing policy even if the accused pleaded guilty. In the Supreme Court's view, the approach of assessing sentence adopted by the learned Judge supposedly based on English authorities by harmonising them with the maximum sentence of 20 years in s. 409 of the Penal Code,was not only misleading but was wrong in principle. When the legislature fixed a maximum penalty for an offence, the discretion of the Court in determining the extent to which in a particular case the punishment should be awarded must be exercised judicially. [2] In assessing the length of custodial sentence, the Court must look at the overall picture in perspective by considering firstly, the gravity of the type of offence committed; secondly, the facts in the commission of the offence; thirdly, the presence or absence of mitigating factors, and fourthly, the sentence that have been imposed in the past for similar offences to javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1997_574&ActSectionNo=409&SearchId=7perpm05C','_DisplayAct','');DispAct.focus() javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1997_574&ActSectionNo=409&SearchId=7perpm05C','_DisplayAct','');DispAct.focus() 14 determine the trend of sentencing policy, if any. The fact that a sentence of imprisonment is imposed as a deterrence does not justify the sentencer in passing a sentence of greater length than the facts of the offence warrant. The gravity of the type of offence involved must be considered in the light of the particular facts of the offence. [3] A sentencer must give sufficient discount for all extenuating circumstances pertaining to the degree of culpability or criminality involved which must necessarily vary from case to case apart from other mitigating factors. Unless there is a proper reason for withholding such credits, failure to do so may result in the sentence not exercising his or her discretion judicially in assessing the level of custodial sentence. The sentence imposed on the appellant was manifestly excessive. It is generally accepted that the extent of reduction on account of a plea of guilty would be between ¼ and 1/3 of what otherwise would have been the sentence. In this particular case, apart from plea of guilty, the sentence must also be discounted to reflect the full restitution made and other mitigating factors. 15 [4] Although the learned Judge indicated in his judgment that he had given the necessary discounts they were not reflected at all in the sentence imposed, as it was imposed without regard to the particular facts of this case and without giving the appellant any or sufficient credit for all the mitigating circumstances. The recommended prison terms in Barrick were not meant for pleading guilty cases. If the learned Judge had not fallen into error in misreading the facts and the law in Barrick and Davies he would probably have found that a 4 year sentence would adequately fit the crime which by any standard was severe enough to satisfy the justice of this case. [5] Since full restitution had been made and the appellant had not enriched himself personally by the crime, the Supreme Court found no purpose in imposing a fine in addition to custodial sentence. 26. Kesemua faktor yang dicadangkan di dalam kes tersebut telah mahkamah ini ambilkira dan diselaraskan dengan Fakta kes di hadapan kita ini sebelum mahkamah ini menjatuhkan hukuman. 16 27. OKT telah mengaku bersalah dan pengakuan bersalahnya ini perlu diambilkira sebagai satu faktor peringanan utama. Namun demikian mahkamah juga harus melihat bahawa di dalam jenayah serius dan hina serta kejam seperti ini, pengakuan salah OKT juga tidak harus dipertimbangkan sebagai faktor peringanan sepertimana yang telah banyak diputuskan dalam nas-nas undang-undang. OKT juga tidak mempunyai apa-apa rekod lampau. Di dalam rayuannya, OKT memohon maaf di atas kesalahannya. Beliau telah kesal dan insaf. Datang ke Malaysia setelah rumahnya di bakar di Myanmar. Mempunyai 7 orang adik beradik dan membantu keluarganya dikampung. Berjanji tidak akan mengulangi lagi kesalahannya dan ingin balik ke Negara asalnya. 28. Hujahan pemberatan oleh pihak pendakwaan juga telah mahkamah ini ambilkira kesemuanya dimana faktor kepentingan awam adalah faktor utama di dalam pertimbangan untuk memberikan hukuman paling setimpal untuk OKT. Mahkamah juga diingatkan bahawa OKT mempunyai 2 pertuduhan yang serius dan satu hukuman yang berbentuk pengajaran perlu diberikan kepada OKT agar ianya dapat menjadi hukuman dan pengajaran kepada OKT dan mana-mana bakal pesalah lain. 17 29. Oleh yang demikian, Dari tempoh asal selama 30 tahun yang dibenarkan oleh undang-undang, tempoh pemenjaraan selama 10 tahun yang dikenakan terhadap OKT tersebut adalah dirasakan setimpal dengan jenayah kejam yang telah dilakukan oleh OKT (kos sara hidup OKT (yang bukan warganegara) selama tempoh pemenjaraan itu juga perlu dilihat dan diambilkira secara ekonomi) dimana disamping hukuman pemenjaraan itu OKT juga telah dikenakan hukuman 6 kali sebatan yang mana mahkamah merasakan cukup dan setimpal dengan kesalahan tersebut. 30. OKT seharusnya bersyukur kerana dapat menyelamatkan nyawanya dari diancam di Negara asalnya sendiri dan menumpang hidup di bumi bertuah Malaysia ini dan bukannya melakukan onar sepertimana yang terjadi. 31. Perbuatan merogol kanak-kanak gadis sunti yang berusia 10 tahun 9 bulan sehingga mangsa mengandung dan keguguran ini adalah satu perbuatan yang hina lagi terkutuk dan semestinya dibendung dan dicegah dimana suatu hukuman yang berat dan menginsafkan perlu diberikan bagi menampaikan mesej kepada OKT dan masyarakat bahawa pihak 18 mahkamah memandang serius dan berat untuk kes-kes jenayah yang melibatkan kesalahan seksual dan kanak-kanak seperti kes ini. 32. Tingkah laku OKT yang merupakan seorang Pendatang Asing yang datang dan masuk ke Negara ini secara haram dan kemudiannya melakukan kesalahan adalah suatu perlakuan yang tidak boleh diterima dengan langsung tidak menghormati dan meremehkan undang-undang tegas Negara ini dan oleh itu hendaklah dikenakan hukuman yang lebih keras dan sepadan sebagai ingatan dan amaran kepada mana-mana bakal pesalah lain. 33. Semoga tempoh pemenjaraan yang lama ini dapat manjadi iktibar kepada OKT dan mengubah OKT menjadi insan yang lebih baik dan mulia setelah dibebaskan kelak selain kesan parut dari luka libasan rotan di kulit punggungnya yang tersiat akibat sebatan nanti dapat mengingatkan OKT dan yang paling penting kepada mana-mana bakal pesalah lain dari melakukan kesalahan dan jenayah yang sama di masa hadapan. 19 E. KESIMPULAN. 34. Setelah mengambilkira prinsip undang-undang dan kesemua faktor yang perlu di dalam menjatuhkan hukuman, maka mahkamah ini berpendapat bahawa sabitan yang dikenakan terhadap OKT adalah selamat dan hukuman yang diberikan adalah adil, setimpal, wajar dan mengikut undang-undang. Sekian. Disediakan oleh; tt. KAMARUDIN BIN KAMSUN, Hakim, Mahkamah Sesyen Jenayah 1, Johor Bahru. Bertarikh: 24 Ogos 2017. Pendakwa Raya: Puan Suhaila. Timbalan Pendakwa Raya Johor. OKT mewakili diri sendiri.

Tika 2.6.0

WA-12ANCC-32-05/2017

PLAINTIF Virtual Force Sdn Bhd & 1 Lagi DEFENDAN Jalita Engineering Sdn Bhd

21/08/2017

YA DATUK LAU BEE LAN

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=146790bd-29be-45f5-88c2-c87255eb1736&Inline=true

Failed Extraction

21C-3-06/2015

PLAINTIF Marljaya (M) Sdn Bhd DEFENDAN 1. Kerajaan Malaysia; 2. Ketua Pengarah Jabatan Kerja Raya Malaysia; 3. Pengarah Jabatan Kerja Raya Melaka

18/08/2017

YA DATO' LEE SWEE SENG

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=5b36066b-f8e6-4e25-b003-4a1595ca3dd3&Inline=true

1 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF WILAYAH PERSEKUTUAN, MALAYSIA (CIVIL DIVISION) CIVIL SUIT NO: 21C-3-06/2015 BETWEEN MARL JAYA (M) SDN BHD ... PLAINTIFF AND 1. KERAJAAN MALAYSIA 2. KETUA PENGARAH JABATAN KERJA RAYA MALAYSIA 3. PENGARAH JABATAN KERJA RAYA MELAKA ... DEFENDANTS THE JUDGMENT OF Y.A. TUAN LEE SWEE SENG [1] This is an appeal in Enclosure 50 against the assessment of damages for loss and expense and idling costs of machineries arising out of an Extension of Time (“EOT”) granted by the Third Defendant to the 2 Plaintiff under a construction contract. The Contract was with respect to a construction Project known as “UiTM Melaka Branch, Alor Gajah Campus- Hostel Complex and FSS Workshop” in Alor Gajah, Melaka (“the Project”). [2] The Contract sum for the Project was RM75 million and the initial completion date was 14.11.2010. The Contract was signed between the Plaintiff and the Second Defendant, the Director General of the Public Works Department (“PWD”). The Third Defendant is the Director of PWD Melaka. [3] Without going into the whys and wherefores, there were problems that arose in the course of the execution of works for the Project. There was an EOT No.1 granted to the Plaintiff dated 4.12.2009 by the Third Defendant. This was for a period of 177 days with the consequence of the completion date being extended to 10.5.2011. [4] The Plaintiff had claimed in its statement of claim for the losses due to the delay and EOT No.1, changes to the design of the FSSR Workshop’s Roof Trusses and idling machineries costs. Preliminaries [5] The parties had recorded an interlocutory consent judgment on 29.1.2016 with damages to be assessed and there was a further date for 3 clarification on 11.3.2016 where with the consent of the parties the words “without any admission as to liability” have been added to the consent judgment on liability. In the consent judgment recorded before me on 29.1.2016 it was also recorded that the Defendants shall pay the Plaintiff the sum of RM128,984.00 being the agreed sum for the “Changes to Design of the FSSR Workshop Roof Trusses” together with interest at 5% per annum from date of writ to realization and with no order as to costs. [6] It was written into the consent judgment that liability shall be assessed with respect to the loss and expense suffered by the Plaintiff arising out of the EOT as claimed in the Plaintiff’s statement of claim. Thus it was agreed that there is no disputes as to liability and the only dispute is the quantum of the claims to be paid by the Defendants to the Plaintiff. [7] The assessment was before the Deputy Registrar who heard a witness each from the Plaintiff and the Defendants. Bundle of Documents were also filed by the parties to assist the Court with the assessment of damages exercise. [8] The learned Deputy Registrar on 30.5.2026 assessed the damages and allowed the sum of RM2,224,254.73 together with costs of RM50,000.00 to be paid by the Defendants to the Plaintiff. 4 [9] A Registrar’s Certificate for Assessment under O.37 r.2 Rules of Court 2012 (“ROC 2012”) was duly issued dated 30.5.2016 setting out the breakdown of the sums allowed under “Schedule of Claims 1 (Loss and Expense due to EPT No.1) and under Schedule of Claims 2 (Idling Machineries Costs) for a total of RM2,224,254.73. The Deputy Registrar had disallowed the claim for Telephone Bills as there was no evidence that it was incurred for the Project. The Schedules of Claims 1 and 2 assessed and allowed by the learned Deputy Registrar are as follows: SCHEDULE OF CLAIMS 1 (LOSS AND EXPENSES DUE TO EOT NO. 1) NO ITEMS QUANTUM ALLOWED 1 EPF RM 13,259.00 2 SOCSO RM 1,544.60 3 INSURANCE RM23,568.48 4 TELEPHONE BILLS NIL 5 PLANT AND MACHINERIES RM365,572.65 5 SCHEDULE OF CLAIMS 2 (IDLING MACHINERIES COSTS) 6 MACHINERIES (MAY 2009) RM257,025.00 7 MACHINERIES (JUNE 2009) RM316,505.00 8 MACHINERIES (JULY 2009) RM434,805.00 9 MACHINERIES (AUGUST 2009) RM314,507.00 10 MACHINERIES (SEPTEMBER 2009) RM327,985.00 11 MACHINERIES (OCTOBER 2009) RM169,483.00 TOTAL RM2,224,254.73 Prayer [10] The Defendants were dissatisfied with the quantum of damages as assessed by the Deputy Registrar and so appealed to this Court. [11] The parties shall be referred to the way they were referred at the assessment of damages before the Deputy Registrar as Plaintiff and Defendants. [12] The following issues were raised in this appeal: 6 1. Whether the Plaintiff is entitled to the damages since it fails to submit the Notice of Intention to Claim for losses pursuant to Clause 44 of the Contract; 2. Whether the Plaintiff has mitigated its losses; 3. Whether the EPF, SOCSO and Insurance can be considered as additional expenses due to the EOT No.1; 4. What will be the rate of the idling machineries; 5. Whether the Claimant's for idling machineries overlaps with the claim for plant and machineries under loss and expense. Principles Whether the Defendants can raise at the stage of assessment of damages that the Notice of Intention to claim for loss and expense was not duly served by the Plaintiff and as such the Defendants are not liable [13] The requirement of a Notice of Intention to claim for loss and expense arising out of an EOT is apparently found in Clause 44 of the Contract dated 13.4.2009. It reads: “44 Loss and Expense Caused by Delays 7 If the regular Progress of the Works or any part thereof has been materially affected by reason as stated under Clause 43 (c), (f) or (i) hereof (and no other), and the Contractor has incurred direct loss and/or expense for which he would not be reimbursed by a Payment made under any other provision in this Contract, then the Contractor shall within one (1) month of the occurrence of such event or circumstance give notice in writing to the S.O. of his intention to claim for such direct loss or expense together with an estimate of the amount of such loss and/or expense, subject always to clause 48 hereof.” [14] It is too late in the day for the Defendants to raise the issue of the non-service of the Notice of Intention to claim for Loss and Expense. By agreeing to a consent judgment on liability to be entered, the Defendant has also with it agreed that there is no further dispute on liability but only on quantum. The Defendants may not admit liability as recorded in the clarification of the consent judgment but that does not mean that liability is still an issue. In fact it has become a non-issue and the only issue is the quantum. [15] The Defendants by entering into and consent to a judgment being entered and agreeing to proceed with assessment of damages would mean 8 that they cannot now resile from that position. Indeed the Defendants are estopped from raising the issue of liability in that since the said Notice under Clause 44 of the Contract is not issued, then the Defendants are not liable. [16] If they had wanted to do that, then they should not have agreed to a consent judgment being recorded and then the parties would have the opportunity to lead evidence as to whether the Notice requirement had been met or waived. [17] I am in full agreement with the authority cited by learned counsel for the Plaintiff in the English case of New Century Media Limited v Makhlay [2013] EWHC 3556 (QB) which involved an assessment of damages after a judgment in default had been entered against the Defendant. Mrs Justice Carr observed astutely as follows: “23 One unsatisfactory aspect of this hearing has been the fact that the scope of issues had not been agreed or determined in advance and was materially in dispute. Specifically, it is Mr Makhlay's contention that, despite the judgment against him, it is open to him to advance the following arguments: 9 a) That he was entitled to terminate the contract due to a substantive (repudiatory) failure of performance on the part of NCM (“the repudiation issue”). On this basis, it was submitted that he was entitled to terminate the contract on 24th October 2012, which he did, giving rise to a liability only for debt or damages for a 4 day period (20th to 24th October 2012); b) That there was an implied term of the contract entitling him to terminate the contract on reasonable notice, said to be one month (“the early termination issue”). … 29 For the reasons set out below, I have reached the clear conclusion that Mr Makhlay's position is misconceived and that it is not open to him now to raise the repudiation and early termination issues. 30 A default judgment on liability under CPR Part 12 is a final judgment that is conclusive on liability. The Particulars of Claim are, in effect, a proxy for the judgment, setting out the basis of liability. Once judgment is entered, it is not open to a defendant to go behind it. Damages of course still have to be proved, and a https://login.westlawasia.com/maf/app/document?src=doc&maintain-toc-node=true&linktype=ref&&context=&crumb-action=replace&docguid=I0D981C00E45011DA8D70A0E70A78ED65 10 defendant can raise any issue which is not inconsistent with the judgment – see the White Book 2013 notes to CPR 12.4.4 . ... 36 Mr Makhlay had a full opportunity to defend the claim on liability. If he disagreed with an aspect of liability that was relevant to quantum, it was for him to challenge the claim at the liability stage. He chose not to do so. He has not sought to set the judgment aside. He cannot now “roam freely” across issues of liability as he wishes to do. ... 40 Mr Makhlay's approach is tantamount to an abuse of process by way of a back-door attempt to challenge the findings in the judgment. It offends not only a natural sense of justice, but also against the general rule that a party should not be allowed to litigate issues which have already been decided by a court of competent jurisdiction. 41 The consequences of Mr Makhlay's position being correct would be startling: a defendant would benefit from failing to lodge a defence on liability and by simply submitting to a judgment in default, https://login.westlawasia.com/maf/app/document?src=doc&maintain-toc-node=true&linktype=ref&&context=&crumb-action=replace&docguid=I71F54A60E42311DAA7CF8F68F6EE57AB 11 holding his powder dry until the quantum stage. He would then be able to mount, essentially unfettered, all and any arguments on liability at the quantum stage that he wished – probably, as has happened here, without any proper pleading or identification of the issues.” (emphasis added) [18] If the above principle applies to a default judgment it would a fortiori apply with greater force to a consent interlocutory judgment. [19] The High Court there had followed the principle enunciated in their Court of Appeal case of Lunnun v Singh and Another [1999] WL 477360 where it was held as follows: “In my judgment, the underlying principle is that on an assessment of damages all issues are open to a defendant save to the extent that they are inconsistent with the earlier determination of the issue of liability, whether such determination takes the form of a judgment following a full hearing on the facts or a default judgment. In this case the judgment was a default judgment.” [20] It is too late in the day and indeed the SFC, upon being confronted with these case, did not pursue further, the contention that no prior notice 12 was given on time under Cl 44 for the claim for loss and expense caused by delay. [21] If indeed that was the stand taken from the outset, then it should be clearly stated in the recording of the consent judgment. To allow the issue of the prior Notice of Intention to Claim to be raised at this stage of assessment would be to allow the Defendants to act inconsistently with the earlier consent interlocutors judgment entered where liability is no longer an issue and only quantum is to be resolved at the assessment of damages stage. [22] I agree with the approach taken by the learned Deputy Registrar in dismissing this issue raised by the Defendants as set out succinctly in his grounds of judgment as follows: “[15] …It should be noted that before the commencement of this assessment hearing, it was agreed by parties that only the quantum of claims (sic) to be assessed by Deputy Registrar. This agreement was recorded during a Case Management held on the 1st October 2015. It was further agreed by both counsels (sic) that the assessment would be done only in relation with (sic) the loss and expenses due to EOT 1 and also the idling machinery charges. Both 13 parties by consent had agreed that the assessment will not be dealing with the issue on liability. This was recorded before the court on the 29th February 2016.” [23] The SFC appearing for the Defendants agreed, though not without some reluctance, that it is too late in the day to raise the issue of Notice to Claim which has the effect of challenging the validity of the Plaintiff’s claim under the head of damages for “Loss and Expense”. It is the backdoor way of resurrecting what has been put to rest on the issue of liability; bringing to life what has been buried and reviving what has been interned! [24] At any rate I am more than satisfied that the Defendants had been given sufficient Notice of Intention to Claim and were fully aware of the loss and expense incurred from the correspondence between the parties, the Site Progress Reports and reports on the Critical Path Method and the Daily Site Report duly signed off by the Defendants’ representative. Whether the Plaintiff has proved the claims for EPF, SOCSO and Insurance under the head of “Loss and Expense” under EOT No. 1 [25] The claims allowed are basically under 3 heads. [26] First are the EPF and SOCSO and Insurance. For this claim I am satisfied that the evidence adduced substantiate the sum claimed. The 14 learned SFC said it should be part of the costs that the Plaintiff would have factored into the Preliminaries. I do not think so. This is the additional costs incurred during the EOT. [27] Learned counsel for the Plaintiff explained that they could have claimed for salaries during this period but as the Defendants’ Quantity Surveyor (“QS”) Perunding NFL Sdn Bhd (“NFL”) in its report did not allow for this but did allow for EPF, SOCSO and Insurance, out of deference to the QS report, the Plaintiff had confined their claim to just EPF, SOCSO and insurance. [28] As found by the learned Deputy Registrar the claim for EPF and SOCSO were made based on the Defendants’ own QS Report that of NFL dated 30.4.2013. [29] One would expect some measure of independence and neutrality as an independent professional though engaged by the Defendants. It there is any unconscious biasness towards its paymaster, though none is suggested, the Plaintiff is prepared to accept it. [30] In the QS Report is listed the names of the workers of the Plaintiff whose names appear in the Progress Reports and also the Minutes of the Meetings. The amount claimed was for the Payment for the period from 15 December 2010 until May 2011 which is the period that was extended by the Defendants. The learned Deputy Registrar was satisfied that the Plaintiff had to bear those costs at the material time due to EOT No.1. [31] As rightly observed by the learned Deputy Registrar, since the Defendants’ own QS had recognized these amounts, the Defendants cannot now dissociate and distance themselves from the QS treatment of these payments as additional expenses due to EOT No.1, much less to deny and dismiss it altogether. I have no good reason to disagree with the learned Deputy Registrar’s findings based on written documents substantiating the claims for EPF, SOCSO and Insurance and also based on the audio-visual advantage he had in assessing the credibility of the Plaintiff’s witness and Defendants’ witness. [32] As stated by the learned Deputy Registrar, evidence of employment of the workers can be seen in the documents compiled and marked as CBD B1. Their names could also be seen in the Site Progress Reports dated 27.12.2019 (CBD B1 p 49) and dated 15.3.2011 (CBD B1 p 152). Their names were recorded as the employee/representative of the Plaintiff. The learned Deputy Registrar was satisfied, on the balance of probabilities, that by looking at the documents, all the names listed were that of the Plaintiff’s employees. 16 [33] As the Site Progress Reports and the Minutes of Meetings were contemporaneous documents and the Defendants’ own QS had accepted these charges as additional expenses incurred, I see no good reason not to accept these documents and the QS Report as sound and safe to rely on for the assessment of the additional loss and expense incurred for the period of the EOT No.1. [34] The Defendants could have called their very own QS if there had been an error of classification or judgment or assessment but since the QS was not called, this Court should not allow doubts to be cast on the veracity and reliability of the QS Report on this head of claim. Whether the Plaintiff has proved the claim for Plant and Machineries of RM365,572.65 under Loss and Expense Claim due to EOT No. 1 [35] Second is the claim for the use of the Plant and Machineries during the period of EOT No.1. [36] There is a formula for calculating this as set out in page 324 of Volume 2 of the Appeal Record (“AR”). The formula is as follows: Plant and Machineries 1. Preliminaries 17 A/19/E Plant and Equipment RM1,503,598.14 2. Tempoh kontrak 104 minggu = 728 days 3. Tempoh Lanjutan Masa No. 1 177 HARI 4. Pengiraan RM1,503,598.14 = RM2,065.38/hari 728 hari = RM2,065.38 x 177 hari = RM365,572.26 ============ [37] I am satisfied that this is a fair method of calculation based on the Defendants’ own formula and guidelines and also confirmed by the Defendants’ QS. [38] This is for the period during the EOT No.1 from December 2010 till May 2011 as can be seen in the Certificate of Delay and EOT No.1 at pages 537-539 AR Volume 2 and more specifically from 15.11.2010 till 10.5.2011. The basis of the claim is under Preliminary costs at page A/19/E 18 and at p 40 CBD B1. It covers machineries, Wilkie talkies, scaffoldings and other equipment for the whole Project. This claim had not been priced in the Preliminaries which only covered the period without the EOT No.1. This claim of RM365,572.62 is for the Loss and Expense incurred during the EOT No.1 period. I am satisfied that this is calculated pro-rated from the sum allocated under Preliminaries at A/19/E Plant and Equipment (p 40 CBD B1). Moreover the said calculation has been verified and approved by NFL the consultant for the Defendants. [39] I have no good reason to disturb this finding of fact of the learned Deputy Registrar supported as it is from contemporaneous documents and the reasonable explanation of the Plaintiff’s witness. Whether the claim idling of machineries overlaps with the claim for Plant and Machineries under EOT No.1 [40] Third there is the claim for idling costs of machineries. SFC said that this is overlapping with the claim for the same items during the EOT No.1. [41] I am satisfied that the claims are different and the machineries are a much longer list under the idling costs claim. The details are as set out in AR Volume 1 pp 277 -282. The rates of calculation based on the average rate of prices for each item are enumerated at pages 257-260 CBD B2. 19 [42] The sole witness for the Defendants had not given any alternative rates for the rental of the Plant and Machineries other than saying he did not agree to those rates. On the other hand the Defendants’ QS had accepted those rates in their Report of 30.4.2013. [43] It covers the period before the commencement of the works from May 2009 to October 2009 and so is different from that of the claim for Plant and Machineries for the period of the EOT No.1 from December 2010 till May 2011. This claim arose from the problems at the construction site when the machineries could not be used. It is supported by the Site Daily Reports from pages 548-727 of the AR Volume 3. There was also the evidence of Certificates of Payments made, payment vouchers and Bank-in slips at pages 745-921 AR Volume 3 to substantiate this claim. [44] Further at pages 278-283 AR Volume 1 are set out the details of the period of Claim, the items claimed, the period, quantities, rates per unit, and the supporting documents in the Daily Reports and the Average Schedule of Rates for the rental of the Equipment and Machineries. [45] The problems faced at the site included lack of access to site, change of piles for Block B5, infrastructure work for FSSR Workshop and problem with external sewerage system. 20 [46] I am satisfied that it is a claim allowed under Clause 44 of the Contract. There is no overlap for otherwise the Defendants’ own QS would not have approved it. Whether the Plaintiff had mitigated their losses [47] The learned SFC before the Deputy Registrar contended that the Plaintiff ought to have mitigated their losses by demobilizing the machineries that were not needed from the Site. There was no necessity to leave the trucks at the site which should have been deployed for use elsewhere. [48] The principle of mitigation of damages has been explained in a number of cases. In Millicent Limited v Malaysia-Europe Forum Berhad, Natasha Zulkifli & Another [2011] MLJU 452 the High Court held that a Plaintiff in a case of breach by the Defendant of a contract, has a legal duty or responsibility to avoid unnecessary losses. Failure to do so does not attract any liability on the part of the Plaintiff but reduces the damages payable by the Defendant. What this duty encompasses was explained in British Westinghouse Electric and Manufacturing Co Ltd v Underground Electric Railways Co of London Ltd [1912] AC 673 in the speech of Viscount Haldane LC at p 689 as “…the duty of taking all 21 reasonable steps to mitigate the loss consequent on breach, and debars him from claiming any part of the damage which is due to his neglect to take such steps.” [49] I bear in mind the principle enunciated by the Federal Court in Akitek Tenggara Sdn Bhd v Mid Valley City Sdn Bhd [2007] 5 MLJ 697 as follows: “[58] …Subrahmanyan & Singhal in their book entitled Indian Contract Act (3rd Ed) Vol 2, in dealing with the basic principles of awarding compensation under the section, said at pp 144–145: Two important principles, governing the grant of damages, are — (1) that the claimant should not himself be guilty of any negligence or other improper conduct, and should have taken all the reasonable steps to minimise the loss to be suffered by him; and (2) that the amount of damages to be awarded should never exceed the loss actually suffered by him (the claimant), or, which he is likely to suffer, provided that his acts are lawful, 22 just, reasonable and not contrary to the law, rules or bye-laws duly enacted. These principles can be easily explained by considering the instances, where a person can have a legal right to sue for damages. For example, if A had made a contract with B for the supply of fuel- wood for running a brick-kiln and B fails to carry out the contract, it will not be open to A to close the brick-kiln and to claim damages to the extent of the profits which he could derive from the business, if the fuel-wood had been supplied. He must carry on the business by purchasing fuel-wood, or a similar fuel from the market at a reasonable rate, that is, at the market price, and claim the difference between the market price and contractual price as damages from B. But, if no such fuel was available, he will, of course, have to close the business, and, in these exceptional circumstances, he can claim damages to the extent of all kinds of losses suffered by him.” (emphasis added) [50] I agree with the learned Deputy Registrar that what is reasonable would depend on the facts of each case and that the onus as to reasonableness of the Plaintiff’s conduct lies on the Defendants. 23 [51] The Defendants had submitted that the machinery should have been demobilized from the site since the works could not be carried out. However PW 1 had given a reasonable explanation as to the impracticality of demobilization as it would cause them to incur more costs. The sole witness of the Defendant DW 1, on the other hand, had no idea how much it would cost the Plaintiff to demobilize the machinery. Thus I agree with the learned Deputy Registrar that the Defendant had failed to show that by demobilizing the machineries the Plaintiff would be able to reduce its losses. [52] The learned Deputy Registrar had noted that the Plaintiff had nevertheless willingly claimed for a lesser sum. The Plaintiff has made its claims in this action based on the Report and calculations of Perunding NFL Sdn Bhd, the QS appointed by the Defendant. In that calculation the charges that were incurred from November 2008 to April 2009 had not been included. The Plaintiff had agreed to this reduction even though they would end up with a claim for a lesser sum. The Plaintiff had thus claimed for the idling machineries for the period of May 2009 until October 2009 even though the machineries were idling as early as November 2008 and this evidence was not challenged by the Defendant. By so doing the Plaintiff had mitigated their losses. 24 Pronouncement [53] In the circumstances there is no good reason for me to disturb the quantum of damages as assessed as I am satisfied that the learned Deputy Registrar had proceeded on the right principles. [54] Therefore I had dismissed the appeal with costs of RM5,000.00. Dated: 18 August 2017. - signed - Y.A. LEE SWEE SENG Judge High Court Kuala Lumpur For the Plaintiff : PC Chew together with LL Lim (Messrs Kwong & Hwang) For the Defendants : Natassa Zaini (Senior Federal Counsel – AG’s Chambers) Dates of Decisions: 18 April 2017

Tika 2.6.0

24-26-01/2013

PLAINTIF HAFEEZ IQBAL OIL & GHEE INDUSTRIES (PVT) LTD (NO. SYARIKAT: 1-00353) DEFENDAN ALAMI VEGETABLE OIL PRODUCTS SDN BHD (NO. SYARIKAT: 489927-K)

18/08/2017

YA DATUK AZIMAH BINTI OMAR

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=a5ae9f06-dc51-4f5b-bc74-2ce4bb182aaf&Inline=true

IN THE HIGH COURT OF MALAYA IN SHAH ALAM IN THE STATE OF SELANGOR DARUL EHSAN, MALAYSIA ORIGINATING SUMMONS NO.: 24-26-01/2013 Dalam perkara Seksyen 8 Akta Timbangtara 2005; DAN Dalam perkara mengenai Perjanjian Perjualan bertarikh 10hb Julai 2006 antara Hafeez Iqbal Oil & Ghee Industries (Pvt) Ltd (No. Syarikat: I- 00353) daftar di Pakistan bagi satu pihak dan Alami Vegetable Oil Products Sdn Bhd (No. Syarikat 489927-K) daftar di Malaysia bagi satu pihak lagi; DAN Dalam perkara Persatuan Penapis Minyak Sawit Malaysia “Award Of Arbitration Final Award” bertarikh 11.02.2009 dan Persatuan Penapis Minyak Sawit Malaysia “Final Appeal Board Award” bertarikh 24.05.2010 2 antara Hafeez Iqbal Oil & Ghee Industries (Pvt) Ltd dan Alami Vegetable Oil Products Sdn Bhd. BETWEEN HAFEEZ IQBAL OIL & GHEE INDUSTRIES (PVT) LTD (NO. SYARIKAT: 1-00353) …PLAINTIFF AND ALAMI VEGETABLE OIL PRODUCTS SDN BHD (NO. SYARIKAT: 489927-K) …DEFENDANT GROUNDS OF JUDGMENT (Enclosure 1- Application pursuant to section 38 (1) of the Arbitration Act 2005) A. INTRODUCTION [1] This Originating Summons (Enclosure 1) relates to an arbitration matter. By its Enclosure 1, the Plaintiff is seeking from this Court for an order that the Persatuan Minyak Sawit Malaysia Award of Arbitration Final Award dated the 11.2.2009 and the Persatuan Penapis Minyak Sawit Malaysia Final Appeal Board Award dated the 3 24.5.2010 made by the Persatuan Penapis Minyak Sawit Malaysia against Alami Vegetable Oil Products Sdn Bhd, be recognized as binding and be enforced by entry as a judgment in terms of the award. [2] The Plaintiff’s Enclosure 1 is filed pursuant to section 38 (1) of the Arbitration Act 2005 (“Act"). B. THE BACKGROUND FACTS [3] The Plaintiff {Hafeez Iqbal Oil & Ghee Industries (PVT) Ltd} is a limited liability company incorporated under the laws of Pakistan, based in Pakistan. [4] While the Defendant (Alami Vegetable Oil Products Sdn Bhd) is a Malaysian based limited liability company incorporated under the laws of Malaysia, [5] Through a broker, Intra Oil and Fats Sdn Bhd (Intra Oil), the Plaintiff and the Defendant had entered into an agreement to sell and purchase 10,000 Metric Tonne (MT) of RBD Palm Olein in bulk. 4 [6] For confirmation of the said sale of 10,000 MT of RBD Palm Olein in bulk between the Plaintiff and the Defendant, Intra Oil had on 8.7.2006 issued an Initial Contract / Sold Note (RBDOLN/0607018) to both the Plaintiff and the Defendant. The Initial Contract / Sold Note (Exhibit SA-2, Enclosure 2) contained the detailed particulars of the transaction as well as the terms and conditions of the sale and purchase of the RBD Palm Olein. [7] It must be noted that item 12 of the Initial Contract / Sold Note reads as follows: 12) Other Terms and Conditions a) the Seller to provide 2% unconditional Performance upon receipt of pre-advice /draft copy of LC (Already received by Seller on 8/7/2006). Upon receipt of PB buyer shall make LC operative b) Arbitration: Kuala Lumpur as per PORAM Rules. c) Seller to appoint SGS as surveyor for quantity and quality. [8] Two days later namely; on 10.7.2006, a Sales Contract {No: AV/BLK- 1700(M)08 (Exhibit “A-1, Enclosure 2)} was executed between the Plaintiff and the Defendant to formalize the Initial Contract / Sold Note. 5 [9] The term set out in item 12 of the Initial Contract / Sold Note with regards to the Performance Bond and the Letter of Credit was incorporated in the Sales Contract in the following terms: Payment: 100% IRREVOCABLE LC AT SIGHT WITH REIMBURSEMENT ALLOWED Validity: LC WILL BE OPERATIVE WITHIN 3 WORKING DAYS UPON RECEIPT UPON RECEIPT OF THE 2% UNCONDITIONAL PERFORMANCE BOND / GUARANTEE ISSUED BY SELLER’S BANK. [10] Dispute arose between both the Plaintiff and the Defendant in respect of the sale and purchase of 10,000 MT of RBD Palm Olein which had resulted in the Plaintiff filing a request for arbitration under the PORAM Rules of Arbitration and Appeal pursuant to item 12 of the Initial Contract /Sold Note. [11] This Court must mention at this juncture that the arbitration clause or term with regards to arbitration provided in item 12 of the Initial Contract /Sold Note was not incorporated in the Sales Contract dated 6 10.7.2000. [12] In its REQUEST FOR ARBITRATION, the Plaintiff has described the dispute as follows: “the seller [the Defendant] has failed to make performance bond due to huge rate jump & finally default no shipment”. [13] The Defendant had however refuted the Plaintiff’s claim that the Defendant had failed to furnish the performance bond to the Plaintiff. [14] The Defendant takes the stance that the terms of the Sales Contract has clearly and expressly provided that the Plaintiff was required to issue/ furnish a Letter of Credit (LC) first and upon the issuance of the LC, only then the Defendant is required to furnish the Performance Bond. The Plaintiff however, takes the opposite stance that, only upon the issuance of the Performance Bond the earlier furnished LC would then become operational. [15] Both the Arbitration Tribunal and the Appeal Board found in favour of the Plaintiff. 7 SALIENT FINDINGS OF THE ARBITRAL BODIES [16] For easy understanding of the matter at hand, it is apt for this Court to set out the relevant findings of the two arbitral bodies below. i. THE FINAL AWARD OF ARBITRATION TRIBUNAL ( Exhibit “A-2”, Enclosure 2) The Arbitration Tribunal consisted of three (3) arbitrators, namely Vinayak Pradhan, Nakul Rastogi and P.R.Thakore. Arbitration Tribunal delivered its decision on 11.2.2009. It was a split decision wherein Nakul Rastogi and P.R. Thakore found in favour of the Plaintiff but Vinayak Pradhan found in favour of the Defendant. The relevant findings: 61.1. ….The Contract was on a shipped weight and quality basis. 61.2. The Respondent was to procure the issuance of 2% Performance Bond. 61.3. It was a condition precedent to the issuance of the 2% Performance bond that the claimant provided a draft/pre-advice letter of credit. 61.4. It was an implied condition of the contract that the draft/pre-advice letter of credit would conform to the terms and conditions of the Contract. 8 61.5. The obligation for a letter of credit, whether a draft letter of credit or an issued letter of credit, to conform to the terms of the Contract, cannot be satisfied through the seller’s assurance that it will order the issuing bank to amend the terms of the letter of credit after the letter of credit is issued and/or the goods are shipped. Accordingly: 61.5.1.The claimant, in evincing an intention to issue a letter of credit that would be on a landed weight and quality basis, anticipatorily repudiated the contract, even though the claimant intended to amend the letter of credit after issue or shipment of the goods, and the Respondent exercised its right to terminate the Contract following this anticipatory repudiation by refusing to issue the Performance Bond; or ii. THE FINAL APPEAL BOARD AWARD The Final Appeal Board consisted of three (3) members namely; Rajendra Navaratnam, Mohamed Abd Majed and Yoong Chow Han. (a) At paragraph 5.2 of the Appeal Board Award, the Appeal Board had noted that the Respondent had appealed against the Arbitration Tribunal’s decision primarily on two grounds. 9 (1) Whether the Respondent had failed to perform his contractual obligations in not posting a Performance Bond (PB), and whether there were circumstances that discharged the Respondent from so posting the Performance Bond, and (2) Whether the Claimant was in breach of contract by proposing to establish a Letter of Credit (L/C) that provided for payment on the basis of weights and quality final at the port of discharge, instead of at the port of loading. (b) The relevant findings on the first ground of appeal with regards the issuance of the performance bond by the Defendant (Seller). The Board had referred to both the Initial Contract/Sold Note dated the 8.7.2006 and the Sales Contract and had made these findings: 5.9 The appeal Board notes that the Initial Contract was not objected to as to its terms at the time by the Respondent. 5.10 The Appeal Board also finds that the provision in the Sales 10 Contract relating to the provision of the Letter of Credit is not inconsistent with that in the Initial Contract. 5.11 It must be presumed that the Sales Contract ought to reflect the agreement of the parties in the Initial Contract, unless there is some evidence that there was further negotiation of these terms between the Initial Contract and the Sales Contract. No such evidence was tendered. 5.12 Furthermore, as the obligation in the Initial Contract as to the provision of the Letter of Credit had already been performed [“Already received”], it would be unconscionable if the corresponding provision in the subsequent Sales Contract were to be given an interpretation which was inconsistent with that in the earlier Initial Contract. 5.12A. Finally, the Respondent’s message to the Claimant on 19 July 2006 states as follows: “Thanks for arranging the amendments in the Letter of Credit. We are arranging the Performing Bond. A matter of concern to us is that to date we have not been able to finalise fixture of vessel to carry the cargo in the first week of August 2006. 11 For reasons of prudence and to avoid disappointments, we request that the latest shipment date to be extended to end August 2006.” 5.13 This is not a response that would be expected from a party who is anxiously awaiting a Letter of Credit, as is now being contended. We find this message from the Respondent to the claimant to be the absolute confirmation and agreement of the Respondent as to its understanding of its obligations to provide a Performance Bond as soon as the draft Letter of Credit was tendered. 5.15 If that is the case, then the draft Letter of Credit which was already received by the Respondent as of 8th July 2006 would have discharged the claimant’s initial obligations in respect of the Letter of Credit until the Respondent tendered a Performance Bond, upon which the Claimant would be obliged to tender an operative Letter of Credit within 3 days. 5.16 The Claimant would therefore be within its rights to declare default if Respondent did not tender a Performance Bond as 12 soon as it received the draft Letter of Credit, as happened in this case. 5.17 There are therefore no circumstances that discharged the Respondent from posting the Performance Bond, and the Respondent therefore fails on this ground of appeal. (emphasis given) C. THE EARLIER PROCEEDINGS [17] Before this Court proceeds to consider the merits of this case, it is pertinent for this Court to set out a brief account of the earlier proceedings that took place in relation to the Plaintiff’s application (Enclosure 1). 17.1 The Plaintiff filed its Enclosure 1 on 7.3.2013. It was filed under the new section 38 of the Act. 17.2 When Enclosure 1 was called for hearing on 30.5.2013 before Justice Hadhariah bt Syed Ismail, the Defendant had objected the Plaintiff’s application and contended the position that the Final Appeal Award could not be recognised and enforced by 13 reason of the wording of the old Section 38 of the Act. The Defendant had argued that the old section 38 of the Act did not provide for an award for an “international arbitration”. In the present case, it is not in dispute that the Plaintiff is a Pakistani based company. It was further argued by the Defendant that in view of the provision of section 2 of the Act, the Appeal Board Award is an award of an international arbitration. However, section 38 of the Act was subsequently amended via the Arbitration (Amendment) Act 2011 which came into force on 1.7.2011, wherein the term “domestic arbitration” was replaced with “where the seat of arbitration is in Malaysia”. 17.3 According to the Defendant, the purpose of the amendment in section 38 the Act is not to extend enforcement to international arbitrations but to provide for situations where the office of the foreign party is in Malaysia and preponderances of the business or other activities that is the subject of the arbitration takes place in Malaysia. It was the contention of the Defendant that sections 38 and 39 of the Act do not apply to international arbitration. Based on these contentions, the Defendant had 14 submitted that the Plaintiff’s application must be dismissed. 17.4 Justice Hadhariah had found in favour of the Plaintiff and allowed the recognition and enforcement of the Final Arbitration Award and the Final Appeal Award. It must be made clear that based in the submission of the parties, Justice Hadhariah’s decision here is that section 38 of the Act applies upon international arbitral awards so long as the seat of arbitration is in Malaysia. Nonetheless, Justice Hadhariah’s decision at this juncture did not consider the application of section 39 of the Act as elucidated in the Court of Appeal’s decision in Alami Vegetable Oil Products Sdn Bhd v Hafeez Iqbal Oil & Ghee Industries (Pvt) Ltd [2016] 12 MLJ 169: “What was before the learned trial judge was a s 38 application. What was the complaint before the learned trial judge and before us by the appellant was in respect of the merit of the award, which is irrelevant consideration at the stage of a s 38 application… The learned trial judge did not deal with a s 39 of the ACT 2005 application.” 15 17.5 Dissatisfied, the Defendant had filed a notice of appeal in the Court of Appeal appealing against Justice Hadhariah’s decision. The Court of Appeal had dismissed the Defendant’s appeal with costs. The Court of Appeal however further elaborated its stance on the applicability on section 38 and 39 of the Act. Briefly, the Court of Appeal held that section 38 the Act covers international arbitral awards to be put to recognition under the same section. In addition, the Court of Appeal adds that issues on merits of the dispute (that were put in arbitration) cannot be raised at the recognition stage under section 38 of the Act. The Court of Appeal states that the only challenge that could be raised is the grounds and instances as prescribed under section 39 of the Act. The Court of Appeal also adds that for such challenge under section 39 of the Act to be raised, the challenge must be raised via a formal application: “It was not permissible to argue issues relating to the award or merit of the award etc under s 38 of the Act as the merit of the award could not be an issue under s 38. Section 38 is a ‘recognition procedure’ to convert an arbitration award 16 to a judgment and can only be done by the person holding an arbitration award. What was before the court was a s 38 application which was in respect of the merit of the award, which was irrelevant consideration at the stage of s 38 application. It was permissible to place such an argument in an application under s 39 of the Act. For s 39 to apply, the application must be made by the respondent to the award. The respondent to the award was the appellant and no such application had been filed. Instead, the appellant had only filed an opposing affidavit stating why the respondent’s application should not be allowed. The appeal had no merit and was an abuse of judicial process as the appellant had not taken the argument before the court by a proper application under s 39 of the Act” 17.6 The Defendant thereafter applied for leave to appeal to the Federal Court and on 22.10.2015, the Federal Court granted leave on the following questions: 17 1. Whether or not the Defendant, being part of a group of persons/entities upon whom an international arbitration award had been made against, prior to 1.7.2011, would be allowed to challenge the international arbitration award at the recognition or enforcement stage, i.e. when an application was made pursuant to section 38 of ACT 2005? 2. Whether under the circumstances of this case, the Defendant, being part of a group of persons/entities upon whom an international arbitration award had been made against prior to 1.7.2011, could avail itself of a “passive remedy” as recognised in the Federal Court decision in State Government of Sarawak v Chin Hwa Engineering Development Co [1995] 3 MLJ 237, meaning that it did not have to take the initiative to attack an award, but could simply wait until an application was made to recognise or enforce the award and resist the application then? 3. Could the circumstances of the present case constitute an additional situation upon which a party in the same position as the applicant (i.e. the Defendant) could avail itself of the “passive remedy” in order to meet the ends of justice? 18 17.7 It is pertinent to note that the Federal Court then had not granted leave to questions regarding the applicability of section 38 regarding international arbitral awards. It remains undisputed that section 38 of the Act applies. The questions which were granted leave only pertain to the nature and the manner of challenge that may be raised by the Appellant/Defendant. 17.8 The Federal Court heard the appeal and on 13.10.2016 the Federal Court allowed the appeal with no order as to costs. Both the Court of Appeal decision and High Court decision were set aside (but limited to only questions which were granted leave by the Federal Court). The Federal Court had directed that the case be remitted to the High Court to be heard on its merits of the Appellant’s challenge under section 39 of the Act before a new judge. Based on the previous Courts’ decisions, as well as both parties’ respective written and oral submission before this Court, it is understood that the task at hand for this Court, is to determine the merits Defendant’s challenge of the recognition of the award under section 39 of 19 the Act. And this was exactly what was submitted by the parties (particularly by the Defendant) before this Court. It is essential for this Court to stress that the applicability of section 38 of the Act is not a live issue in the present case as the Federal Court had not allowed any questions to deter the application of the provision with regard to international arbitral award. It remains that section 38 of the Act is sufficiently wide to cover international arbitral awards. The only matter to be determined by this Court is whether the Defendant had successfully proven any of the grounds under section 39 of the Act to challenge the recognition of the international arbitral award. 17.9 It is utterly crucial to be appreciated that the merits dealt with by both of the counsels, and this Court is not the exactly the merits of the finding of any of the arbitral tribunal, but the merits of the Defendant’s challenge within the purview of section 39 of the Act. And this is exactly in line with the decision of the Federal Court. Even the submission by the Defendant is generally tailored to section 39 of the Act. 20 [18] Hence, this Court now shall determine the Plaintiff’s application namely; whether or not the Plaintiff is able to recognise and enforce the Final Award and the Final Appeal Award pursuant to the new section 38 of the Act and most pertinently, whether there are grounds for the refusal of such recognition or enforcement pursuant to section 39 of the Act. D. THE LAW - SECTION 38 AND 39 OF THE ACT [19] The new section 38 of the Act provides as follows: “Recognition and enforcement (1) On an application in writing to the High Court, an award made in respect of an arbitration where the seat of arbitration is in Malaysia or an award from a foreign State shall, subject to this section and section 39 be recognised as binding and be enforced by entry as a judgment in terms of the award or by action. (2) In an application under subsection (1) the applicant shall produce— (a) the duly authenticated original award or a duly certified copy of the award; and (b) the original arbitration agreement or a duly certified copy of the agreement. 21 (3) Where the award or arbitration agreement is in a language other than the national language or the English language, the applicant shall supply a duly certified translation of the award or agreement in the English language. (4) For the purposes of this Act, "foreign State" means a State which is a party to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards adopted by the United Nations Conference on International Commercial Arbitration in 1958.” [20] Section 38 (2) provides that – “In an application under subsection (1) the applicant shall produce- (a) the duly authenticated original award or a duly certified copy of the award and (b) the original arbitration agreement or a duly certified copy of the agreement [21] Section 39 of the Act provides: “Grounds for refusing recognition or enforcement 22 (1) Recognition or enforcement of an award, irrespective of the State in which it was made, may be refused only at the request of the party against whom it is invoked— (a) where that party provides to the High Court proof that— (i) a party to the arbitration agreement was under any incapacity; (ii) the arbitration agreement is not valid under the law to which the parties have subjected it, or, failing any indication thereon, under the laws of the State where the award was made; (iii) the party making the application was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present that party's case; (iv) the award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration; 23 (v) subject to subsection (3), the award contains decisions on matters beyond the scope of the submission to arbitration; (vi) the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement was in conflict with a provision of this Act from which the parties cannot derogate, or, failing such agreement, was not in accordance with this Act; or (vii) the award has not yet become binding on the parties or has been set aside or suspended by a court of the country in which, or under the law of which, that award was made; or (b) if the High Court finds that— (i) the subject-matter of the dispute is not capable of settlement by arbitration under the laws of Malaysia; or (ii) the award is in conflict with the public policy of Malaysia. 24 (2) If an application for setting aside or suspension of an award has been made to the High Court on the grounds referred to in subparagraph (1)(a)(vii), the High Court may, if it considers it proper, adjourn its decision and may also, on the application of the party claiming recognition or enforcement of the award, order the other party to provide appropriate security. (3) Where the decision on matters submitted to arbitration can be separated from those not so submitted, only that part of the award which contains decisions on matters submitted to arbitration may be recognized and enforced.” [22] It remains as a rule of law that the above section 38 of the ACT provides that a party who had obtained an arbitration award (where the seat of arbitration is in Malaysia irrespective of the award being international or domestic) can apply to the High Court for an order that the award be recognised as binding and be enforced by entry as a judgment in terms of the award or by action. [23] Meanwhile, section 39 of the ACT expressly provides the numerous instances where such an application for recognition can be refused at the request of the party against whom it is invoked. It is for the party 25 against whom the application is invoked, to produce evidence or proof to the satisfaction of the court that instances under 39 (1)(a) (i) to (vii) has been established. [24] The Plaintiff’s application is supported by an Affidavit in Support affirmed by Sheikh Muhammed Ikram a/l Sheikh Muhammed Yaqoob on 30.10.2012. E. THE PRELIMINARY OBJECTION [25] At the commencement of the hearing of the Plaintiff’s application, the Defendant raised a preliminary point in relation to section 38 that the Plaintiff cannot seek to recognise and enforce both the Final Arbitration Award the Final Appeal Award. It was submitted by the counsel for the Defendant that two decisions by the two arbitral bodies were arrived on different reasoning and awarded different amounts of compensation. Furthermore, the compensation amounts awarded were based on a different calculation/formula. [26] It was submitted by the counsel for the Defendant that if the Plaintiff were to recognise and enforce both the Final Award and Final Appeal 26 Award, such enforcement would lead to confusion as to what was the basis for the award in favour of the Plaintiff. Hence, the Plaintiff can only seek to recognise and enforce the Final Appeal Award. [27] This Court finds no merits in the preliminary point raised by the counsel for the Defendant simply on the ground that even though there are two decisions of arbitral bodies, (namely; the Final Arbitration Award the Final Appeal Award) the latter award was delivered by the Appeal Board as a result of an appeal filed by the Defendant against the Arbitration Tribunal award. Once the Appeal Board has heard the appeal and delivered its decision, thus the decision or the award by the Final Appeal Board would be the final award or the concluded award. Hence, the award to be recognised and enforced obviously would be the final award by the Final Appeal Board. F. THE PLAINTIFF’S CASE [28] It was submitted by the Plaintiff’s counsel that the Plaintiff has duly complied with both requirements in this application and is entitled to the order prayed for, until and unless the Defendant can bring itself 27 within section 39 of the Act. [29] The counsel for the Plaintiff submitted that the Defendant has not identified in their affidavits of which are the exact provisions of section 39 (1)(a) (i) to (vii) that the Defendant is invoking. [30] The counsel for the Plaintiff further submitted that under section 39 of the Act the Defendant is required to prove the grounds of refusal by affidavit evidence. The failure of the Defendant to state the specific provision relied upon in its affidavit should appropriately lead the Court to dismiss Defendant’s challenge under section 39 of the Act. Regarding this contention, the counsel for the Plaintiff had referred to the case of Archer Daniels Midland Co v TTH Global (M) Sdn Bhd [2017] 7 MLJ 325. G. THE DEFENDANT’S OPPOSITION [31] In opposing the Plaintiff’s application, the Defendant filed the following affidavits: i. Affidavit in Reply affirmed by Sultan Alaudin a/l KS Mohamed Ismail on 22.2.2013 (Sultan Alaudin). 28 ii. Affidavit in Reply affirmed by Sultan Alaudin a/l KS Mohamed Ismail on 27.2.2017. [32] Upon this Court’s perusal on both affidavits affirmed by Sultan Alaudin in opposing the Plaintiff’s application, this Court wholly agrees with the submission by the counsel by the Plaintiff that in both of the Defendant’s affidavits, the Defendant did not specifically state or identify the exact provisions of section 39 (1)(a) (i) to (vii) that the Defendant is invoking. However, the counsel for the Defendant had in paragraph of 29 of the Defendant’s written submission had submitted that in opposing the recognition and enforcement by the Plaintiff, the Defendant relies on sections 39(1)(a)(iv) and/or (v) of the Act and also sections 39(1)(b)(ii), namely, the following grounds: (i) the final Appeal Board had acted outside the terms of Arbitration stipulated in the plaintiff’s Request for Arbitration and/or contains decisions on matters beyond the scope of the submission to arbitration. (ii) both the Final Award and Final Appeal Award are in conflict with the public policy of Malaysia in that they are inconsistent with the 29 PORAM terms and would be unfair to the seller. Ground (i): the final Appeal Board had acted outside the terms of Arbitration stipulated in the plaintiff’s Request for Arbitration and/or contains decisions on matters beyond the scope of the submission to arbitration [33] It was submitted on behalf of the Defendant that the Appeal Board had considered matters outside the terms of the submission to arbitration and this has occasioned a circumstance under section 39(1)(a)(iv) and/or (v) of the Act. With regards to this ground, the counsel for the Defendant had submitted the following argument: i. The Plaintiff in its Request for Arbitration had requested for arbitration of the dispute arose between the Plaintiff and the Defendant under Contract Number: AV/BLK-1700(M)/06 DATED 10TH JULY 2006 which was the Sales Contract. ii. It is not in dispute that the Sales Contract constituted a binding contract between the Plaintiff and the Defendant and the said 30 Sales Contract contained terms and conditions which has been agreed upon between the parties. iii. Notwithstanding the fact that in the Request for Arbitration, the Plaintiff had only cited that the dispute between the Plaintiff and the Defendant arose from the Sales Contract, the Appeal Board when considering the appeal before them had referred and considered not only the Sales Contract but also the Initial Contract / Sold Note issued by Intra Oil. The Appeal Board in this case had found that the said Initial Contract / Sold Note constituted the actual binding agreement between the Plaintiff and the Defendant. The Appeal Board had gone further to consider Clause 12 of the Initial Contract/ Sold Note and concluded that the draft letter of credit which was issued by the Plaintiff to the Defendant was a sufficient compliance of the Plaintiff’s obligation to issue Letter of Credit. Since the Plaintiff had issued the Letter of Credit, it was incumbent on the Defendant upon receipt of the Letter of Credit to prepare and issue the Performance Bond. 31 iv. The Appeal Board had therefore derived its decision from the wrong contract namely; outside the Sales Contract, and hence acted outside and beyond the terms of the submission to arbitration (which only stipulated the Sales Contract). Consequentially, the award by the Appeal Board gives rise to the circumstance under section 39(1)(a)(v) of the Act. v. When the Appeal Board had considered matters outside the Sales Contract, the Appeal Board had gone out the parol evidence rule. The application of terms or matters outside the Sales Contract constituted a clear violation of the way in which contracts should be interpreted. On this contention, the counsel for the Defendant had relied on the Federal Court’s decision in the case of Berjaya Times Square Sdn Bhd (formerly known as Berjaya Ditan Sdn Bhd) v M Concept Sdn Bhd [2010] 1 MLJ 597. vi. The Appeal Board had no reason to conclude that a “draft” letter of credit was agreed upon by the parties when there was no mention of the word “draft” in the Sales Contract. Hence, the 32 conclusion that a “draft” letter of credit was sufficient amounted to a material change in the already clear terms of the Sales Contract. vii. When the Sales Contract provided that the letter of credit or L/C will be “operative within 3 working days upon receipt of the 2% unconditional performance bond…”. It must mean that the letter of credit had to have first been issued before the performance bond. Otherwise, the Sales Contract would have used the word “issued” rather than “operative”. viii. Even from a commercial perspective, the requirement to furnish a proper letter of credit rather than a mere draft letter of credit is important. In the marketplace, when the abovementioned clause is stipulated, the buyer (in this case the Plaintiff) would have to arrange for its bank to issue the letter of credit in favour of the seller/beneficiary (in this case the Defendant) and transmit the same via SWIFT to the advising bank with instructions to release the letter of credit to the seller/beneficiary upon them posting the two (2) per cent 33 performance bond. Accordingly, it makes no sense for a “draft” letter of credit to be issued when such a “draft” would carry no weight as it did not constitute a formal document (carrying with it the seriousness of the party to commit to the transaction). xi. The obligation of the Defendant to issue the performance bond only arises when the letter of credit itself was issued by the Plaintiff (and not the draft letter of credit). And thus, the decision arrived at by the Appeal Board is manifestly wrong and must not be recognised or enforced by the court. H. COURT ANALYSIS AND FINDINGS ON GROUND (i) [34] The dispute in this matter obviously concerns parties obligation in a contract and primarily in relation of interpretation of contract, namely; whether the Plaintiff as the buyer is required to issue the Letter of Credit first or whether the Defendant as the seller is required to issue the Performance Bond first. [35] It is the Defendant’s contention that, since the Plaintiff’s in its Request for Arbitration had only cited the Sales Contract in requesting the 34 dispute be arbitrated by arbitrator, it is incumbent upon both the arbitral bodies to adjudicate the dispute within the confines or the parameters of the Sales Contract only. According to the Defendant, when the Plaintiff referred the dispute to the Arbitration Tribunal by citing only the Sales Contract, therefore the submission of the arbitration shall strictly be based on the Sales Contract and consideration must only be given to the terms and conditions contained in the Sales Contract. Given that situation, the arbitral bodies should only focus on the Sales Contract and must not take into account the Initial Contract or the Sold Note. [36] In essence the Defendant argues that, when the Appeal Board in this case had considered the Initial Contract or Sold Note in arriving at its decision, the Appeal Board had gone outside the submission of the arbitration, and therefore has occasioned a circumstance in section 39(1)(a)(iv) and/or (v) of the Act. [37] In analysis, this Court will first begin by setting out what was covered or provided under the Sales Contract. The Sales Contract provides the following particulars: 35 CONTRACT NO : AV/BLK-1700(M)/05 DATE : 10 TH JULY 2008 SELLER : ALAMI VEGETABLE OIL PRODUCTS SDN BHD WE CONFIRM SOLD TO YOU THE FOLLOWING ITEMS DATED 10/07/2006:- BUYER : HAFEEZ IQBAL OIL & GHEE INDUSTRIES (PVT) LTD, PLOT NO.191 & 192, INDUSTRIAL AREA D, ISLAMABAD, PAKISTAN INTERNATIONAL BROKER : INTRA OILS AND FATS SN. BHD. QUANTITY : 10,000 MT COMMODITY : RBD PALM OLIEN IN BULK PORAM SPESIFICATION : FFA (AS PALMITIC : 0.10% MAX …. : 0.10% MAX IV : 58 MIN MELTING POINT (ADCB CC 3-25) : 24 DEG. C MAX COLOUR (5% LOVIBOND CELL) : 8 RED MAX CLOUD POINT : 10 MAX SHIPMENTS : BEFORE 10TH AUGUST 2006 PRICE : USD 450 PMT CNF PORT QABIM, PAKISTAN PAYMENT : 100% IRREVOCABLE, L/C AT SIGHT WITH TT REIMBURSEMENT ALLOWED L/C TO BE ESTABLISHED TO BENEFICIARY ALAMI VEGETABLE OIL PRODUCTS SDN BHD. BANK DETAILS : STANDARD CHARTERED BANK MALAYSIA BERHAD KLANG BRANCH NO. 11, 15 & 17 KEPAYANG, 41050 KLANG, SELANGOR DARUL EHSAN. TEL : 603-3344 1700/ 3344 1170 FAX : 603-3344 1770 SWIFT : SCBLMYXXXXX ACCOUNT NO. 708-1-……… WEIGHT ANALYSIS : FINAL AT THE PORT OF LOADING QUALITY AND QUANTITY : FINAL AT THE PORT OF LOADING ORIGIN : MALAYSIA VALIDITY : L/C WILL BE OPERATIVE WITH IN 3 WORKING DAYS UPON RECEIPT OF THE 2% UNCONDITIONAL PERFORMANCE BOND/ GUARANTEE ISSUED BY SELLERS BANK 36 [38] It must be noted and observed here that the Sales Contract did not provide a term for arbitration. The Arbitration clause or term is provided under item 12 of the Initial Contract / Sold Note. In the present case, the Plaintiff had referred the parties’ dispute to Arbitration Tribunal pursuant to the arbitration term provided under the Initial Contract / Sold Note. The Defendant did not take any objection on the arbitration proceedings and as a matter of fact submitted itself within the jurisdiction of the two arbitral bodies even though the Sales Contract did not provide for arbitration clause. [39] Here, it is crystal clear that when the dispute was referred to the Arbitration Tribunal it was pursuant to the Initial Contract / Sold Note and this was accepted by the Defendant readily and willingly. And on top of that, the Defendant who was not happy with the award of the Arbitration Tribunal had filed an appeal to the Appeal Board. [40] In addition to that, this Court agrees with the submission of the counsel for the Plaintiff that the Defendant’s contention that the Appeal Board had acted outside the submission of the arbitration, was clearly an afterthought. Item 12 of the Initial Contract or the Sold 37 Note not only provides for arbitration but also stipulates that arbitration must be governed by the PORAM Rules and Kuala Lumpur was nominated as the seat of Arbitration. [41] Thereto, this Court opines that the Defendant cannot be allowed to willy-nilly elect when the Initial Contract or the Sold Note should apply or should not apply at its whims and fancies. Upon the Defendant submitting itself to the jurisdiction of arbitration by virtue of item 12 of the Initial Contract /Sold Note, thus, it entails that the rest of the terms provided under the Initial Contract or the Sold Note must also have similar application. Both the arbitral bodies are justified in making reference to both the Sales Contract and the Initial Contract / Sold Note and consider the same. Upholding the same principle, the Court of Appeal in the case of Cheah Theam Kheang v City Centre Sdn Bhd & Other Appeals (2012) 2 CLJ 16 had held the following: “In other words of Sir Nicolas Browne-Wilkinson VC in Express Newspapers Plc v News (UK) Ltd and Others (1990) 3 All ER 376 at pp. 383 to 384: There is a principle of law of general application that it is not possible to approbate and reprobate. That means you are 38 not allowed to blow hot and cold in the attitude that you adopt. A man cannot adopt two inconsistent attitude towards another : he must elect between them and, having elected to adopt one stance, cannot thereafter be permitted to go back and adopt an inconsistent stance” [42] Be that as it may, it is undisputed that the dispute between the Plaintiff and the Defendant is primarily in respect of the issuance of the Performance Bond by the Defendant and the issuance of the Letter of Credit by the Plaintiff. The issuances of the Performance Bond as well as Letter of Credit are set out both in the Sales Contract as well as the Initial Contract / Sold Note. Both the Sales Contract and the Initial Contract were put before the Appeal Board for their consideration. [43] What the Appeal Board had done in this present case was to consider the Initial Contract / Sold Note together with the Sales Contract and read both documents harmoniously and then conclude an express finding of fact that the documents were consistent. 39 [44] This Court is of the view that the Appeal Board has dealt with the precise dispute contemplated by the parties and falling within the terms of the submission to arbitration namely, the issue pertaining to the Performance Bond being the primary or central issue to the dispute as cited by the Plaintiff in its the Request for Arbitration. [45] It is this Court’s judgment that that the Final Appeal Board Award did not contain decision on matters beyond the scope of the submission to arbitration. The Appeal Board had derived its decision within the scope of the submission of the arbitration. And therefore the contentions of the Defendant that the Appeal Board had exceeded its scope are without merits and therefore must fail. The circumstance in section 39(1)(a)(iv) and/or (v) of the Act was never proven by the Defendant. I. COURT ANALYSIS AND FINDINGS ON GROUND (ii) Ground ii: both the Final Award and Final Appeal Award are in conflict with the public policy of Malaysia in that they are inconsistent with the PORAM terms and would be unfair to the seller. [46] The Defendant had contended that the Final Award and/or the Final 40 Appeal Award are in conflict with the public policy of Malaysia. This Court is in agreement with the Plaintiff’s counsel that the Defendant in its affidavits does not state how the Final Appeal Award is in conflict with the public policy of Malaysia. [47] The Defendant had never raised any issue in their affidavit explaining that the award conflicted with fundamental principles of natural justice, illegality or morality or otherwise offensive to the public policy of Malaysia. The only ground that the Defendant had raised was that somehow (though not explained by the Defendant) the award is allegedly inconsistent with the PORAM terms and would be unfair against the Defendant. [48] In the present case, both the Plaintiff and the Defendant had voluntarily chose and agreed to arbitrate their dispute according to PORAM Rules. The PORAM Rules expressly provide that the decision of the arbitral tribunal shall be final and conclusive. [49] The Defendant is therefore estopped from asserting that the award is inconsistent with the PORAM Rules. It is trite law that those who 41 make a contract to arbitrate their dispute should be held to their bargain. (See: Allianz General Insurance Company (M) Bhd & Ors v Kapar Energy Ventures Sdn Bhd [2016] MLJU 1515) [50] Coming back to the issue of contravention of public policy, the law requires the Defendant to adduce proof that the award is in conflict with the public policy of Malaysia. The Defendant here has clearly failed to prove the same. It is trite law that the contravention of public policy argument ought not to be utilized as a facade to reopen settled matters in the arbitration. (See: i. Colliers International Property Consultants (USA) v Colliers Jordan Lee and Jaafar (Malaysia) 2010 MLJU 650; ii. Open Tyre Joint Stock Company Efirnoye (“EFKO”) v Alfa Trading Ltd [2012] 1 MLJ 685) [51] The Defendant here did not make any application under section 37 (1)(a)(i) to (vi) or under (b)(ii) of the Act. [52] This Court agrees with the Plaintiff’s submission that if the Defendant was indeed serious about their contention (that the final Appeal Board had acted outside the terms of Arbitration stipulated in the Plaintiff’s 42 Request for Arbitration and/or contains decisions on matters beyond the scope of the submission to arbitration and that both the Final Award and Final Appeal Award are in conflict with the public policy of Malaysia) the Defendant should have moved the court under section 37 of the Act to set aside the Award which they failed to do. [53] The failure in applying to set aside the Award under section 37 the Act on the same grounds now attempted to be raised under section 39 the Act, leads to the inescapable conclusion that the issues raised by the Defendant in this application lacks bona fide intent and obviously an afterthought. [54] It is this Court’s judgment that the Defendant in the present case has ultimately failed to discharge the burden of proof to prove that the Defendant’s challenges against the recognition under section 38 of the Act falls within any of the circumstances under section 39 of the same Act. J. COURT’S DECISION [55] Based on the above mentioned reasons, the Plaintiff’s application in 43 Enclosure 1 is allowed with costs. This Court also orders that the Defendant to pay the Plaintiff the sum of RM 10,000.00 as costs. …………………………………………….. (DATUK AZIMAH BINTI OMAR) Judge High Court Shah Alam Selangor Darul Ehsan Dated the 18th August, 2017 For the Plaintiff - Messrs Ajit & Co Datuk R.S. Sodhi For the Defendant - Messrs Ranjit Singh & Yeoh Mr. Gregory Ling Mr. CS Hui

Tika 2.6.0

WA-24C-161-12/2016 & WA-24C-171-12/2016

PLAINTIF 1. ) Binastra Ablebuild Sdn Bhd 2. ) JPS Holdings Sdn Bhd DEFENDAN 1. ) JPS Holdings Sdn Bhd 2. ) Binastra Ablebuild Sdn Bhd

18/08/2017

YA DATO' LEE SWEE SENG

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=599f7ec0-2cd5-4b0d-a9c4-225741112e78&Inline=true

1 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF KUALA LUMPUR (CIVIL DIVISION) ORIGINATING SUMMONS NO. WA-24C-161-12/2016 In the matter of an adjudication pursuant to the Construction Industry Payment and Adjudication Act 2012 between Binastra Ablebuild Sdn Bhd and JPS Holdings Sdn Bhd in relation to the works “Superstructure Works for Cadangan Pembangunan Perniagaan (Hotel 3 Bintang 10 tingkat) Di atas Lot PT 17407, Bandar Puchong Jaya, Mukim Petaling, Daerah Petaling, Selangor Darul Ehsan” And In the matter of Adjudication Decision dated 5.12.2016 issued by Mr Yong Hee Leong And In the matter of Section 28 of the Construction Industry Payment and Adjudication Act 2012 And In the matter of Orders 7, 92 and other provisions under the Rules of Court 2012 2 BETWEEN BINASTRA ABLEBUILD SDN BHD (Company No.: 1043057-W) ... PLAINTIFF AND JPS HOLDINGS SDN BHD ... DEFENDANT (Company No.: 620456-A) (Heard together with) IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF KUALA LUMPUR (CIVIL DIVISION) ORIGINATING SUMMONS NO.:WA-24C-171-12/2016 In the matter of the Adjudication No: KLRCA/D/ADJ-0481-2016 between Binastra Ablebuild Sdn Bhd (Claimant) and JPS Holdings Sdn Bhd (Respondent) And In the matter of Adjudication Decision dated 5.12.2016 issued by Ir Yong Hee Leong And 3 In the matter of the Construction Industry Payment and Adjudication Act 2012 And In the matter of Order 92 Rule 4, Rules of Court 2012 and the Honourable Court’s Existing Jurisdiction BETWEEN JPS HOLDINGS SDN BHD ... PLAINTIFF (Company No.: 620456-A) AND BINASTRA ABLEBUILD SDN BHD (Company No.: 1043057-W) ... DEFENDANT The Judgment of YA Lee Swee Seng [1] By Originating Summons no. WA–24C–161–12/2016 (“the enforcement application”), Binastra Ablebuild Sdn Bhd (“Binastra”) sought to enforce an Adjudication Decision as a court judgment against 4 JPS Holdings Sdn Bhd (“JPS”) under section 28 of the Construction Industry Payment and Adjudication Act 2012 (“CIPAA”). [2] As is not uncommon, the party against whom the Adjudication Decision is given would apply to set aside the Adjudication Decision especially when served with an application for enforcement of the said Decision. JPS by Originating Summons no. WA–24C–171–12/2016 (“the setting aside application”) applied to set aside the Adjudication Decision. Parties agreed that both the applications should be heard together as one is the flip side of the other. Generally if an Adjudication Decision is set aside then invariably there would be no Decision to enforce and the enforcement application would be dismissed. [3] The focus thus would be on the setting aside application as in whether JPS has valid grounds to set aside the Adjudication Decision. The parties shall be referred to as Claimant and Respondent in the said Adjudication or sometimes as Binastra and JPS respectively. Project [4] The parties had entered into a construction contract in writing which included the PAM Contract 2006 Form for a project for the construction of a hotel in Puchong, Selangor. The Claimant was the contractor, and JPS the employer, of the project. The Letter of Award 5 was dated 31.10.2014. The contract sum was agreed at RM19,214,765.66. [5] According to the Claimant, payments were not made promptly pursuant to the various Certificates of Payment issued. Binastra as Claimant served a Payment Claim on JPS with respect to the Architect’s Certificates of Payment no. 14, 15 and 16 (collectively the “said Certificates”). [6] At that time, the balance outstanding under the said Certificates was about RM2.37 million, as claimed in the Payment Claim. [7] There was no Payment Response served by the Respondent, JPS. [8] The Claimant proceeded with the Adjudication vide a Notice of Adjudication dated 5.8.2016 which was duly served on the Respondent on 8.8.2016. The Claimant had reduced its claimed sum to RM2,020,419.34 as by then Certificates 15 and 16 had been paid. [9] The Claimant duly served its Adjudication Claim. Subsequently, the Respondent served its Adjudication Response which (a) raised a jurisdictional challenge based on the argument that upon determination of the Contract, CIPAA no longer applies; and (b) alleged set-off / counterclaim against the Claimant’s claim for the first time. The set-off/ 6 counterclaim is for the LAD claim for late completion by the Claimant and also for the costs of the rectification works. [10] In the Adjudication Reply served the Claimant had revised the claim to RM625,800.92 as the balance sum due and payable under Certificate No. 14 after taking into consideration further payments made to NSCs direct on behalf of the Claimant and also the fact that Certificates 15 and 16 had been fully paid before the Notice of Adjudication was served. Problem [11] By way of separate letter, the Respondent made an application for extension of time to serve a Payment Response containing the set-off / counterclaim. The purpose of the application was to extend the jurisdiction of the Adjudicator to those matters. [12] The Claimant objected to the said application for extension of time to serve a Payment Response. [13] The Adjudicator dismissed the Respondent’s jurisdictional challenge. He also disallowed the Respondent’s application for an extension of time to serve a Payment Response, thereby excluding the Respondent’s set off and counterclaim. On 5.12.2016 he allowed the Claimant’s claim for the balance sum of RM625,800.92 (Adjudicated 7 Sum) as there were further part-payments made by the Respondent on behalf of the Claimant to the NSCs. The Adjudicated Sum was to be paid on or before 15.12.2016. The Adjudicator also awarded Interest of 5% per annum on the Adjudicated Sum from 22.4.2016 until full payment or settlement of the Adjudicated Sum. Finally the Respondent was also to pay the Claimant the sum of RM40,717.97 being the costs of the adjudication proceedings. Prayers [14] The Respondent in the setting aside application relied on the following grounds: that the Adjudicator exceeded his jurisdiction, or breached the rules of natural justice, or failed to act independently or impartially under section 15(b),(c) and (d) CIPAA. Principles [15] Lest it be forgotten, it must be stated again that it is not the function of the courts to review merits of an Adjudication Decision, or the correctness of it. The Court of Appeal in ACFM Engineering & Construction Sdn Bhd v Esstar Vision Sdn Bhd and another appeal [2016] MLJU 1776 was very clear on this. [16] The courts will intervene only in very exceptional circumstances, which are far and few in between. The prima facie stand of the courts is 8 to affirm the Adjudicator’s Decision, unless the aggrieved party can show that the grounds stated in section 15 CIPAA apply. [17] The approach of the courts is to facilitate regular and timely payment, and not to be engaged in dilatory and abusive applications to oppose the award, per Hamid Sultan Bin Abu Backer, JCA in View Esteem Sdn Bhd v Bina Puri Holdings Bhd [2017] 1 CLJ 677, at pg 697, para 15. Whether the Adjudicator has jurisdiction to hear the matter by virtue of the handwritten notation of 18.7.2016 whereby the parties agreed, after a Payment Claim has been served, to extend time to settle payments due and owing under Certificates 14, 15 and 16 subject to terms [18] Learned counsel for the Respondent argued that the Adjudicator had no jurisdiction to hear this dispute as the Payment Claim was subsumed into a handwritten notation and agreement dated 18.7.2016 which was entered into by the parties 2 working days after the Payment Claim was served by the Claimant on the Respondent on 14.7.2016. It was further argued that in the light of the said handwritten notation dated 18.7.2016, the Payment Claim was redundant, inoperative and void in law. It was further submitted that the dispute referred in the Payment 9 Claim and Notice of Adjudication are not disputes that can be referred to Adjudication in light of the handwritten notation dated 18.7.2016. [19] The rough and rudimentary handwritten notation is set out below for a fuller appreciation of the terms that parties had agreed: “As agreed below: 1) Claim 15 – RM 274,286.68 2) Claim 16 – RM 82,536.79 3) Claim 14 – Balance sum of RM 625,800.92 – will be settled by 20/8/2016 by JPS 4) Temporary water supply will be continued to provide. 5) Temporary electricity supply will be continued to provide. 6) Scaffolding will be continued to provide. 7) Binasatra Ablebuild Sdn Bhd will agree to sign all relevant documents for CCC compliance.” [20] The context of the handwritten notation is relevant. It was after the Claimant had on 8.7.2016 issued a notice pursuant to Clause 26.2 of the PAM Form contract and proceeded to terminate the Contract. The ground for termination was for non-payment on the Certificates of Payment due. In a meeting held on 18.7.2016 to resolve matters, it was To be settled by 20/7/2016 by JPS 10 agreed that the Respondent shall make payments under Certificate No.14, No.15 and No.16 without any deduction for the payment of LAD and costs for rectification of defects provided the water supply, electricity supply and scaffolding will continue to be provided and that the Claimant will sign all relevant documents for CCC compliance. [21] The Respondent contended that, as a matter of law, by this handwritten notation, the Claimant had effectively agreed to waive all its rights which may have accrued to it prior to the entry of this Agreement. [22] If truly the Claimant had agreed not to proceed with the Adjudication with the conclusion of this handwritten notation, then one would have expected the handwritten notation to make reference to the Claimant agreeing not to proceed with the Notice of Adjudication under section 8 CIPAA. [23] As there was none one would have expected the Respondent to serve a Payment Response either admitting to the Payment Claim or so much of it as agreed in the handwritten notation and disputing the balance if any. The last day to serve the Payment Response was 28.7.2016. However none of that was forthcoming. 11 [24] Be that as it may, the Respondent’s position is not prejudiced in any way as under section 6(4) a non-paying party who fails to respond to a Payment Claim is deemed to have disputed the entire Payment Claim. [25] Here one must distinguish between an amount that is already due and owing and an amount that is to be settled at a later date by consent. From the PAM Contract, Certificates No. 14, 15 and 16 were already due for Payment but parties had agreed to a later date for settlement of the amount due and owing. [26] If parties had intended the postponement of the cause of action then that must be specifically brought to the attention of the Claimant by the Respondent. Otherwise the Claimant is entitled to proceed but shall not execute on the agreed amounts due until the postponed dates for payments are up. [27] It is not unlike a case where in a writ action a Plaintiff has sued for a sum owing for work done and then before Defence is filed the Defendant and the Plaintiff agreed to a postponed date where the sums owing would be paid in full. As the cause of action has arisen to sue for the amount owing, the Plaintiff is perfectly entitled to record either a consent judgment reflecting a future date of payment or to take judgment for the balance sum if by the time judgment is taken the balance sum is still not paid by the postponed date of payment. There is no necessity to 12 withdraw the writ unless that is a term of the settlement and it cannot be said that the Plaintiff’s cause of action has been extinguished unless it is expressly provided in a settlement agreement which is in the nature of a full and final settlement such that any dispute or breach will only require parties to sue on the settlement agreement. [28] There is merit in the Claimant’s submission that there is no mention in the handwritten notation of the expression “full and final settlement” of the said Certificates. Indeed there cannot be as the certified sums concerning the NSCs works were not included. Neither did the handwritten notation require the Claimant to withdraw its Payment Claim or to undertake not to proceed with a Notice of Adjudication. [29] The payments for the agreed sums under Certificates No. 15 and 16 were duly made on 20.7.2016. On 26.7.2016 the Claimant wrote to inform the Respondent that it reserved its rights on the Payment Claim and the outstanding sums under the said Certificates which Claim shall not be prejudiced by the above payments on 20.7.2016. The Respondent did not refute the Claimant’s assertion and reservation of rights. The Respondent at that time still had until 28.7.2016 to serve its Payment Response but chose, for reason best known to itself, not to serve its Payment Response. 13 [30] The Claimant then proceeded with what it understood to be within its legal rights, i.e. to serve its Notice of Adjudication dated 5.8.2016 on the Respondent on 8.8.2016. The amount claimed in the said Notice of Adjudication was reduced by the payments of the first 2 amounts paid on 20.7.2016. [31] The Respondent failed to pay the 3rd amount of RM625,800.92 as agreed for Certificate No.14 by 20.8.2016. The Respondent disputed its liability to pay the 3rd amount only after it had defaulted on 20.8.2016 and after the Claimant had demanded Payment. [32] As narrated by the Claimant, notwithstanding its alleged dispute, the Respondent through its parent company, Plus Degree, continued to pay parts of the said Certificates to the NSCs, even up until 7.9.2016. [33] The Claimant only came to know of these payments made direct to the NSCs when it was adduced in the Adjudication Response subsequently. It was only after the Respondent had defaulted on the 3rd Payment on the due date of 20.8.2016 that the Claimant wrote to the KLRCA to appoint an Adjudicator by its letter of 26.8.2016. [34] The first time the Respondent raised the issue of jurisdiction was in the Adjudication Response served dated 4.11.2016 which is 3 months after being served with the Notice of Adjudication. However the 14 jurisdictional issue was with respect to whether the Adjudicator has jurisdiction to proceed with the Adjudication once the Contract has been terminated. [35] It was not on the jurisdictional issue that there was settlement of all outstanding claims with the result that there was nothing to adjudicate on and that the Adjudication ought to have terminated by virtue of section 37(3) CIPAA. [36] There are valid grounds for the Claimant’s argument that the handwritten notation is not a full and final settlement where both parties withdraw pending claims against each other in the Adjudication and that both parties shall not have any claims against the other. [37] For all intents and purposes, the settlement so-called was a temporary roadmap forward for the parties to explore an amicable solution in the light of the anticipated opening of the hotel in September 2016 where as the Respondent said the staff, already employed from July 2016, were all ready to start work to welcome the guests. Indeed in the Respondent’s reply dated 2.9.2016 to the Claimant’s letter of 26.7.2016, the Respondent themselves acknowledged as follows: “…the terms as stated in the hand written notation dated 18th July 2016 of which we had agreed to pay you without any deductions of 15 LAD. However these payments are made strictly without prejudice to our rights to claim for LAD.” (emphasis added) [38] The Respondent in the Adjudication Response served, claimed for the amount due as LAD and for the costs of rectification works. Clearly the Respondent had not abandoned their rights to make such a claim, consistent with their letter of 2.9.2016 highlighted above. [39] This is further reinforced by the Respondent’s letter to the Claimant dated 6.10.2016. Somewhat exasperated by the numerous letters from the Claimant reiterating their position, the Respondent wrote as follows: “We also refer to the Adjudication filed by you against us which is now pending the acceptance of appointment of the Adjudicator. ... As all the issues raised by you will be determined in the Adjudication or arbitration proceedings, we write to inform you to put an end to this ongoing correspondence of reiterating your position repeatedly when these issues should be raised in the Adjudication or arbitration proceedings.” [40] Nowhere in the correspondence of the parties nor in the Adjudication Response filed nor in any letters to the Adjudicator had the 16 Respondent raised the issue of jurisdiction in the sense that the parties had fully and finally settled all the claims against each other and that a settlement having been reached, the Adjudicator had no jurisdiction to continue with the Adjudication. [41] The position taken by the Respondent themselves in the Adjudication Response served at para 28 reads as follows: “28. Under this arrangement, the Respondent whilst reserving the Respondent’s rights under the Contract to claim LAD, had agreed to release the payments held under Progress Certificates No. 14, 15 and 16 provided the Claimant continues to complete the rectification of the defective works.” (emphasis added) [42] This is not a case under section 37(3) CIPAA which reads: “An adjudication proceeding is terminated if the dispute being adjudicated is settled by agreement in writing between the parties or decided by arbitration or the court.” [43] Not only did the learned counsel for both sides not refer to this section in their submissions before this court but there was also no reference in the correspondence of the parties with each other and with the adjudicator; the focus of the jurisdictional challenge being that of the 17 Adjudicator having no jurisdiction because the contract had been terminated. [44] Of course the Respondent is at liberty to raise this jurisdictional challenge at this stage of setting aside the Adjudication Decision but the fact that it was not raised at the Adjudication would be more in the nature of a Freudian slip in that the Respondent was not labouring under a misconception that the handwritten notation was meant to be a full and final settlement of the parties’ claim against each other. [45] To put it very simply it was a case where the parties agree that sums due and owing under the 3 Certificates shall be settled by a certain future date. [46] One can also view the handwritten notation from the perspective taken by the Respondent in that the Claimant is said to have reneged from it by introducing additional terms with respect to the signing of the relevant documents for the CCC. The Respondent had stated in their letter of 2.9.2016 as follows: “…It now appears that you have taken the position that the contract has been determined and you will only apply for CCC upon final payment or final account payment. 18 Surely that cannot be the case as you are fully aware that the documents relating to CCC will have to be signed immediately upon completion and it was not agreed at the meeting that the relevant documents relating to the CCC will be signed upon final payment or final account payment as it will take a considerable amount of time to settle the final account. It is clear that you have breached the terms of the agreement reached between the parties on 18th July 2016. … Since you have reneged on what was agreed at the Meeting and you have now proceeded with the adjudication process, you have no basis to claim for the sum of RM625,800.92 as this amount will be used to set off with LAD and damages for the delay in the completion of the project.” [47] As can be seen, in the final analysis, the Respondent was prepared to take the position that there was no settlement as the terms have been breached by the Claimant and that the parties shall proceed with the adjudication. [48] Learned counsel for the Respondent referred to the decision of the Singapore High Court in Admin Construction Pte Ltd v Vivaldi (S) Pte 19 Ltd [2013] 3 SLR 609 in support of the proposition that where there is a settlement agreement then the Adjudicator has no jurisdiction to hear the claim. The facts in Admin Construction (supra) can be distinguished from our present case as there it was clearly stated the settlement agreement is a “full and final settlement” of the claims. The operative clause of the settlement agreement reads as follows at para 23: “We, Vivaldi (S) Pte Ltd, do hereby irrevocably and unconditionally agree with and accept the sum of S$165,271.80… and a further S$34,125.00… being retention as shown herein being the full and final settlement for all the Works under the Sub-Contract. We further confirm that we have no further claims whatsoever arising out of any matters whether covered by this Sub-Contract or otherwise and all Final Account [sic] issued earlier if any, shall be superseded by this Statement of Final Account.” (emphasis added) [49] The Singapore High Court observed as follows: “31. As noted above, the Settlement Agreement is ex facie, valid and binding on parties and since Vivaldi has not taken any steps to set it aside, accordingly, as at 28 December 2011, the date of Vivaldi’s application, all disputes that existed 20 between the parties on or before 31 January 2011 were extinguished. There was therefore no dispute as at 28 December 2011 in relation to the Third PC capable of being referred to adjudication and Vivaldi had no right to apply for adjudication in relation to the Third PC. 32. It follows that the Adjudicator had no authority or jurisdiction to deal with the adjudication application of 28 December 2011. Consequently, I find that the Adjudicator had no jurisdiction to hear the dispute, and the determination rendered by the Adjudicator must be set aside.” [50] In our case the parties have expressly reserved and preserved their rights under the Contract. [51] The Adjudicator clearly has jurisdiction to hear the dispute as this is not a case where the parties have arrived at a settlement resulting in section 37(3) CIPAA being triggered, bringing the Adjudication to an end. [52] Being a jurisdictional issue raised for the first time in this setting aside application, this Court is at liberty to hear it afresh without being fettered by any finding of fact of the Adjudicator. My conclusion as stated is that there was no settlement agreement arrived at where the Claimant 21 is not allowed to proceed with the Notice to Adjudicate. Neither has there been a settlement agreement arrived at where, if adjudication had been proceeded with, the Respondent is to withdraw the Adjudication claim under section 17(1) CIPAA or to terminate the Adjudication proceedings pursuant to section 37(3) CIPAA. [53] It was a finding of fact at para 13.4.6 of the Adjudication Decision that the outstanding sum of RM625,800.92 was admitted by the Respondent in their Adjudication Response. As pointed out by the Adjudicator the reason given by the Respondent for not paying was because of the alleged set-offs, cross claims and/or counterclaim. Para 42 of the Adjudication Response served by the Respondent is as clear as crystal: “42. Therefore, based on the terms of the Contract and the agreement between the parties, there are no payments which are due and payable under Progress Certificates No. 15 and 16 whilst under Progress Certificate No. 14, the only outstanding amount is RM625,800.92 which is a subject matter of set-off, cross-claim and/or counterclaim. ... 22 47. The Respondent contends that the amount of set-off, cross- claim and/or counter-claim which the Respondent has against the Claimant is in excess of the balance certified sum of RM625,800.92 under Progress Certificate No. 14 or any other alleged claim of the Claimant under Progress Certificates No. 14, 15 and 16.” (emphasis added) [54] The English decision in Shepherd Construction Ltd v Mecright Ltd [2000] BLR 489 can be distinguished because there the Technology and Construction Court held that the settlement agreement had superseded the construction Contract such that if there were still any disputes arising out of the settlement agreement, parties may sue on it but not to pursue Adjudication because there was nothing left of the construction Contract to adjudicate. [55] This is to be contrasted with our present case where as can be seen in para 42 of the Adjudication Response the Respondent had based their defense and set-off / cross-claim or counterclaim on the LAD clauses in the main Contract. [56] At any rate the Respondent had taken the stand that the handwritten notation terms had been breached by the Claimant and is no longer binding on the parties and that consistent with the parties preserving their respective rights, they are both proceeding with the 23 Adjudication. The Respondent is estopped from resiling from that position to now insist that there was a full and final settlement in the handwritten notation. [57] As to whether the Respondent’s set-off of LADs and rectification works should be allowed is a matter that had to be decided by the Adjudicator based on whether it was properly raised before him since there was no Payment Response filed. This shall be discussed shortly. Whether the Adjudicator has jurisdiction to hear the matter if the contract has been terminated [58] The Respondent had raised in their Adjudication Response in para B.1 that once the contract was terminated, CIPAA could no longer apply as the contractual provisions in terms of payment were no longer operative. The Respondent further contended at para B.2 that upon determination, parties are to conduct a joint inspection and proceed with the final accounts. [59] From the rationale and perspective of CIPAA, there is no good reason to exclude its application once a construction contract has been terminated. The Court has addressed this issue in Econpile (M) Sdn Bhd v IRDK Ventures Sdn Bhd and another case [2017] 7 MLJ 732 as follows: 24 “[56] From the rationale and purpose perspective of the CIPAA, there is no good reason to exclude its application once the construction contract has been terminated. The long title to the CIPAA sets out its preamble and captures in a concise statement the prophylactics purpose of the Act which is to: … to facilitate regular and timely payment, to provide a mechanism for speedy dispute resolution through adjudication, to provide remedies for the recovery of payment in the construction industry and to provide for connected and incidental matters. [57] Regard may also be had to the explanatory statement to the Bill of Construction Industry Payment And Adjudication Act 2012 which reads: The Construction Industry Payment Adjudication Act 2012 (‘the proposed Act’) seeks to facilitate regular and timely payment in respect of construction contracts and to provide for speedy dispute resolution through adjudication. The purpose of the proposed Act is to alleviate payment problems that presently prevails pervasively and which stifles cash flow in the construction industry. The proposed Act further provides default payment terms in the absence of 25 provisions to that effect and prohibits conditional payment terms that inhibit cash flow. The Act also seeks to provide remedies for the recovery of payment upon the conclusion of adjudication. (Emphasis added.) [58] Unscrupulous contractors would have a predilection to terminate a construction contract if that has the potent effect of preempting adjudication and with that a need to make payments forthwith on the pain of execution. Of course, any wrongful termination would finally result in damages to be paid, but that can wait for some contractors, for so long as his current cash flow is not adversely affected. That would skirt the application of CIPAA at a time when it is needed most by the claimant for survival when without the cash flow for work done, it would be suffocating and the claimant may have to slow down, suspend or even stop work altogether. [59] The issue had been raised in Singapore under their SOPA in AU v AV [2006] SGSOP 9, where a construction contract was terminated and a claim was made under SOPA. Philip Jeyaretnam SC concluded that he had jurisdiction under SOPA to hear the claim. His reasoning was as follows: 26 [13] I also noted to both counsel in the course of the hearing that while the New South Wales Act expressly included within the definition of ‘progress payment’ ‘the final payment for construction work carried out’, our Act did not. Nonetheless, I am of the view that the Act does apply even after a contract is terminated. First, the intention to protect cash flow would not be achieved if the interpretation put forward by the Respondent is adopted. If cash flow is blocked on one project, that will affect a contractor or service provider’s financial resources for other projects. Secondly, although one always speaks of termination of a contract when it is really the right and obligation to do work and be paid for it which is terminated for the future, the contract continues to govern the relationship between the parties in relation to the work already done. [60] It was conceded that there are authorities in England that suggest that an adjudicator can still proceed with an adjudication and produce his ‘determination’ even if the underlying construction contract has been terminated. This line of authorities, it was submitted, were premised on the provision of the English Act that provides that the adjudication can be proceeded ‘at any time’ (see 27 s 108(2)(a) of the Housing Grant Construction and Regeneration Act 1996 [UK] (‘the HGCRA’). [61] However the rationale set out in A & D Maintenance and Construction Ltd v Pagehurst Construction Services Ltd [1999] Lexis Citation 3443; [2000] 16 Const LK 199 QBD (TCC) is clear. There Wilcox J of the UK Technology and Construction Court observes as follows: 18. Even if the contract had been terminated, the matters referred to the adjudicator remain disputes under the contract. Where there is a contract to which the Act applies, as in this case, and there are disputes arising out of the contract to be adjudicated, the adjudication provisions clearly remain operative just as much as an arbitration clause would remain operative. 19. Had it been the intention of Parliament to limit the time wherein the party could give notice of his intention to refer a matter to adjudication, in the exercise of his right under s 108(1), it could have imposed a clear limit. Precise limits as to the appointment of Adjudicators and the time tabling of the process of adjudication are clearly set out in the Scheme. By contrast there is no such limitation under the Act or the http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.3461404143758491&bct=A&service=citation&risb=21_T26387558325&langcountry=MY&linkInfo=F%23GB%23Lexis%23sel1%251999%25page%25Cit%25year%251999%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.3461404143758491&bct=A&service=citation&risb=21_T26387558325&langcountry=MY&linkInfo=F%23GB%23Lexis%23sel1%251999%25page%25Cit%25year%251999%25 28 Scheme as to when a notice of intention to refer a matter to adjudication may be made. By analogy, with arbitration provisions, there is clear authority to the proposition that those terms governing reference to arbitration survive the determination of the contract. See Heyman v Darwins Ltd [1942] AC 356; [1942] 1 All ER 337. Doubtless the position in relation to arbitration was in the minds of the legislators when the clear words of s 108 were enacted. [62] For the reasons given above, I am not inclined to follow the contrary position taken by the Queensland Supreme Court in holding that upon the termination of a contract, the adjudicator has no jurisdiction to adjudicate on an outstanding claim as exemplified in McConnell Dowell Constructors (Aust) Pty Ltd v Heavy Plant Leasing Pty Ltd [2013] QSC 223 and McNab NQ Pty Ltd v Walkcrete Pty Ltd & Ors [2013] QSC 128.” [60] Here is a case where the Claimant as contractor had exercised its rights to terminate the Contract under Clause 26.2 for default in the Respondent to honor the Certificates of Payment No. 14 and 15 on their due dates. After the expiry of 14 days the Claimant issued and served on the Respondent a Notice of Determination of Employment and Termination of Contract dated 8.7.2016. http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.1951179429471397&bct=A&service=citation&risb=21_T26387558325&langcountry=MY&linkInfo=F%23GB%23AC%23sel1%251942%25page%25356%25year%251942%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.1951179429471397&bct=A&service=citation&risb=21_T26387558325&langcountry=MY&linkInfo=F%23GB%23AC%23sel1%251942%25page%25356%25year%251942%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.46930253324922233&bct=A&service=citation&risb=21_T26387558325&langcountry=MY&linkInfo=F%23AU%23QSC%23sel1%252013%25page%25223%25year%252013%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.4479470771922288&bct=A&service=citation&risb=21_T26387558325&langcountry=MY&linkInfo=F%23AU%23QSC%23sel1%252013%25page%25128%25year%252013%25 29 [61] The Respondent is now saying by para 3 of its Adjudication Response that the correct approach is for the parties to proceed with arbitration proceedings after the finalization of the final accounts as provided under the Contract and it is improper for all outstanding matters and ongoing matters to be decided summarily in an Adjudication proceeding under CIPAA. [62] On the other hand the Respondent had admitted in its letter of 2.9.2016 to the Claimant that the Claimant should not insist on signing the relevant documents relating to CCC only upon the Final Payment or Final Account Payment as “it will take a considerable amount of time to settle the final account.” [63] Whilst I accept that any disputes on the final accounts may be referred by the Employer to arbitration under Clause 26.6 (b) in the case of determination of employment by the contractor under Clause 26 of the Contract, that is not to say that the Claimant as contractor cannot avail itself of its right to Adjudication for Certificates already due for payment. [64] To deprive the Claimant such a statutory right for a speedy resolution of the dispute would be to visit the Claimant with a double whammy; on the one hand it was precisely for non-payment that the Claimant was constrained to terminate the contract and on the other hand the Claimant is barred from pursuing a speedy claim in 30 Adjudication until the final account is finalized and the Employer disputes the final account and refers the matter to arbitration. [65] That would be to defeat the purpose of CIPAA altogether and it might as well be declared loud and clear that CIPAA is not available to a contractor who terminates the Contract even for lawful grounds. If that had been the intention of Parliament on a matter of such serious ramifications, it could easily have added such a provision under section 3 on “Non-application”. [66] It would be dangerous to conclude from silence that Parliament had not intended CIPAA to apply once the Contract has been terminated, whether by the contractor or the employer, for then the full and final resolution of all disputes is better resolved at arbitration when the final account is ready. It would be a case where when CIPAA is most needed to solve the Contractor’s problem of non-payment by the Employer that its prophylactic properties are not available until final account is prepared which the Employer here admits that it would take a considerable time. [67] Whilst there may be issues that may be more fully ventilated and resolved finally in arbitration, the statutory right to Adjudication must be promoted and preserved if the purpose of CIPAA to facilitate regular and timely payment and to provide for speedy dispute resolution through 31 adjudication is not to be thwarted. Adjudication yields a result of interim finality and merely because arbitration or litigation may more fully resolve all disputes arising out of the termination of a construction contract, that is no justification for dismissing adjudication as being wholly inapplicable even when the contractor has a valid Payment Claim within the meaning of section 5 CIPAA. [68] It can be said that Parliament appreciates the interim finality of an Adjudication Decision for it is provided in section 13(c) that the decision is binding unless the dispute is finally decided by arbitration or the court. [69] Likewise it is expressly provided in section 37 CIPAA the proper relationship between Adjudication and Arbitration or Court litigation as follows: “37. Relationship Between Adjudication and Other Dispute Resolution Process (1) A dispute in respect of payment under a construction contract may be referred concurrently to adjudication, arbitration or the court. (2) Subject to subsection (3), a reference to arbitration or the court in respect of a dispute which is being adjudicated shall not 32 bring the adjudication proceedings to an end nor affect the adjudication proceedings. (3) An adjudication proceeding is terminated if the dispute being adjudicated is settled by agreement in writing between the parties or decided by arbitration or the court.” [70] It cannot be seriously stated that arbitration is a speedy mode of resolving resolution; it is anything but speedy. In jurisdictions like ours where the Courts are efficient with a target date of disposal of cases within 9 months of date of filing of the writ, litigation has become the preferred mode of dispute resolution as compared to arbitration with parties in some cases, even conceding and consenting to litigation in spite of an arbitration clause in the Contract. Many would say, with tongue in cheek, that it is faster and less expensive and with more grounds to canvass on appeal if one is dissatisfied with the Court’s decision. [71] The Claimant is not confined to pursuing its claim in arbitration only, but can have recourse to adjudication, being an additional dispute resolution mechanism introduced by CIPAA. It is certainly not precluded from availing itself of Adjudication under CIPAA for so long as it has a valid Payment Claim against the non-paying party. 33 [72] In Martego Sdn Bhd v Arkitek Meor & Chew Sdn Bhd & another case [2017] 1 CLJ 101 at pgs 119 to 120, para 76, the argument raised was that any dispute with respect to an Architect’s fees has to be referred to arbitration as provided for under section 7A of the Architects Act 1967 and rule 23 of the Architects Rules 1996 and not to Adjudication under CIPAA. The High Court observed as follows: “[76] I agree that the dispute resolution mechanism under CIPAA is by way of adjudication and the statutory requirement for dispute resolution under the Architects Act is by way of arbitration. I must also state that there is nothing strange in this difference as statutory adjudication came into being only with the coming into force of CIPAA on 10 April 2014 and that there is no need to see adjudication and arbitration to be mutually exclusive of each other as adjudication would only yield a decision of temporary finality and it is only with arbitration or litigation that one gets a final and binding decision. The whole scheme of statutory adjudication was never intended to be set in opposition to arbitration or litigation. Adjudication operates independently on a separate track and indeed a fast track and it will not run into collision with arbitration or litigation simply because its track is different. Before there was adjudication, there were 34 already arbitration and litigation. After the introduction of adjudication, both arbitration and litigation will still continue except that now there is an additional dispute resolution mechanism of temporary finality that can be embarked upon before or concurrently with arbitration or litigation as the case may be. Thus one need not have to choose in an "either or" approach between adjudication and arbitration but one can proceed in a "both and" approach in resolving a dispute on an architect's claim against his client for his professional fees. Adjudication under CIPAA was never designed to be in conflict with arbitration and litigation and so its process may be activated at any time when there is a valid payment claim under a construction contract. Premised on that proper perspective, the question of which would prevail over the other does not arise at all.” (emphasis added) [73] I would hold that the Adjudicator has jurisdiction to decide the dispute even though the Contract has been terminated. Whether there has been a breach of natural justice when the Adjudicator did not allow an extension of time for the Respondent to serve a Payment Response [74] The rules of natural justice are two-fold – (a) an affected person has the right to prior notice and an affective opportunity to make 35 presentations before a decision is made; and (b) affected person has the right to an unbiased tribunal. [75] See the English Court of Appeal decision of Amec Capital Projects Ltd v Whitefriars City Estates Ltd [2004] EWCA Civ 1418 at pg 7, para 14. [76] In this case, only the first limb – i.e. opportunity to be heard – is relevant. As such, the complainant has to show any of the following: (a) that he was prevented from tendering evidence or making submissions. See the Court of Appeal decision of ACFM Engineering & Construction Sdn Bhd v Esstar Vision Sdn Bhd [2016] MLJU 1776, at pages 10 to 11, paras 19, 20; (b) that the adjudicator decided the case on a basis not argued by either party, and without giving them a prior opportunity to comment on the “new” basis. See decision of his Court in Econpile (M) Sdn Bhd v IRDK Ventures Sdn Bhd & another case [2016] 5 CLJ 882, at pg 921, para 90(e) [77] There is no breach of natural justice where an adjudicator declines to consider evidence which – on his analysis of the law – is irrelevant. 36 [78] See the English High Court decision of Carillion Construction Ltd v Devonport Royal Dockyard Ltd [2005] EWHC 778 at para 81(1). [79] The Respondent contended that there was a breach of natural justice because the Adjudicator refused to allow the Respondent’s application for extension of time to submit a Payment Response. Surely that is not what a breach of natural justice is. [80] The application of natural justice does not require the Adjudicator to decide an issue in a particular manner. All that natural justice requires is that the Adjudicator should hear both sides and come to a determination on the issue. The fact that he has made a decision favouring one party and not the other party is no justification that he has breached natural justice. [81] The Respondent was certainly not prevented from making its application. On the contrary, the application was submitted and arguments thereon were ventilated before the Adjudicator as can be seen in the exchange of correspondence in Enclosure 2, pages 352 to 394. [82] The Claimant marshaled the argument before the Adjudicator that (a) the extension of time sought by the Respondent was intended to extend the Adjudicator’s jurisdiction to the set-off / counterclaim raised 37 by the Respondent; and (b) the only way in which such jurisdiction can only be extended by mutual agreement in writing of the parties as provided for under section 27(2) CIPAA. [83] Since there was no such agreement in writing to extend the jurisdiction of the Adjudicator the application was not allowed. See the Adjudication Decision in Enclosure 2, pg 642 (para 13.3.8) and pg 644 (paras 13.3.22, 13.3.23). [84] Therefore the Adjudicator declined to consider the set-off / counterclaim that had not been raised in any Payment Response. As stated by this Court on many an occasion, the Adjudicator’s jurisdiction is conferred by and confined to the matters raised in section 5 Payment Claim and section 6 Payment Response as provided for under section 27(1) CIPAA. See the case of Bina Puri Construction Sdn Bhd v Hing Nyit Enterprise Sdn Bhd [2015] 4 AMR 565 at paras 11-13 and the case of View Esteem Sdn Bhd v Bina Puri Holdings Sdn Bhd [2015] MLJU 695 at paras 60-64. [85] The Court of Appeal in View Esteem Sdn Bhd v Bina Puri Holdings Bhd [2016] 6 MLJ 717 at paragraphs 17 and 18 is even more explicit on the consequences of not meeting the deadline for the service of a Payment Response as follows: 38 “17. In dealing with sections 5 and 6, section 26 of CIPAA 2012 that pave way for the adjudicator to deal with issues relating to time limit, form or content, etc. that is to say, any irregularity and/or non-compliance of the provision of sections 5 and 6 do not mean that the adjudicator will not have jurisdiction to hear the dispute. Non-compliance if any, can be remedied and/or condone by the adjudicator as set out in the section. 18. The second stage is related to adjudication claim and response. It is a strict requirement under section 5 of CIPAA that the unpaid party may refer to dispute arising from a payment claim under section 5. Why we say it is a strict requirement is that the law provides for parties to extend the adjudicator’s jurisdiction only in writing and in consequent the unpaid party cannot unilaterally extend the scope of its claim. Equally the non-paying party also cannot extend the scope of its defence for adjudicator’s consideration without a written agreement between the parties as set out in section 27(2). There time frame set out in sections 5, 6, 9, 16 etc (subject to s. 26) need to be strictly complied with, failing which the parties will not be able 39 to benefit from the statutory rights provided in CIPAA 2012.” (emphasis added) [86] I would agree with the approach taken by the said Adjudicator after analyzing the legal arguments raised by both parties before him. That I must say, cannot be a breach of natural justice even if a wrong decision has been arrived at. [87] In this case I must say that I am in agreement with the arguments of the Claimant in objecting to the extension of time for the Respondent to serve a Payment Response out of time and the Adjudicator’s analysis of the arguments presented. The Adjudicator had stated succinctly as follows in his Decision: “13.3.22 In further consideration of the submissions of both parties, I find that there is no agreement in writing between the parties pursuant to section 27(2) CIPAA to extend the jurisdiction of the Tribunal to extend the time for submission of the Payment Response. On the contrary, the Claimant objected to the Respondent’s application. Furthermore, there is no submission on legal authority that specifically allows an adjudicator to enlarge his own jurisdiction by allowing time for the serving of the Payment Response.” 40 [88] It is doubtful if an Adjudicator has the power to extend the time for service of a Payment Response as this was a matter to be complied with and served before his appointment as an Adjudicator. His power to extend time under section 26 CIPAA must be over matters in which he has the jurisdiction under section 27 CIPAA. If he has no jurisdiction over a matter because no Payment Response was filed, he cannot have the power to extend time to enable him to have jurisdiction over such a matter. [89] A closer scrutiny of section 26(2) CIPAA reveals that the non- compliance in respect of time, form or content or in any other respect is in relation to “the adjudication proceedings…” Under section 8(1) CIPAA an adjudication proceeding is initiated by the service by a Claimant by a written Notice of Adjudication. Until then no adjudication proceedings have begun. [90] At any rate even if the Adjudicator has the power to extend the time for service of the Payment Response, he had in this case, not been persuaded that there are cogent grounds for an extension of time. [91] Learned counsel for the Respondent submitted that the Adjudicator failed to appreciate that the reason in why the Respondent did not issue its Payment Response within the statutory time limit, setting out its claims for liquidated damages, defective works and other 41 claims was due to the execution of the settlement agreement dated 18.7.2016 between the Claimant and the Respondent. It was further impressed upon the Adjudicator that only after the Claimant had reneged on the agreement dated 18.7.2016, which was after the due date for the service of the Payment Response, that the Respondent was compelled to make an application for an extension of time to issue its Payment Response. [92] If indeed the so-called handwritten notation was to have resulted in the Claimant not proceeding with the Adjudication, then one would have expected that to be referred to in the handwritten notation. [93] Alternatively as there were 7 more days after the conclusion of the handwritten agreement for the Payment Response to be filed, one would have expected the Payment Response to simply state that no payments are due on the 3 Certificates no 14, 15 and 16 as the time of payments had been postponed and that with those payments at the postponed dates, the parties had no further claims against each other. [94] The handwritten is strangely silent on these if indeed the terms of the so-called agreement involved the withdrawal of the Adjudication proceedings. 42 [95] It cannot escape one’s notice that the Notice of Adjudication dated 5.8.2016 was served on the Respondent on 8.8.2016. It was only on 26.10.2016 that the Respondent’s solicitors wrote to the Director of KLRCA giving Notice that there was an issue of jurisdiction that merit consideration on whether CIPAA applies as the Contract has been terminated. The said solicitors also requested for an extension of time of 7 days to file an Adjudication Response. The Adjudicator duly extended time to file the Adjudication Response to 4.11.2016 in the exercise of his powers under section 25(p) CIPAA. [96] It was only very late in the day on 4.11.2016 that the Respondent applied to the Adjudicator to serve its Payment Response out of time. If indeed the Claimant had stolen a march on the Respondent as contended by the service of the Notice to Adjudicate, then one would have thought that any application for extension of time, if that is possible, would have been applied for much earlier. Clearly when applying for extension of time to file its Adjudication Response on 26.10.2016 the Respondent’s solicitors did not see any problem with the non-filing of the Respondent’s Payment Response. The fact that the Respondent is not familiar with Adjudication is not an acceptable reason for not filing the Payment Response. As the old adage goes, the Court must proceed 43 from the premise that everyone knows the law and that ignorance of the law is no good excuse. [97] The Court should restrain itself from interfering with the exercise of discretion given by Parliament to an Adjudicator to decide on extension of time unless it has been shown that such a decision is grossly unfair or perverse in the circumstances of the case. Whether the Adjudicator has failed to act independently or impartially under section 15(c) CIPAA [98] The Respondent alleged in passing that the Adjudicator had failed to act independently or impartially merely because he refused the Respondent’s said application. [99] It would be most unfair for the Respondent to level such a accusation against an Adjudicator merely because the Respondent disagreed with the Adjudicator and strongly believed that the Adjudicator’s decision is wrong in law. [100] Unless there is cogent and convincing evidence of such lack of independence or impartiality, this Court would not venture into accusations of this nature where it is easy to allege but with no evidence raised to point in that direction other than the Respondent’s failure to 44 understand how the Adjudicator could have disagreed with the stand that learned counsel for the Respondent had taken. [101] The Adjudicator would have no opportunity to defend himself other than his grounds given in his Adjudication Decision and based in those grounds, I detect not the slightest trace of any lack of independence or impartiality. [102] This is a case where the proper course for the losing party in the Adjudication is to pay the amounts ordered by the Adjudicator and to proceed to arbitration for a final decision by way of an arbitral award. Challenging the Adjudicator’s Decision is likely to lead to a substantial waste of time and expense as was held by the English Court of Appeal decision of Carillion Construction Ltd v Devonport Royal Dockyard Ltd [2005] EWCA Civ 1358 at paras 85- 87 as follows: “85. The objective which underlies the Act and the statutory scheme requires the Courts to respect and enforce the adjudicator’s decision unless it is plain that the question which he has decided was not the question referred to him or the manner in which he has gone about his task is obviously unfair. It should only be in rare circumstances that the courts will interfere with the decision of an adjudicator. The courts should give no encouragement to the approach adopted by DML in the present 45 case; which (contrary to the DML’s outline submissions, to which we have referred in paragraph 66 of this judgment) may, indeed aptly be described as “simply scrabbling around to find some argument, however tenuous, to resist payment. 86. It is only too easy in a complex case for a party who is dissatisfied with the decision of an adjudicator to comb through the adjudicator’s reasons and identify points upon which to present a challenge under the labels of “excess of jurisdiction? or “breach of natural justice?. It must be kept in mind that the majority of the adjudicators are not chosen for their expertise as lawyers. Their skills are as likely (if not more likely) to lie in other disciplines. The task of the adjudicator is not to act as arbitrator or judge. The time constraints within which he is expected to operate are proof of that. The task of the adjudicator is to find an interim solution which meets the needs of the case. Parliament may be taken to have recognised that, in the absence of an interim solution, the contractor (or sub-contractor) or his subcontractors will be driven into insolvency through a wrongful withholding of payments properly due. The statutory scheme provides a means of meeting legitimate cash-flow requirements of contractors and their subcontractors. The need to have the “right” answer has been 46 subordinated to the need to have an answer quickly. The scheme was not enacted in order to provide definitive answers to complex questions. Indeed, it may be open to doubt whether Parliament contemplated that disputes involving difficult questions of law would be referred to adjudication under the statutory scheme. We have every sympathy for an adjudicator faced with the need to reach a decision in a case like the present. 87. In short, in the overwhelming majority of cases, the proper course for the party who is unsuccessful in an adjudication under the scheme must be to pay the amount that he has been ordered to pay by the adjudicator. If he does not accept the adjudicator’s decision as correct (whether on the facts or in law), he can take legal or arbitration proceedings in order to establish the true position. To seek to challenge the adjudicator’s decision on the ground that he has exceeded his jurisdiction or breached the rules of natural justice (save in the plainest cases) is likely to lead to a substantial waste of time and expense - as, we suspect, the costs incurred in the present case will demonstrate only too clearly.” (emphasis added) 47 Pronouncement [103] For the reasons given above I had dismissed JPS’s application to set aside the Adjudication Decision and correspondingly I had allowed Binastra’s application to enforce the Adjudication Decision. As both applications were heard together, I ordered a single costs of RM10,000.00 to be paid to Binastra. Dated: 18 August 2017. - sgd - Y.A. LEE SWEE SENG Judge Construction Court Kuala Lumpur For the Plaintiff in : M.K. Chen, K Ganeson and OS WA-24C-161-12/2016 : Low Kien Seng and for the Defendant in : (Messrs M.K. Chen & Leong) OS WA-24C-171-12/2016 : For the Defendant in : Sanjay Mohan together with OS WA-24C-161-12/2016 : Wong Li Wei and for the Plaintiff in : (Messrs Thangaraj & OS WA-24C-171-12/2016 : Associates) Date of Decision: 21 April 2017

Tika 2.6.0

WA-28NCC-171-03/2017

PEMOHON HAP SENG CREDIT SDN BHD (Company No.: 88601-H) ...PETITIONER RESPONDEN SRI MUDA HAULAGE SDN BHD (Company No.: 751497-A) ... RESPONDEN T

18/08/2017

YA TUAN MOHD NAZLAN BIN MOHD GHAZALI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=d8797a77-ba5b-47da-81eb-39c7f63ca91a&Inline=true

Page 1 of 13 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR (COMMERCIAL DIVISION) COMPANIES WINDING-UP NO.: WA-28NCC-171-03/2017 In the matter of section 465 (1) (e) of the Companies Act, 2016 And In the matter of SRI MUDA HAULAGE SDN BHD (Company No. 751497-A) BETWEEN HAP SENG CREDIT SDN BHD (Company No.: 88601-H) ...PETITIONER AND SRI MUDA HAULAGE SDN BHD (Company No.: 751497-A) ...RESPONDENT BEFORE YANG ARIF TUAN MOHD NAZLAN MOHD GHAZALI JUDGE JUDGMENT Introduction [1] This is a petition for the winding up of the Respondent. At the conclusion of the hearing of the petition, which was resisted by the Respondent, I dismissed the petition, and highlighted my principal reasons for the same. This judgment contains the full reasons for my decision. Page 2 of 13 Key Background Facts [2] The Petitioner, a company involved in credit financing business obtained a Judgment in Default on 8 October 2010 against the Respondent vide suit no. D-22NCC-1061-2010 (“the JID”). [3] The Petitioner then obtained an ex parte leave by the Court on 23 January 2017 which it relied on to file the present petition out of time under Order 46 rule 2 of the Rules of Court 2012 (“the RC 2012”). The Petitioner filed the instant petition under Section 465 of the Companies Act 2016 (“the CA 2016”), more than six years after the said JID. [4] The Notice was however earlier issued under Section 218 of the Companies Act 1965 (“the CA 1965”) against the Respondent on 17 November 2016, claiming for arrears of the principal amount inclusive of accumulated judgment interest at 1.25% per month. [5] The instant current winding up proceeding against the Respondent represented the second petition filed by the Petitioner since the first petition had been withdrawn with liberty to file afresh due to certain part payments made by the Respondent. Contentions, Evaluation & Findings No bona fide dispute? [6] The Respondent raised a number of arguments to resist the petition. It will however be readily appreciated that at first blush, the opposition by the Respondent would seem difficult to sustain as the petition was premised on a judgment, specifically, the JID, thus strongly suggesting the absence of a bona fide dispute on the debt claimed by the Petitioner. [7] In the instant case, as the Petitioner is pursuing the winding up of the Respondent on the basis of Section 218(1) (e) of the CA 1965, and as such, relying in aid of the aforesaid statutory presumption under Section 218 (2) (a), a failure on the part of the latter to pay within the stipulated period of three weeks will give rise to the statutory presumption that the company is unable to pay its debts to all its creditors. This presumption of insolvency, arising from the neglect to meet the demand, confers on the Court the jurisdiction to grant a Page 3 of 13 winding up order on the basis of Section 218(1) (e) of the CA 1965. A similar analysis and effect would obtain in respect of the identically worded Section 466(1) (a) of the CA 2016. [8] However, a neglect and hence a failure to pay the debt as demanded in the valid winding up notice could be justified if the refusal is due to the debt being bona fide disputed. This is a well-established basis in law to deny a petition because it represents a direct challenge on the existence of the debt itself. If the challenge is successful, the presumption does not arise, since it cannot be said that the debtor company has neglected to pay. After all, the demand must relate to a specified debt. As such, the company in that situation has not neglected or refused to pay the debt if the debt is disputed on substantial grounds (see Securicor (M) Sdn Bhd v Universal Cars Sdn Bhd [1985] 1 MLJ 84). [9] It is important to observe however that it is settled law that a judgment debt is ordinarily not considered as capable of having the status of being disputed. This much is clear from the decision of the Court of Appeal in the case of Pacific & Orient Insurance Co Bhd v Muniammah Muniandy [2011] 1 CLJ 947. This is because the Court has already made the determination, in the form of a valid and enforceable judgment, which confirms the existence of the debt. It can thus no longer be disputed, unless the judgment, like the JID in this case, is otherwise stayed or set aside. [10] Furthermore, the case for the Respondent is even more impaired since it had previously made part payment of the original debt which led to the withdrawal of the first petition referred to earlier. This shows admission of indebtedness on the part of the Respondent, and thus again suggests the absence of any bona fide dispute vis-à-vis the Petitioner’s new notice and petition. Notice and petitions issued under different laws [11] But from the affidavits and submissions, the Respondent did raise two principal grounds that should nevertheless be examined. The first however is a point that can be summarily dismissed all the same. It pertains to the argument that the petition is defective since it was made pursuant to the provisions in the CA 2016 whilst the notice which preceded it was issued under the CA 1965. Page 4 of 13 [12] There is little substance in this objection since the situation is addressed by reference to the savings and transitional provisions found in Section 619 of the CA 2016. I set out below the entirety of Section 619. 619. General transitional provisions (1) Any person appointed under the corresponding previous written law and holding office at the commencement of this Act, shall remain in office as if he had been appointed under this Act. (2) Any act made, executed, issued or passed under the corresponding previous written law and in force and operative at the commencement of this Act, shall so far as it could have been made, executed, issued or passed, under this Act have effect as if made, executed, issued or passed under this Act. (3) The memorandum of association and articles of association of an existing company in force and operative at the commencement of this Act, and the provisions of Table A under the Fourth Schedule of the Companies Act 1965 if adopted as all or part of the articles of association of a company at the commencement of this Act, shall have effect as if made or adopted under this Act, unless otherwise resolved by the company. (4) All proceedings, judicial or otherwise commenced before and pending immediately before the commencement of this Act under the Companies Act 1965 shall be deemed to have commenced and may be continued under that Act. (5) A company or foreign company registered under any corresponding previous written law shall be deemed to have been registered under this Act and this Act shall extend and apply to the company accordingly and any reference to this Act, express or implied, to the date of registration of the company shall be construed as a reference to the date upon which the company was registered under the corresponding previous written law. (6) A company which is in the course of winding up immediately before the commencement of this Act shall continue to be wound up under the relevant provisions in the Companies Act 1965. (7) Section 308 of the Companies Act 1965 shall continue to apply to a company which is in the course of being struck off the register by the Registrar immediately before the commencement of this Act. Page 5 of 13 (8) The Minister may direct the Commission to issue guidelines, circulars or practice notes to provide for any matters in force before the commencement of this Act to be dealt with in such manner to bring them in conformity with this Act. [13] There could arguably be two alternative interpretations as to which law to follow in the case before me. The first is pursuant to Section 619(2), which provides for the petition to continue as if the notice had been issued under the relevant corresponding provision now found in the new law in the CA 2016. The second is that the petition should be deemed to continue to be governed under the CA 1965 in accordance with Section 619(4) or Section 619(6), the latter specifically dealing with winding up proceedings. [14] I take the view that the correct application of the law on savings and transitional arrangement should, in this context, invoke the latter interpretation. I say so for several reasons. First, the words “Any act made, executed, issued or passed under the corresponding previous written law” in Section 619(2) suggest the subject matter to be more in the nature of an executive decision or an exercise of discretionary authority. Which is not generally the case for the issue of the winding up notice. These words do not appear intended to encompass the decision to issue a winding up notice under Section 218 of the CA 1965. [15] Second, Section 619(4) on the other hand, refers to “proceedings, judicial or otherwise”. It is not incorrect to characterise the service of a winding up notice as a proceeding, for the word “proceeding” is not used exclusively to refer to judicial proceedings. For instance, Section 355 (1) of the CA 1965 (now Section 582 (1) of the CA 2016) on irregularities in proceedings empowers the Court to cure any deficiency, defect or irregularity in notice, in the absence of substantial injustice. Clearly “proceeding” in that statutory provision must be interpreted to include steps taken under the Act, such as the issuance of a winding up notice, which is not in the nature of a proceedings usually understood to be judicial or court-related. [16] Further, in any event, Section 619(4) itself describes “proceedings” as “judicial or otherwise”. Additionally, it is very plain from the language of Section 619 (6) that specifically, for winding up process which has not concluded before the new Act came into force, reliance ought to continue to be made under the previous legislation. Page 6 of 13 [17] Third, and this is probably the most important, in respect of winding up proceedings which had been initiated by the issuance of notice under Section 218, but which petition was issued post the coming into force of the CA 2016 on 31 January 2017, like the situation in the instant petition, Section 619(2) which deems the “act” to be made under the corresponding provision in the new law, may not be able to be fully applied because the new law in the CA 2016 contain provisions that were not part of the old law in the CA 1965, and vice versa. [18] One key example is the new Section 466(2) which introduces the requirement that a winding up notice expires after six months. There was no such provision under the CA 1965. Thus, if Section 619(2) was to be applied to a winding up notice that had been issued more than six months before the service of petition, the notice would be deemed to have been issued under Section 466(1), but Section 466(2) would also at the same time operate to render the petition defective on account of the notice which had expired under the CA 2016. [19] Another notable change is found in Section 467(2) which significantly provides for the commencement of winding up by the Court to be at the date of the winding up order, and no longer from the date of the presentation of petition as was the requirement previously in Section 219 of the CA 1965. [20] As such, given the significant differences, it would be more legally efficient, fair and consistent with the pursuit of justice if winding up notices issued prior to the coming into force of the CA 2016 be deemed under Sections 619(4) or 619(6) to continue to subsist under the CA 1965. [21] The objection of the Respondent which is premised on this ground is therefore lacking in merit. The Petitioner could have easily applied to the Court orally at the hearing for appropriate amendments be made to the intitulement of the petition to reflect the application of Section 218 of the CA 1965 and Section 619 (4) or (6) of the CA 2016 to the instant winding up petition. Excessive Interest Not Justified [22] A more substantive challenge presented by the Respondent pertains to the claim for interest made by the Petitioner. The Petitioner submitted that the interest rate imposed by the Petitioner against the Page 7 of 13 Respondent was wholly on the basis of the agreed terms of the agreement signed by the Respondent earlier. The interest rate of 1.25% per month as claimed by the Petitioner is in accordance with the Petitioner’s prayers in the Statement of Claim filed against the Respondent earlier which later reflects in the judgment being the JID dated 8 October 2010. No objection was ever raised by the Respondent in regards to the interest rate imposed. [23] The Petitioner argued that the Respondent should have filed an application to set aside the JID instead of objecting and questioning the interest rate claimed by the Petitioner after almost seven years has lapsed, at this final stage whereby all cause papers for winding up proceeding are in order. The JID obtained by the Petitioner on 8 October 2010 was a regular judgment, and the Petitioner was under no responsibility to seek an amendment to the said JID. [24] The crux of the Respondent’s challenge on the interest claim is that the Section 218 Notice is invalid for claiming an excessive sum given that the interest rate imposed, at 1.25% per month or 15% per annum is almost double the statutory limit of 8% per annum as stipulated under Order 42 r 12 of the former Rules of High Court 1980 applicable then. [25] In Kong Ming Bank Bhd v Lau Pang Thang & Ors [1995] 1 MLJ 567, the High Court held that a post-judgment interest rate which is in excess of the statutory minimum provided for by O 42 r 12 of the RHC and Section 16(i) of the Courts of Judicature Act 1964 is illegal and would entitle the court to set aside the judgment ex debito justitiae unless the plaintiff can prove that it is entitled to a higher interest rate. [26] It was stated in that case that in order to penalize the defendant into paying more than the statutory rate of interest after judgment, the plaintiff must expressly state so in the agreement, and the relevant provision in the agreement must be construed strictly. The Court ruled in that case that the provision on interest was too vague to amount to an agreement on post-judgment interest. Therefore, the defendants were entitled as of right to set aside the default judgments as being illegal. [27] In the instant case, the Petitioner maintained that the interest terms were in accordance with the provisions of the agreement. Yet, the Petitioner chose not to exhibit the agreement which it contended Page 8 of 13 contained the specific term on the higher interest allegedly agreed to by the parties. Kong Ming Bank Bhd v Lau Pang Thang & Ors clearly ruled that it would be for the plaintiff, or the Petitioner herein, to prove such agreement on higher interest. The Petitioner has in the instant case not discharged this evidential burden. The claim for interest is out of time [28] For the purpose of computing the six-year limitation period under Section 6(3) of the Limitation Act 1953 (“the LA”) for the recovery of interest in respect of a judgment debt, I think the position in law is pretty settled. Time starts to run from the date of judgment, and that the limitation however only concerns post judgment interest and does not apply to pre-judgment interest. In Perwira Affin Bank Bhd v Lim Ah Hee [2004] 2 CLJ 787, Abdul Hamid Mohamad FCJ (later Chief Justice) stated thus:- “A few things need be said about this part of the judgment. First, the learned judge took the date from which the interest was calculated (1 December 1985) as the date the interest became due. In view of the judgment of this court in Ernest Cheong which was followed by this court in Moskow Narodny Bank Ltd, with respect, that is not correct. Those cases held, and I agree, that regarding interest before judgment, the date the interest became due is the date of judgment. The interest merged with the judgment sum. Secondly, the learned judge calculated the period of limitation from the date the interest was calculated in the judgment (1 December 1985) to the date of judgment (23 October 1987). In view of the two judgments of this court just mentioned, with respect, that too is not correct. As decided in Ernest Cheong, the period is to be calculated from the date of judgment to the date of filing of the bankruptcy notice... (emphasis added) [29] The interest calculated prior to the date of the judgment merged into the judgment debt. Therefore, the limitation period would start to run from the date of the JID in the instant case. The service of the winding up notice however was effected subsequent to the expiry of the requisite six-year period from the date of the JID of 8 October 2010. The last date for making the claim for arrears of interest was therefore 7 October 2016. The Petitioner however only served the notice on 16 November 2016 and the presentation of the petition even later in March 2017. javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1981_254&ActSectionNo=6.&SearchId=8hakim46','_DisplayAct','');DispAct.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2737766913&SearchId=8hakim46','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2737766913&SearchId=8hakim46','_DisplayCase','');DispCase.focus() Page 9 of 13 [30] It is thus an undeniable fact that the recovery instituted by the Petitioner was more than the stipulated six-year limitation period. The limitation period for the recovery of interest in respect of a judgment debt is stated under Section 6(3) of the Limitation Act 1953 as follows: (3) An action upon a judgment debt shall not be brought after the expiration of twelve years from the date on which the judgment became enforceable and no arrears of interest in respect of any judgment debt shall be recovered after the expiration of six years from the date on which the interest became due. [31] The Federal Court in United Malayan Banking Corporation Bhd v Ernest Cheong Yong Yin [2002] 2 CLJ 413 held that the second part of Section 6(3) which concerns arrears of interest ought to be construed thus: - “... we would hold that it is obvious that the second limb of s. 6(3) of the Act provides that an action to recover arrears of interest must be brought within six years of the judgment date and because of the word "arrears", it cannot denote interest which is still not due...” [32] What this means is that if a person commences a recovery action on a judgment even one day after the six-year limitation, that person is absolutely barred from claiming arrears in interest. This arrears encapsulates not only the interest otherwise incurred after the six-year period but crucially also the entire interest having arisen within the six-year limitation period. [33] I reproduce that part of the judgment of Abdul Malek Ahmad FCJ in United Malayan Banking Corporation Bhd v Ernest Cheong Yong Yin [2002] 2 CLJ 413 which made this important statement of law, as follows:- “Thus, a person filing an action for recovery of arrears of interest on the last day of the six-year period from the judgment date is only entitled to that amount and nothing more. If he files it on the first day after the six year period, his action is barred by limitation, arrears of interest included. In the instant case, although the amount of arrears of interest claimed is only for six years from the judgment date, the bankruptcy notice had been filed on 24 January 1996, long after the limitation period of six years which expired on 14 October 1993. Accordingly, the bankruptcy notice is rendered invalid. As for the prejudgment interest, despite the Court of Appeal's finding on this point, we hold that that is in order as it is merged with the principal amount from the date of the breach, and javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1981_254&ActSectionNo=6.&SearchId=8hakim46','_DisplayAct','');DispAct.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2687042049&SearchId=8hakim46','_DisplayCase','');DispCase.focus() javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1981_254&ActSectionNo=6.&SearchId=8hakim46','_DisplayAct','');DispAct.focus() javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1981_254&ActSectionNo=6.&SearchId=8hakim46','_DisplayAct','');DispAct.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2687042049&SearchId=8hakim46','_DisplayCase','');DispCase.focus() Page 10 of 13 which is the standard stipulation in all contracts, to become the judgment debt”. [34] As such, it is as clear as day that although the Petitioner in the instant case had merely included the claim for interest calculated up to the six years post judgment (the JID), that claim cannot but fail. This is because the Petitioner is statutorily prevented from claiming any or all of this interest since the Petitioner only commenced the action to recover after the expiry of the six-year period subsequent to the JID. In light of the decision of the Federal Court in Ernest Cheong, in the instant case, if the Petitioner had instituted the present action on the very final day of the six-year limitation under Section 6(3), the Petitioner would certainly be entitled to the interest thus accumulated. However, limitation would set in and bar any such action even if the Petitioner had claimed for the very same arrears in interest merely one day after the expiry of the six years. [35] I should add that even though Ernest Cheong concerned a bankruptcy case and not a winding up proceeding like the petition before me, the construction of Section 6(3) by the Federal Court applies with equal force to all situations involving a claim for arrears of interest. To the extent there is a judgment debt, like the JID in the instant case, “the action on a judgment debt” referred to in Section 6(3) should appropriately include a winding up petition. [36] The Petitioner’s argument that it had confined the claim for interest to only that portion having accrued within the six years upon the JID is misconceived since it failed to appreciate that it is the time of recovery which is crucial here. For the claim was only filed after the expiry of the six years. Order 46 r 2 irrelevant [37] Neither can the assertion of the Petitioner that it had obtained leave to execute the JID after six years under Order 46 r 2 of the Rules of Court 2012 (“the RC 2012”) assist the case of the Petitioner. Order 46 r 2 (1) (a) provides that a writ of execution to enforce a judgment or order may not be issued without the leave of the Court where six years or more have lapsed since the date of the relevant judgment or order. [38] For even if the Petitioner could enforce the JID beyond the six-year period in light of the requisite leave under Order 46 r 2, that Page 11 of 13 leave does not and cannot have the effect of permitting the specific claim for arrears in interest, in light of the clear prohibition under Section 6(3) of the LA, and as made manifest by the Federal Court in United Malayan Banking Corporation Bhd v Ernest Cheong Yong Yin [2002] 2 CLJ 413. [39] No less importantly, Order 46 r 2 cannot be the basis of the Petitioner’s claim for arrears in interest because even though Order 46 r 2 provides leave to execute a judgment after the expiry of six years, a winding up petition is not a form of execution. [40] Thus, the fact that leave had been obtained under Order 46 r 2 to pursue recovery against the Respondent is of no consequence in so far as the winding up proceeding is concerned, and it is therefore doubtful whether the grant of an order for leave under Order 46 r 2 under the circumstances was necessary in the first place. [41] It has, after all, been established and considered settled law, as for instance by the Court of Appeal in Maril-Rionebel (M) Sdn Bhd & Anor v Perdana Merchant Bankers Bhd & Other Appeals [2001] 3 CLJ 248 that a winding up petition is not a form execution since it is not necessarily based on any judgment of the Court. It is premised on the inability of a company to pay its debts when they fall due, pure and simple. [42] Thus, in other words, as winding up petitions are not subject to Order 46 r 2, the Petitioner’s contention that had sought to justify its instant action on the basis of the leave obtained under Order 46 r 2 is unmeritorious. The leave would be necessary to pursue other forms of execution, but not the instant winding up petition. [43] As such, since the pertinent Section 218 notice as well as the petition had claimed for an amount inclusive of the judgment interest which has been shown to be statute-barred, the amount set out in the Section 218 notice can be validly said to be excessive, rendering the amount claimed under the Section 218 Notice to be erroneous, and not valid. [44] Furthermore, whilst part payment would, as stated above, often give rise to admission to indebtedness, the part-payment in the instant case, even if deemed to be an admission, cannot be the basis to javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2687042049&SearchId=8hakim46','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2687042049&SearchId=8hakim46','_DisplayCase','');DispCase.focus() Page 12 of 13 deny the legal effect of the statute of limitation. The claim for arrears in interest simply cannot be sustained. [45] The claim for arrears of interest via the winding up petition as expressed in the notice served and the petition presented by the Petitioner being barred by statute, the entire amount so demanded in the notice and petition is as such excessive, not valid and cannot be sustained. Any such form of illegality, being in the nature of a claim in contravention of the LA cannot be overridden or defeated by any argument of estoppel against the Respondent on the basis that the Respondent, after all these years had never applied to set aside the said JID. The limitation is absolute in effect, and given the absence of any evidence of fraud or mistake under Section 29 of the LA, neither of which was even suggested by the Petitioner. [46] In any event, there is no duty on or basis for the Respondent to have the JID set aside. The claim for interest only got statute-barred given the passage of time. And as for the claim at the rate higher than permitted, it was after all for the Petitioner to demonstrate agreement of parties in order to prove otherwise. Which it did not do. [47] For completeness, I should add that I am not unmindful of the decision of the Federal Court in the case of Malaysia Air Charter Company Sdn Bhd v Petronas Dagangan Sdn Bhd [2000] 4 CLJ 437 which had ruled that a notice of demand under Section 218(2)(a) of the CA 1965 need not specify the exact sum due as at the date of the demand since for so long as the sum due exceeds RM500 and remains unpaid, after a demand has been made, without a reasonable explanation to the satisfaction of the court, there is "neglect" to pay such sum within the meaning of the said section. [48] But that decision cannot be relied on to circumvent the clear statutory requirement of the LA. Neither did Malaysia Air Charter concern a statute of limitation. After all, furthermore, the Federal Court in that case was of the view that commercial reality demanded that preference be accorded to an interpretation that will remove from unmeritorious respondents the temptation to undertake an investigation into the exactness of the debt claimed to be owing on the relevant date. [49] Plainly, that concern did not arise in the instant case, where the LA clearly applies to bar the action on the arrears of interest which at the same time vitiated the notice and the petition. Page 13 of 13 Conclusion [50] In view of the foregoing reasons, primarily on account of the claim for interest being barred by statute, as well as of the absence of evidence of agreement justifying the high interest, the notice and petition are thus rendered defective. Accordingly, I dismiss the petition, with cost to the Respondent. Dated: 18 August 2017 (MOHD NAZLAN BIN MOHD GHAZALI) Judge High Court NCC1 Kuala Lumpur Counsel: For the Petitioner Shahirul Nazleen Messrs Bell & Lee Kuala Lumpur For Respondent Ahmad Zulfikri with Izmi Izdiharuddin Messrs Hasan Sabri & Hashim Nazri Selangor

Tika 2.6.0

WA-22NCC-147-04/2016

PLAINTIF MOHD GHAZALI AHMAD NASURUDDIN (NRIC NO.: 440208-07-5319) ...PLAINTIF F DEFENDAN 1. CHOK KAI KUANG (NRIC NO.: 550224-08-5733) 2. GAINWELL SDN BHD (Company NO.: 343172-K) ... DEFENDAN TS

17/08/2017

YA TUAN MOHD NAZLAN BIN MOHD GHAZALI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=e2f24204-da5a-4ec1-8a4e-90a937142c3b&Inline=true

Page 1 of 12 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY WRIT NO.: WA-22NCC-147-04/2016 BETWEEN MOHD GHAZALI AHMAD NASURUDDIN (NRIC NO.: 440208-07-5319) ...PLAINTIFF AND 1. CHOK KAI KUANG (NRIC NO.: 550224-08-5733) 2. GAINWELL SDN BHD (Company NO.: 343172-K) ...DEFENDANTS BEFORE YANG ARIF TUAN MOHD NAZLAN MOHD GHAZALI JUDGE JUDGMENT Introduction [1] This is an application by the Plaintiff for the appointment of receiver and manager (“R&M”) for the proper collection and d istribution of the assets of a partnership following the dissolution of the same, pursuant to a Judgment of this Court on 27 March 2017 (“the Judgment”). [2] I allowed the application at the conclusion of the hearing of the same in enclosure 108, and highlighted the key reasons for the granting of the order. These grounds of judgment set out the full reasons for my decision. Key Background Facts [3] The Judgment was the outcome of a writ action brought by the Plaintiff against the First Defendant, given a partnership dispute Page 2 of 12 between the two, who are senior professional engineers and were the only two partners in the firm known as “Ingenieur Bersekutu” (“the Firm”). [4] It was not in dispute that the Plaintiff’s statement of claim and the First Defendant’s counter-claim both prayed for the dissolution of the Firm. This was also made express by the parties at the start of the trial of the main suit. In the Judgment, with a view to ensuring a practical, expedient and fair resolution of the distribution of partnership assets, I allowed for an R&M to be appointed, as prayed for by the Plaintiff, to facilitate the liquidation process of the Firm. Thus, the following prayer for relief pleaded by the Plaintiff in his statement of claim was granted in the Judgment:- “3. Suatu Perintah bahawa penerima dan pengurus, atau orang lain atas pemberian jaminan, boleh dilantik untuk: a) memungut, membawa masuk dan menerima hutang-hutang yang sekarang kena dibayar dan terakru dan semua aset-aset, harta serta barang-barang lain kepunyaan perkongsian yang dikenali sebagai Ingenieur Bersekutu; b) mengagihkan/membahagikan apa-apa bayaran atau lebihan (“surplus”) atas kadar ........... seperti diperuntukkan di dalam Perjanjian Perkongsian; c) mengendalikan akaun-akaun bagi perkongsian dan/ atau membuka akaun bank baru dan membuat segala transaksi yang diperlukan, dengan syarat bahawa segala perakaunan yang sewajarnya dibuat; d) memfailkan ke Mahkamah pernyataan hal ehwal (“statement of affairs”) yang menunjukkan aset-aset dan liabiliti-liabiliti perkongisan setiap tiga (3) bulan dari tarikh perlantikan mereka; dan e) menjalankan segala tugas-tugas sebagai penerima dan pengurus dan memohon semua arahan yang diperlukan bagi tujuan ini. [5] The Plaintiff then moved to file enclosure 108 herein for the appointment of the proposed R&M. The First Defendant however opposed this application. Summary of Contentions of Parties [6] In essence, the Plaintiff submitted that the appointment of the R&M would be in line with Order 30 r 1 of the Rules of Court 2012 Page 3 of 12 (“the RC 2012”) and is a consequence of the Judgment, and in any event a natural outcome of a dissolution of partnership where disagreements run among the partners. [7] The Plaintiff alleged that the First Defendant, would in any event oppose the appointment of any R&M as the same would disrupt the First Defendant’s attempts to dissipate the assets of the Firm, which continues to be in jeopardy if the appointment of an R&M is delayed, [8] The primary objection of the First Defendant, on the other hand, is founded on the argument that the Plaintiff did not secure the consent of the First Defendant on the appointment of the R&M which ought to have been done on mutual agreement. [9] The First Defendant in particular referred to a Consent Order granted by this Court on 31 October 2016, prior to the Judgment, binding the two former partners to the following terms:- “MAKA ADALAH SECARA PERSETUJUAN DIPERINTAHKAN: a) Bahawa Plaintif dan Defendan Ke-1 (sama ada secara sendirinya dan/atau kakitangan-kakitangannya dan/atau pegawai-pegawai dan/atau ejen-ejennya) akan kekal mengurus perkongsian secara bersama dan akan menjaga statuts quo; b) yang mana akan berkuatkuasa secara serta merta dan pada setiap masa sehingga guaman ini dan juga penggulungan perkongsian diselesaikan secara penuh dan muktamad.” [10] The Consent Order, according to the First Defendant naturally entails that all matters pertaining to the Firm until the final winding-up of the same are to be managed and decided mutually by the Plaintiff and the First Defendant. This should include the appointment of the R&M. As such, the unilateral filing of enclosure 108 by the Plaintiff stands in complete disobeyance to that Consent Order. This is especially so since a Consent Order is a valid contract between the parties which is merged into the consent order (see the Federal Court decision in Tan Geok Lan v La Kuan @ Lian Kuan [2004] 3 MLJ 465). [11] In addition to asserting that enclosure 108 wrongfully sought to enlarge the scope of the Judgment by encroaching on the management of the Firm as well, the First Defendant maintained that an appointment of R&M for purposes of winding-up is purely founded on the Page 4 of 12 basis of mutual interest to the partners, neglect of which additionally violates Section 40 of the Partnership Act 1961. Evaluation and Findings of the Court The Appointment of R&M required mutual agreement of parties? [12] The crux of the First Defendant’s contention is that the Plaintiff had moved this Court on the application for appointment without the agreement of the First Defendant. The question therefore is whether the consent of parties is a pre-requisite to the appointment of an R&M. [13] The answer to this question is a resolute no. In the first place, the First Defendant’s reliance on the Consent Order is misconceived. The Consent Order is in a nature of an interim injunction requiring the parties to jointly manage the Firm and maintain status quo until disposal of the suit and the completion of the winding-up of the Firm. The suit has since been disposed of, as manifested in the Judgement. Although the winding-up has not completed, the terms of the Judgment expressly provided for the appointment of an R&M as an independent party to deal with the liquidation process, and specifically with the distribution of partnership assets between the parties in dispute. [14] In other words, the Consent Order must to such extent be taken to have been superseded by the Judgment. Further insistence on mutual agreement may render the Judgment to be of little utility, if one party can easily with or without good reason withhold agreement for the appointment, thus frustrating the true realisation of the outcome of the main suit. This is not in consonance with the pursuit of justice which this Court cannot accept. [15] Further, it cannot justifiably be said that the Plaintiff is disobeying the Consent Order for in any event, the terms of the Consent Order do not state or even touch on the issue of the appointment of the R&M. It is manifest that the purpose of the Consent Order was to ensure that each of the partners must consult the other in matters of management of the Firm, which thus ought to be exercised on joint basis. [16] As such, there is absolutely nothing wrong with a party seeking the assistance of the Court if the other party refused consent or declined cooperation, especially on a matter such as the appointment of Page 5 of 12 an R&M which is mandated by the terms of the Judgment in any event. If the position were otherwise, the fruits of the litigation could not be pursued, because consent is withheld and resort to the Court prohibited. [17] The disagreement between the parties in the instant case cannot be more serious and obvious. The First Defendant’s argument that he was merely asking for more details about the proposed R&M and was not out-rightly against the appointment was also less than convincing. For I had decided to reserve my decision on this enclosure 108 for about 2 weeks to give time to the parties to resolve the matter, if possible. That did not work out, and both refused any concessions on a matter which is only meant to facilitate the liquidation and separation process. There are grounds for appointment of R&M [18] Furthermore, quite apart from the terms of the Judgment, the Plaintiff’s application is also supported by his averments concerning the First Defendant’s attempts to dissipate the assets of the Firm. While the Plaintiff, in his averments repeated the allegations previously raised at trial, I was more interested to know if such allegations included conduct of the First Defendant post-Judgment. [19] According to the Plaintiff, based on the documents obtained from the Board of Engineers Malaysia, the First Defendant has registered a new firm using the name “Ingenieur Bersekutu Consulting Engineer”. This is clearly infringing paragraph 5 of the Judgment for the continued use of the name “Ingenieur Bersekutu”, despite the order of Court expressly forbidding either party from its use, as follows:- “5. Suatu Perintah bahawa kedua-dua pihak dihalang dari menggunakan nama “Ingenieur Bersekutu” bagi tujuan projek- projek dan/atau apa-apa urusan perkongsian atau urusan peribadi tanpa persetujuan satu sama lain.” [20] The First Defendant still has not disclaimed his use of the name. This arguably, as the Plaintiff submitted thus increases the probability of dissipation of assets, by reason of the First Defendant’s continued use of the former firm’s letterhead without giving notification of the Firm’s true status; and as he may persuade unwary clients to make payment for claims of the Firm’s projects to his new firm instead, given that the names of the two firms are similar. Thus, in this context, it could be said that there is basis to the argument that the Plaintiff has a good Page 6 of 12 prima facie title to the partnership assets (as does the First Defendant on equal basis, as per the Judgment), that the partnership assets are in jeopardy and the Plaintiff as the applicant would be in a worse off position if the proposed appointment is delayed (see Lim Poh Choo v Absolute Ascend Sdn Bhd & Anor [2008] 7 CLJ 810). This is yet another ground that justifies the appointment of a R&M. No basis to reject the proposed R&M [21] Nor has the First Defendant proffered any basis for its disagreement of the appointment of the proposed R&M. The Plaintiff had proposed Mr. Sathiea Seelean a/l Manickam, who practises at Messrs Morison Anuarul Azizan Chew in Kuala Lumpur, to be appointed as the R&M of the Firm. His appointment as a professional is, according to the Plaintiff, sought to impartially resolve the winding-up and the Firm’s pending issues. [22] At this juncture, it appears that the First Defendant has no cause to speculate or cast allegations of bias against Mr. Sathiea Seelean a/l Manickam, who is an experienced and qualified insolvency professional, and formally approved by the Ministry of Finance, and whose duties lie to the Court and in accordance with Judgment. As such, I do not see any basis to deny this appointment. It is after all designed to bring closure to the dispute between the parties. The First Defendant’s objection merely delays the resolution of what is just and right. It should be for the party objecting to the appointment of an R&M, like the First Defendant herein, to furnish evidence of partiality on the part of the proposed R&M. This the First Defendant did not do. Source of Authority to appoint R&M [23] No less importantly, not only does the Judgment not stipulate the requirement for mutual appointment of the R&M, but also that the true basis of the appointment, that is Order 30 r 1 of the RC 2012 too does not require the agreement of the First Defendant, for it is all too obvious that the appointment is by the Court. Order 30 r 1 reads as follows:- “1. Application for receiver and injunction (O. 30 r. 1) (1) An application for the appointment of a receiver may be made by notice of application. Page 7 of 12 (2) An application for an injunction ancillary or incidental to an order appointing a receiver may be joined with the application for such order. (3) Where the applicant intends to apply for the immediate grant of such injunction, he may do so ex parte with the application for such order. (4) The Court hearing an application under paragraph (3) may grant an injunction, restraining the party beneficially entitled to any interest in the property of which a receiver is sought from assigning, charging or otherwise dealing with that property until after the hearing of a notice of application for the appointment of the receiver and may require such a notice of application, returnable on such date as the Court may direct, to be used.” [24] It is of significance to note that whilst an application for the appointment of a receiver under Order 30 r 1 is generally made to preserve any property where litigation is pending, there is no rule prohibiting appointment after the resolution of the litigation, for the overarching premise is the preservation of assets, especially if they are in jeopardy, and more so when the judgment of the Court ordered the same like the case presently. Fundamentally, the source of the authority of the Court in this regard is the Courts of Judicature Act 1964 (“the CJA”). [25] The Schedule to the CJA, specifying the additional powers of the High Court provides in paragraph 6 thus:- “6. Power to provide for the interim preservation of property the subject matter of any cause or matter by sale or by injunction or the appointment of a receiver or the registration of a caveat or a lis pendens or in any manner whatsoever”. [26] It should be noted that the structure of non-corporate receivership is not contained in statute like that of corporate receivership, although not unusually, a receiver is appointed over a non- corporate entity to collect and safeguard its assets for the purpose of realisation or at least protection of those assets for the benefit of a party or to protect a party’s contractual rights, especially concerning a partnership dispute where the Courts will intervene to prevent detrimental effects of a dispute especially to the business and third parties such as creditors or employees. Page 8 of 12 [27] Whilst receivers are generally readily appointed following dissolution of a partnership or prior to dissolution of a partnership if there has been such breakdown of good faith between the partners as to make dissolution inevitable (see, for example, the observations of Lord Cozens-Hardy in Re Yenidje Tobacco Co Ltd [1916] 2 Ch 426), in the instant case, I emphasise that I have already ordered, in the Judgment, upon conclusion of the main suit, that an R&M be appointment as prayed for by the Plaintiff who was successful in the main suit. [28] Whilst the Courts should refuse to intervene in cases where it is more practical and cost effective for the partners themselves to undertake the winding up of the partnership, case law authorities have shown that a receiver would likely be appointed in circumstances where partnership assets are in jeopardy or that the partners are in serious dispute. Thus in the Supreme Court of Western Australia case of Wedge v Wedge [1995] 12 WAR 489, faced with competing proposals amongst the partners in dispute, one asking for the appointment of an R&M to consider the sale of the partnership assets, and another seeking the appointment of a valuer to facilitate possible buy-outs, Parker J ruled that the interests of the parties would be best served by the appointment of an independent R&M with freedom to determine the most appropriate method of realising the assets of the partnership. [29] Indeed, there is, based on my research, caselaw authority which held that in the absence of cooperation between partners post- dissolution, an independent third party such as a receiver may be appointed to take over the affairs of the partnership. Thus, the Court of Appeal of Singapore in Hwang Ju-In v Huang Han Chao [1997] 2 MLJ 229 held as follows:- “As regards the contention of counsel for the respondent, there is evidence that the partnership has substantial book-debts to be collected; that the respondent has not taken any steps to collect such debts and that some of them will soon be statute-barred if not already statute-barred. There is no doubt that there is no co-operation at all between the parties and it is therefore desirable that an independent third party such as a receiver take over the affairs of the partnership, collect book-debts, prepare final accounts and thus complete the dissolution of the partnership.” [30] Furthermore, although strictly inapplicable, the scheme of the Companies Act 2016 on receivers and managers of corporations similarly provides for the appointment to be made by the Court in Section 374 and nowhere in the Act is it mentioned that there must be Page 9 of 12 agreement among the relevant parties before an application for such appointment could be considered. [31] The powers of the appointed R&M are derived from and defined and limited by the order of the Court making the appointment. A Court-appointed R&M is an officer of the court responsible to perform the duties stipulated in the Court order. Indeed, any attempt by any of the partners to interfere with the exercise of the duties of the appointed R&M in dealing with the assets vested in him could even constitute contempt of Court (see Murray v King [1984] 55 ALR 559). In the instant case before me, it bears repetition that the very terms of the Judgment itself already provide expressly for the appointment of the R&M. [32] The Supreme Court in Zainal Abidin Putih & Anor v Che Wan Development Sdn Bhd [1992] 2 MLJ 233 held that a court-appointed receiver is an officer of the Court and his remit is to discharge certain duties prescribed by the order appointing him. Thus Gunn Chit Tuan SCJ stated:- “We would start off by pointing out that the appellants were appointed receivers by the court and are therefore first and foremost officers of the court, and to use the words of Viscount Haldane LC in William H Parsons & Ors v The Sovereign Bank of Canada 3 ‘put in to discharge certain duties prescribed by the order appointing him’.” [33] There is also authority that a receiver may even be appointed despite the absence of the relevant parties before the Court, if the proposed appointment of a receiver cannot prejudice the interest of those absent parties (see Holmes v Bell [1840] 48 ER 1102). [34] There is thus no legal requirement that upon dissolution of a partnership, whether by operation of law, court order or agreement, all the partners must jointly make an application for the appointment of a receiver. This ignores the fact that cases requiring the involvement of receivers are often those where the partners cannot agree on anything, and is contrary to the main reason why a receiver is essential. [35] Any of the parties to the partnership agreement may apply to the Court for the appointment of a receiver to wind up the business and affairs of the partnership and to have the property of the partnership applied in payment of the debts and liabilities of the firm and to have the surplus assets applied in payment to what is due to the partners of the firm, and in compliance with the provisions on the rules for distribution of Page 10 of 12 assets on final settlement of accounts under Section 46 of the Partnership Act 1961. [36] The First Defendant’s argument on the Plaintiff breaching Section 40 of the Partnership Act 1961 is also difficult to sustain. Section 40 states as follows:- 40. Continuing authority of partners for purposes of winding up After the dissolution of a partnership, the authority of each partner to bind the firm, and the other rights and obligations of the partners, continue, notwithstanding the dissolution, so far as may be necessary to wind up the affairs of the partnership, and to complete transaction begun but unfinished at the time of the dissolution, but not otherwise: Provided that the firm is in no case bound by the acts of a partner who has become bankrupt; but his proviso does not affect the liability of any person who has, after the bankruptcy, represented himself or knowingly suffered himself to be represented as a partner of the bankrupt. [emphasis added] [37] It has not been shown by the First Defendant in what manner this statutory provision had been violated by the Plaintiff. I see no infringement in the instant case. This section provides for the continuation of the authority of the partners of a firm in the process of being dissolved. It is manifest that as stated in the above mentioned Section 40, such authority is only for the purposes of concluding unfinished transactions and completing the winding up of the firm. In the instant case, the Judgment had already authorised parties to appoint an R&M, and the appointment of one would necessarily mean that the R&M takes over the management of the firm, and in this case, in respect of the winding up process of the Firm. [38] Lord Atkinson in the House of Lords decision in Moss Steamship Co Ltd v Whinney [1912] AC 254 made it clear that:- “This appointment of a receiver and manager over the assets and business of a company does not dissolve or annihilate the company... Both continue to exist; but it entirely supersedes the company in the conduct of its business; deprives it of all power to enter into contracts in relation to that business, or to sell, pledge, or otherwise dispose of the property put into the possession, or under the control of the receiver and manager. Its powers in these respects are entirely in abeyance”. Page 11 of 12 [39] The same effects of appointment would apply to a partnership. As such even notwithstanding the fact that the Judgment had already provided for the appointment, the application for the appointment of the R&M to deal with the dissolution of a partnership would in my view be a valid exercise of the authority of the Plaintiff as a former partner under Section 40 of the Partnership Act 1961 which does not state that such authority must be jointly exercised. Neither can it be said, as the First Defendant seemed to contend, that the appointment of an R&M would deny the authority of the First Defendant to deal with winding up matters of the Firm, for the appointment itself is plainly designed to address the winding up of the Firm in situation like presently in the absence of cooperation between the partners. Scope of R&M Appointment and Powers 40] I however find some merit in the submission of the First Defendant in that some of the prayers in this application in enclosure 108 by the Plaintiff for the appointment of the R&M appear to be additional to the terms of the Judgment and beyond the ambit of winding up but extends also to general management of the Firm as well. I thus agree that such additional powers are unnecessary for being inconsistent with the objective of the appointment. As such I only allow prayers 1, 2 (a) and (c) but not (b), 3, 4, 5, 7, 8 and 9. I disallow prayer 2 (b) because it seeks to incorporate a Jadual A which was enclosed with the application, which contained a list of additional powers which encompass general management powers. [41] These included the power to undertake any business of the partnership (paragraph e) and to change the registered office of the Firm (paragraph k) and to employ and dismiss staff for the Firm (paragraph o). I find all these are either inconsistent with the purpose of appointment or in any event unnecessary as the terms of the Judgment have more than adequately set out the broad objective for the appointment. [42] I also decide against granting prayer 6 which sought to dispense with the need for the giving of security. The requirement for security is stated in Order 30 r 2 of the RC 2012. It reads:- 2. Giving of security by receiver (O. 30 r. 2) (1) Where a judgment is given, or order made, directing the appointment of a receiver, then, unless the judgment or order otherwise directs, a person shall Page 12 of 12 not be appointed receiver in accordance with the judgment or order until he has given security in accordance with this rule. [43] I see no basis to do away with the requirement of giving of security, and neither has the Plaintiff proffered any cogent reasons for its dispensation. I find it more imperative that the requirement for security be adhered to, in situations like the present, where the appointment is objected to by the First Defendant. Conclusion [44] In view of the foregoing reasons, the Plaintiff has successfully justified the need for the appointment of the proposed R&M, on account of not only the earlier Judgment, but also the various reasons discussed above. [45] As such I allow enclosure 108, apart from prayers 2(b) and 6, as stated earlier. Dated: 17 August 2017 (MOHD NAZLAN BIN MOHD GHAZALI) Judge High Court NCC1 Kuala Lumpur Counsel Counsel for Plaintiff Wan Zafran Messrs Wan Marican Hamzah & Shaik Kuala Lumpur Counsel for Defendant Wallace Wong Messrs Thomas Lai & Wallace Wong Kuala Lumpur

Tika 2.6.0

WA-22NCC-147-04/2016

PLAINTIF MOHD GHAZALI AHMAD NASURUDDIN (NRIC NO.: 440208-07-5319) ...PLAINTIF F DEFENDAN 1. CHOK KAI KUANG (NRIC NO.: 550224-08-5733) 2. GAINWELL SDN BHD (Company NO.: 343172-K) ... DEFENDAN TS

17/08/2017

YA TUAN MOHD NAZLAN BIN MOHD GHAZALI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=e2f24204-da5a-4ec1-8a4e-90a937142c3b&Inline=true

Page 1 of 12 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY WRIT NO.: WA-22NCC-147-04/2016 BETWEEN MOHD GHAZALI AHMAD NASURUDDIN (NRIC NO.: 440208-07-5319) ...PLAINTIFF AND 1. CHOK KAI KUANG (NRIC NO.: 550224-08-5733) 2. GAINWELL SDN BHD (Company NO.: 343172-K) ...DEFENDANTS BEFORE YANG ARIF TUAN MOHD NAZLAN MOHD GHAZALI JUDGE JUDGMENT Introduction [1] This is an application by the Plaintiff for the appointment of receiver and manager (“R&M”) for the proper collection and d istribution of the assets of a partnership following the dissolution of the same, pursuant to a Judgment of this Court on 27 March 2017 (“the Judgment”). [2] I allowed the application at the conclusion of the hearing of the same in enclosure 108, and highlighted the key reasons for the granting of the order. These grounds of judgment set out the full reasons for my decision. Key Background Facts [3] The Judgment was the outcome of a writ action brought by the Plaintiff against the First Defendant, given a partnership dispute Page 2 of 12 between the two, who are senior professional engineers and were the only two partners in the firm known as “Ingenieur Bersekutu” (“the Firm”). [4] It was not in dispute that the Plaintiff’s statement of claim and the First Defendant’s counter-claim both prayed for the dissolution of the Firm. This was also made express by the parties at the start of the trial of the main suit. In the Judgment, with a view to ensuring a practical, expedient and fair resolution of the distribution of partnership assets, I allowed for an R&M to be appointed, as prayed for by the Plaintiff, to facilitate the liquidation process of the Firm. Thus, the following prayer for relief pleaded by the Plaintiff in his statement of claim was granted in the Judgment:- “3. Suatu Perintah bahawa penerima dan pengurus, atau orang lain atas pemberian jaminan, boleh dilantik untuk: a) memungut, membawa masuk dan menerima hutang-hutang yang sekarang kena dibayar dan terakru dan semua aset-aset, harta serta barang-barang lain kepunyaan perkongsian yang dikenali sebagai Ingenieur Bersekutu; b) mengagihkan/membahagikan apa-apa bayaran atau lebihan (“surplus”) atas kadar ........... seperti diperuntukkan di dalam Perjanjian Perkongsian; c) mengendalikan akaun-akaun bagi perkongsian dan/ atau membuka akaun bank baru dan membuat segala transaksi yang diperlukan, dengan syarat bahawa segala perakaunan yang sewajarnya dibuat; d) memfailkan ke Mahkamah pernyataan hal ehwal (“statement of affairs”) yang menunjukkan aset-aset dan liabiliti-liabiliti perkongisan setiap tiga (3) bulan dari tarikh perlantikan mereka; dan e) menjalankan segala tugas-tugas sebagai penerima dan pengurus dan memohon semua arahan yang diperlukan bagi tujuan ini. [5] The Plaintiff then moved to file enclosure 108 herein for the appointment of the proposed R&M. The First Defendant however opposed this application. Summary of Contentions of Parties [6] In essence, the Plaintiff submitted that the appointment of the R&M would be in line with Order 30 r 1 of the Rules of Court 2012 Page 3 of 12 (“the RC 2012”) and is a consequence of the Judgment, and in any event a natural outcome of a dissolution of partnership where disagreements run among the partners. [7] The Plaintiff alleged that the First Defendant, would in any event oppose the appointment of any R&M as the same would disrupt the First Defendant’s attempts to dissipate the assets of the Firm, which continues to be in jeopardy if the appointment of an R&M is delayed, [8] The primary objection of the First Defendant, on the other hand, is founded on the argument that the Plaintiff did not secure the consent of the First Defendant on the appointment of the R&M which ought to have been done on mutual agreement. [9] The First Defendant in particular referred to a Consent Order granted by this Court on 31 October 2016, prior to the Judgment, binding the two former partners to the following terms:- “MAKA ADALAH SECARA PERSETUJUAN DIPERINTAHKAN: a) Bahawa Plaintif dan Defendan Ke-1 (sama ada secara sendirinya dan/atau kakitangan-kakitangannya dan/atau pegawai-pegawai dan/atau ejen-ejennya) akan kekal mengurus perkongsian secara bersama dan akan menjaga statuts quo; b) yang mana akan berkuatkuasa secara serta merta dan pada setiap masa sehingga guaman ini dan juga penggulungan perkongsian diselesaikan secara penuh dan muktamad.” [10] The Consent Order, according to the First Defendant naturally entails that all matters pertaining to the Firm until the final winding-up of the same are to be managed and decided mutually by the Plaintiff and the First Defendant. This should include the appointment of the R&M. As such, the unilateral filing of enclosure 108 by the Plaintiff stands in complete disobeyance to that Consent Order. This is especially so since a Consent Order is a valid contract between the parties which is merged into the consent order (see the Federal Court decision in Tan Geok Lan v La Kuan @ Lian Kuan [2004] 3 MLJ 465). [11] In addition to asserting that enclosure 108 wrongfully sought to enlarge the scope of the Judgment by encroaching on the management of the Firm as well, the First Defendant maintained that an appointment of R&M for purposes of winding-up is purely founded on the Page 4 of 12 basis of mutual interest to the partners, neglect of which additionally violates Section 40 of the Partnership Act 1961. Evaluation and Findings of the Court The Appointment of R&M required mutual agreement of parties? [12] The crux of the First Defendant’s contention is that the Plaintiff had moved this Court on the application for appointment without the agreement of the First Defendant. The question therefore is whether the consent of parties is a pre-requisite to the appointment of an R&M. [13] The answer to this question is a resolute no. In the first place, the First Defendant’s reliance on the Consent Order is misconceived. The Consent Order is in a nature of an interim injunction requiring the parties to jointly manage the Firm and maintain status quo until disposal of the suit and the completion of the winding-up of the Firm. The suit has since been disposed of, as manifested in the Judgement. Although the winding-up has not completed, the terms of the Judgment expressly provided for the appointment of an R&M as an independent party to deal with the liquidation process, and specifically with the distribution of partnership assets between the parties in dispute. [14] In other words, the Consent Order must to such extent be taken to have been superseded by the Judgment. Further insistence on mutual agreement may render the Judgment to be of little utility, if one party can easily with or without good reason withhold agreement for the appointment, thus frustrating the true realisation of the outcome of the main suit. This is not in consonance with the pursuit of justice which this Court cannot accept. [15] Further, it cannot justifiably be said that the Plaintiff is disobeying the Consent Order for in any event, the terms of the Consent Order do not state or even touch on the issue of the appointment of the R&M. It is manifest that the purpose of the Consent Order was to ensure that each of the partners must consult the other in matters of management of the Firm, which thus ought to be exercised on joint basis. [16] As such, there is absolutely nothing wrong with a party seeking the assistance of the Court if the other party refused consent or declined cooperation, especially on a matter such as the appointment of Page 5 of 12 an R&M which is mandated by the terms of the Judgment in any event. If the position were otherwise, the fruits of the litigation could not be pursued, because consent is withheld and resort to the Court prohibited. [17] The disagreement between the parties in the instant case cannot be more serious and obvious. The First Defendant’s argument that he was merely asking for more details about the proposed R&M and was not out-rightly against the appointment was also less than convincing. For I had decided to reserve my decision on this enclosure 108 for about 2 weeks to give time to the parties to resolve the matter, if possible. That did not work out, and both refused any concessions on a matter which is only meant to facilitate the liquidation and separation process. There are grounds for appointment of R&M [18] Furthermore, quite apart from the terms of the Judgment, the Plaintiff’s application is also supported by his averments concerning the First Defendant’s attempts to dissipate the assets of the Firm. While the Plaintiff, in his averments repeated the allegations previously raised at trial, I was more interested to know if such allegations included conduct of the First Defendant post-Judgment. [19] According to the Plaintiff, based on the documents obtained from the Board of Engineers Malaysia, the First Defendant has registered a new firm using the name “Ingenieur Bersekutu Consulting Engineer”. This is clearly infringing paragraph 5 of the Judgment for the continued use of the name “Ingenieur Bersekutu”, despite the order of Court expressly forbidding either party from its use, as follows:- “5. Suatu Perintah bahawa kedua-dua pihak dihalang dari menggunakan nama “Ingenieur Bersekutu” bagi tujuan projek- projek dan/atau apa-apa urusan perkongsian atau urusan peribadi tanpa persetujuan satu sama lain.” [20] The First Defendant still has not disclaimed his use of the name. This arguably, as the Plaintiff submitted thus increases the probability of dissipation of assets, by reason of the First Defendant’s continued use of the former firm’s letterhead without giving notification of the Firm’s true status; and as he may persuade unwary clients to make payment for claims of the Firm’s projects to his new firm instead, given that the names of the two firms are similar. Thus, in this context, it could be said that there is basis to the argument that the Plaintiff has a good Page 6 of 12 prima facie title to the partnership assets (as does the First Defendant on equal basis, as per the Judgment), that the partnership assets are in jeopardy and the Plaintiff as the applicant would be in a worse off position if the proposed appointment is delayed (see Lim Poh Choo v Absolute Ascend Sdn Bhd & Anor [2008] 7 CLJ 810). This is yet another ground that justifies the appointment of a R&M. No basis to reject the proposed R&M [21] Nor has the First Defendant proffered any basis for its disagreement of the appointment of the proposed R&M. The Plaintiff had proposed Mr. Sathiea Seelean a/l Manickam, who practises at Messrs Morison Anuarul Azizan Chew in Kuala Lumpur, to be appointed as the R&M of the Firm. His appointment as a professional is, according to the Plaintiff, sought to impartially resolve the winding-up and the Firm’s pending issues. [22] At this juncture, it appears that the First Defendant has no cause to speculate or cast allegations of bias against Mr. Sathiea Seelean a/l Manickam, who is an experienced and qualified insolvency professional, and formally approved by the Ministry of Finance, and whose duties lie to the Court and in accordance with Judgment. As such, I do not see any basis to deny this appointment. It is after all designed to bring closure to the dispute between the parties. The First Defendant’s objection merely delays the resolution of what is just and right. It should be for the party objecting to the appointment of an R&M, like the First Defendant herein, to furnish evidence of partiality on the part of the proposed R&M. This the First Defendant did not do. Source of Authority to appoint R&M [23] No less importantly, not only does the Judgment not stipulate the requirement for mutual appointment of the R&M, but also that the true basis of the appointment, that is Order 30 r 1 of the RC 2012 too does not require the agreement of the First Defendant, for it is all too obvious that the appointment is by the Court. Order 30 r 1 reads as follows:- “1. Application for receiver and injunction (O. 30 r. 1) (1) An application for the appointment of a receiver may be made by notice of application. Page 7 of 12 (2) An application for an injunction ancillary or incidental to an order appointing a receiver may be joined with the application for such order. (3) Where the applicant intends to apply for the immediate grant of such injunction, he may do so ex parte with the application for such order. (4) The Court hearing an application under paragraph (3) may grant an injunction, restraining the party beneficially entitled to any interest in the property of which a receiver is sought from assigning, charging or otherwise dealing with that property until after the hearing of a notice of application for the appointment of the receiver and may require such a notice of application, returnable on such date as the Court may direct, to be used.” [24] It is of significance to note that whilst an application for the appointment of a receiver under Order 30 r 1 is generally made to preserve any property where litigation is pending, there is no rule prohibiting appointment after the resolution of the litigation, for the overarching premise is the preservation of assets, especially if they are in jeopardy, and more so when the judgment of the Court ordered the same like the case presently. Fundamentally, the source of the authority of the Court in this regard is the Courts of Judicature Act 1964 (“the CJA”). [25] The Schedule to the CJA, specifying the additional powers of the High Court provides in paragraph 6 thus:- “6. Power to provide for the interim preservation of property the subject matter of any cause or matter by sale or by injunction or the appointment of a receiver or the registration of a caveat or a lis pendens or in any manner whatsoever”. [26] It should be noted that the structure of non-corporate receivership is not contained in statute like that of corporate receivership, although not unusually, a receiver is appointed over a non- corporate entity to collect and safeguard its assets for the purpose of realisation or at least protection of those assets for the benefit of a party or to protect a party’s contractual rights, especially concerning a partnership dispute where the Courts will intervene to prevent detrimental effects of a dispute especially to the business and third parties such as creditors or employees. Page 8 of 12 [27] Whilst receivers are generally readily appointed following dissolution of a partnership or prior to dissolution of a partnership if there has been such breakdown of good faith between the partners as to make dissolution inevitable (see, for example, the observations of Lord Cozens-Hardy in Re Yenidje Tobacco Co Ltd [1916] 2 Ch 426), in the instant case, I emphasise that I have already ordered, in the Judgment, upon conclusion of the main suit, that an R&M be appointment as prayed for by the Plaintiff who was successful in the main suit. [28] Whilst the Courts should refuse to intervene in cases where it is more practical and cost effective for the partners themselves to undertake the winding up of the partnership, case law authorities have shown that a receiver would likely be appointed in circumstances where partnership assets are in jeopardy or that the partners are in serious dispute. Thus in the Supreme Court of Western Australia case of Wedge v Wedge [1995] 12 WAR 489, faced with competing proposals amongst the partners in dispute, one asking for the appointment of an R&M to consider the sale of the partnership assets, and another seeking the appointment of a valuer to facilitate possible buy-outs, Parker J ruled that the interests of the parties would be best served by the appointment of an independent R&M with freedom to determine the most appropriate method of realising the assets of the partnership. [29] Indeed, there is, based on my research, caselaw authority which held that in the absence of cooperation between partners post- dissolution, an independent third party such as a receiver may be appointed to take over the affairs of the partnership. Thus, the Court of Appeal of Singapore in Hwang Ju-In v Huang Han Chao [1997] 2 MLJ 229 held as follows:- “As regards the contention of counsel for the respondent, there is evidence that the partnership has substantial book-debts to be collected; that the respondent has not taken any steps to collect such debts and that some of them will soon be statute-barred if not already statute-barred. There is no doubt that there is no co-operation at all between the parties and it is therefore desirable that an independent third party such as a receiver take over the affairs of the partnership, collect book-debts, prepare final accounts and thus complete the dissolution of the partnership.” [30] Furthermore, although strictly inapplicable, the scheme of the Companies Act 2016 on receivers and managers of corporations similarly provides for the appointment to be made by the Court in Section 374 and nowhere in the Act is it mentioned that there must be Page 9 of 12 agreement among the relevant parties before an application for such appointment could be considered. [31] The powers of the appointed R&M are derived from and defined and limited by the order of the Court making the appointment. A Court-appointed R&M is an officer of the court responsible to perform the duties stipulated in the Court order. Indeed, any attempt by any of the partners to interfere with the exercise of the duties of the appointed R&M in dealing with the assets vested in him could even constitute contempt of Court (see Murray v King [1984] 55 ALR 559). In the instant case before me, it bears repetition that the very terms of the Judgment itself already provide expressly for the appointment of the R&M. [32] The Supreme Court in Zainal Abidin Putih & Anor v Che Wan Development Sdn Bhd [1992] 2 MLJ 233 held that a court-appointed receiver is an officer of the Court and his remit is to discharge certain duties prescribed by the order appointing him. Thus Gunn Chit Tuan SCJ stated:- “We would start off by pointing out that the appellants were appointed receivers by the court and are therefore first and foremost officers of the court, and to use the words of Viscount Haldane LC in William H Parsons & Ors v The Sovereign Bank of Canada 3 ‘put in to discharge certain duties prescribed by the order appointing him’.” [33] There is also authority that a receiver may even be appointed despite the absence of the relevant parties before the Court, if the proposed appointment of a receiver cannot prejudice the interest of those absent parties (see Holmes v Bell [1840] 48 ER 1102). [34] There is thus no legal requirement that upon dissolution of a partnership, whether by operation of law, court order or agreement, all the partners must jointly make an application for the appointment of a receiver. This ignores the fact that cases requiring the involvement of receivers are often those where the partners cannot agree on anything, and is contrary to the main reason why a receiver is essential. [35] Any of the parties to the partnership agreement may apply to the Court for the appointment of a receiver to wind up the business and affairs of the partnership and to have the property of the partnership applied in payment of the debts and liabilities of the firm and to have the surplus assets applied in payment to what is due to the partners of the firm, and in compliance with the provisions on the rules for distribution of Page 10 of 12 assets on final settlement of accounts under Section 46 of the Partnership Act 1961. [36] The First Defendant’s argument on the Plaintiff breaching Section 40 of the Partnership Act 1961 is also difficult to sustain. Section 40 states as follows:- 40. Continuing authority of partners for purposes of winding up After the dissolution of a partnership, the authority of each partner to bind the firm, and the other rights and obligations of the partners, continue, notwithstanding the dissolution, so far as may be necessary to wind up the affairs of the partnership, and to complete transaction begun but unfinished at the time of the dissolution, but not otherwise: Provided that the firm is in no case bound by the acts of a partner who has become bankrupt; but his proviso does not affect the liability of any person who has, after the bankruptcy, represented himself or knowingly suffered himself to be represented as a partner of the bankrupt. [emphasis added] [37] It has not been shown by the First Defendant in what manner this statutory provision had been violated by the Plaintiff. I see no infringement in the instant case. This section provides for the continuation of the authority of the partners of a firm in the process of being dissolved. It is manifest that as stated in the above mentioned Section 40, such authority is only for the purposes of concluding unfinished transactions and completing the winding up of the firm. In the instant case, the Judgment had already authorised parties to appoint an R&M, and the appointment of one would necessarily mean that the R&M takes over the management of the firm, and in this case, in respect of the winding up process of the Firm. [38] Lord Atkinson in the House of Lords decision in Moss Steamship Co Ltd v Whinney [1912] AC 254 made it clear that:- “This appointment of a receiver and manager over the assets and business of a company does not dissolve or annihilate the company... Both continue to exist; but it entirely supersedes the company in the conduct of its business; deprives it of all power to enter into contracts in relation to that business, or to sell, pledge, or otherwise dispose of the property put into the possession, or under the control of the receiver and manager. Its powers in these respects are entirely in abeyance”. Page 11 of 12 [39] The same effects of appointment would apply to a partnership. As such even notwithstanding the fact that the Judgment had already provided for the appointment, the application for the appointment of the R&M to deal with the dissolution of a partnership would in my view be a valid exercise of the authority of the Plaintiff as a former partner under Section 40 of the Partnership Act 1961 which does not state that such authority must be jointly exercised. Neither can it be said, as the First Defendant seemed to contend, that the appointment of an R&M would deny the authority of the First Defendant to deal with winding up matters of the Firm, for the appointment itself is plainly designed to address the winding up of the Firm in situation like presently in the absence of cooperation between the partners. Scope of R&M Appointment and Powers 40] I however find some merit in the submission of the First Defendant in that some of the prayers in this application in enclosure 108 by the Plaintiff for the appointment of the R&M appear to be additional to the terms of the Judgment and beyond the ambit of winding up but extends also to general management of the Firm as well. I thus agree that such additional powers are unnecessary for being inconsistent with the objective of the appointment. As such I only allow prayers 1, 2 (a) and (c) but not (b), 3, 4, 5, 7, 8 and 9. I disallow prayer 2 (b) because it seeks to incorporate a Jadual A which was enclosed with the application, which contained a list of additional powers which encompass general management powers. [41] These included the power to undertake any business of the partnership (paragraph e) and to change the registered office of the Firm (paragraph k) and to employ and dismiss staff for the Firm (paragraph o). I find all these are either inconsistent with the purpose of appointment or in any event unnecessary as the terms of the Judgment have more than adequately set out the broad objective for the appointment. [42] I also decide against granting prayer 6 which sought to dispense with the need for the giving of security. The requirement for security is stated in Order 30 r 2 of the RC 2012. It reads:- 2. Giving of security by receiver (O. 30 r. 2) (1) Where a judgment is given, or order made, directing the appointment of a receiver, then, unless the judgment or order otherwise directs, a person shall Page 12 of 12 not be appointed receiver in accordance with the judgment or order until he has given security in accordance with this rule. [43] I see no basis to do away with the requirement of giving of security, and neither has the Plaintiff proffered any cogent reasons for its dispensation. I find it more imperative that the requirement for security be adhered to, in situations like the present, where the appointment is objected to by the First Defendant. Conclusion [44] In view of the foregoing reasons, the Plaintiff has successfully justified the need for the appointment of the proposed R&M, on account of not only the earlier Judgment, but also the various reasons discussed above. [45] As such I allow enclosure 108, apart from prayers 2(b) and 6, as stated earlier. Dated: 17 August 2017 (MOHD NAZLAN BIN MOHD GHAZALI) Judge High Court NCC1 Kuala Lumpur Counsel Counsel for Plaintiff Wan Zafran Messrs Wan Marican Hamzah & Shaik Kuala Lumpur Counsel for Defendant Wallace Wong Messrs Thomas Lai & Wallace Wong Kuala Lumpur

Tika 2.6.0

W-01(IM)-135-04/2017

PERAYU 1. SURUHANJAYA PILIHAN RAYA 2. DATUK SERI MOHD HASHIM BIN ABDULLAH 3. DATUK HAJI ABDUL GHANI BIN SALLEH … APPELLANTS RESPONDEN KERAJAAN NEGERI SELANGOR … RESPONDEN T

Discovery — Application for — Judicial review application to challenge proposed recommendations of Election Commission in relation to its review of division of federal and state constituencies in Selangor — Application for discovery of information and materials in relation to judicial review application — Application to cross-examine Chairman of Election Commission — Whether s 9A of the Elections Act 1958 ousts jurisdiction of court — Whether necessary to cross-examine Chairman of Election Commission — Whether application for discovery should be allowed

17/08/2017

YA DATO' ABDUL RAHMAN BIN SEBLIKorumYA DATUK SERI HAJI MOHD ZAWAWI BIN SALLEHYA DATO' ABDUL RAHMAN BIN SEBLIYA DATUK KAMARDIN BIN HASHIM

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=519472f2-a23b-4bba-a69c-21a5df973d2e&Inline=true

1 IN THE COURT OF APPEAL OF MALAYSIA (APPELLATE CIVIL JURISDICTION) CIVIL APPEAL NO: W-01(IM)-135-04/2017 BETWEEN 1. SURUHANJAYA PILIHAN RAYA 2. DATUK SERI MOHD HASHIM BIN ABDULLAH 3. DATUK HAJI ABDUL GHANI BIN SALLEH … APPELLANTS AND KERAJAAN NEGERI SELANGOR … RESPONDENT [Heard together with Appeal No: W-01(IM)-136-04/2017 BETWEEN KERAJAAN NEGERI SELANGOR … APPELLANT AND 1. SURUHANJAYA PILIHAN RAYA 2. DATUK SERI MOHD HASHIM BIN ABDULLAH 3. DATUK HAJI ABDUL GHANI BIN SALLEH … RESPONDENTS] CORAM MOHD ZAWAWI SALLEH, JCA ABDUL RAHMAN SEBLI, JCA KAMARDIN HASHIM, JCA JUDGMENT OF THE COURT Introduction [1] There were two appeals before us involving the same parties. The first appeal was by the Election Commission (1st appellant) and its Chairman (2nd appellant) and Secretary (3rd appellant) against the following order made by the High Court: 2 “Responden-Responden akan dalam masa 14 hari selepas penyampaian servis kepadanya Perintah ini untuk menzahirkan kod dan nama lokaliti dalam format “data base format of Microsoft Access” untuk 136,272 pengundi-pengundi yang dirujuk dalam perenggan 58 dan Ekshibit MAA-12 Afidavit Sokongan Pemohon yang diikrarkan oleh Mohamed Azmin bin Ali pada 18 Oktober 2016 (dibaca bersama Appendix 1 yang disimpan dalam cakera padat yang diberikan kepada parti-parti pada 16 Disember 2016) buat 2 latihan kajian semula persempadanan untuk Negeri-Negeri Tanah Melayu yang lepas iaitu 2003 dan 1994.” [2] It was an order to furnish the locality code and locality name of the 136,272 voters for the State of Selangor which the Election Commission used during the 2003 and 1994 delimitation exercises. [3] The second appeal was by the Government of the State of Selangor against the decision of the same court dismissing its application to cross- examine the Chairman of the Election Commission. [4] For convenience, we shall refer to the appellants in the first appeal collectively as “the Election Commission” and the appellant in the second appeal as “the Selangor Government”. [5] Having heard arguments by both sides, both written and oral, we unanimously allowed the Election Commission’s appeal and dismissed the Selangor Government’s appeal. We set aside the decision of the High Court allowing discovery of the locality code and locality name of the 136,272 voters and affirmed the decision to disallow cross examination of the Election Commission Chairman. No order for costs was made in respect of both appeals. We now provide the grounds for our decision. Facts of the case 3 [6] The facts are these. On 15.9.2016, the Election Commission published a notice under section 4 of the Thirteenth Schedule to the Federal Constitution (“the thirteenth schedule notice”) which set in motion the delimitation of constituencies in the States of Malaya as reviewed by the Election Commission in 2016. [7] On 18.10.2016, the Selangor Government filed an application for judicial review in the High Court at Kuala Lumpur praying, inter alia, for the following reliefs: (a) An order of certiorari to quash the thirteenth schedule notice published by the Election Commission; and (b) An order of mandamus to compel the Election Commission to publish a new thirteenth schedule notice and new proposed recommendations which comply inter alia with the Thirteenth Schedule to the Federal Constitution and to take into account the correct and updated addresses of the 136,272 voters in the State of Selangor where no addresses are stated. [8] The basis on which the above reliefs were sought was that the Election Commission acted contrary to law, unconstitutionally, unreasonably and irrationally when it carried out the 2016 delimitation exercise by using an electoral roll that was defective in that it did not contain the addresses of approximately 136,272 Selangor voters. This was expressed in Ground 7.3 of the Statement pursuant to Order 53 rule 3(2) of the Rules of Court 2012 (“the Rules”) (“the Order 53 Statement”) under the heading “GROUNDS”, which reads: 4 “7.3 used the electoral roll which is defective as approximately 136,272 voters in the State of Selangor shown on the electoral roll do not have their corresponding addresses entered on the roll.” (emphasis added) [9] In her written submissions before us, learned counsel for the Selangor Government summarized the above Ground 7.3 as follows: “22. Before we proceed, it is pertinent to summarise Ground 3 of the Applicant’s judicial review application: (i) the Election Commission does not possess the addresses of at least 136,272 voters in the State of Selangor; (ii) without the addresses, it is open for the Election Commission to arbitrarily assign, maintain or change constituencies of these 136,272 voters in the State of Selangor; (iii) such arbitrary assignment, maintenance or changing of constituencies for these 136,272 voters without addresses is tainted with illegality and cannot be used as a basis for the delimitation in the State of Selangor.” (emphasis added) [10] Grounds (ii) and (iii) reflect the Selangor Government’s suspicion that the Election Commission had not acted honestly in carrying out the 2016 delimitation exercise. Learned counsel stressed the point when she submitted at paragraph 24: “24. We submit that the correctness of the electoral roll is not an issue in this case – the heart of the matter is whether the EC could carry out the 2016 Delimitation Exercise when i) the addresses of up to 136,272 voters in the State of Selangor were missing and/or unknown and/or ii) there is a real possibility that the localities of these 136,272 voters in the State of Selangor have been incorrectly assigned.” (emphasis added) 5 [11] Paragraph 17 read with paragraphs 18 and 19 of the Selangor Government’s affidavit in support affirmed by Mohamed Azmin bin Ali on 13.1.2017 also emphasized on the missing addresses of the 136,272 voters when the Menteri Besar averred: “17. I have been advised and verily believe that as a body which collects and compiles voter information, and has conducted both delimitation exercises in 2003 and 1994, the Election Commission is in possession, custody or power of the Locality of 136,271 Voters for the Last 2 Delimitation Exercises. 18. It is thus imperative and in the interests of justice for this Honourable Court to know whether the localities of these 136,272 voters have changed in the last 2 delimitation exercises to make a determination on whether localities are indeed permanent and would not be changed (as alleged by the Respondents) or have been arbitrarily changed (as alleged by the Applicant). 19. Such finding would have a direct bearing on Ground 3 in this Application, whereby the issue is whether the Election Commission has used a flawed electoral roll with missing addresses (and consequently would result in and cause the arbitrary assignment of voters into localities, polling districts and constituencies) in the State of Selangor for the delimitation process.” (emphasis added) Premise of Selangor Government’s case [12] It is clear beyond peradventure that the whole premise of the Selangor Government’s pleaded case against the Election Commission is the missing addresses of the 136,272 voters from the electoral roll. It is the veracity of the electoral roll that the Selangor Government is challenging. [13] The contention was that without the voters’ addresses on the electoral roll, it was not possible for the Election Commission to carry out 6 the 2016 delimitation exercise. This is the substratum of the Selangor Government’s case against the Election Commission. This is the dispute that it wants the High Court to resolve at the substantive judicial review hearing. Its case must rest or fall on this pleaded ground. [14] What is pertinent to note with regard to Ground 7.3 of the Order 53 Statement is that it makes no mention of the locality code and locality name of the 136,272 voters that the Election Commission used in carrying out the 2003 and 1994 delimitation exercises. The non-availability of the locality code and locality name is clearly not a ground for impugning the 2016 delimitation exercise. [15] Ground 8 of the Order 53 Statement sums up the Selangor Government’s grievance over the publication of the thirteenth schedule notice, in the following words: “8. Given all the evidence, facts and circumstances of the case, the Election Commission has issued the Notice and the Proposed Recommendations unconstitutionally, unreasonably, irrationally and unfairly. Any other Election Commission similarly circumstanced would not have issued the Notice and the Proposed Recommendations.” [16] The application for leave was not opposed by the Election Commission and was duly granted by the Kuala Lumpur High Court on 16.12.2016. Discovery and cross-examination [17] Having obtained leave and before the substantive judicial review application was heard by the High Court, the Selangor Government vide notice of application dated 13.1.2017 applied for the following prayers for discovery: 7 “1(A)(i) the addresses in database format of Microsoft Access of the 136,272 voters referred to in paragraph 58 and Exhibit MAA-12 of the Applicant’s Affidavit in Support affirmed by Mohamed Azmin bin Ali on 18.10.2016 (read together with Appendix 1 stored in a compact disc which was handed to parties on 16.12.2016); 1(A)(ii) the voter registration documentation for all the 136,272 voters referred to in paragraph 58 and Exhibit MAA-12 of the Applicant’s Affidavit in Support affirmed by Mohamed Azmin bin Ali on 18.10.2016 (read together with Appendix 1 stored in a compact disc which was handed to parties on 16.12.2016), such as the Borang A referred to in Exhibit TF-1 of the Affidavit in Reply of Thomas Fann affirmed on 6.1.2017; 1(A)(iii) the locality code and locality name and database format of Microsoft Access of the 136,272 voters referred to in paragraph 58 and Exhibit MAA-12 of the Applicant’s Affidavit in Support affirmed by Mohamed Azmin bin Ali on 18.10.2016 (read together with Appendix 1 stored on a compact disc which was handed to parties on 16.12.2016) for the last 2 delimitation exercises for the States of Malaya i.e. 2003 and 1994; 1(B) all reports, minutes and documentation on the steps taken by the Election Commission to implement the recommendations and/or address the issues raised in the 2012 PSC Report, particularly Recommendations 10.5 to 10.7 and 11.1 to 11.3 as found in Exhibit MAA-14 of the Applicant’s Affidavit in Support affirmed by Mohamed Azmin bin Ali on 18.10.2016 (at pages 476-477); 1(C) the auditing trail of all voters in the State of Selangor in database format of Microsoft Access which would reflect all changes to voter information to date since registration to become a voter, including the reasons for any such change and when such change had occurred; and 1(D) a computer software application built by the Election Commission named the Electoral Geographical Information system used in the delimitation exercise for the State of Selangor.” (emphasis added) [18] In the same notice of application, the Selangor Government also applied to cross-examine the Chairman of the Election Commission on 8 the affidavit that he filed in opposing the application for judicial review, in terms of the following prayers: “(2) Further and/or in the alternatively, for the purpose above, that the Applicant be at liberty to cross-examine the 2nd Respondent upon the affidavit sworn by him and filed on 27.12.2016 by the Respondents for the purpose of being used as evidence at the hearing of the Applicant’s judicial review application herein; (3) That such cross-examination may be taken at the hearing of the Applicant’s judicial review application herein; (4) That the 2nd Respondent be ordered to attend to be cross-examined accordingly.” The High Court’s decision [19] The High Court delivered its decision on 21.4.2016. The learned judge only allowed prayer 1A(iii) i.e. discovery of the locality code and locality name of the 136,272 voters for the last two delimitation exercises, i.e. the delimitation exercises carried out in 2003 and 1994. The rest of the prayers, including the prayers for discovery of the addresses of the 136,272 Selangor voters and for cross-examination of the Election Commission Chairman were disallowed. Hence, the respective appeals by the Election Commission and the Selangor Government. Withdrawal of prayers and its effect [20] At the commencement of the hearing of these appeals on 20.7.2017, learned counsel for the Selangor Government informed us that the Selangor Government did not wish to proceed with its appeal against the dismissal of prayers 1A(i), 1A(ii), 1B, 1C and 1D but only wished to defend the learned judge’s decision in respect of prayer 1A(iii) which was granted in its favour, and to pursue its appeal against the decision to disallow cross-examination of the Election Commission Chairman. 9 [21] Prayer 1A(i), it will be recalled, was the prayer asking for discovery of the addresses of the 136,272 voters. This prayer was crucial and central to the application for judicial review as it relates to a matter that goes to the root of the Selangor Government’s case against the Election Commission, namely that the Election Commission acted unlawfully when it carried out the 2016 delimitation exercise by using an electoral roll that did not have the addresses of the 136,272 voters, as pleaded in Ground 7.3 of the Order 53 Statement (paragraph 8 above). [22] By abandoning its appeal in respect of prayer 1A(i), the Selangor Government must now be taken to accept that the addresses of the 136,272 voters are not necessary for the purposes of the substantive judicial review hearing. In other words, discovery of the addresses is not necessary. [23] If the addresses of the 136,272 voters are not required for purposes of the judicial review hearing, we do not see how it can be argued at the same hearing that they were necessary for purposes of the 2016 delimitation exercise. Thus, even if the High Court were to grant the order of mandamus to compel the Election Commission to publish a new thirteenth schedule notice and new proposed recommendations, it will not include an order to take into account the correct and updated addresses of the 136,272 voters. [24] If at all, the Election Commission will only be required to publish a new thirteenth schedule notice and new proposed recommendations, but minus the addresses of the 136,272 voters. 10 [25] In our opinion, the admission by the Selangor Government that the addresses of the 136,272 voters were not necessary for the 2016 delimitation exercise undermines the whole substratum of its case (as pleaded in Ground 7.3) that the 2016 delimitation exercise was unlawful for the reason that it was carried out using an electoral roll that did not contain the addresses of the 136,272 voters. It leaves Ground 7.3 of the Order 53 Statement without any leg to stand on. The issues and our determination [26] Given the stand now taken by the Selangor Government, there were only two issues left for our determination, namely: (1) Whether the High Court was right in allowing prayer 1A(iii); and (2) Whether the High Court was right in disallowing the cross- examination of the Chairman of the Election Commission. [27] We shall deal with issue (1) first. The locality code and locality name referred to in prayer 1A(iii) is the locality code and locality name of the 136,272 voters that the Election Commission used to carry out the last two delimitation exercises for the States of Malaya, i.e. the exercises carried out in 2003 and 1994; events that took place 14 years and 23 years ago respectively, with a gap of 9 years in between the two exercises. [28] A locality is a sub-unit of a polling district. Several polling districts then form a State Constituency. Several State Constituencies in turn form a Parliamentary Constituency. In the document titled “Portal Rasmi Suruhanjaya Pilihan Raya Malaysia” handed to us by learned counsel for 11 the Selangor Government during the course of argument, the following information is given with respect to a locality: “LOKALITI Lokaliti adalah komponen paling kecil yang terdapat dalam Bahagian Pilihan Raya. Ia merupakan tempat tinggal sekumpulan orang tempatan yang mempunyai talian sosial yang jelas seperti kampong atau taman perumahan. Dalam urusan pendaftaran pemilih, lokaliti adalah asas bagi menentukan di mana seorang pemilih akan mengundi. Penentuan tersebut adalah berdasarkan alamat yang dinyatakan dalam kad pengenalan.” (emphasis added) [29] A locality is therefore the basis for the Election Commission to determine the location where the elector is to cast his vote. To determine the locality of a voter, the Election Commission relies on his address at the point of registration, which it obtains from the voter’s identity card. According to the Election Commission, the addresses are not important and need not be in its possession because: (i) Voters have been accurately assigned their corresponding locality at the point of registration based on the addresses shown on their identity cards; (ii) It is the locality of the voters which is the reference point for the Election Commission to assign, maintain and change constituencies of such voters; and (iii) The localities of voters will not be changed, unless there is a change of address upon application made by the voters themselves. [30] What this means is that once a voter has been assigned a locality at the point of registration, it is not necessary for the Election Commission 12 to keep his address. The Selangor Government does not seriously dispute the Election Commission’s averment that the addresses are not important. What it disputes is the Election Commission’s explanation in (i), (ii) and (iii) above. [31] First, explanation (i) and (ii). According to learned counsel, this is not borne out in some cases and in fact admitted by the Election Commission upon being queried on the change of localities of a sample of 3 voters in the State of Selangor. We were referred to paragraph 16 of the Election Commission’s Affidavit in Reply No.2 where the deponent affirmed: “Saya nyatakan bahawa lokaliti telah diubah menurut peraturan 25(3) Peraturan-Peraturan Pilihan Raya (Pendaftaran Pemilih) 2002 kerana kesilapan pendaftaran menyebabkan ketiga-tiga orang diambil sebagai contoh didaftarkan di kawasan yang bukan kawasan pendaftarannya di atas permohonan pemilih tersebut.” [32] As for explanation (iii), it was pointed out that this is not accurate as evidenced by: (i) The change of localities of 23 voters in the Parliamentary Constituency of Klang (P110) due to vague reasons such as “dikeluarkan kerana silap pendataan” and “pembetulan lokaliti”. (ii) The change of localities of 180 voters were removed from the Parliamentary Constituency of Klang (P110) and 177 voters who were transferred to Kapar. (iii) Several other examples of voters in the State of Selangor whose localities have been changed without any change of addresses and application made by the voters themselves. 13 [33] The Selangor Government’s “dispute” is therefore over the question whether the voters’ localities had been accurately determined by the Election Commission. It was submitted that there is thus a material dispute of fact between the Selangor Government and the Election Commission that requires disclosure of the locality code and locality name of the 136,272 voters that the Election Commission used in carrying out the 2003 and 1994 delimitation exercises. [34] The question to ask in relation to this dispute vis-à-vis prayer 1A(iii) of the discovery application is whether the issues raised by learned counsel, in particular the mistakes that the Election Commission admitted to have made with regard to the change of localities of some of the voters, constitute serious disputes of fact that necessitated discovery of the locality code and locality name of the 136,272 voters that the Election Commission used in carrying out the 2003 and 1994 delimitation exercises. [35] It was submitted that they constitute material disputes of fact between the Selangor Government and the Election Commission and that the only way to resolve the disputes was by discovery of the locality code and locality name of the 136,272 voters used during the 2003 and 1994 delimitation exercises. [36] We were told that if the locality code and locality name of the 136,272 voters for the 2003 and 1994 delimitation exercises are presented before the court at the substantive hearing, the Selangor Government would be able to observe the change of localities of these voters from 1994 up to the present date to ascertain if there is any unusual 14 pattern, which can be evidence of arbitrary and unlawful assignment of constituencies, thus tainting the 2016 delimitation exercise. [37] We were also told that the localities of these voters from 1994 to date can also be cross-checked for their accuracy with the record of these voters kept at the National Registration Department, past electoral rolls and other sources. It was submitted that if the localities of this huge group of voters in the State of Selangor are shown to be incorrectly assigned, this would similarly taint the entire 2016 delimitation exercise. [38] It was submitted that the learned judge had correctly appreciated the relevance and importance of the locality code and locality name of the 136,272 voters for the last two delimitation exercises when His Lordship said: “[41] In my view, the locality codes for the addressless voters in the two previous redelimitation exercises would be valuable information that may prove or disprove either party’s contentions. For example, if the information on the locality of the addressless voters establishes that the localities have been correctly recorded by reference to the current records for that voter at the National Registration Department, then it could not be said that the redelimitation exercise was flawed by reason of reliance on an electoral roll that did not contain the addresses of the 136,272 voters. [42] Of course, the mere fact that a voter’s locality does not match his or her current address does not necessarily mean that the electoral roll is flawed, for the residency of a voter in the electoral roll is only changed if the voter makes an application to change his constituency. Nonetheless, if the locality code can be shown to have somehow been incorrectly recorded – whether by reason of the division of locality over time or otherwise – then the applicant’s case for review is made stronger. [43] I was therefore of the view that the discovery of the locality codes was necessary for the fair disposal of the substantive application.” (emphasis added) 15 [39] Learned counsel further submitted that the learned judge rightfully took into account the constitutional importance of the judicial review application when he took an expansive view of the documents: “[46] What is relevant and necessary for the fair disposal for the substantive application is to be ascertained from the surrounding circumstances of the case, including the nature of the proceedings: see para. 30, ante. In my view, if the challenge relates to a fundamental and constitutionally-guaranteed right, such as the right to vote, or the right to free and fair elections, the court would be entitled to take an expansive view of the documents would be necessary for the fair disposal of the challenge. This is an embodiment of the principle that the intensity of review in a public law case will depend on the subject matter at hand (per Laws LJ in R v. Secretary of State for the Home Department ex p. Mahmood). In the words of Lord Steyn, in law context is everything.” [40] The first thing to note with regard to the learned judge’s description of the 136,272 voters as being “addressless” is that it is factually wrong, and we say this with all due respect to the learned judge. The truth, as explained by the Election Commission, is that at the point of registration, the addresses of these 136,272 voters actually existed and were in fact taken from their identity cards, but once their localities were assigned, the Election Commission did not keep them as it was not necessary to do so. [41] As we have alluded to earlier, with the withdrawal of prayer 1A(i), the Selangor Government is deemed to accept that it is unnecessary for the Election Commission to furnish the addresses of the 136,272 voters. Further, the Election Commission has explained that the localities of the voters will not be changed, unless there are changes of address upon application made by the voters themselves. 16 [42] Most importantly, there is no evidence that any of the 136,272 voters had applied to change their localities. Therefore, the Selangor Government’s assertion that “there is a real possibility that the localities of these 136,272 voters in the State of Selangor have been incorrectly assigned” (see paragraph 10 above) is baseless. [43] At paragraph 41 of the grounds of judgment, the learned judge made references to the addresses of the 136,272 voters. It is obvious that the address factor weighed heavily in His Lordship’s mind. This is perfectly understandable as the learned judge was considering whether to grant prayer 1A(i), i.e. discovery of the addresses. [44] But with the withdrawal of prayer 1A(i) by the Selangor Government in these appeals, the issue of the missing addresses has become completely irrelevant. In our view, the effect of the withdrawal is to knock out Selangor Government’s pleaded case that the Election Commission acted contrary to law, unconstitutionally, unreasonably and irrationally when it carried out the 2016 delimitation exercise by using a defective electoral roll that did not contain the addresses of the 136,272 voters. This has to be so because the whole basis of the Selangor Government’s case against the Election Commission rests on the missing addresses, as pleaded in Ground 7.3 of the Order 53 Statement. Inconsistency of the respondent’s position [45] However, in spite of the abandonment of prayer 1A(i), learned counsel persisted in her argument that it was necessary for the Election Commission to have the addresses of the 136,272 voters to carry out the 2016 delimitation exercise. At one point in her argument, learned counsel candidly told us that the Selangor Government does not need the 17 addresses, but this is inconsistent with the main thrust of her argument, as can be seen from the following submissions before us: “We say you need the addresses to delimit. Refer to Jilid 2(a) page 233. They could not have done the delimitation exercise without the addresses. Refer to Article 119 of the Constitution – Tab 1 orange bundle. The right to vote is tied to your address. That is the document that they have destroyed. Refer to Jilid 2(a) page 99. Judge asked the question. We want to see whether the locality code has changed. Refer to the judge’s order – Bahagian A Jilid 1 page 16. Order No.1. We are not asking for the addresses. We only ask for the code for 2003 and 1994 for the 136,272 voters.” [46] In fact, it was strenuously argued that if the Election Commission were to deal only with locality and not the addresses, it would be relying on vague information which, according to learned counsel, would place the Selangor Government in the unenviable position of not knowing where exactly the 136,272 voters live. [47] Clearly, the focus of the argument was still on the missing addresses of the 136,272 voters, which was exactly how the case was presented in the High Court, as can be seen from learned counsel’s submissions at page 106 Jilid 2A of the Appeal Record: “No.2 My Lord, we are actually questioning the delimitation exercise. What we are saying is, they ought to base their delimitation exercise on the addresses. Not on the locality that you assigned ages ago and which may have changed and where we have shown there are errors. That’s the point we are making here. That… it is vital that you do that because as I’ve shown My Lord, when the population grows, localities can change. Addresses remain the same but you then know where to place them. So that’s why we say it is critical. So here My Lord, they are saying that you can’t question the roll. No.1, I disagree with that. But in any event My Lord, what we are saying here is you based your delimitation exercise on the wrong basis. That without addresses you cannot do this delimitation exercise.” (emphasis added) 18 [48] The third sentence above clearly suggests that the localities assigned to the 136,272 voters which the Election Commission used for the 2003 and 1994 delimitation exercises were not needed for the 2016 exercise. To drive home the point that the right to vote is tied to the addresses of the voters, we were referred to Article 119 of the Federal Constitution. [49] But this position has been overtaken by events and is history with the withdrawal of prayer 1A(i). It is therefore not open to the Selangor Government to now resurrect the issue of missing addresses. The position is no longer tenable. The Selangor Government’s position after the withdrawal of prayer 1A(i) is the same as if it had never applied for discovery of the addresses of the 136,272 voters. The factual basis on which Ground 7.3 of the Order 53 Statement is based is gone. [50] It is abundantly clear that the Selangor Government’s case now and then was that the impugned 2016 delimitation exercise was unlawful for only one reason, and that is, the electoral roll did not have the addresses of the 137,272 voters. [51] Now that the missing addresses of the 136,272 voters is no longer relevant and no longer needed for the substantive hearing, we do not think it is permissible for the Selangor Government to blow fire and ice over the issue, in one breadth accepting that the addresses were not necessary for the 2016 delimitation exercise, yet in the next saying that they were needed to carry out the exercise. 19 [52] For the same reason, the Selangor Government cannot now be heard to say that the High Court was right in allowing for discovery of the locality code and locality name of the 136,272 voters, given the fact that the locality code and locality name of the 136,272 voters is tied to the addresses of these voters which, as explained by the Election Commission, were obtained from their identity cards at the point of registration and which were then used to determine their localities. [53] If, as implicitly admitted by the Selangor Government that the addresses are not necessary for purposes of the judicial review application (and by extension the 2016 delimitation exercise itself), then the fact that the addresses were not on the electoral roll cannot now be used as a ground to say that the 2016 delimitation exercise was not carried out in accordance with the law. The real issue in dispute [54] It is important to always keep in mind that the real dispute between the Selangor Government and the Election Commission is over the missing addresses of the 136,272 voters. This, we reiterate, is the factual ground on which the Selangor Government sought to quash the thirteenth schedule notice published by the Election Commission, as contained in Ground 7.3 of the Order 53 Statement. None of the other pleaded grounds has the same importance and impact as the issue of the missing addresses. [55] The missing addresses is the core issue and the whole basis for the Selangor Government’s case against the Election Commission. It must not be blurred by learned counsel’s statement from the bar table that what the Selangor Government needs now is only the locality code and locality 20 name of the 136,272 voters that the Election Commission used during the 2003 and 1994 delimitation exercise, and not their addresses. [56] On the facts and the pleaded case, there can be no argument that the Selangor Government relied entirely on the missing addresses to support prayer 1A(iii), i.e. for discovery of the locality code and locality name of the 136,272 voters that the Election Commission used for the 2003 and 1994 delimitation exercises. [57] In the course of the hearing of these appeals and as the argument turned on the locality code and locality name of the 136,272 voters, the learned Senior Federal Counsel Dato’ Amarjeet Singh informed the court that the Election Commission does not have the locality code for the 2003 and 1994 delimitation exercises. [58] This, according to Dato’ Amarjeet Singh, was due to the fact that the 1994 electoral roll does not exist today. We were referred to Regulation 10 of the Elections (Registration of Electors) Regulations 2002 (“the Elections Regulations”) which stipulates that the electoral roll must be revised every three months. It is an ongoing process. We reproduce below the provisions of Regulation 10: “10. (1) The electoral roll prepared under the Elections (Registration of Electors) Regulations 1971 [P.U. 326/1971], the Elections (Registration of Electors) Regulations (Sarawak) 1971 [P.U. (A) 327/1971] and the Elections (Registration of Electors) (Sabah) 1971 [P.U. (A) 328/1971] and certified by the Election Commission on or before 31 December 2001 become the principal electoral roll under these Regulations. (2) For the purposes of revision, the Registrar shall, every three months, prepare a list of the names of electors from the principal electoral roll who have died or have become 21 disqualified for registration and the Registrar shall update the principal electoral roll by deleting the names of electors who have died or have become disqualified for registration.” [59] Learned counsel for the Selangor Government took issue with this statement from the bar table by the learned Senior Federal Counsel and insisted that the assertion must be averred to by way of affidavit evidence. We have pondered over the matter and we do not think it is necessary for the Election Commission to affirm an affidavit to confirm what the learned Senior Federal Counsel told the court. [60] In the first place, the real issue in the judicial review application is the effect in law of the Election Commission’s act of using an electoral roll that did not contain the addresses of the 136,272 voters, as pleaded in Ground 7.3 of the Order 53 Statement. The issue concerning the 2003 and 1994 locality code and locality name of the voters was an issue that was raised for the first time in the course of the exchange of affidavits between the parties. It is certainly not the ground on which the Selangor Government’s case is based to challenge the legality of the 2016 delimitation exercise. [61] Secondly, the learned Senior Federal Counsel’s explanation on the non-availability of the locality code is reasonable and consistent with what Regulation 10 of the Elections Regulations stipulates. There is no reasonable ground for believing that there has been a breach of public duty on the part of the Election Commission in failing to keep the locality code. We venture to say that it is unreasonable to expect the Election Commission to keep an electoral roll and locality code that were used for the delimitation exercises carried out decades ago. 22 The law and legal principles applicable [62] As for the applicable law on discovery in a judicial review application, Order 53 rule 6 of the Rules, which empowers the court to grant discovery (and cross-examination) in such application, is couched in the following language: “After leave has been granted, any party to an application for judicial review may apply to the Judge for discovery and inspection of documents pursuant to Order 24, to administer interrogatories pursuant to Order 26, or to cross examine the deponent of any affidavit filed in support of or in opposition to the application pursuant to Order 38.” [63] Order 24 referred to in Order 53 rule 6 above, of which rules 12 and 13 are directly relevant, stipulates as follows: Order 24 “Order for production to Court (O. 24, r. 12) 12. (1) At any stage of the proceedings in any cause or matter the Court may, subject to rule 13(1), order any party to produce to the Court any document in his possession, custody or power relating to any matter in question in the cause or matter that falls within one of the following descriptions: (a) Documents on which the party relies or will rely; (b) Documents which could – (i) adversely affect a party’s case; or (ii) support a party’s case; and (c) documents which may lead to a series of enquiry resulting in the obtaining of information which may – (i) adversely affect a party’s case; or (ii) support a party’s case. (2) The Court may deal with the documents when produced in pursuance of an order made under paragraph (1) in such manner as it thinks fit. 23 Production to be ordered only if necessary (O. 24, r. 13) 13. (1) An order for the production of any documents for inspection or to the Court shall not be made under any of the foregoing rules unless the Court is of the opinion that the order is necessary either for disposing fairly of the cause or matter or for saving costs.” (emphasis added) [64] The legal principles upon which discovery can be ordered in judicial review proceedings had been explained by this Court in Rekapacific Bhd v Securities Commission & Anor and Other Appeals [2005] 2 MLJ 269 where Gopal Sri Ram JCA (as he then was) delivering the judgment of the Court noted that the current practice in England after the amendment to their Order 53 is set out at pages 254-257 of Richard Gordon’s work Judicial Review and Crown Office Practice, which he described as the locus classicus on the subject. He then quoted (in extenso) the following observations by the learned author: “Discovery and inspection Parties seeking discovery and inspection may experience more difficulty than in an ordinary action, notwithstanding the incorporation of O 24 into judicial review proceedings. Whereas in most actions discovery occurs automatically under O 24, rr 1 and 2 there is no inherent right, in applications for judicial review, to orders for discovery or inspection. The retention of control by the court may indicate that such orders will be more difficult to obtain in cases under O 53. Certainly this was the view of the Court of Appeal in R v Secretary of State for the Home office, ex p Harrison (unreported, 10 December 1987) where it was stated that an application for judicial review discovery would be appropriate in fewer cases and was likely to be more circumscribed. In general, the following principles appear to govern the grant or refusal of discovery under O 53: 24 (a) Discovery will not be ordered so as to make good defects in the applicant’s evidence (R v Inland Revenue Commissioners, ex p Taylor [1988] 1 COD 61; R v Secretary of State for Education, ex p J [1993] 1 COD 146; R v Inland Revenue Commissioners, ex p National Federation of Small Employed and Small Businesses Ltd [1982] AC 617 at p 635H). (b) One will seldom obtain full private law type discovery in a Wednesbury challenge (R v Secretary of State for the Environment, ex p Smith [1988] COD 3). (c) By contrast, discovery will be ordered under O 53 where it is required so that the justice of the case may be advanced and where it is necessary for disposing fairly of the matter (within the meaning of O 24 r 8) (see R v Inland Revenue Commissioners, ex p J Rothchild Holdings Plc [1987] 1 DSTC 163; R v Governor of Pentonville Prison, ex p Herbage (No 2) [1987] 1 QB 1077). (d) Discovery will also be ordered to go behind the contents of affidavits if there was some matter before the court which suggested that the contents of the affidavits were not accurate (Re H, The Guardian, 17 May 1990). By contrast, discovery will not be ordered where there is no reason to doubt the bona fides or accuracy of the reasons given on affidavit (see R v Secretary of State for the Environment, ex p Islington LBC [1992] COD 67; R v Secretary of State for Health, ex p LB of Hackney [1994] 1 COD 432). The most authoritative pronouncement remains that of Lord Scarman in Inland Revenue Commissioners v National Federation of Self-Employed and Small Businesses Ltd [1982] AC 617 at p 654. In relation to discovery under O 53 he indicated that:… Upon general principles, discovery should not be ordered unless and until the court is satisfied that the evidence reveals reasonable grounds for believing that there has been a breach of public duty; and it should be limited strictly to documents relevant to the issue which emerges from the affidavits. The second limb of this statement is unexceptionable. It is a guiding rule that discovery and inspection must be restricted to matters relevant to an existing dispute. Indeed, in judicial review proceedings it has been held that discovery must be central to the application (see R v Secretary of State for the Home Department, ex p Benson [1989] COD 329). It is, however, questionable whether, as a preliminary requirement, the court must attempt an evaluation of merits. Interlocutory relief will be granted only after leave has been given to apply for judicial review. In that sense therefore an applicant seeking discovery has, ex hypothesi, an arguable case for asserting a breach of public duty. In 25 R v Secretary of State for Transport, ex p ABH Road Safety Ltd [1993] COD 150, Schiemann J left open the possibility that, in an appropriate case, the grant of leave in judicial review may sometimes be taken to establish a prima facie ground of irrationality, thereby justifying an order for discovery. Certainly, following the grant of leave, it is difficult to see what else the court can do when considering discovery/inspection beyond determining whether potentially discoverable documents are relevant to the issues between the parties. Given the two-stage procedure under O 53 it may be that Lord Scarman was merely emphasizing the overall hurdles to be surmounted before discovery could become available. Even if these hurdles are surmounted the doctrine of public interest immunity would appear to have more scope, having regard to the nature of the judicial review, as a means of opposing an order for discovery in O 53 proceedings.” (emphasis added) [65] As for the elements required to be shown for the grant of an order for discovery, the then Supreme Court in Yekambaran Marimuthu v Malayawata Steel Berhad [1994] 2 CLJ 581 through Edgar Joseph Jr SCJ had this to say: “The essential elements for an order for discovery are threefold; namely, first there must be a “document”, secondly, the document must be “relevant” and thirdly, the document must be or have been in the “possession, custody or power” of the party against whom the order for discovery is sought. It is indisputable, that the items of which discovery is sought are documents and they are in the possession, custody or power of the defendant and nothing more need be said about this. As to “relevance”, our Rules of the High Court limit discovery to documents which are “relevant to” or “relate” to the factual issues in dispute. More particularly, the discovery obligation applies to documents “relating to matters in question in the action” [Rules of the High Court, O. 24, r. 1(1) or “relating to any matter in 26 question in the cause or matter” [O. 24 r. 3(1)]. In practice, the relevance is primarily determined by reference to the pleadings but there need not be a pleading for a matter to be said to be in issue. (See Phillips v. Phillips [1879] 40 LT 815, 821).” (emphasis added) Application of the law to the facts [66] Juxtaposed with the facts of the present case, how does the law fit in to favour the Selangor Government’s prayer for discovery of the locality code and locality name of the 136,272 voters that the Election Commission used for the 2003 and 1994 delimitation exercises? [67] At the risk of being repetitive, we must first of all reiterate that the main issue before the court is whether the Election Commission acted unlawfully when it carried out the 2016 delimitation exercise (not the 2003 and 1994 exercises) by using an electoral roll that did not have the addresses of the 136,272 voters. [68] In this regard, it is important to bear in mind that the Selangor Government’s pleaded case was never about the non-availability of the locality code and locality name of voters used during the 2003 and 1994 delimitation exercises. It was also never the Selangor Government’s pleaded case that the 2016 delimitation exercise was unlawful because the electoral roll did not contain the locality code and locality name of the 136,272 voters used during the 2003 and 1994 delimitation exercises. The Selangor Government’s case all along has only been about the missing addresses on the electoral roll that was used during the 2016 delimitation exercise. [69] The electoral roll with the missing addresses of the 136,272 voters used during the 2016 delimitation exercise is the real dispute between the 27 Selangor Government and the Election Commission, as pleaded in Ground 7.3 of the Order 53 Statement. We must not be sidetracked by side issues. For ease of reference, we reproduce again Ground 7.3 of the Order 53 Statement: “7.3 used the electoral roll which is defective as approximately 136,272 voters in the State of Selangor shown on the electoral roll do not have their corresponding addresses entered on the roll.” [70] Necessity and not fairness is the prime concern of the court in an application for discovery: See Nguang Chan aka Nguang Chan Liquor Trader & Ors v Hai-O Enterprise Bhd & Ors [2009] 5 MLJ 40 where this Court held as follows: “The test is necessity not fairness and it is for the applicant to satisfy the court, see Dolling- Baker’s case and Ventouris v Mountain. Because of that erroneous premise the learned judge appears to be more concerned with relevance and fairness and omitted to consider whether and why it was necessary for the order to be made. If necessity is not the prime concern of the court, allowing discovery would tantamount to allowing the respondents to fish for evidence which defeats the purpose of the rule by causing the appellants to suffer unfair disadvantage if they fail to comply with an order which is oppressive and incapable of compliance – see Taylor v Anderton and Leslie S Holmes.” [71] To entitle the Selangor Government to an order for discovery of the locality code and locality name of the 136,272 voters, it must be shown that there are essentially or fundamentally important questions of fact that are in serious dispute, as decided in Rekapacific (supra). This is what Gopal Sri Ram JCA (as he then was) said in this regard: 28 “The second point that needs to be made – and made quite emphatically – is that it is only in very rare cases that either cross-examination or discovery or both should be permitted in judicial review proceedings. This is because questions of fact are rarely in dispute in judicial review proceedings. Of course, if there are any essential or fundamentally important questions of fact that are in serious dispute then the judicial review court would be entirely justified in ordering cross-examination to enable it to make the relevant finding of fact.” (emphasis added) [72] The question that called for our consideration was whether there is any essentially and fundamentally serious question of fact that is in serious dispute between the Selangor Government and the Election Commission in relation to the 2016 delimitation exercise that warrants discovery of the documents sought for in prayer 1A(iii). From the Selangor Government’s perspective and pleaded case, the dispute is over the missing addresses of the 136,272 Selangor voters from the electoral roll. [73] We must say at the outset that the missing addresses does not even qualify as a dispute, let alone a serious dispute on an essentially and fundamentally important question of fact that warrants discovery of the locality code and locality name of the 136,272 voters that the Election Commission used in carrying out the 2003 and 1994 delimitation exercises. [74] In the first place, the addresses are not in the Election Commission’s possession and the Selangor Government itself has confirmed that it does not need the addresses for the substantive hearing. It is therefore futile to argue that the locality code and locality name of the voters used during the 2003 and 1994 delimitation exercises would provide valuable 29 information that may prove or disprove either party’s contentions at the substantive hearing. [75] Consequently, it was and still is unnecessary for an order of discovery to be made in respect of the locality code and locality name that was used more than 20 years ago. The only issue before the High Court at the substantive hearing would be whether, without the locality code and locality name of the voters used during the 2003 and 1994 delimitation exercises, the 2016 delimitation exercise had been rendered unlawful when Election Commission used an electoral roll that did not have the addresses of the 136,272 voters. [76] Secondly, the locality code and locality name of the 136,272 voters that the Election Commission used to carry out the 2003 and 1994 delimitation exercises is already out of the Election Commission’s possession and it has not been shown that the Election Commission is required by law to keep the locality code and locality name after the 136,272 voters had been assigned their localities at the point of registration. [77] In Kerajaan Negeri Kelantan v Petroliam Nasional Berhad and other appeals [2014] 6 MLJ 31, the Federal Court held that the underlying principle which underscores the discovery process is that it must be predicated on the issues involved in a particular case. In the present case, the application for discovery of the locality code and locality name was clearly not predicated on the issue involved, which is whether the missing addresses had tainted the 2016 delimitation exercise, given that the prayer for discovery of the addresses of the 136,272 voters had been withdrawn. 30 [78] The law further requires that the documents sought to be discovered must be in the other party’s possession before an order for discovery can be issued: Yekambaran Marimuthu (supra at paragraph 65). Since the locality code and locality name for the 2003 and 1994 delimitation exercises is not in the Election Commission’s possession, the High Court was in no position in any event to allow prayer 1A(iii), which was to compel the Election Commission to furnish the locality code and locality name for purposes of the substantive judicial review hearing. [79] To recapitulate, the missing addresses of the 136,272 voters on the electoral roll is a non-issue with the withdrawal of prayer 1A(i), the Election Commission does not have the locality code and locality name used for the 2003 and 1994 delimitation exercises, and the Election Commission has admitted that there are mistakes in the change of localities in some cases. [80] The question to ask is whether these complaints constitute disputes of fact, and if so whether they can only be resolved by way of discovery of the locality code and locality name used during the 2003 and 1994 delimitation exercises. We do not think so. In our view all these are not disputes of fact, let alone serious disputes on essentially and fundamentally important questions of fact. Surely, facts that are not in dispute cannot constitute facts in dispute. This is to state the obvious. [81] There is therefore nothing for the court to resolve by way of discovery as the addresses of the 136,272 voters are not needed, the locality code and locality name of the 136,272 voters used for the 2003 and 1994 delimitation exercises is not in the Election Commission’s 31 possession, and mistakes in changing the localities of some of the voters had been admitted by the Election Commission. [82] Given the factual matrix of the case, all that the High Court needs to resolve at the substantive hearing is purely a question of law, i.e. whether the application for judicial review ought to be allowed on the ground that the Election Commission acted contrary to law, unconstitutionally, unreasonably and irrationally when it carried out the 2016 delimitation exercise by using an electoral roll that was defective in that it did not contain the addresses of the 136,272 Selangor voters. The application for cross-examination [83] As for the application to cross examine the Chairman of the Election Commission, the principles applicable are the same as those that are applicable in an application for discovery: Rekapacific (supra). Cross- examination of deponents of affidavits in judicial review applications are seldom allowed for reasons stated by Lord Diplock in O’Reily v Mackman [1983] 2 AC 237 at page 282: “…and to applications for cross-examination of deponents to affidavits Ord. 28, r. 2(3) applies. This is the rule that deals with evidence in actions begun by originating summons and permits oral cross-examination on affidavit evidence wherever the justice of the case requires. It may well be that for the reasons given by Lord Denning M.R. in George v Secretary of State for the Environment (1979) 77 L.G.R. 689, it will be upon rare occasions that the interest of justice will require that leave be given for cross-examination of deponents on their affidavits in applications for judicial review. This is because of the nature of the issues that normally arise upon judicial review. The facts, except where the claim that a decision was invalid on the ground that the statutory tribunal or public authority that made the decision failed to comply with the procedure prescribed under the legislation under which it was acting or failed to observe the fundamental rules of natural justice or fairness, can seldom be a matter of relevant dispute upon an application for judicial review, 32 since the tribunal or authority’s findings of fact, as distinguished from the legal consequences of the facts that they have found, are not open to review by the court in the exercise of its supervisory powers…” [84] The application to cross-examine must satisfy the three primary considerations as set out by this Court in Tetuan Kumar Jaspal Quah & Aisha (suing as a firm) v The Co-operative Central Bank Ltd [2007] 4 MLJ 638: “Firstly, the truth of the averment in the affidavit must be challenged or the issues of fact identified. Secondly, cross-examination should only be allowed if the disputed fact is relevant to the issue to be decided and must be limited to that issue only. And thirdly, cross- examination would not advance the cause of justice and should be refused if there is sufficient evidence or contemporaneous documents to enable the court to properly decide without the need for cross-examination.” [85] All three conditions must be satisfied cumulatively and not alternatively: Tun Dr Mahathir bin Mohamad & Ors v Datuk Seri Mohd Najib bin Tun Haji Abdul Razak [2016] 11 MLJ 1, per Abu Bakar Jais J. In Paruvathy a/p Palany v Sathiasealan a/l Govindasamy [1999] 5 MLJ 151, Abdul Malik Ishak J (as he then was) held as follows: “Of pertinence to note would be the principle of law gleaned from the case of Shea v Green [1886] 2 TLR 533 which states that the court may refuse to act on an affidavit where the deponent cannot be cross-examined. Then there is the principle of law which states that where there is a question of motive or of good faith of a deponent, the court ought not to be asked to act without cross-examination (Re Smith and Fawcett Ltd [1942] Ch 304). The court certainly has a discretion to allow a party to cross-examine a deponent. Chan Sek Keong J in Tang Choon Keng Realty (Pte) Ltd & Ors v Tang Wee Cheng [1992] 2 SLR 1114 succinctly said at p 1142 of the report that ‘… in an action tried on affidavits a party who has sworn an affidavit may be subject to being cross-examined on it.” 33 [86] Allegations of bad faith on the part of the decision maker may also have to be investigated by cross-examination: See Judicial Remedies in Public Law (5th Edition) by Clive Lewis at page 363. [87] The Selangor Government’s complaint against the Election Commission was over the destruction of the addresses and voter registration documentation of the 136,272 voters. It was submitted that it was improper for the Election Commission to have done so. [88] It was pointed out that there is a grave inconsistency in the Election Commission’s averment that the documents had been destroyed, as the following would show: (1) The Election Commission’s Sistem Semakan Isi Rumah itself clearly suggests that voters can check their addresses online and even apply to change their addresses if there is any error. Learned counsel questioned how this would be possible if the Election Commission now states that it had destroyed the addresses of all voters who registered prior to 2002 before the migration to the computer system, which includes the 136,272 voters; (2) The Sistem Semakan Isi Rumah to date contains the addresses of voters registered before the migration to the computer system in 2002; (3) The Election Commission previously averred that it does possess at least some of the addresses of voters registered before the migration to the computer system in 2002. It was pointed out that the Election Commission appears to have adopted a completely 34 different position now by making a blanket statement that all the addresses pre-2002 had been destroyed; and (4) The Election Commission itself averred that “…sebelum seseorang itu boleh didaftarkan sebagai pemilih, ia akan melalui proses ketat dengan mempamerkan nama-nama dan alamat yang diberikan oleh pemilih-pemilih tersebut sendiri untuk maksud bantahan oleh pihak-pihak berkenaan”. According to learned counsel, it would be very unusual if the Election Commission does not possess documentation of a process that it deems so stringent. [89] Reference was made to the following passages in R (Quark Fishing Ltd) v Secretary of State for Foreign Affairs and Commonwealth Affairs [2002] EWCA Civ 1409: “50. Mr Parker submits, correctly, that there is no duty of general disclosure in judicial review proceedings. However there is – of course- a very high duty on public authority respondents, not least central government, to assist the court with full and accurate explanations of all the facts relevant to the issue the court must decide. The real question here is whether in the evidence put forward on his behalf the Secretary of State has given a true and comprehensive account of the way the relevant decisions in the case were arrived at. If the court has not been given a true and comprehensive account, but has had to tease the truth out of late discovery, it may be appropriate to draw inferences against the Secretary of State upon points which remain obscure: see Padfield [1968] AC 997, per Lord UpJohn at 1061G – 1062A.” (emphasis added) [90] It was argued that the Election Commission must keep all the historical records or addresses of the voters and that it was incumbent on them to retain copies of the addresses. It was alleged that the Election Commission was not forthcoming on this vital information. 35 [91] It was further contended that if the Election Commission fails to answer these questions, then this would provide the basis for the Selangor Government’s application to cross-examine the Chairman of the Election Commission in connection with the destruction of the documents. [92] Learned counsel went on to submit that from the evidence filed, it is clear that there are several disputes of fact warranting resolution by cross- examination of the Election Commission Chairman. Such disputes of fact include: (1) Why, when and how did the Election Commission destroy information as important as the addresses of at least 136,272 voters in the State of Selangor and whether they nonetheless maintained in other formats and where it is stored; and (2) Whether the localities of voters have been arbitrarily changed by the Election Commission without any change of addresses or application being made by the voters themselves, and the extent of such discrepancy. [93] It was submitted that these issues revolve around the question whether the Election Commission had conducted itself in good faith or had acted mala fide in the exercise of its power, which is a strong consideration for allowing cross-examination in a judicial review. [94] What is clear from the argument is that the application to cross- examine the Election Commission Chairman is grounded on the missing addresses of the 136,272 voters, the same ground that it relied on in applying for discovery of the locality code and locality name of the voters. 36 We have said enough on the address issue when dealing with the application for discovery and we do not propose to repeat them, save to say that having regard to the principles applicable, the learned judge was right in disallowing the prayer for cross-examination. The exercise of discretion [95] In deciding the way we did, we were mindful of the fact that these appeals concern the exercise of a discretion by the learned judge. It was urged upon us by learned counsel not to disturb the High Court’s decision as it is trite law that an appellate court would be slow to interfere with the discretion of the judge of first instance, especially with regard to interlocutory matters. Reliance was placed on ECM Libra Investment Bank Bhd v Foo Ai Meng & Ors [2013] 3 MLJ 35 where this Court held: “(a) it is well settled that the appellate court will not ordinarily interfere with the exercise of discretion of a trial court in relation to procedural and/or interlocutory matters (see Davy v Garrett (1878) 7 Ch D 473); (b) the appeal relates to an interlocutory procedural order and exercise of discretion. It is well settled that in an appeal against the exercise of discretion by a judge, the initial function of the appellate court is one of review only, there being no original discretion vested in the appellate court. It is for the appellant to demonstrate that an error in the exercise of discretion has indeed occurred and it is also one of the categories of cases where appellate interference is warranted (see Wah Bee Construction Engineering v Pembenaan Fungsi Baik Sdn Bhd [1996] 3 CLJ 858; Majlis Peguam Malaysia & Ors v Raja Segaran a/l S Krishnan [2002] 3 MLJ 155);” [96] The correct approach to be adopted by an appellate court in dealing with the exercise of such discretion has been explained by Lord Guest delivering the judgment of the Privy Council in Ratnam v Cumarasamy & Anor [1964] 1 LNS 237; [1965] 1 MLJ 228, a decision on appeal from Malaysia, in the following terms at page 229: 37 “The principles upon which a court will act in reviewing the discretion exercised by a lower court are well settled. There is a presumption that the judge has rightly exercised his discretion (Charles Osenton & Co. v Johnston per Lord Wright at 148). The court will not interfere unless it is clearly satisfied that the discretion has been exercised on a wrong principle and should have been exercised in a contrary way or that there has been a miscarriage of justice (Evans v. Bartlam).” [97] There are, therefore, two situations where the exercise of the discretion can be assailed on appeal: (a) Where the discretion has been exercised on a wrong principle and should have been exercised in a contrary way; or (b) Where there has been a miscarriage of justice occasioned by the exercise of the discretion. [98] Other than these two situations, the exercise of the discretion must not ordinarily be disturbed on appeal as the presumption is that the judge has rightly exercised his discretion. For reasons that we have given, and with due respect to the learned judge, we were of the view that he had acted on a wrong principle in allowing the Selangor Government’s application for discovery of the locality code and locality name that was used for the 2003 and 1994 delimitation exercises. 38 Conclusion [99] It was for all these reasons that we allowed the appeal by the Election Commission and dismissed the appeal by the Selangor Government. ABDUL RAHMAN SEBLI Judge Court of Appeal Malaysia Dated: 17 August 2017. For the Election Commission: Dato’ Amarjeet Singh a/l Serjit Singh, Alice Loke Yee Ching, Azizan bin Md Arshad, Nik Azrin Zairin binti Nik Abdullah, Shaiful Nizam bin Shahrin, Senior Federal Counsel of the Attorney General’s Chambers. For the Selangor Government: Dato’ Ambiga Sreenevasan, Derek Fernandez, Latheefa Koya, Lim Wei Jiet, Shahid Adli of Messrs Daim & Gamany. Watching Brief for the Bar Council: Andrew Khoo Chin Hock.

Tika 2.6.0

02(f)-91-12/2015

PERAYU 1. Thai–Lao Lignite Co. Ltd 2. Hongsa Lignite Co. Ltd ... APPELLANTS RESPONDEN Government of the Lao People’s Democratic Republic ... RESPONDEN T

Reported in [2017] 9 CLJ 273 ARBITRATION: Agreement - Construction - Subject matter of arbitration - Two separate contracts - Whether matters arising under one contract could be arbitrated in arbitration proceeding of the other - Judicial seat for arbitration - Whether indicative of applicable or governing law - Arbitration Act 2005 [Act 646], ss. 18(3), 18(5), 37 ARBITRATION: Arbitral award - Setting aside - International arbitration -Jurisdiction of arbitration tribunal - Challenge to jurisdiction - Whether made 'out of time' - Challenge to status and standing of parties in arbitration - Whether simultaneously raising procedural issue of whether arbitrator had jurisdiction - Arbitration Act 2005, s. 18(3) ARBITRATION: Arbitral award - Setting aside - International arbitration - Application of correct law governing arbitration agreement - UNCITRAL Rules - Proper approach - Whether to be determined by conflict of laws rules - Whether governing law to follow contract - Whether to follow law governing seat - Arbitration Act 2005, ss. 18(3), 18(5), 37

17/08/2017

YA TAN SRI JEFFREY TAN KOK WHA KorumYA TAN SRI HASAN BIN LAHYA TAN SRI DATUK RAMLY BIN HAJI ALIYAA TAN SRI ZAHARAH BINTI IBRAHIMYA DATO' BALIA YUSOF BIN HAJI WAHIYA TAN SRI JEFFREY TAN KOK WHA

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=a8447da0-514f-4647-a48b-73753e2545a9&Inline=true

kjhggjj 1 FC-02(f)-91-12/2015 IN THE FEDERAL COURT OF MALAYSIA AT PUTRAJAYA CIVIL APPEAL NO. 02(f)-91-12/2015 BETWEEN 1. Thai–Lao Lignite Co. Ltd 2. Hongsa Lignite Co. Ltd ... APPELLANTS AND Government of the Lao People’s Democratic Republic ... RESPONDENT CORAM: Hasan Lah FCJ Ramly Ali FCJ Zaharah Ibrahim FCJ Balia Yusoff FCJ Jeffrey Tan FCJ JUDGMENT OF THE COURT Introduction 1. This is an appeal against the setting aside, by the High Court, of an international arbitral award (award) of US56.21m obtained by the Appellants (hereinafter referred to as Appellants). The Appellants appealed but were unsuccessful at the Court of 2 FC-02(f)-91-12/2015 Appeal. The Appellants applied and were granted leave to raise the following questions of law before this Court: (i) Where the governing law of the contract is foreign law and the seat of arbitration [seat] is Malaysia, does the parties’ stipulation of Malaysia as the seat constitute an express agreement that the law governing the arbitration agreement is Malaysian law? (ii) Whether a party to an arbitration can properly obtain an order to set aside the award on the ground that the arbitral tribunal had no jurisdiction when that party has brought a counterclaim in that arbitration seeking positive relief against a non- signatory to the arbitration agreement? (iii) Whether a party to an arbitration can properly obtain an order to set aside the award on the ground that the arbitral tribunal had no jurisdiction when that party has brought a counterclaim in that arbitration seeking positive relief based on contracts other than the contract containing the arbitration agreement? (iv) Whether matters which a party in an arbitration has required the tribunal to decide on, and which have been determined on the merits, fall within the scope of submission to arbitration which thereby precludes that party’s subsequent challenge that the arbitral tribunal had no jurisdiction? (v) Whether a party to an arbitration who challenges the ‘standing’ of a non-signatory to the arbitration agreement to assert claims in the arbitration, has properly challenged the jurisdiction of the arbitral tribunal within the meaning of section 18(3) of the Arbitration Act 2005, and preserved its right to seek to set aside the award on jurisdictional grounds? 3 FC-02(f)-91-12/2015 (vi) Whether a party to an arbitration can properly obtain an order to set aside the award on the ground that the arbitral tribunal had no jurisdiction on matters which fell within the arbitral tribunal’s interpretation of the contract? 2. The Respondent is the Government of the Lao People’s Democratic Republic (hereinafter referred to as the Respondent). The 1stAppellant, Thai-Lao Lignite Co Ltd (TLL), is a Thai company. The 2nd Appellant, Hongsa Lignite Co Ltd (HLL), is a Laotian company. Both Appellants were founded by one Siva Nganthavee (Siva), a Thai businessman, together with members of his family or companies under his control. 3. By agreement dated 29.5.1992 (1st Mining Contract), the Respondent and TLL entered into a joint venture to survey and mine lignite in a designated area measuring 20 square kilometres in North-West Laos for a term of 15 years, which term was renewable for further 5 year terms. The 1st Mining Contract provided that TLL and the Agricultural Forestry and Import-Export Development Co. Ltd of Laos shall incorporate a company, namely the 2nd Appellant, “to perform the target and objectives of the 1st Mining Contract”. By supplementary agreement dated 21.7.1992 (2nd Mining Contract), the Respondent and TLL agreed to an increase of the area of survey and mining from 20 to 60 square kilometres and to a time frame of 2 years to survey the “increased area”. Appended to the 2nd Mining Contract was a “memorandum” 4 FC-02(f)-91-12/2015 between the Respondent and TLL for the construction of a lignite power plant in Hongsa, Laos. 4. About 2 years later, by project development agreement dated 22.7.1994 (PDA), the Respondent granted and TLL accepted the exclusive right to develop and implement a “Lignite-fired Power Complex” (power plant) to produce electricity in Hongsa, Laos. The PDA required TLL to incorporate another company, namely Thai-Lao Power Co. Ltd (TLP), “to implement the project”. Article 5.1 of the PDA provided that “this agreement shall be assigned to [TLP]”. Article 6.1 of the PDA provided that the electricity generated would be sold to the Electricity Generating Authority of Thailand/other power purchasers in Thailand or elsewhere. 5. In all, the parties entered into 3 agreements. But those 3 agreements were not exactly “East is East, and West is West, and never the twain shall meet”. The PDA also incorporated terms which touched upon the mining rights and which required those terms to be read together with the mining contracts, and vice versa. Those terms would be referred to in due course. Suffice it to say that mining rights were not solely governed by the mining contracts. The PDA also had a say in it. 6. In due course, the 2nd Appellant, which was beneficially owned by the Agricultural Forestry and Import-Export Development Co. Ltd of Laos (25%) and TLL (75%), was incorporated to undertake the mining venture. TLP, which was 5 FC-02(f)-91-12/2015 beneficially owned by South East Asian Power Co (SEAP) (60%) and TLL (40%) was incorporated to build and operate the power plant. Silva had incorporated SEAP, which was beneficially owned by Siva and his associated companies and family members (60%) and TLL (40%), to arrange for bank financing. But none of those companies, HLL, SEAP, TLP, were parties to the PDA. Termination of the mining contracts and PDA 7. According to the Arbitral Tribunal, (i) the Asian Financial Crisis in 1997 not only impacted on Siva’s performance of the mining contracts and the PDA, but also led to the suspension by the Thai Government of all arrangements to purchase electricity from Laos, (ii) after the Asian Financial Crisis had passed, Siva sought out joint venture partners “who might help overcome governmental roadblocks ... and provide significant financing ... ”, (iii) in 2005, Siva “selected Banpu Public Co. Ltd (Banpu)” as that joint venture partner, (iv) in 2006, Siva terminated the joint venture with Banpu, and (v) Castlepines Finance Pty Limited of Australia became Siva’s new joint venture partner. 8. Company after company was incorporated and joint venture after joint venture was entered into to perform the mining contracts and the PDA. But neither mining nor production of electricity materialised despite the passage of years. “No mines have been dug and no power plant construction has begun” (see [37] of the award). At [19] of the judgment of the High Court 6 FC-02(f)-91-12/2015 (Government of the Lao People's Democratic Republic v Thai-Lao Lignite Co Ltd [2013] 3 MLJ 409), Lee Swee Seng JC, as he then was, thus summed up the state of affairs: “The plaintiff painted a pathetic picture of the problem that after a decade: not a watt of electricity was produced and not an ounce in weight of lignite was mined!” If that were so, then should it be a surprise that the Respondent terminated the mining contracts and the PDA? On 5.10.2006, the Respondent terminated the PDA. On 11.10.2006, the Respondent terminated the mining contracts. 9. Termination of the mining contracts was not challenged. 10. But both Appellants invoked the arbitration clause in the PDA which read: “Article 14.1: Arbitration. (i) In the event a dispute arises out of this Agreement including any matters relating to interpretation of this agreement … either party may submit the dispute to arbitration conducted in Malaysia at the Kuala Lumpur Regional Center for arbitration in accordance with the UNCITRAL Rules ... ” The Arbitral Tribunal 11. On 26.6.2008, the Appellants filed a statement of claim as well as a petition for interim relief. The Appellants contended that they were respectively a party and an intended beneficiary of the PDA, and that the PDA was wrongly terminated (see [54] of 7 FC-02(f)-91-12/2015 the award). The Appellants claimed injunctive relief to restore their rights under the PDA or damages in accordance with Article 15.1(b) of the PDA “which shall include TLL’s total investment costs plus a premium and consideration of the Lenders and Investors in the event of a default on the part of the Government”. The Appellants computed their damages “to be US$172m of invested capital plus US$275m in the value of lost opportunity, for a total of US$447m” (see [55] of the award). 12. The Respondent contended “that neither [Appellant] has the standing to bring the present claims. GOL argues that TLL lacks capacity to enforce the PDA, that HLL has no right to claim under the PDA and that other affiliated organizations that are not parties to the arbitration, namely TLP and SEAP have asserted no claims and have no rights to claim under the PDA” (see [56] of the award). The Respondent argued that only TLP, who was the assignee of TLL under the PDA, had the standing to enforce the PDA and to pursue arbitration, and that under New York law, a party who assigns its rights under a contract containing an arbitration clause loses the right to pursue arbitration to enforce those rights (see [59] and [60] of the award). The Appellants replied that when the PDA was terminated, TLL had not assigned its rights under the PDA to TLP (see [61] of the award), that HLL was an intended beneficiary of the PDA (see [63] of the award), and that the Respondent had “waived any objection to their standing to assert rights under the PDA by dealing with them 8 FC-02(f)-91-12/2015 consistently as the proper parties to that Agreement for a dozen years. [Appellants noted] that the [Respondent] dealt with them both for years and treated them together with TLP and SEAP as the companies under the Banpu Joint Venture Development, which the GOL approved, without distinction as to formal entities within the group of companies controlled by Mr Siva” (see [64] of the award). 13. The Arbitral Tribunal ruled in favour of the Appellants that “TLL is a party to and HLL is an intended beneficiary of the PDA” and that “there is no evidence that either of them has assigned away its rights to do so. As we appreciate Laotian law, it requires only that the company intended to operate the eventually completed facilities maintains an investment licence, and TLP was so licensed at all relevant times” (see [65] of the award). 14. The Arbitral Tribunal rejected the Appellants’ application to add TLP as a party (see [66] of the award), but ruled in favour of the Appellants that all conditions precedent to enforce the PDA had been fulfilled and that the dispute resolution provisions of the PDA were not part of those conditions precedent (see [70] and [71] of the award). 15. In relation to the Respondent’s assertion that the Appellants repudiated the PDA by its “demonstrated inability to perform within a reasonable time and failure to provide adequate assurances of future performance” and that there was therefore proper basis for the Respondent to terminate the PDA, the Arbitral 9 FC-02(f)-91-12/2015 Tribunal held that New York law “would entitle [the Respondent] to terminate the PDA without following the contractually prescribed procedure for termination under [Article] 15.1” if the conduct of the Appellants amounted to a repudiation of the PDA. However, the Arbitral Tribunal held at [76] that [the Respondent] failed to prove that the conduct of the Appellants amounted to repudiation under New York law: “76. [The Respondent] makes much of the fact that approximately 14 years passed between the execution of the PDA and [the Respondent]’s attempt to terminate that agreement. In effect, [the Respondent] argues that at some point the sheer passage of time without the successful development of an operational power project must be taken as a repudiation. However, as uncontroverted testimony in the proceeding established, approximately the first four of those 14 years were marked by active development activity on the part of the Claimants with which the Respondent was evidently satisfied. During the following six years, the Asian Financial Crisis paralyzed progress and the Thai Government refused to execute new power purchase contracts. The result was that all power project development in Laos effectively came to a halt during this period. Over the remaining four years Claimants sought a development partner and eventually entered into a joint development agreement in [2005] with Banpu, a respected power development company with whom Respondent continues efforts to develop the Hongsa Project to this day. In [2006], as indicated, Claimants dismissed Banpu and were subsequently ousted by the Respondent from the Hongsa Project. Based on this record, the Tribunal finds that the Respondent has failed to prove that Claimants met the standard for repudiation under New York law. In the 10 FC-02(f)-91-12/2015 years after the end of the Asian Financial Crisis, the diligence of Claimants was not entirely clear, but given the long lead times required for development of electric generation projects and Banpu’s lack of progress since 2006, the Tribunal finds that the Claimants’ lack of success during this period did not amount to a contractual repudiation.” 16. The Arbitral Tribunal went on to hold that “the dismissal of Banpu did not amount to repudiation of the PDA”, that “the ... termination of the PDA based on Claimants’ dismissal of Banpu” was not permitted (see [77] of the award), that “the doctrine of adequate assurances is applicable under New York only to contracts for sale of goods that are subject to Uniform Commercial Code Article 2” (see [78] of the award), that “the failure of the Claimants to provide adequate assurances upon request by the Respondent would not constitute a repudiation of the PDA” (see [79] and [80] of the award), that “[the Respondent had] not established that it had a proper basis to terminate the PDA in 2006” (see [81] of the award), and that “[the Respondent] breached the PDA by improperly depriving the Claimants of the rights to proceed with performance and did not properly terminate the PDA” (see [86] of the award). 17. At [87] to [91] of the award, the Arbitral Tribunal noted but declined to adjudicate on the so-called “other claims”. 18. Pursuant to the finding of wrongful termination of the PDA, the Arbitral Tribunal next held that “[the Respondent] is liable 11 FC-02(f)-91-12/2015 to Claimants for any damages caused by that action, and that the PDA now is effectively at an end and should be declared to be so terminated as a result of this proceeding, as Claimants have requested” (see [92] of the award). 19. On the issue of damages, the Arbitral Tribunal referred to Article 15.1(b) of the PDA, which provided: “In the event of the termination of this Agreement, compensation shall be paid to TLL or the Government, as the case may be, as determined by the arbitration panel constituted in accordance with Article 14 hereof which shall include TLL's total investment cost plus a premium and consideration of the Lenders and Investors in the event of default on the part of the Government.” 20. The Appellants argued, allegedly supported by the testimony of one of the negotiators of the PDA, that the term ‘premium’ in article 15.1(b) was understood by all to refer to “lost profits as well as any additional share premium to be expected from listing [shares of] the project’s developer” on the stock exchange, and that the reference to ‘Lenders and Investors’ was “to provide a basis for compensating those parties for impaired loans or lost equity”. [The Respondent] replied that Article 15.1(b) of the PDA was not clear, and that to read ‘premium’ to include both investment cost and lost profits “would constitute double accounting or an unenforceable penalty”. 12 FC-02(f)-91-12/2015 21. On the quantum of the damages, the Arbitral Tribunal thus set out the initial and ultimate claim of US$447m of the Claimants: “96. Claimants submitted claims for damages under two heading: (a) their costs incurred for the Hongsa Project through 31st December 2007, which Grant Thornton Specialists Advisory Services Ltd (“Grant Thornton”), an independent member firm of the international accounting firm of that name, calculated initially as US$179m (the “Hongsa Project Investment Cost Report,” Ex. C-178), and (b) a calculation of the net present value of the Hongsa Project over its lifetime, on the assumption of either 720 MW or 1,800 MW installed capacity (the “Hongsa Project Valuation Reports,” Ex C-179 and C- 180), the net present value of which, as of the end of 2008, was computed by Grant Thornton prior to hearing to be either US$153.5m (720 MW scenario) or US$387m (1,800 MW scenario). Claimant ultimately relied on the 1,800 MW scenario. 99. At the conclusion of the hearing, after taking into account various adjustments occasioned by the experts’ testimony, Claimants calculated that their “investment costs” related to the Hongsa Project totalled US$172m and that the value of the completed Hongsa Project to Claimants, had they being allowed to complete it as a 1,800 MW project, would have been US$275m, net of the costs of building the project. Claimants seek the sum of these two calculations, US$447m, as damages.” 22. The Respondent maintained that a claim for both investment cost and lost profits constituted double accounting and a penalty, and argued that the Claimants, who were not able to 13 FC-02(f)-91-12/2015 develop the “Hongsa Project” alone, could therefore not justify a claim for lost opportunity. 23. All claims were contested. But the finding of the Arbitral Tribunal was that it was admitted by the expert witness of the Respondent “that the records produced by Claimants supported expenditures of US$23.2m paid by Claimants or their affiliates to non-affiliated entities for the benefit of the Hongsa Project” (see [101] of the award). 24. The Arbitral Tribunal also held at [102] that the following evidence “concerned” the Appellants’ investments: (a) the Banpu New Supplementary Agreement “which established the equity value of claim of the project at US$100m of which Banpu was to pay half and Mr Siva was to pay half” and which recited and acknowledged that Siva’s “equity contribution to the venture would be comprised of the existing rights and assets contributed to the Hongsa Project by TLL, HLL and TLPC which shall be deemed to be in the amount of US$50m as of 2005. The bank lenders were to own 40% of the joint venture, leaving Mr Siva with 10%, which he retained the right to transfer”, and (b) the Castlepines Memorandum of Understanding which recited that the “existing sunk costs of the Hongsa Project as of 2006 would be US$40m, subject to a due diligence to be commissioned or undertaken by Castlepines”. 14 FC-02(f)-91-12/2015 25. On Article 15.1(b) of the PDA, the Arbitral Tribunal held that ‘TLL’s total investment cost’, ‘plus a premium’, and ‘consideration of the Lenders and Investors’ shall be construed in accordance with New York law (see [108] of the award). At [109] to [110], the Arbitral Tribunal set out the principles of New York law on the interpretation of a contract, which latter principles, we observe, are not that different from common law principles. 26. Thereafter, at [111] and [133], the Arbitral Tribunal awarded US$40 as the total investment cost plus a premium of US$4m and interest of US$12.21m, it being 9% simple interest from date of breach (5.10.2006) to date of the award (4.11.2009), to the Appellants. 27. In effect, the Arbitral Tribunal wholly dismissed the claim (US$275m) for loss of profits or lost opportunity. Of the claim that remained (US$179m), it was made up of the following expenses and amounts (see [112] of the award): Project Cost Category Claimants’ Expert (US$) Respondent’s Expert (US$) 1. Road Construction 7,552,248 6,720,601 2. Financial Consulting 1,663,754 1,585,296 3. Engineer Consulting 12,702,343 12,097,683 4. Management Fee 5,186,604 5,800 5. Legal Consulting 629,359 616,674 6. Administrative Expenses 8,050,985 0 7. Survey Expenses 8,032,042 1,011,852 8. Interest Expenses 126,053,749 0 9. Exchange Loss 9,099,736 0 TOTALS: 178,970,821 22,037,907 15 FC-02(f)-91-12/2015 28. The Arbitral Tribunal cut down that claim of US$179m to US$40m. It held that the plain meaning of ‘total investment cost’ meant “the total amount of money that Claimants together, on behalf of TLL reasonably and unavoidably actually expended out- of-pocket in the normal course of preparation for performance or in performance up and until the date of breach” which would include “for example, money spent purchasing necessary materials, labor costs and expenses to obtain necessary permits” but would not include “costs incurred as a result of the Claimants’ borrowings or defaults on loans” (see [114] of the award) or interest and financing cost (see [115] of the award). The argument that ‘total investment cost’ included interest and financing costs was rejected (see [115] of the award). It was held that “it was not the intention of the parties in Article 15.1(b) or otherwise to award interest and financing expenses as investment costs in the event of breach ... the Claimants [failed to] establish that the interest and financing costs incurred were the proximate result of GOL’s breach ... the Claimants [were] not entitled to an award for financing costs because they [failed] to establish the amount of these costs with a reasonable degree of certainty ... ” (see [117] of the award). 29. Of the nine items of expense that the Appellants sought to recover, the arbitral tribunal held that only items 1 - 7 fell within ‘total investment cost’, while items 8 and 9, being interest and financing costs, were not recoverable (see [118] of the award). 16 FC-02(f)-91-12/2015 30. Items 1 – 7 aggregated to US$43,817,336. The Arbitral Tribunal held that the ‘total investment cost’ was US$40m “which [was] the amount agreed by Claimants to represent ‘existing sunk costs of the Project’ in the Memorandum of Understanding between TLL ... and Castlepines”, and which US$40m was consistent with the aggregate of items 1 – 7 and was below the US$50m acknowledged by Banpu (see [102] of the award). 31. A premium of 10% of US$40m was awarded. Interest was awarded. Nothing was awarded for ‘Lenders and Investors’. The counter-claim, which was held as not proved, was dismissed. US$1m was awarded to the Appellants as legal costs. At the High Court 32. The Respondent applied to the High Court to set aside the award under section 37(1)(a)(iv) and (v) of Arbitration Act (AA 2005). That application was only heard after the Respondent had overcome numerous procedural objections (see [1] - [7]) of the judgment of the High Court). 33. When the application to set aside the award was eventually heard, the Respondent raised 2 principal grounds to challenge the award. At [22] of his judgment, the learned JC thus summarised the challenge of the Respondent: “[22] [The Respondent]'s application in this OS to set aside the award is mainly on two grounds. One is 17 FC-02(f)-91-12/2015 jurisdictional. It has the twin elements of the tribunal exceeding its jurisdiction on the one hand and exercising its jurisdiction wrongfully on the other. The other ground is that of public policy in that the tribunal breached the rules of natural justice in granting a 'premium' of 10% of investment costs to TLL and HLL when both parties had submitted differently on it, quite apart from the fact that the tribunal ordered the investment costs to be paid to non-parties to the PDA by taking into consideration the evidence of investment costs incurred by HLL, TLP and SEAP under the mining contracts and in that sense wrongfully exercising its jurisdiction over non-parties to the arbitration agreement.” 34. As said, only the Respondent and TLL were parties to the PDA, and only the termination of the PDA was challenged. Given those 2 irrefragable facts, the Respondent made it a point to stress “that SEAP and TLP never did acquire rights and obligations under the mining contracts as well as under the PDA to which the Respondent was a party”, and that the Arbitral Tribunal ordered the investment cost of HLL, TLP and SEAP to be paid to HLL, TLP and SEAP, who were not parties to the PDA and who incurred the alleged investment cost under the mining contracts. Learned counsel for the Respondent “encapsulated” the alleged jurisdictional error as follows (see [49] of the judgment of the High Court): “(a) wrong[ly] exercised jurisdiction over Laos' disputes with TLL and HLL under the mining contracts [when] without jurisdiction to award TLL and HLL a return of their investment costs made under the mining contracts; 18 FC-02(f)-91-12/2015 (b) while exercising jurisdiction under the arbitration agreement of the PDA, the arbitrators wrong[ly] exercised jurisdiction over the Siva companies ie TLP and SEAP that were not signatories to the PDA by amalgamating their costs with TLL's costs in awarding damages under the PDA; (c) the arbitrators failed to address the issue of breaches of Laotian law although on the pleadings; and (d) granted a 'premium' of 10% of investment costs, a sum of USD4m, to TLL and HLL.” 35. The Court of Appeal, who granted an extension of time to the Respondent to make the instant application to set aside the award, was of the view that the jurisdictional challenge was based on the following assertions: “(a) that the arbitrators exceeded their jurisdiction by exercising jurisdiction over the Appellant's disputes with the respondents under the mining contracts which were governed by law of Laos and in respect of which the arbitrators [had] no jurisdiction; (b) that the arbitrators wrongly exercised jurisdiction over non-parties in respect of a dispute that was, and remained a dispute between the Appellant and the 1st respondent pursuant to Article 14 of the PDA. The arbitrators erroneously decided that the 2nd respondent was a party to the arbitration proceeding; and (c) that the arbitrators awarded investment costs against the Appellant to be paid to non-parties of the PDA by taking into consideration the evidence of investment costs incurred by the 2nd 19 FC-02(f)-91-12/2015 respondent, Thai-Lao Power Co. Ltd and South East Asian Power Co. under the mining contract; thus the award was bad ex facie as it contained costs and damages beyond the scope of the submission of the parties under the PDA.” 36. The other ground raised to challenge the award was that there was a breach of natural justice when the Arbitral Tribunal granted “a premium of 10% of investment cost to TLL and HLL, when both parties had submitted differently on it”. 37. Article 15.1 of the PDA provided that compensation payable upon termination of the PDA shall include a premium: “In the event of the termination of this Agreement, compensation shall be paid to TLL or the Government, as the case may be, as determined by the arbitration panel constituted in accordance with Article 14 hereof which shall include TLL's total investment cost plus a premium and consideration of the Lenders and Investors in the event of default on the part of the Government.” 38. Article 15.1 should justify why the award was “plus a premium”. But the Respondent contended that the arbitral tribunal should call parties to submit on the proper interpretation of Article 15.1, and that in not doing so there was a breach of natural justice. 39. Section 37(1)(b)(ii)(ii) of AA 2005 provides that an award may be set aside where it is in conflict with the public policy of Malaysia. Section 37(2)(b) of AA 2005 provides that “an award is in conflict with the public policy of Malaysia where a breach of 20 FC-02(f)-91-12/2015 the rules of natural justice occurred during the arbitral proceedings or in connection with the making of the award”. When read together, those 2 provisions provide that a breach of natural justice is a ground to set aside an award. 40. However, the learned JC held at [26] that “the Arbitral Tribunal was entitled to interpret the PDA the way it did”, “that … a matter of construction of an agreement … is essentially a question of law” which requires no legal submission, “that not every breach of the rules of natural justice [offends] the public policy of Malaysia”, and that a breach of the rules of natural justice offends the public policy of Malaysia only “where the upholding of an arbitral award would 'shock the conscience' … or is 'clearly injurious to the public good or … wholly offensive to the ordinary reasonable and fully informed member of the public' … or where it violates the forum's most basic notion of morality and justice”. The breach of natural justice ground was thus ruled in favour of the Appellants. 41. The 1st ground to challenge the award – excess of jurisdiction – was however not as easy to tackle as the 2nd ground. The learned JC had to navigate through a host of preliminary issues before he could get to the issue of whether the arbitral tribunal exceeded jurisdiction. 42. The first of those preliminary issues was whether the UNCITRAL Rules advanced or advocated a position of minimum 21 FC-02(f)-91-12/2015 interference by the court or whether intervention by the court was specifically provided for under section 37 of AA 2005. The learned JC answered that while “there is a palpable paradigm shift towards non-interference in international arbitration awards especially on issues of errors of law”, the UNCITRAL Rules yet recognise and respect interference by courts, as reflected in section 37(1)(a)(iv) and (v) of AA 2005.” 43. The learned JC then thus dealt with the proposition, with which he evidently disagreed, that arbitrators have the sole and exclusive right to decide their own jurisdiction under Model Law principles or under the general principle of competence- competence: “[35] The English Supreme Court has recently put in proper perspective and proportion the position and power of the court when a jurisdictional point is taken at setting aside of the award stage. It corrects the prevalent proposition that arbitrators have the sole and exclusive right to decide their own jurisdiction under Model Law principles or under the general principle of competence-competence. In Dallah Real Estate and Tourism Holding Co v Ministry of Religious Affairs, Government of Pakistan [2011] 1 AC 763, Lord Collins observed (at [84–85]) as follows: ‘84. So also the principle that a tribunal in an International Commercial Arbitration has the power to consider its own jurisdiction is no doubt a general principle of law. It is a principle which is connected with, but not dependent upon, the principle that the arbitration agreement is separate from the contract of which it normally forms a part. 22 FC-02(f)-91-12/2015 But it does not follow that the tribunal has the exclusive power to determine its own jurisdiction, nor does it follow that the court of the seat may not determine whether the tribunal has jurisdiction before the tribunal has ruled on it. Nor does it follow that the question of jurisdiction may not be re-examined by the supervisory court of the seat in a challenge to the tribunal's ruling on jurisdiction. Still less does it mean that when the award comes to be enforced in another country, the foreign court may not re-examine the jurisdiction of the tribunal. 85. Thus article 16(1) of the UNCITRAL Model Law on International Commercial Arbitration provides that the Arbitral Tribunal may rule on its own jurisdiction, including any objections with respect to the existence or validity of the arbitration agreement. But by article 34(2) an arbitral award may be set aside by the court of the seat if an applicant furnished proof that the agreement is not valid under the law to which the parties have subjected it, or, failing any indication thereon, under the law of the seat (and see also article 36(I)(a)(i). (Emphasis added.)’ ” 44. The learned JC affirmed that only the supervisory court of the seat may set aside an award (see [41]). 45. The next preliminary issue was aimed at the jugular of the 1st ground to challenge the award. Section 18(3) of AA 2005 provides that “A plea that the Arbitral Tribunal does not have jurisdiction shall be raised not later than the submission of the statement of defence”. Learned counsel for the Appellants contended “that the issue of jurisdiction was only raised for the 23 FC-02(f)-91-12/2015 first time at the setting aside stage and also in the [Appellant]'s various applications to resist the enforcement of the award in other jurisdictions such as in the United States of America and in England”. It was contended that the plea of no jurisdiction was not raised during the arbitral proceedings. 46. But learned counsel for the Respondent responded “that [the Respondent] was at pains to point out, by way of repeated references to the arbitrators, that HLL and the mining contracts cannot be the subject of arbitration under the PDA”. Learned counsel for the Respondent pointed to paragraph 3.1.2 of the defence statement, where the Respondent allegedly asserted that TLL could not bring claims under the mining contracts, to footnote 97, where the Respondent allegedly stated that the arbitral tribunal had no jurisdiction over HLL or claims under the mining contracts, to the opening memorial at paragraph 3.1 of the defence statement, where the Respondent allegedly reasserted that HLL was not a party to the PDA, to paragraph 7.1 of the defence statement, where the Respondent allegedly asserted that Article 15.1 of the PDA had no application to the mining contracts, to paragraph 7.2 of the defence statement, where the Respondent allegedly asserted that the mining contracts were governed by Laotian law, and to paragraph 2.3 of the closing memorial, where the Respondent allegedly reasserted that HLL was not a party to the PDA and had no right to enforce the PDA. In that regard, the closing remark of learned counsel for the Respondent was that 24 FC-02(f)-91-12/2015 “there is no doubt that the arbitrators recognised the jurisdictional challenge before them. This may be seen in paras 54, 56 and 62– 63 of the award. In para 62 the arbitrators record the objection that 'HLL has no right to enforce the PDA' ”. 47. Undaunted, learned counsel for the Appellants persisted that “that was not enough for [the Respondent] as the respondent in the arbitration to have merely raised the objection on jurisdiction in its pleadings”. According to the learned JC, learned counsel for the Appellants took the position “that no matter how vigorous and rigorous the objection to jurisdiction is taken, the party objecting on ground so basic as jurisdiction must proceed to press the arbitral tribunal for an award on jurisdiction against which it ought then to appeal to the court where the seat is”, in view of the following dicta of Belinda Ang J in Astro Nusantara International BV and others v PT Ayunda Prima Mitra and others [2013] 1 SLR 636: “[15] The simple point is this: if a party fails to appeal or decides not to appeal an award on jurisdiction, the award will be treated as final between the parties and the hearing on the merits will proceed on the basis (and not simply the assumption) that the tribunal has jurisdiction. Challenging such an award on jurisdictional grounds is thus excluded from the grounds which a party may invoke at the setting-aside or the enforcement stage if the party has chosen not to bring an appeal under article 16(3) if a party wishes to properly and effectively retain its right to raise an objection to the 25 FC-02(f)-91-12/2015 tribunal's jurisdiction under the IAA - a party wishing to oppose a jurisdictional award must act … ” 48. On the question as to whether the Respondent should “press the arbitral tribunal for an award on jurisdiction”, the learned JC first held (i) at [54], that “Laos asserted before the arbitral tribunal that the termination clause (Article 15.1) of the PDA providing for prior-arbitral approval to terminate the PDA has no application to the mining contracts (para 7.1) [which] termination clause was described by TLL in its claim statement as fundamental to its case (see para 5.1.1)”, (ii) at [55], that “Laos also argued that the mining contracts were governed by Laotian Law (para 7.2) which was to say that the arbitrators would lack the jurisdiction to apply New York Law to any matter relating to the mining contracts [and at] para 2.3 of its closing memorial, Laos again asserted that HLL was not a party to the PDA and has no right to enforce its terms”, and (iii) at [58], that the dicta of Belinda Ang J was said “in the context where the arbitral tribunal has made an award on jurisdiction and not one where an award has been made on the merits”. 49. At [65] and [66], the learned JC held that “from the reading of the award and in particular paras 54, 56 and 62–63 it would appear that the Arbitral Tribunal had proceeded with the option of joining the issue of jurisdiction to the merits and the respondent there, Laos, had chosen the option of having raised the objection, to then proceed to participate in the proceedings and 26 FC-02(f)-91-12/2015 only to challenge the award after it has been made”, and “that what Laos did was a perfectly legitimate course available to it which option it has availed itself of”. 50. With the finding that the Arbitral Tribunal opted to join the issue of jurisdiction to the merits, and that the Respondent opted to raise the objection, participate in the proceedings and later challenge the award, the learned JC then referred to section 18 of AA 2005, to The Arbitration Act 2005 by Sundra Rajoo and WSW Davidson at pages 87 and 89, and to Redfern and Hunter, Law & Practice of International Arbitration (4th Edition) at pp 257 – 261, and held at [68] that the Respondent was “perfectly positioned and hence permitted to raise the jurisdictional challenge at this stage of setting aside the award”: “[68] I am therefore of the opinion that [the Respondent] having raised its objections timeously before the Arbitral Tribunal, is validly justified in raising the jurisdictional challenge at this stage of setting aside the award. Where the AA 2005 provides under s 37(1)(a)(iv) and (v) the grounds for setting aside an award on excess of jurisdiction and where the Arbitral Tribunal had proceeded under s 18(7) to deliver an award on the merits instead of as a preliminary question or an interim award on jurisdiction, the plaintiff is perfectly positioned and hence permitted to raise the jurisdictional challenge at this stage of setting aside the award.” 51. The final preliminary issue before the High Court was whether the jurisdictional challenge was waived by conduct. The 27 FC-02(f)-91-12/2015 Appellants contended that the Respondent “participated passionately in the arbitration by filing and prosecuting a counterclaim” which “must be viewed as a submission to the tribunal's jurisdiction”. It was “a qualified participation”, the Respondent replied. 52. Paragraph 11 of the said counterclaim read: “Given the uncertainty as to identity and standing of the various claimants and potential claimants, the GOL is uncertain of the parties against whom it should assert its counterclaims. Accordingly, the GOL sets forth in this section descriptions of its counterclaims, rather than particular claims against particular parties and reserves the right to later identify the respondent or respondents to particular claims.” 53. The learned JC referred to Bauer (M) Sdn Bhd v Daewoo Corp [1999] 4 MLJ 545 at 561 – 564, and held at [74] that the Respondent had not “gone beyond the point of no-return” as to have waived its challenge to the arbitral tribunal “exercising jurisdiction over the mining contracts which are governed by the law of Laos, over non-parties to the arbitration agreement … and in awarding investment costs to non-parties of the PDA in its defence as well as opening and closing memorials”. 54. Finally, at long last, the learned JC proceeded to deliberate on the 1st ground, under the following headings. 28 FC-02(f)-91-12/2015 “Specific jurisdictional challenge - Assuming jurisdiction over disputes arising under the mining contracts when the arbitration was under the PDA” 55. At [77] – [81], the findings of the learned JC were (i) that the mining contracts and the PDA were separate contracts with substantial differences, (ii) that Article 2 of the 1st Mining Contract provided that Laotian law was the governing law of the mining contracts, (iii) that the governing law of the PDA was a mixture of Laotian law and New York law, (iv) that the dispute settlement mechanism in the agreements was also different, (v) that the Respondent could not have agreed, not through Article 14.1 of the PDA, to arbitrate HLL’s claims under the mining contracts, (vi) that only Laotian law applied to the mining contracts, and “it would be a breach of the spirit as well as the manifest understanding of the parties for claims under the mining contracts to be decided by New York law”, (vii) “that the arbitrators seemed oblivious to the obvious fact that Laotian law applied to the mining contracts [which] provided for a Laos dispute mechanism” (viii) the Arbitral Tribunal “allowed the choice of law and the dispute mechanism under the mining contracts to be by- passed or circumvented by de facto enlarge[ment of] the arbitration clause under the PDA or by admi[ssion of] the American doctrine of an intended beneficiary or third party beneficiary”, and (viii) “that the arbitrators failed to address their mind, as they were obliged to, to the question whether the American doctrine [could] be applied to override or discard Laotian law which was the 29 FC-02(f)-91-12/2015 proper law of the mining contracts … [which American doctrine was applied when] the alleged lost investments under the mining contracts incurred by TLL, HLL and the other Siva companies were admitted into the PDA”. 56. At [82], the learned JC thus enunciated on the correlation between the mining contracts and the PDA, and then held that the mining contracts were not subsumed under the PDA: “[82] Reading the award as a whole, the Arbitral Tribunal seemed to have lumped together or co-mingled the claims and disputes under the mining contracts with the claims and disputes under the PDA. The Arbitral Tribunal might have on ground of efficiency or expediency decided the whole of the dispute between the parties under the PDA as if the rights of the parties under the mining agreements have been subsumed into the PDA. While there may be interlinking and indeed interlocking elements between the mining contracts and the PDA, it is safe to say that the parties had intended their respective rights under the mining contracts to remain 'in full force and effect and undisturbed' (see article 19.3) as provided specifically in the PDA. The PDA itself recognises the mining contracts as separate from the PDA and it cannot simply be said to be subordinated to the PDA or be subsumed under the PDA. It has a life of its own and while some of its rights may have been enlarged under the PDA, it is substantially and singularly structured to stand on its own. Article 19.13 further emphasised lest errors might arise in the future that 'HLL rights and benefits under the mining contracts shall remain intact'. Leaving no room for doubts, article 19.11 of the PDA clarified and confirmed that 'both parties acknowledge the existence and continuing validity of the (mining contracts)'.” 30 FC-02(f)-91-12/2015 57. The key finding was that the arbitral tribunal went beyond the scope of the arbitration when it exercised jurisdiction over disputes arising out of the mining contracts. “Specific jurisdictional challenge - Admitting claims by TLL and HLL under the mining contracts when the arbitration was under the PDA” 58. The Respondent contended (i) that the Arbitral Tribunal committed a patent jurisdictional error in admitting and in awarding TLL/HLL's claims under the mining contracts in the PDA arbitration, (ii) that the Arbitral Tribunal so stated in Procedural Order No 1 that it exercised jurisdiction by virtue of the arbitration clause in the PDA, (iii) that the Arbitral Tribunal could not exercise jurisdiction over the mining contracts unless the parties consented to it, (iv) that the Respondent had so said in its defence as well as its opening memorials and closing memorials that the tribunal had no jurisdiction over the claims under the mining contracts, (v) that claims properly due under the mining contracts were admitted, adjudicated and disposed of under the PDA arbitration, (vi) that claims by HLL, who was a non-signatory to the PDA and TLP and SEAP, who were also not parties or signatories to the PDA, were admitted by the Arbitral Tribunal under the 'intended beneficiary concept' or ‘third party beneficiary’ concept recognised under US law, and (vii) that relief by way of damages was given to those parties under the PDA arbitration. 31 FC-02(f)-91-12/2015 59. The Respondent argued that the 'intended beneficiary' concept or ‘third party beneficiary’ concept recognised under US Law is circumscribed by the scope and intent of the arbitration clause, and that the error of the arbitrators was made apparent by the decision of the US Court of Appeals in Republic of Iraq v BNP Paribas 472 Fed Appx 11 decided on 28.3.2012, where Iraq sought to invoke or rely on the arbitration clause in a contract between BNP Paribas and the United Nations, and where the US Appeals Court rejected Iraq's claim by construing the arbitration agreement and said: “Assuming arguendo that Iraq is a third-party beneficiary with a right to enforce the United Nations contract with BNP Paribas, Iraq must nevertheless show by a preponderance of the evidence that the parties intended to provide Iraq with the right to invoke arbitration. See Williams v Progressive Ne Ins Co, 41 AD 3d 1244, 1245, 839 NYS 2d 381, 381 (4th Dep't 2007) ('It is well settled that a third party beneficiary is entitled only to those rights which the original parties to the contract intended the third party to have.'); see also Stolt-Nielsen SA v Animal Feeds Int'l Corp, 130 S Ct at 1782 (arbitration is a matter of consent, not coercion). For reason already discussed, the plain language of the provision defeat as any such contention. The provision's focus on 'Parties', JA 339, and its express identification of parties as the only persons who could refer disputes to arbitration is all the more striking given that the agreement anticipated potential third-party claims in provisions that [**8] indemnify BNP Paribas for 'any claim by a third party … arising out of any breach of or failure to perform' the agreement, JA 322. Thus, even if 32 FC-02(f)-91-12/2015 the contract between the United Nations and BNP Paribas can give rise to third-party claims, there is no evidentiary basis for concluding that the parties bound themselves to resolve such claims through arbitration.” 60. The counter argument of the Appellants was (i) that the concept of an 'intended beneficiary' is an exception to the privity rule, (ii) that at [65] of the award, the arbitrators found that “TLL is a party to and HLL is an intended beneficiary of the PDA”, (iii) that HLL and other non parties could yet be recognised as parties under the ‘intended beneficiary’ rule, and (iv) that whether the ‘intended beneficiary’ rule applied was a question of law and not a jurisdictional question for the Arbitral Tribunal to decide. 61. To that, the learned JC held (i) that the American doctrine of ‘third party beneficiary’ was not articulated in the PDA, (ii) that the PDA “declared the integrity and intactness of the mining contracts which would include the preservation of the choice of law and dispute mechanism provisions of the mining contracts”, (iii) that there was no “cogent basis for the arbitrators to reasonably conclude that the intent ingredient (see Republic of Iraq v BNP Paribas USA 2nd Cir 2012) in the American doctrine of ‘intended beneficiary’ was met in this case”, (iv) that “there was never any adjudication by the arbitrators or anyone [on] whether Laos was in breach of the mining contracts [but yet] Laos was directed to pay lost investment costs to TLL and HLL under the mining contracts, [when] “there [was] no clause for recovery of 33 FC-02(f)-91-12/2015 lost investments under the mining contracts” and (v) that the identification of the parties to an arbitration agreement is related to the scope of jurisdiction and is therefore a jurisdictional question and not a question of law. “Specific jurisdictional challenge - Applying the wrong law of the arbitration agreement in admitting non-parties into the arbitration and awarding damages to non-parties” 62. Given the fact that the seat was Malaysia, the learned JC held at [98] that the arbitration agreement was governed by the law of Malaysia, which, according to the learned JC, was supported by the following dicta of Toulson J in XL Insurance Ltd v Owens Corning [2000] 2 Lloyd's Rep 500, where the designated seat was London and the governing law of the contract was the internal law of the State of New York: “by stipulating for arbitration in London under the provisions of the arbitration Act 1996 the parties chose English law to govern the matters which fell within those provisions including the formal validity of the arbitration clause and the jurisdiction of the arbitration tribunal; and by implication chose English law as the proper law of the arbitration clause.” 63. Further to the finding that Malaysian law was the governing law of the arbitration agreement, the learned JC went on to hold (i) that Malaysian law was the proper law to determine the question as to whether HLL and or other non-signatories could be recognised as a party to the arbitration agreement, (ii) that “if the 34 FC-02(f)-91-12/2015 arbitrators applied the wrong regime of law they would have gone wrong in jurisdiction with respect to the proper parties to the arbitration” which would not “be in accordance with the laws as agreed upon by the parties as envisaged in s 30(2) of the AA 2005”, (iii) that “there is no reference in the AA 2005 to any 'intended beneficiary' who is not a party to the arbitration agreement who can participate in the arbitration proceedings”, (iv) that “the AA 2005 also does not permit anyone, other than a party to the arbitration agreement, to participate in the arbitration proceedings”, (v) that the doctrine of 'intended beneficiary' is not a recognised exception to the privity rule under the laws of Malaysia, (vi) that “in an arbitration … no one can be compelled to arbitrate their disputes … with a non-party to an arbitration agreement”, and (vii) that unless it can be shown that HLL has come within the accepted exceptions, HLL being a non-signatory to the arbitration agreement cannot become a party to the arbitration proceedings and neither can non-parties claims by TLP and SEAP be lumped together in the arbitration award”. “Specific jurisdictional challenge - aggregating claims under the mining contracts and with respect to non-parties in an arbitration under the PDA” 64. At [110], the learned JC made the following finding which set the scene for the findings that followed: “I find that the Arbitral Tribunal had proceeded to adjudicate matters under the mining agreements and in 35 FC-02(f)-91-12/2015 particular claims for the recovery of investment costs on roads and survey which are clearly matters under the mining contracts and completed under the mining contracts to be decided under Laotian law in the event the defendants here (the claimants there) are desirous of challenging the validity of the termination of the mining agreements. Under the mining contracts a road of 70km was built by TLL and HLL from Hongsa mine site to and into Thailand as the original plan was to sell lignite in Thailand to Thai power companies. In fact Mr. Siva in his witness statement admitted that investment costs in terms of infra-structure and road building were completed by mid 1994 before the entry into the PDA.” 65. The findings that followed were (i) that “[Article] 2 of the [1st] mining contract expressly declared that 'both parties shall be subject to this agreement under the rules, procedures, and the Law of the People's Democratic Republic of Laos' ”, (ii) that the choice of Laotian law was a matter of contract that the arbitral tribunal could not alter, (iii) that TLL was allowed to aggregate and was awarded all monies expended on the project including that under the mining contracts as investment cost, (iv) in that the disputes under the mining contracts were adjudicated under the PDA, the Respondent were denied the defence of termination for poor performance under Laotian law, (v) that the aggregation of claims under both mining contracts and PDA, and the so-called investments in the 'project' by TLP and SEAP, were admitted under the 'group of companies' approach taken by the arbitrators, (vi) that the mining contracts and the PDA did not form one project, and (vii) that the “so-called 'lost investment' cost [were] not 36 FC-02(f)-91-12/2015 recoverable under the mining contracts. Their inclusion by the aggregation method as a PDA claim by the arbitrators was a fundamental jurisdictional error”. 66. At [122 - 125], the learned JC held that “the award was an aggregation of claims under the two contracts (ie the mining contracts and the PDA)” which were treated “as a single claim for calculating ‘lost investment’ cost due only under the PDA”, that “the inclusion by the aggregation method as a PDA claim by the arbitrators was a fundamental jurisdictional error”, that the arbitrators had not separated the investment cost by contract or by party basis, and that “in failing to do so, the award ended up dealing with a dispute not contemplated by or not falling within the terms of the submission to arbitration as envisaged by section 37(1)(a)(iv) … the award contain[ed] decisions on matters beyond the scope of the submission to arbitration as envisaged by section 37(1)(a)(v)”, and that the award was “so co-mingled and computed together that it was impossible to excise and extract that which stem[med] from the PDA as opposed to that which [was] traceable to the mining contracts”. 67. The whole of the award was set aside by the learned JC who ordered “the dispute confining to the PDA and solely between the parties to the arbitration agreement to be re-arbitrated before a new panel, resisting every temptation to traverse or transgress into the mining contracts which are governed by Laotian law”. 37 FC-02(f)-91-12/2015 At the Court of Appeal 68. Only 2 arguments, which had been raised before, were considered by the Court of Appeal (see Thai-Lao Lignite Co Ltd & anor v Government of the Lao People’s Democratic Republic [2014] 1 LNS 525). Learned counsel for the Appellants (different counsel than in the High Court) repeated that section 18 of AA 2005 had not been complied with and that by filing a counter-claim in the arbitral proceedings the Respondent acquiesced to the jurisdiction of the arbitral tribunal and waived its right to object thereto (see [2014] 1 LNS 525). But the Court of Appeal was not persuaded. 69. On the alleged non-compliance with section 18 of AA 2005, the Court referred to the Opening Memorial, Closing Memorial, and the Statement of Defence and held that the objection to jurisdiction was raised from the start of the arbitral proceeding: “In our judgment, with respect, we know of no principle that, in an arbitration proceedings, objection to jurisdiction can only be done by the use of specific words as suggested by the appellants' counsel. The authorities that he cites, with respect, do not support his proposition. Further, we accept the submission of Dato' Cyrus Das that the issue of jurisdiction was indeed taken up by the respondent before the Arbitrators. It is clear to us that the issue of jurisdiction was raised in various parts in the pleadings. For instance, at footnote 97 at paragraph 3.1.2 of the Statement of Defence it is stated - 38 FC-02(f)-91-12/2015 ‘fn.97 ... However, the Tribunal's jurisdiction over such claims (ie, the Prior Contracts) would not come from the arbitration clause of the PDA, which applies only to "dispute[s] aris[ing] out of this Agreement ... '' (PDA, Art. 14.1). That language is not broad enough to encompass disputes arising out of the Prior Contracts. (See Paragraph 7.1, infra.). Rather, the Tribunal's jurisdiction over such claims would come from the dispute settlement clause (Paragraph 31) of the First Contract ... ’ At paragraphs 7.1 and 7.1.1 of the Statement of Defence the respondent contended that the PDA and its termination clause does not apply to the Mining Contracts, (i.e. referred to as 'Prior Contracts' under the PDA):- ‘7.1. However, Article 15.1(b)(iii) does not refer to the termination of the "Prior Contracts," which the PDA repeatedly distinguishes from the "Agreement," rendering the PDA ambiguous, at the very least as to whether provisions that apply to the "Agreement" also apply to the "Prior Contracts". 7.1.1. The text of the PDA repeatedly distinguishes the PDA (the "Agreement") from the Prior Contracts. Consequently, it is reasonable to conclude that the failure to mention the Prior Contracts in Article 15.1(b) means that that Article does not refer to disputes arising out of the Prior Contracts. We also note that the respondent contended at paragraph 3.1 of its Opening Memorial that HLL and TLP could not have been parties to the Arbitration proceedings: ‘HLL is not a party to the PDA and, even if it were, it would have no right to enforce the PDA because 39 FC-02(f)-91-12/2015 its Lao investment license mentioned only the Second Contract. And TLP, which has an investment license, is not a party to this arbitration, was not a party to the PDA when signed, and never became a party through an assignment. Any references in this memorial to "Claimants" rights or obligations under the PDA are not intended to suggest otherwise.’ [The Respondent] repeated their stand in paragraph 2.3 of the Closing Memorial:- ‘HLL was not a party to the PDA and has no right to enforce its terms, HLL's rights were governed by the Prior Contracts, and HLL's investment license referred to the Second Contract only.’ We further observe that the Arbitrators had duly acknowledged the jurisdictional challenges. In paragraph 56 of the Arbitral Award the Arbitrators state the objection as to jurisdiction in the following terms:- [The Respondent] contends, first, that neither claimant has standing to bring the present claims. GOL argues that TLL lacks capacity to enforce the PDA, that HLL has no right to claim under the PDA and that other affiliated organizations that are not parties to the arbitration, namely TLP and SEAP, have asserted no claims and have no right to claim under the PDA. Then at paragraph 62, the Arbitral Tribunal recognizes the challenge as follows: ‘62. [The Respondent] challenges HLL's standing because HLL is not a signatory of the PDA and, even if HLL is an intended beneficiary of the PDA, HLL has no right to enforce the PDA because HLL's Laos investment license mentions only the Second Contract and not the PDA.’ ” 40 FC-02(f)-91-12/2015 70. On the alleged acquiescence to jurisdiction, the Court of Appeal again referred to the Statement of Defence and held that the so-called counter-claim was not a true counter-claim but a statement of an intended counter-claim against unspecified parties: “With respect, we also reject this submission. We accept [The Respondent]'s explanation regarding the counter-claim. [The Respondent] in its explanation had explained that the counter-claim was put forward with the express reservation of legal rights on the question of parties and who is entitled to be a party to the arbitration. Thus, at the outset, in its Statement of Defence, [The Respondent] twice state[d] of its uncertainty as to who should be parties to this Arbitration. First, it is stated at paragraph 2.1 of the Statement of Defence:- ‘because of the uncertainty as to ... who should be parties to this arbitration (paragraph 2.1);’ and, again, later at paragraph 11 of the Statement of Defence:- ‘Given the uncertainty as to identity and standing of the various claimants and claimants, the GOL is uncertain of the parties against whom it should assert its counter-claims ... ’ Accordingly the respondent merely stated the 'nature' of its counter-claim rather than as 'a particular claim against particular parties'. In short, it was not a counter- claim made against any specific party. In other words, it is not a counter-claim in the normal sense. 41 FC-02(f)-91-12/2015 The above makes it clear that the counter-claim was presented with the express reservation of legal rights and leaving it to the Arbitrators to decide who ought to be the proper parties to the Arbitration. Since the Arbitrators had chosen not to determine the issue of parties as a preliminary issue, but at the end by the Award, [The Respondent] had declined to make a specific counter-claim against specific parties. Thus no counter-claim was made specifically against any party against whom objection could have been taken to by the respondent as having no standing to bring claims and over whom the Arbitrators under the Arbitration Agreement could not have exercised jurisdiction. Therefore, there is no basis for the appellants to contend there was a waiver over jurisdiction in the light of the nature of the counter-claim and of the repeated reservations of legal rights made by the respondent.” 71. It was the incidental finding of the Court of Appeal that the Arbitral Tribunal “had chosen not to determine the issue of parties as a preliminary issue”. 72. It was the concurrent finding of the Court of Appeal that the award included ‘investment cost’ under the mining contracts: “ … the Arbitrators proceeded to allow recovery of all claims as 'investment costs' of the appellants in the Hongsa Project under Article 15.1(b) of the PDA; and included therein the investment costs under the Mining Contracts. It is of importance to observe that the loss of investment costs put forward to the Arbitrators by the appellants' accountant, Messrs Grant Thornton, included the 42 FC-02(f)-91-12/2015 investments costs in the Mining Contracts (see the appellants Closing Memorial (at para. 3.2)):- The Project originated in May 1992 under TLL when TLL entered into the "Exploration and Lignite Mining Contract" with the Lao Government. HLL was incorporated in 1992 to exploit the mining concessions. Pursuant to the PDA, which was executed in July 1994, TLP was incorporated to undertake aspects of the Project. As a result, costs of the Project which has been previously incurred by TLL and HLL and capitalized as Project Development Assets were in effect "sold" to TLP at book values, the consideration being the recording of debts owing to TLL and HLL in TLP's books. GT testified that this was a perfectly appropriate and proper accounting procedure. The underlined portions above reflect the part relating to investment costs in the Mining Contracts. The Arbitrators admitted the claim under the Mining Contracts justifying it as being due under 'total investment cost' under Article 15.1(b) of the PDA. In para. 114 of the Award, the Arbitrators ruled:- '... "total investment cost" means the total amount of money that Claimants together, on behalf of TLL, reasonably and unavoidably actually expended out- of-pocket in the normal course of preparation for performance or in performance up until the date of breach.' The words 'Claimants together' include HLL, which was involved only in the Mining Contracts and had nothing to do with the PDA.” 43 FC-02(f)-91-12/2015 73. It was also the concurrent finding of the Court of Appeal that the Arbitral Tribunal “dealt with a dispute not contemplated by or not falling within the terms of the submission, of the arbitration” and that “the award contain[ed] decisions on matters beyond the scope of the submission to arbitration”. 74. Given those concurrent findings, coupled with rejection of the Appellants’ arguments, the Court of Appeal unanimously dismissed the appeal. Arguments Before the Federal Court 75. Both learned counsel submitted orally as well as filed lengthy submissions. Both learned counsel also filed, either a “summary of [Appellants’] arguments”, or an “executive summary of [the Respondent’s] arguments” and “[the Respondent’s] notes on oral submission”. “Appellants’ summary of arguments” dated 3.8.2016 76. Save that the seat was Malaysia, there was no connection with Malaysia. The Appellants sought to enforce the award in the United States and in the United Kingdom. At the same time, the Respondent initiated proceedings in Malaysia to set aside the award. The Malaysian courts (i) interfered with the award, (ii) took the view, which was inconsistent with the principles of international arbitration, that reference to Malaysia as the seat permitted the application of Malaysian law to set aside the 44 FC-02(f)-91-12/2015 award, despite the fact that none of the parties applied or submitted on Malaysian law during the arbitral proceedings. Both parties submitted on New York law. Save for 4 specific areas which were governed by Laotian law, the PDA was governed by New York law. “The arbitration agreement specifically required the Arbitral Tribunal to be trained in New York law … ” The Respondent submitted an expert report on New York law, which disagreed that the doctrine of third party beneficiary applied to the case. In international arbitration, it is common that parties may agree to apply laws and principles foreign to Malaysian law. Local courts must resist the temptation to scrutinize foreign law through the prism of Malaysian law. Local courts must uphold the Model Law principles of party autonomy and freedom of contract. The courts below fell into error (i) when they assumed the role of the arbitral tribunal, (ii) when they reheard and applied Malaysian law, and (iii) when they inquired as to whether the doctrine of intended beneficiary was correctly applied to the facts of the case. It was not an appeal or judicial review. The courts below should not have substituted the findings of the arbitral tribunal with their own. How could the arbitral tribunal know Malaysian law when there was no submission on Malaysian law? How could the courts below impose Malaysian law when none had submitted on it? 77. Each claimant, TLL, HLL, TLP and SEAP, “had a role to play in the project and [was] very much associated with the project”. Damages were awarded pursuant to a finding of liability 45 FC-02(f)-91-12/2015 for wrongful termination of the PDA. The Arbitral Tribunal’s assessment was based on ‘total investment cost’ as prescribed by Article 15.1 of the PDA. There was nothing in the award that stated that the mining contracts were taken into consideration in the assessment of damages. The Arbitral Tribunal had carefully considered all submission on quantum. The courts below ignored the findings of fact of the Arbitral Tribunal and went behind the award when they considered and analysed evidence which did not form the basis of the quantum. It is trite that an error of law or fact is not sufficient ground to warrant the setting aside of an award. AA 2005 does not empower the courts to do so. All leave questions should be answered in the negative save for leave question (iv) which should be answered in the positive. 78. Learned counsel for the Appellant (same counsel as in the Court of Appeal) then thus submitted on the leave questions: 79. Leave question (i): It did not ipso facto follow that the law governing the arbitration agreement, if not expressed, followed the seat. Authorities across the globe showed that the law governing the arbitration agreement followed the contract. That was ignored by the courts below, who took the simpliciter approach that the law governing the seat is the law governing the arbitration agreement. “Malaysia is an outlier in this regard.” The courts below relied on one authority, XL Insurance Ltd v Owens Corning, which was overruled and was no longer good law. The 46 FC-02(f)-91-12/2015 application of the correct law governing the arbitration agreement was critical to the issue of proper parties to the arbitration. “If New York law (as the law governing the contract) [applied], … the New York law concept of third party intended beneficiary would apply … non-signatories [could] be [parties] to the arbitration [and] HLL retain[ed] a right to claim … as an intended third party beneficiary”. “If Malaysian law (as the law of the seat) [applied], … only TLL and Laos [PDR] could be parties to the arbitration … ” During the arbitration, the Respondent adopted the position that New York law applied. At the High Court, the Respondent belatedly advanced the argument that Malaysian law was the law governing the arbitration agreement and that the award fell into jurisdictional error when it included HLL. “[The Respondent] never did so at any stage of the arbitration proceedings.” “Both parties accepted and applied New York law on the locus standi of HLL, and as to whether HLL was an intended third party beneficiary under New York law.” With realisation that even a wrong application of that doctrine had no bearing on the jurisdiction of the Arbitral Tribunal, the Respondent advanced the new argument at the High Court that Malaysian law was the governing law of the arbitration agreement. The Respondent ought to have been precluded from doing so as it never took such a position since commencement of the arbitration in 2007. That new argument resulted in the erroneous findings by the courts below. In Sulamerica CIA Nacional De Seguros S.A. and others v Enesa Engenharia S. A and others [2012] EWCA Civ 638, the English Court of Appeal held that 47 FC-02(f)-91-12/2015 in the absence of an indication to the contrary, an express choice of substantive law for the contract will be a strong indication of the parties’ intention as to the law governing the arbitration agreement. In Sulamerica, the English Court of Appeal formulated the following three-stage test to determine the governing law of the arbitration agreement: (a) is there an express choice of law governing the law of the arbitration agreement; (b) if not, can a choice be implied, and (c) in the absence of a choice, with which law does the arbitration agreement have the closest and most real connection. The English Court of Appeal as well observed that whether the proper law of the arbitration agreement is that of the country whose law is to apply to the contract or that of the country which is specified as the seat is a matter of contractual interpretation and that it may be inevitable that the answer must depend on all the terms of the particular contract, when read in the light of the surrounding circumstances and commercial common sense. In Arsanovia Ltd & ors v Cruz City Mauritius Holdings [2012] EWHC 3702 (Comm), the court agreed that the law governing the contract was a strong pointer that parties intended Indian law to apply as the law governing the arbitration agreement. In Habas Sinai Ve Tibbi Gazier Istihsal Endustrisi AS v VSC Steel Co Ltd [2013] EWHC 4071 (Comm), the court adopted the principles stated in Sulamerica. In Klockner Pentaplast Gmbh & Co Kg v Advance Technology (HK) Company Ltd [2011] HKCU 1340, the court held that there is no rule that the lex arbitrii must be the law of the seat, and that the law governing the arbitration 48 FC-02(f)-91-12/2015 agreement is normally the law governing the contract. In National Thermal Power Corp Ltd (NTPC) v Singer Co (1992) 3 SCC 551, the court held that where the proper law of the contract is expressly chosen, such law must, in the absence of an unmistakable intention to the contrary, govern the arbitration agreement. Singapore took a different approach. In FirstLink Investments Corp Ltd v GT Payment Pte Ltd [2014] SGHCR 12, the learned Senior Assistant Registrar held that in the absence of an express choice of the law governing the arbitration agreement, parties would be presumed to have impliedly chosen the law of the seat to be the proper law of the arbitration agreement. Even if the Singapore position were to be preferred, leave question (i) must be answered in the negative as the stipulation of the seat could not constitute an express agreement that the law governing the arbitration agreement would be the same. 80. Leave questions (ii) and (iii): After the counter-claim was dismissed, the Respondent claimed for the first time that the arbitral tribunal had no jurisdiction to determine the counter-claim, and that the arbitral tribunal exceeded its jurisdiction, although it was the Respondent who requested the arbitral tribunal to determine the counter-claim. The Respondent now claimed that the counter-claim amounted to nothing. The courts below had different views of the counter-claim. The Respondent recognised the arbitral tribunal’s jurisdiction with respect to HLL when it counterclaimed. It was erroneous of the Court of Appeal to find 49 FC-02(f)-91-12/2015 that the counter-claim was not specifically made against any party. In fact, the Respondent claimed against all parties related to Siva, which included TLL, HLL TLP and other entities controlled by Siva. The Respondent claimed that the counter-claim was made under protest. But given the extent of the evidence and submissions put forward by the [Respondent] on the counterclaim, the Respondent could not take a “diametrically opposed position as and when it likes”. Both Procedural Orders 1 and 2 included HLL as a party without challenge by the Respondent who recognised the jurisdiction of the arbitral tribunal when it counterclaimed on the mining contracts – “For the reasons set forth [GOL] requests the arbitral tribunal … declare the PDA and the prior contract terminated … ”. Footnote 97 of the Defence and Counter-claim conferred jurisdiction to the arbitral tribunal with respect to the mining contracts. Rather than opposed, the Respondent recognised the arbitral tribunal’s jurisdiction when it sought the arbitral tribunal’s jurisdiction on the counter-claim against HLL, and when it counter-claimed on the mining contracts. In Bauer (M) Sdn Bhd v Daewoo Corp, the respondent in the arbitration invited the arbitrator to determine whether there was a second settlement between the parties in dispute, despite it having objected that most of the matters submitted for arbitration were not covered by the arbitration clause. The Court of Appeal held that the respondent, by its conduct, was estopped from arguing that the arbitrator lacked jurisdiction. Bauer (M) Sdn Bhd v Daewoo Corp, which was applied in Usahasama SPNB-LTAT Sdn 50 FC-02(f)-91-12/2015 Bhd v Borneo Synergy (M) Sdn Bhd [2009] 2 MLJ 308, is consistent with the position in the United Kingdom (Svenska v Government of the Republic of Lithuania [2006] 1 Lloyd’s Rep LR 181), United States (Lakeshore Engineering Services Inc v Target Construction Inc No 13-14498 (USDC E.D. Mich. Feb 27 2014), India (Prasun Roy v Calcutta Metropolitan Development Authority & anor 1998 AIR 205), Hong Kong (China Nanhai Oil Joint Service Corporation v Gee Tai Holdings Co. Ltd [1995] 2 HKLR 216) and Singapore (PT First Media TBK v Astro Nusantara International BV [2014] 1 SLR 372). The preferred position under Malaysia law should be to find the party filing a counter-claim, be it against a non-signatory or based on contract other than the contract containing the arbitration agreement, to have waived the right to challenge the arbitral tribunal’s jurisdiction. The Respondent must be consistent. A counter-claim is a positive action. The Respondent could not have a qualified counter-claim as and when it suited its cause. “A counter-claim would form part of the ‘terms of submissions’ to arbitration and fall within ‘the scope of submission to arbitration’ as per section 37(1)(a)(iv) and (v) of AA 2005. There can be no setting aside on jurisdictional grounds in this regard.” 81. Leave questions (v): The Respondent objected to both TLL and HLL’s standing to bring the claim. That was an issue that pertained to the claimants’ right to claim and not to the Arbitral Tribunal’s right to hear. It was an invitation to the Arbitral 51 FC-02(f)-91-12/2015 Tribunal to determine the right to claim as a matter of interpretation under the PDA. That explained why the Respondent objected to TLL, even though TLL was a party to the arbitration agreement. The courts below misinterpreted an objection to standing as a challenge to jurisdiction. The Respondent’s assertions in its pleading and memorials could not be construed as a challenge to jurisdiction. The Respondent relied on the PDA and factual arguments to support its assertion that HLL was not an intended beneficiary under New York law. The Arbitral Tribunal was invited to determine the issue of standing from a legal and factual standpoint. Whatever error of law or fact of the arbitral tribunal was not a sufficient ground to set aside the award. The Respondent did not challenge the jurisdiction of the arbitral tribunal to determine HLL’s claims. The objection was not a challenge to jurisdiction, but to “the arbitral tribunal’s power to hear and determine the claim”. Any challenge to jurisdiction ought to be made before the filing of the defence. The dictionary meaning of ‘standing’ and ‘jurisdiction’ is not the same. An objection to ‘standing’ is taken against the litigant’s ‘status’ or ‘position’, whereas a challenge to ‘jurisdiction’ is against the tribunal. US law was authoritative on the issue of ‘standing’, given that both parties chose New York law as governing the PDA. The Court of Appeal applied Malaysian law and did not consider this issue from the standpoint of US law. In the context of arbitration, US law states that the standing or right to claim is a procedural issue (counsel cited Chicago Typographical Union No 16 v Chicago 52 FC-02(f)-91-12/2015 Sun-Times Inc No 88-1392 United States Court of Appeals, Seventh Circuit) and that a question of contract interpretation is a matter for the arbitrator, not a district court, to decide (counsel cited Joseph A. Antkoowiak v Taxmaster Inc No 11-1182). ‘Standing’ in arbitration is a matter for the arbitrator to decide. It would be absurd to hold that a challenge to standing could be deemed to be a challenge to jurisdiction. The Arbitral Tribunal retained jurisdiction to determine whether the claimants had standing. A jurisdictional challenge must be clear (counsel cited Aoot Kalmneft v Glencore International AG and anor [2001] EWHC QB 461, and Ranko Group v Anatartic Maritime SA [The Robin] All England Transcripts 1997-2008, and Redfern & Hunter). 82. Leave questions (iv) and (vi): The purported challenge to jurisdiction was in fact an issue of interpretation of the PDA - HLL’s standing and the counter-claims under the mining contracts/PDA. Another challenge was the purported ‘amalgamation’ of damages by ‘co-mingling’ the losses and damages under the mining contracts with the PDA. In actual fact, that pertained to the arbitral tribunal’s interpretation of ‘total investment cost’ suffered by TLL-HLL due to the wrongful termination of the PDA. The High Court wrongly traversed into the merits and quantification of damages as decided in the award. The High Court reversed the factual findings of the arbitral tribunal when it decided that the Respondent’s expert report should be favoured, and when it held that there was a wrong quantification 53 FC-02(f)-91-12/2015 due to some ‘amalgamation’ or ‘co-mingling’ of the [total investment] cost. The merits of the case and the total investment cost, which were put to the arbitral tribunal, fell within the ‘submission to arbitration’. The courts below wrongly reversed the arbitral tribunal’s findings under the guise of jurisdictional challenge. The courts below did not follow established authority (counsel cited Government of India v Cairn Energy India Pty Ltd and anor [2011] 6 MLJ 441, Intelek Timur Sdn Bhd v Future Heritage Sdn Bhd [2004] 1 MLJ 401, which were decisions of the Federal Court, and Cairn Energy India Pty Ltd & Anor v The Government of India [2009] 6 MLJ 796; Hartela Contractors Ltd v Hartecon JV Sdn Bhd & Anor [1991] 2 MLJ 481; AJWA For Food Industries Co (MIGOP), Egypt v Pacific Inter-Link Sdn Bhd & another Appeal [2013] 2 CLJ 395, which were decisions of the Court of Appeal) when it went into the merits of TLL-HLL’s quantum of damages. An error of fact or law is not a sufficient ground to set aside an award is a well applied principle in the United Kingdom (Lesotho Highlands Authority v Impregilo SpA [2006] 1 AC 221), Singapore (CRW Joint Operation v PT Perusahaan Gas Negara (Persero) TBK; PT Asuransi Jasa Indonesia (Persero) v Dexia Bank SA [2007] 1 SLR 597; John Holland Construction & Engineering Pty Ltd v Too Engineering Corp (Japan) [2001] 2 SLR 262), and New Zealand (Pupuke Service Station Ltd v Caltex Oil (NZ) Ltd [2000] 3 NZLR). “Malaysian courts ought to ensure that their decisions are in line with the Model Law principles and within international arbitration framework … This appeal has 54 FC-02(f)-91-12/2015 far reaching consequences beyond the parties … it is a test of whether the Malaysian judiciary indeed recognises and supports arbitration in order to provide satisfactory resolutions to disputes … The parties … chose Malaysia as the seat … even though there were no factors connecting the parties nor their relationship … because they expected the Malaysian judiciary to uphold their bargain and the sanctity of the arbitral process.” “Malaysian courts should resist the temptation to impose the application of Malaysian law … should also defer to the role of the arbitral tribunal and adhere to the role prescribed by the Model Law framework and uphold party autonomy and the sanctity of the arbitral process.” “Written Submission for [the Respondent]” dated 4.8.2016 83. It was the Respondent’s case from inception that the arbitrators failed to separate the contracts. It was not disputed that the mining contracts, which were governed by Laotian law, provided a dispute resolution mechanism before the Laotian Economic Reconciliation Board or the Laotian Courts. The PDA, which was governed by a combination of Laotian law and New York law, provided for arbitration under UNCITRAL rules at Kuala Lumpur. Both mining contracts and PDA were terminated by the Respondent in October 2006 on the ground that “not a single ounce of lignite was mined and not a single watt of electricity was produced”. The arbitral tribunal found that “no mines have been dug and no power plant construction has begun”. 55 FC-02(f)-91-12/2015 84. It was not disputed that termination of the mining contracts was not challenged. Only arbitration under the PDA was held. The problem was created by the 1st Appellant when it took a short-cut by persuading the arbitral tribunal to amalgamate the claims under the mining contracts with the claims under the PDA and with the claims of other non-parties like SEAP. 85. The short-cut approach of treating the contracts as one, thus enabling the recovery of mining claims under the PDA arbitration, was expressly proposed in para 5.1.1 of the Appellants’ statement of claim. It was thus the Appellants’ case, which was accepted by the arbitral tribunal, that once the PDA was held as wrongly terminated, claims under the mining contracts would be recoverable. 86. The fundamental mistake in the short-cut approach was that there was never any challenge to the termination of the mining contracts and there was never any adjudication on the lawfulness of the termination of the mining contracts. Nevertheless, by the award, the Respondent was ordered to pay claims under the mining contracts without the opportunity to justify the termination of the mining contracts. 87. The issues raised by the Appellants were tangential, in that they did not deal with the core issue of whether the amalgamation of claims under separate contracts exceeded jurisdiction. The mining contracts contained a different resolution 56 FC-02(f)-91-12/2015 clause. Article 2 of the 1st Mining Contract provided that “the agreement would be governed by the law of Laos”. Under the mining contracts, TLL and HLL built a road from the Hongsa mine site to and into Thailand, because of the original plan to sell lignite to Thai power plants. Later, the Respondent granted the right to TLL to build a power plant in Hongsa. The PDA had its own arbitration clause. The agreements were individually terminated. Only the termination of the PDA was challenged. Article 15.1 of the PDA provided a procedure that was not first followed. Obviously confident of success, the Appellants stated in para 1.2.1 of their opening memorial that “this is a straightforward issue to resolve, dependent solely upon a single fact, ie in October 2006 did the GOL terminate the PDA upon the approval of the arbitration panel constituted in accordance with Article 14 of the PDA?” 88. In Procedural Order 2, the arbitral tribunal pronounced its preliminary view that the PDA could only be terminated in accordance with Article 15.1 of the PDA. Thus emboldened, the Appellant took the short-cut and amalgamated the mining claims with the PDA claims, without having to go to the Laotian courts or the Laotian Economic Council to make the mining claims. 89. It was unjust to allow the mining claims under the PDA arbitration without first determining whether the mining contracts were justly terminated. The arbitral tribunal was led to the jurisdictional error by the stand taken by the Appellants that all 57 FC-02(f)-91-12/2015 claims under the Hongsa Project could be adjudicated under the PDA. In para 5.1.1 of the Statement of Claim, the Appellants contended “that the purported termination of the two concession contracts (ie the Mining Contracts) does not pose distinct issues but are subsumed within the larger question of the purported termination of the PDA”. That short-cut approach led to the jurisdictional error. Liability was solely determined on the validity of the termination of the PDA. 90. In their opening memorial, the Appellants contended that “this is a straightforward issue to resolve, dependent solely upon a single fact, ie in October 2006 did the GOL terminate the PDA upon the approval of the arbitration panel constituted in accordance with Article 14 of the PDA?” The arbitral tribunal was only asked to determine that question. The arbitral tribunal agreed that “claimants’ primary assertion is that the respondent breached the PDA by improperly purporting to terminate the PDA”. At [114] of the award, the arbitral tribunal admitted the cost incurred under the mining contracts as ‘total investment cost’. The ‘claimants together’ included HLL, who was not a signatory to the PDA and who only incurred expenditure under the mining contracts. The French enforcement court held that there was a wrongful inclusion of claims from the mining contracts and that the Arbitral Tribunal ruled in part without an arbitration agreement. 91. The fundamental error lay in allowing mining claims under the PDA arbitration. The separateness of the contracts and 58 FC-02(f)-91-12/2015 the separateness of the arbitration clauses in the PDA were expressly recognised in the PDA itself where Article 19.11 declared that “both parties acknowledge the existence and continuing validity of the Prior Contracts (ie the mining contracts)”. Article 19.13 of the PDA went on to say that the projects are “two separate but related projects” and that the failure of the PDA project would not affect HLL’s rights under the mining contracts which “remained intact”. At [79] of his judgment, the learned JC correctly observed that “it is unthinkable that Laos agreed through article 14.1 of the PDA to arbitrate HLL’s claims under the mining contracts”. 92. There was no intent to amalgamate rights under the separate contracts or to have them adjudicated under one contract to the exclusion of the other. New York law under the PDA could not replace or override Laotian law under the mining contracts. Arbitration under the mining contracts would not allow the award of a premium or the award of pre-judgment interest. The arbitral tribunal failed to give effect to Article 19.13 of the PDA. 93. The error of the Arbitral Tribunal arose because they classified both contracts as part of the Hongsa Project. The dispute resolution clause in the 1st mining contract was by-passed. The Arbitral Tribunal recognised non-parties as parties to the arbitration. In CRW Joint Operation v PT Perusahaan Gas Negara (Persero) TBK, the Singapore Court of Appeal had to contend with the equivalent of section 37(1)(a)(iv) and (v) of AA 2005. It held 59 FC-02(f)-91-12/2015 that Article 34(2)(a)(iii) of the Model Law addresses the situation where the tribunal exceeded or failed to exercise the authority that the parties granted to it. In Sui Southern Gas Co. Ltd v Habibullah Coastal Power Co. (Pte.) Ltd. [2010] 3 SLR 1 at [34], it was held that the correct approach is to ascertain the matters which were within the scope of submission to the tribunal. 94. Article 14.1 of the PDA limited claims to “disputes arising out of this Agreement”. It is now settled that an arbitral tribunal is not the decider of its own jurisdiction (counsel cited Dallah Real Estate and Tourism Holding Co v Ministry of Religious Affairs, Government of Pakistan per Lord Collins). The Dallah principle has been adopted in several jurisdictions. It is a de novo review by the supervising court in the seat or the enforcing court (counsel cited PT First Media TBK v Astro Nusantara International BV; IMC Aviation Solutions Pty Ltd v Altain Khuder LLC [2011] 282 ALR 717). 95. Jurisdiction comes from the arbitration agreement. Excess of jurisdiction is determined from the scope of the arbitration clause. An arbitral tribunal must take care to stay within the terms of the mandate (counsel cited Redfern & Hunter Law & Practice of International Arbitration (4th Edition) at 248). If an arbitrator travelled beyond the contract, he would be acting without jurisdiction (counsel cited Bharat Coking Coal Ltd v M/s Annapurna Construction AIR 2003 SC 3660). It was not just non- parties that gave rise to jurisdictional objections but the mixing of 60 FC-02(f)-91-12/2015 contracts which involved the same parties but with different seats of arbitration (counsel cited Redfern & Hunter on International Arbitration (Oxford University Press) at para 5.89). 96. The arbitral tribunal gave relief under the mining contracts to parties, HLL, TLP, SEAP, who were not entitled to be before them. That was the consistent stand of the Respondent. There was no adjudication on the validity of the termination of the mining contracts. Yet the Respondent was ordered to pay TLL and HLL under the mining contracts. 97. A party could not be forced to arbitrate with a non-party with whom it had no contract. Arbitration must be confined to the parties under the arbitration agreement (counsel cited Deutsche Post Bank Home Finance Ltd v Taduri Sridhar & anor AIR 2011 SC 1899). Remedies are awarded only to parties. To be a party there must have been a dispute between them and it had to be a dispute in respect of a defined legal relationship (counsel cited Methanex Motunui Ltd. v Spellman [2004] 3 NZLR 454). 98. In his witness statement, Siva admitted that the survey and roads were executed under the mining contracts and before 1994, ie before the advent of the PDA. Investment cost in the mining contracts was amalgamated as part of PDA expenses by a questionable device, by which the investment costs of HLL in the mining contracts were bought over and capitalised as PDA expenses and recorded in the books of TLP as debts owing to TLL 61 FC-02(f)-91-12/2015 and HLL. That accounting device could be seen in page 3 of the report of Grant Thornton. There was a shifting of accounting entries from the books of the mining companies to the books of the PDA, for purposes of recovery under the PDA arbitration. It was incumbent upon the arbitral tribunal to decide if investment cost under the mining contracts was admissible under the PDA. The arbitral tribunal should not have allowed the padding and embellishment of TLP’s accounts with the expenses under the mining contracts as book debts. This jurisdictional bar could not be overridden by an accounting device. 99. In “Written Submission for [The Respondent]” dated 4.8.2016, learned counsel for the Respondent also submitted at length on section 18 of AA 2005, on the governing law of the arbitration agreement, on the application of the American doctrine of third party beneficiary, on the ‘counter-claim’ issue, and on the jurisdictional error as opposed to an interpretational error of the arbitral tribunal. In “Notes on oral submission for the Respondent” dated 25.8.2016, learned counsel condensed his latter submission to the following points: 100. De novo Point: Review by the supervising court on jurisdictional grounds is a de novo review (Dallah Real Estate and Tourism Holding Co v Ministry of Religious Affairs, Government of Pakistan; PT First Media TBK v Astro Nusantara International BV). The principle of finality of arbitration awards must be balanced 62 FC-02(f)-91-12/2015 with the right of review under section 8 of AA 2005 which expressly authorises intervention “where so provided in this Act, namely the grounds set out in sections 37 and 42 (CRW Joint Operation v PT Perusahaan Gas Negara (Persero) TBK [2011] 4 SLR 305; Kerajaan Malaysia v Perwira Bintang Holdings Sdn Bhd [2015] 1 CLJ 617). 101. Mandate Point: If arbitrators applied the wrong law, it would be a jurisdictional error under the curial law as well as under the mandate of parties. Under curial law, section 30(2) of AA 2005 declares that “the arbitral tribunal shall decide the dispute in accordance with the law as agreed upon by the parties”. Redfern & Hunter at page 248 made it clear that “the arbitral tribunal must take care to stay within the terms of its mandate”. The mandate question is always tied to the scope of the arbitration agreement. Article 14.1 confined the arbitration to “a dispute arising out of the agreement”. By admitting the mining claims as found in paragraph 112 of the award, the arbitral tribunal exceeded its jurisdiction. 102. Governing Law of the Arbitration Agreement: Under the Model Law, the arbitration agreement is separate from the contract itself. There could be separate governing laws governing the arbitration agreement and the contract itself (counsel cited Government of India v Cairn Energy India Pty Ltd and anor). Challenge is however decided by curial law. Both case law and 63 FC-02(f)-91-12/2015 textbooks lean to the view that the law of the seat governs the arbitration agreement, because it is also the curial law. The mistake of the Appellants was to ignore the curial law and to place no value on it. That could not be correct as the arbitration agreement must always be valid under the law of the seat. This principle is recognised in section 37(1)(a)(ii) of AA 2005 which provides that an arbitration agreement must be valid under Malaysian law. There is an overriding presumption that in the absence of the parties expressly nominating the law governing the arbitration agreement, the lex arbitrii or the law of the seat shall be the governing law to prevent any contradiction for enforcement purposes between the lex arbitrii and the governing law of the arbitration agreement. 103. Third Party Beneficiary Point: In contending that the third party should be recognised, the Appellant admitted that a third party obtained relief under a contract to which it was not a party. If Malaysian law, as the lex arbitrii, is the governing law on matters such as parties to arbitration, a non-party cannot invoke the arbitration clause under the contract. Even otherwise, it does not automatically follow that New York law applies. The Appellants ignored the fact that Article 18 of the PDA provided that the governing law of the arbitration agreement was a mixture of Laotian and New York law. 4 matters were reserved for Laotian law. Matters (ii) and (iv) applied to HLL. Matter (ii) applied as HLL was only licensed under the FIL to undertake mining under the 64 FC-02(f)-91-12/2015 mining contracts. Matter (iv) applied as mineral rights deed was reserved to be governed by Laotian law. Even if New York law applied, HLL would not satisfy the ‘intention test’ to be classified as an intended beneficiary (counsel cited The Republic of Iraq v BNP Paribas 2012 U.S. App Lexis 6264). 104. Standing vs Jurisdiction Point: in the United States, ‘standing’ has always been related to the exercise of judicial power by the courts. At [62] and [63], the Arbitral Tribunal saw no distinction between those two terms. 105. The Counter-claim Point: It was wrong to contend that the counter-claim “put into play” the mining contracts. HLL was only involved in the mining contracts. HLL was only licensed to undertake mining activities. HLL’s mining claims were brought into the PDA books by an accounting device. 106. Interpretation vs Jurisdiction Point: The Appellants sought to downplay the jurisdictional error by terming it as interpretation of ‘total investment cost’. The admission of non- parties was not mere interpretation. In Lesotho, the error was not a jurisdictional error. The gravity of the error could be seen in the fact that the Respondent was ordered to pay the mining claims without adjudication of the mining contracts. “Appellants’ Reply Submission” dated 9.8.2016 65 FC-02(f)-91-12/2015 107. In “Appellants’ Reply Submission” dated 9.8.2016, learned counsel for the Appellants thus specifically submitted on (i) the principles on setting aside under section 37 of AA 2005, and (ii) the ‘jurisdictional complaint’. 108. The Malaysian position is clear. When dealing with an application to set aside an award, courts must not delve into the merits of the case (counsel cited Cairn Energy India Pty Ltd & Anor v The Government of India [2009] 6 MLJ 796), must respect party autonomy to determine the manner to resolve their disputes (counsel cited Pupuke Service Station Ltd v Caltex Oil (NZ) Ltd), and must read the award with the expectation of no substantial fault (counsel cited Zermalt Holdings v Nu-Life Upholstery Repairs [1985] 2 EGLR 14). 109. Based on UNCITRAL Model Law Commentary and local law (counsel cited Government of India v Cairn Energy India Pty Ltd & anor FC; Intelek Timur Sdn Bhd v Future Heritage Sdn Bhd; Hartela Contractors Ltd v Hartecon JV Sdn Bhd & anor [1999] 2 MLJ 481), the arbitrator is the sole judge of fact and law, and a wrong finding of fact or law is not sufficient ground to set aside an award, the court is not an appellate court, and an award will only be set aside in the prescribed circumstances, which are rare and exceptional circumstances. The court will only set aside an award in exceptional and limited circumstances (counsel cited Government of India v Cairn Energy India Pty Ltd & anor FC). One 66 FC-02(f)-91-12/2015 very limited circumstance is ‘an excess of jurisdiction’. Section 37 of AA 2005 encapsulates the setting aside principle on the basis of ‘excess of jurisdiction’ on the part of an arbitral tribunal. 110. In CRW Joint Operation v PT Perusahaan Gas Negara (Persero) TBK, the Singapore Court of Appeal provided the guideline that setting aside is available where the award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration or contained decisions on matters beyond the scope of the submission to arbitration, and that the ground for setting aside covers substantive jurisdiction and not procedural matters. “When an issue is clearly put before the tribunal, there is no excess of authority if the tribunal applies its own view of the law” (Williams & Kawharu on Arbitration at 17.5.4). “Once the matter is approached correctly … there is no more than an erroneous exercise of the power available under section 48(4) … section 68(2) does not permit a challenge on the ground that the tribunal arrived at a wrong conclusion as a matter of law or fact …” (counsel cited Lesotho Highlands Authority v Impregilo SpA). “Errors of law or fact made in an arbitral decision, per se, are final and binding … and may not be appealed against or set aside by a court except in the situations prescribed under section 24 of the Act and Art 34 of the Model Law” (counsel cited PT Asuransi Jasa Indonesia (Persero) v Dexia Bank SA). 67 FC-02(f)-91-12/2015 111. In the absence of an express stipulation on the governing law of the arbitration agreement, the intention of the parties must be given effect to. Article 18.1 of the PDA stated “overall governing law”. It is not uncommon for parties to choose one set of laws as the overall governing law to govern all aspects of the arbitration. “The construction of an arbitration clause should start from the assumption that the parties … are likely to have intended any dispute arising out of the relationship into which they have entered or purported to enter to be decided by the same tribunal” (counsel cited Fiona Trust & Holding Corporation v Yuri Privalov & ors [2007] 4 ALL ER 951). The parties’ intention to apply New York law as the governing law of the arbitration agreement was substantiated by the emphasis on New York law. Arbitrators must be well versed in New York law. 112. The validity and effect of an arbitration agreement is to be determined by the governing law of the contract (counsel cited Mount Cook (Northland) v Swedish Motors Ltd [1986] 1 NZLR 720; Commandate Marine Corp v Pan Australian Shipping Pty Ltd (2006) 157 FCR 45). In any event, irrespective of whether the law of the seat or the law governing the contract is determinative of the law governing the arbitration agreement, the application of the wrong governing law is not sufficient ground to set aside an arbitral award (counsel cited Quarella SpA v Scelta Marble Australia Pty Ltd [2012] SGHC 166). 68 FC-02(f)-91-12/2015 113. Both courts below erred in stating “that if the Arbitral Tribunal applied the wrong regime of law, they would have gone wrong in jurisdiction”. The Leading Arbitrators Guide to International Arbitration advocates that international arbitrators are not bound by the choice of law rules of the seat in order to determine the applicable law. The trend in international arbitration is to limit the role of the seat. The more modern approach considers artificial an interpretation of the choice of seat as an indication of the applicable law or the applicable choice of law rules by the parties. 114. Except where Part III of AA 2005 applies, local courts have no powers to rehash or re-examine issues related to the interpretation of contracts or to questions of fact or law which belong to the realm of arbitration. Legal principles favour the law governing the contract to be the law governing the arbitral agreement. The Arbitral Tribunal applied New York law in construing the three components of compensation, namely, (i) total investment cost, (ii) premium, and (iii) consideration of lenders and investors. The Arbitral Tribunal interpreted the scope of ‘TLL’s total investment cost’ to mean “the total amount of money that the claimants together on behalf of TLL reasonably and unavoidably actually expended out-of-pocket in the normal course of preparation for performance of or in performance up until the date of breach”. ‘Project’ in the PDA was all encompassing. ‘Infrastructure’ in the PDA included roads. The PDA provided for 69 FC-02(f)-91-12/2015 the construction of roads in connection with the ‘Project’. The award of US$40m was not based on the expert’s report. It was based on the memorandum of understanding between TLL and Castlepines, although the Arbitral Tribunal sought comfort in the corresponding figures in the expert’s report and TLL’s contract with Banpu. “Appellant’s Reply Submission (2)” dated 25.8.2016 115. In Reply Submission (2) dated 25.8.2016, learned counsel for the Appellants thus submitted (that which had not been said before): Error on the face of the award is no longer a ground for setting aside an award. Section 37(1)(a)(iv) of AA 2005 refers to a case where the arbitrator has dealt with a dispute which does not fall within the scope of the arbitration agreement. Section 37(1)(a)(v) of AA 2005 refers to a case where the arbitrator has given decisions on matters which are beyond the scope or outside the questions submitted. The difference between the two is that the first is based on the arbitral clause while the second is based on the mandate given by the parties. 116. Mandate could be broadened by parties’ submissions beyond the scope of the arbitration clause if during the arbitration both parties explicitly or tacitly agreed to such an extension. 117. De novo review will only be exercised after an express jurisdictional objection has been brought. The objection was to 70 FC-02(f)-91-12/2015 standing and not jurisdiction. The Respondent failed to precisely specify the manner in which the award fell within section 37(1)(a)(iv) or (v). Error in the assessment of damages is not excess of jurisdiction. Application of wrong principles in the assessment of damages is not excess of jurisdiction. “Executive summary of Respondent’s Submission” dated 4.8.2016 118. In “Executive summary of Respondent’s Submission” dated 4.8.2016, learned counsel for the Respondent thus elaborated on the amalgamation of claims and the arbitration clause: The investment cost in the mining contracts was transferred to the PDA as part of PDA expenses by an accounting device. The investment costs of HLL in the mining venture was notionally bought by TLP and then capitalized as PDA expenses and recorded in the books of TLP as a debt owing to TLL and HLL. TLP made no payment for that notional purchase. The mining claims were posted as book debts owing by TLP under the PDA to the mining companies. 119. The mining contracts and the PDA were separate contracts with significant differences. The mining contracts were expressly declared to be governed by Laotian law. By Article 31 of the 1st mining contract, the forum for dispute settlement was “Laotian Board of Economic Conciliation or Laotian Court or International Dispute Settlement Organisation”. The proper law of the PDA was a mixture of Laotian law and New York law. Article 71 FC-02(f)-91-12/2015 19.11 of the PDA recognised the separate existence of the mining contracts. Article 19.13 declared that “HLL’s rights and benefits under the mining contracts shall remain intact”. Those Articles made it clear that the mining contracts stood on their own, notwithstanding the PDA. Under the PDA arbitration, the Arbitral Tribunal recognised non-contracting parties as parties to the arbitration and allowed non-parties, namely the 2nd Appellant and SEAP, to claim. 120. The arbitration clause in the PDA was a party-based arbitration clause that was limited to “disputes arising out of this Agreement.” It was the concurrent finding of the courts below that the arbitral tribunal exceeded their jurisdiction by admitting non- parties and their claims to the arbitration. 121. Importance must be given to the choice of the seat. The view that the law governing the contract also governs the arbitration agreement is unsustainable in a Model Law regime. Section 18(2) of AA 2005 recognises the independent existence of an arbitration agreement. The law leans towards the viewpoint that the law governing the arbitration agreement should follow the seat. 122. Since Malaysia was the chosen seat, the law of Malaysia should determine the validity of the arbitration agreement. Section 37(1)(a)(ii) of AA 2005 provides that “An award may be set aside … if the party making the application provides proof that 72 FC-02(f)-91-12/2015 the arbitration agreement is not valid under the law to which the parties have subjected it, or, failing any indication thereon, under the laws of Malaysia”. It was the legislative intent that the law governing the arbitration agreement must be the law of the seat. It would follow that the proper law to determine whether HLL and other non-signatories could be recognised would be the law of Malaysia. 123. The Appellants’ stand on section 18 was not consistent. At the High Court, the Appellants contended that the Respondent was obliged to seek an immediate ruling on the point of jurisdiction. At the Court of Appeal, the Appellant argued that a jurisdictional challenge could only be made by the words “we hereby challenge the jurisdiction of the arbitral tribunal”. At the Federal Court, the Appellants argued that there was a distinction between ‘standing’ and ‘jurisdiction’. 124. There was no difference between ‘standing’ and ‘jurisdiction’. ‘Standing’ was frequently used in the United States to refer to jurisdiction. The Arbitral Tribunal recognised that the Respondent’s challenge was a jurisdictional challenge. Under subsections 9(1) and (2) of AA 2005, only parties to an arbitration agreement may arbitrate. 125. Even if New York law applied, Article 14.1, which was a party-based arbitration agreement, and Article 19.13 of the PDA were obstacles to the admission of third party claims in a party- 73 FC-02(f)-91-12/2015 based arbitration. The intention test was not met. Article 14.1 referred to “each party” “either party” and “both parties” which only referred to TLL and the Respondent. 126. Even if the ‘intention’ theory under the American doctrine applied, it would still exclude third parties from bringing claims under the PDA. Article 14.1 of the PDA provided for the application of Laotian law and the Laotian Foreign Investment Law (FIL). HLL had no FIL approval to participate in the PDA project. The Respondent could not have intended HLL to be a party to the PDA, for it had not given approval to HLL to be involved. 127. The counter-claim was filed with the express reservation of a right to question the locus standi of the parties. Since the Arbitral Tribunal did not determine the issue of locus standi as a preliminary issue, the “Respondent declined to make a specific claim against specific parties”. 128. In arbitration law, a party may object to jurisdiction but yet participate in the arbitration. This ‘passive approach’ is recognised in both foreign and local case law. The courts below were correct to hold that the counter-claim with the express reservation was not acquiescence to the admission of non-parties. “Rebuttal Submission for the Respondent” dated 8.8.2016 129. In paragraph 24 of the Appellants’ written submission dated 3.8.2016, learned counsel for the Appellants said “Today, 74 FC-02(f)-91-12/2015 the eyes of the international community will be cast on Malaysia. It would not be far-fetched to state that this appeal would determine the future of international arbitration in Malaysia – whether we regress or progress. Today, this appeal presents a unique opportunity for the apex court to prescribe legal principles which would favour international arbitration in Malaysia and once again, pronounce the pro-arbitration approach adopted by the Malaysian Courts”. That paragraph 24, which was not an appeal to law or reason, received what could only be described as a stinging rebuke from learned counsel for the Respondent: “This is an alarmist argument and is fear mongering in a legal forum. It should not be expected by the Appellants that Judges sitting in review of an award and concerned only with the law would countenance such an argument”. 130. The rest of the rebuttal submission could be summarised as follows. 131. Section 8 of AA 2005 allows intervention by the court, where the challenge falls within section 37 or 42 of the Act. Singapore, which is a Model Law country like Malaysia, also provides for court intervention where it falls within the grounds similar to section 37 of AA 2005. 132. Courts will not allow an award to stand in the face of clear excess of jurisdiction or a breach of mandate (counsel cited 75 FC-02(f)-91-12/2015 CRW Joint Operation v PT Perusahaan Gas Negara (Persero) TBK, and Kerajaan Malaysia v Perwira Bintang Holdings Sdn Bhd). 133. “The Appellants’ non-legalistic policy argument that there should be non-interference with an international award should be rejected.” 134. The argument that “the arbitrators are world renowned giants in the field of international arbitration” and that parties placed in their trust in Malaysia as the designated seat should also be summarily rejected. An award is reviewed on the basis of content. Eminence of an arbitrator is never a ground to preclude curial supervision (counsel cited Government of India v Cairn Energy India Pty Ltd & ors FC at 33). Eminence of an arbitrator is no defence to any arbitral excess of jurisdiction. 135. The legal costs incurred thus far in the arbitration could not deter curial supervision. 136. The true position is that enforcement courts in the US and UK, after being informed of the decision of the Court of Appeal, had either reversed or not allowed enforcement of the award. 137. The proposition that the law governing the arbitration agreement does not ipso facto follow the law of the seat is wrong. The law of the seat establishes the curial law that governs the challenge to the award. The curial law is the law of the seat. 76 FC-02(f)-91-12/2015 138. The proposition that “authorities across the globe show that the law governing the arbitration agreement follows the law of the contract” is also fundamentally wrong (counsel cited Redfern & Hunter on International Arbitration 6th Edition (Oxford University Press) at para 3.53 – 3.54; Government of India v Petrocon India Limited [2016] 6 CLJ 321 at [28 – 29]; Government of India v Cairn Energy India Pty Ltd & anor FC at 455); C v D [2008] 1 Lloyd’s Rep 239, 245 at [16 -17]; Steel Corporation of The Philippines v International Steel Services Inc. 354 Fed. Appx. 689 (Third Circuit, 2009); Williams & Kawharu on Arbitration at page 275 para 10.2). 139. The statement that XL Insurance Ltd v Owens Corning was overruled was misleading. In Sulamerica, the English Court of Appeal cited XL Insurance and observed that the chosen seat of London suggested that the parties intended English law to govern all aspects of the arbitration agreement. 140. The Appellants argued that the Respondent had not contended before the Arbitral Tribunal that Malaysian law applied as the governing law. It was inconceivable that the Arbitral Tribunal acting under the KLRCA auspices in Kuala Lumpur and sitting in Malaysia would have been oblivious to the application of Malaysian law. It was a jurisdictional error if the Arbitral Tribunal misapplied the relevant governing law. 77 FC-02(f)-91-12/2015 141. The third party beneficiary rule only applied if New York law were the governing law of the arbitration agreement. The Respondent’s answer to the third party beneficiary rule was twofold. First, a third party beneficiary is not recognised under Malaysian law. Secondly, even by the application of New York law, the Appellants failed to meet the ‘intention test’, that is whether the signatories intended to admit the claim of a non-party for arbitration or for a non-party to invoke the arbitration clause. The Appellants had no answer to the ‘intention test’. The Appellants could not provide an answer or contrary authority to the leading case of Republic of Iraq v BNP Paribas which was followed in Trustees of Empire State Carpenters Annuity, Apprenticeship, Labor-Management Cooperation, Pensions & Welfare Funds v Syracuse Floor Sys., Inc. No 13-CV-1509 (SJF) 2015 WL 222133 (E.D.N.Y. Jan 13, 2015). 142. HLL was never licensed under FIL to partake in the PDA. FIL was part of the governing law of Laos. Article 18 of the PDA declared that the law of Laos shall apply. HLL was only licensed under FIL to undertake the mining venture. It could not have been intended for HLL to be claimant under the PDA. 143. It was misleading to contend that there was a counter- claim when there was none against any particular party. It was equally incorrect to contend that a jurisdictional objection was taken after the counter-claim was dismissed. The jurisdictional 78 FC-02(f)-91-12/2015 objection was recorded at [56] of the award. The passive approach of the Respondent, registering the objection and participating in the arbitration while reserving the right of challenge, could be seen even in the old case of Hamlyn v Betteley (1880) 6 QBD 63 (counsel also cited Government of A.P. v K. Mastan Rao 1995 Supp (4) SCC 528; Union of India v G. S. Atwal & Co. (Asansole) (1996) 3 SCC 568). 144. Even US law recognises that a counter-claim may be submitted together with a plea of lack of arbitral jurisdiction without the counterclaimant waiving the jurisdiction defence (counsel cited Kaplan v First Options Chicago Inc 19 F. 3d 1503 (Third Circuit 1994): Carpet v Walter Arnold Inc 462 NYS 2d 206 (First Department 1983); M. Katz & Sons Billiards Products Inc v G.Correale & Sons 270 NYS 2d 672 (First Department 1966); Hasse v American Photograph Corporation 299 F. 2d 666 (Tenth Circuit 1962)). The Bauer case was decided on totally different facts, where the party initially objected to jurisdiction but later requested the arbitrator to decide the very issue that he had objected to. 145. Footnote 97 was misread. Footnote 97 must be read as a whole. Footnote 97 categorically stated that Article 14.1 of the PDA was not broad enough to encompass disputes arising out of the mining contracts. 79 FC-02(f)-91-12/2015 146. The standing vs jurisdiction issue was a non issue. The Arbitral Tribunal itself construed ‘standing’ to mean as used by the Respondent in its pleadings. At [62] of the award, the Arbitral Tribunal took the objection as a dispute to their jurisdiction to admit the claims of HLL. The Appellants were wrong to contend that US law was authoritative on the meaning of standing as merely a procedural issue. In 2 decisions of the US Supreme Court (counsel cited Hein, Director, White House Office of Faith-Based and Community Initiatives v Freedom from Religion Foundation Inc 551 U.S. 587 and Lujan, Secretary of the Interior v Defenders of Wildlife 504 U.S. 555) it was held that standing was related to the exercise of judicial power. 147. Claims under the mining contracts were not submitted to arbitration. The Arbitral Tribunal committed a jurisdictional error when they allowed the claims under the mining contracts as being ‘total investment cost’. That jurisdiction error was not an interpretational error. The local and foreign cases cited by the Appellants did not involve an amalgamation of claims under separate contracts. Our Decision 148. It is apt to first set out the relevant law, much of which has been codified in AA 2005. Arbitration - Core Principles 80 FC-02(f)-91-12/2015 149. “There is no universal definition of arbitration … Each jurisdiction may apply its own ‘spin’ in deciding what may and what may not be arbitrated, and how the arbitral process is to be conducted … Different commentators have defined arbitration differently. However there are core principles that can be found in all the definitions. The core principles include: the need for an arbitral agreement; a dispute, a reference to a third party for its determination; and an award by the third party” (Arbitration of Commercial Disputes by Andrew Tweeddale and Keren Tweeddale at 2.01 and 2.02). The need for an Arbitration Agreement 150. An arbitration agreement “means an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not” (section 9(1) of AA 2005). “An arbitration agreement shall be in writing” (section 9(3) of AA 2005). 151. An arbitration agreement is a sine qua non. “Without a valid and enforceable arbitration agreement, the arbitral process fails” (Arbitration of Commercial Disputes supra at 2.04). “An arbitration agreement may be in the form of an arbitration clause in an agreement or in the form of a separate agreement” (section 9(2) of AA 2005). “A reference in an agreement to a document containing an arbitration clause shall constitute an arbitration 81 FC-02(f)-91-12/2015 agreement, provided that the agreement is in writing and the reference is such as to make that clause part of the agreement” (section 9(5) of AA 2005). When incorporated into a contract, the arbitration agreement “has full autonomy and shall not be affected by the fact that the contract may be invalid” (Cass le civ, 7 May 1963, Ets Raymond Gosset v Carapelli, JCP, Ed G, Pt II, No 13,405 (1963)). Governing Law 152. But contracts, arbitration agreements, and arbitrations do not exist in what book writers termed “a legal vacuum”. A contract, which will include an arbitration agreement, is governed by law. Arbitration “is regulated by the rules of procedure that have been agreed or adopted by the parties and the arbitral tribunal. Secondly, it is regulated by the law of the place of arbitration. It is important to recognise at the outset – as even distinguished judges and commentators failed to do – that this dualism exists” (Redfern and Hunter on International Arbitration Fifth Edition at 3.04). 153. “In many cases the law of a single jurisdiction will govern all aspects of the arbitration, although it is common in international arbitrations for the laws of different jurisdictions to apply to different aspects of the arbitration” (Halsbury’s Law of England 4th Edition Reissue Volume 2(3) at para 5). International commercial arbitration usually involves more than one system of 82 FC-02(f)-91-12/2015 law or of legal rules. Redfern and Hunter on International Arbitration Fifth Edition at 3.07 identified at least five potential systems of law which bear upon international commercial arbitration: “(i) the law governing the arbitration agreement and the performance of that agreement; (ii) the law governing the existence and proceedings of the arbitral tribunal – ie the lex arbitrii; (iii) the law, or the relevant legal rules, governing the substantive issues in dispute – generally described as the ‘applicable law’, the ‘governing law’, ‘the proper law of the contract’ or ‘the substantive law’; (iv) other applicable rules and non-binding guidelines and recommendations; (v) the law governing recognition and enforcement of the award (which may, in practice, prove to be not one law, but two or more, if recognition and enforcement is sought in more than one country in which the losing party has, or is thought to have, assets).” Choice of governing law of the contract 154. “It is often the case that the applicable law will be evidenced by a ‘choice of law’ clause within the contract. The arbitral tribunal appointed will then give effect to this agreement by applying the parties’ chosen law as the law to determine the substantive dispute” (Arbitration of Commercial Disputes supra at 6.04). “This law is often referred to as ‘the proper law of the 83 FC-02(f)-91-12/2015 contract’ or the ‘substantive law’ or ‘the applicable law’. The term ‘applicable law’ … [refers] to the law relevant to the substantive issue of the disputes … [and is] relevant to questions relating to the validity of the contract, its breach, and the remedies” (Arbitration of Commercial Disputes supra at 6.01). “In respect of an international arbitration, the arbitral tribunal shall decide the dispute in accordance with the law as agreed upon by the parties as applicable to the substance of the dispute” and “any designation by the parties of the law of a given State shall be construed, unless otherwise expressed, as directly referring to the substantive law of that State and not to its conflict of laws rules” (section 30(2) and (3) of AA 2005). Definition of governing law of the contract 155. In Amin Rasheed Shipping Corp v Kuwait Insurance Co [1984] AC 50, Lord Wilberforce defined the applicable law as meaning the law which governs the contracts and the parties’ obligations under it; the law which determines normally its validity and legality, its construction and effect, and the conditions of its discharge. 156. Under the principle known as dẻpecage or ‘split proper law’, parties are permitted to choose different laws to apply to different parts of the contracts (CGU International Insurance plc v Szabo [2002] 1 ALL ER (Comm) 83, and Dicey and Morris on the Conflict of Laws (2000) at 32-085). A combined law clause was 84 FC-02(f)-91-12/2015 upheld by the House of Lords in Channel Tunnel Group Ltd v Balfour Beatty Construction Ltd [1993] AC 334. Conflict between choice of governing law of the contract and the rules of the seat 157. But party autonomy is not absolute. “ … where the chosen applicable law conflicts with the rules at the seat of arbitration … these mandatory rules may override the contractual agreement of the parties … the arbitral tribunal will be constrained to apply the mandatory rules of law in preference to the law chosen by the parties” (Arbitration of Commercial Disputes supra at 6.05). No agreement on the governing law of the contract 158. Where there is no agreement on the law applicable to the substance of the dispute in an international arbitration, “the arbitral tribunal shall apply the law determined by the conflict of laws rules” (section 30(4) of AA 2005). Choice of procedural rules 159. “Subject to the provisions of this Act, the parties are free to agree on the procedure to be followed by the arbitral tribunal in conducting the proceedings” (section 21(1) of AA 2005). 160. The “arbitration rules provide the framework in which the arbitration proceedings are to take place ... parties may 85 FC-02(f)-91-12/2015 choose whether to conduct their arbitration under institutional rules [as administered by a specified body or institution] or under ad hoc arbitration [where the arbitral tribunal has control over all aspects of the proceedings subject to any rules which the parties may agree]” (Arbitration of Commercial Disputes supra at 3.01). “In most international ad hoc arbitrations there will be a reference to, or incorporation of, a set of rules that the parties agree to adopt. These may be bespoke to the particular agreement or those of a body such as UNCITRAL” (Arbitration of Commercial Disputes supra at 3.77). 161. Where the procedure chosen is different to that of the law of the seat of the arbitration then the procedure chosen will override the non-mandatory provisions of the seat of the arbitration. However, a choice of procedure by the parties cannot override the mandatory provisions of at the seat of arbitration (see Arbitration of Commercial Disputes supra at 7.60 read together with Redfern and Hunter on International Arbitration 5th Edition at 3.50). Choice of law governing the arbitration agreement 162. The law applicable to the arbitration agreement “governs its validity, interpretation and effect” (Halsbury’s Law of England 4th Edition Reissue Volume 2(3) at para 6). “ … it governs the obligation to submit disputes to arbitration and to honour any award” (Russell on Arbitration 24th Edition at 2-113). “It also 86 FC-02(f)-91-12/2015 governs the identification of the parties to the arbitration agreement … The question as to whether a particular dispute falls within the scope of an arbitration agreement will therefore be governed by the law of the arbitration agreement” (Russell supra at 2-122). “ … issues involving questions of contractual validity, scope and interpretation – including questions relating to identification of the parties – are determined by the law of the putative arbitration agreement” (Williams and Kawharu on Arbitration at 4.8). The ‘law applicable to the arbitration agreement’ must however be distinguished from the ‘law governing the arbitration’ or ‘arbitration law’ (Comparative Law of International Arbitration, Poudret and Besson, 2nd Edition at 291). 163. AA 2005 is silent on the circumstance where parties failed to designate the law to govern the arbitration agreement. Determination of the law governing the arbitration agreement – principal choice - law of the seat vs law governing the contact? 164. “If no such express designation has been made, and it becomes necessary to determine the law applicable to the agreement to arbitrate, what are the choices? There are other possibilities, but the principal choice – in the absence of any express or implied choice by the parties – appears to be between the law of the seat of the arbitration and the law that governs the contract as a whole” (Redfern and Hunter on International Arbitration Fifth Edition at 3.11). 87 FC-02(f)-91-12/2015 165. “The traditional approach to determine the law applicable to the arbitration agreement, in the absence of an agreement of the parties, is by application of the conflict of law rules of the seat of the arbitration. In most cases this will result in the arbitration agreement being governed either by the proper law of the contract or the law of the place of the arbitration” (Arbitration of Commercial Disputes supra at 7.09). “Where parties have made no express choice, the court will consider other indications in the arbitration agreement and more generally the contract as to the parties’ choice. Often this has involved the interplay between the governing law of the contract and the seat of the arbitration, where these have been expressly selected by the parties. Where the underlying contract does not contain an express governing law clause, the significance of the choice of seat of the arbitration is likely to be ‘overwhelming’ ” (Russell supra at 2-120). 166. “In applying the conflict of law rules the arbitral tribunal will be seeking to ascertain which law has the closest and most real connection to the arbitration agreement. The arbitral tribunal will therefore need to look at all the surrounding circumstances. In addition to the law applicable to the underlying contract and the law applicable to the seat of the arbitration the arbitral tribunal may also have regard to other factors such as the law of the country or countries where the parties are resident and the place 88 FC-02(f)-91-12/2015 of performance of the contract” (Arbitration of Commercial Disputes supra at 7.11). 167. “An alternative approach which has often been adopted is to link the law of the arbitration agreement to the applicable law of the contract. It has been said that where there have been no express choice of law to govern the arbitration agreement then there will be a very strong presumption that the law applicable to the arbitration will be the law applicable to the substantive agreement” (Arbitration of Commercial Disputes supra at 7.17). “It seems reasonable to say, as Professor Lew has said: ‘there is a strong presumption in favour of the law governing the substantive agreement which contains the arbitration clause also governing the arbitration agreement. This principle has been followed in many cases. This could even be implied as an agreement of the parties as to the law applicable to the arbitration clause’ … This supports the view that the arbitration clause is generally governed by the same law as the rest of the contract” (Redfern and Hunter on International Arbitration Fifth Edition at 3.13). “In Sumitomo Heavy Industries Ltd v Oil & Natural Gas Commission [1994] 1 Lloyd's Rep. 45 Potter J. (as he then was) expressed the view that the choice of law to govern the substantive contract will usually be decisive in determining the proper law of the arbitration agreement (page 57, col. 1) and in Leibinger v Stryker Trauma GmbH [2005] EWHC 690 (Comm) Cooke J. held that the proper law of an agreement to arbitrate in London was German law because the 89 FC-02(f)-91-12/2015 parties had expressly chosen German law as the proper law of the substantive contract, to which the arbitration agreement, although contained in a separate document, was an adjunct” (Sulamerica at [14]). In Channel Tunnel Group Ltd v Balfour Beatty Construction Ltd [1993] AC 334, 357-8, Lord Mustill stated that “exceptionally this [the substantive law of the contract] may differ from the national law governing the interpretation of the agreement to submit the dispute to arbitration”. 168. “The approach, that the law chosen by the parties to apply to the main contract determines the law applicable to the arbitration agreement, is however not universally accepted” (Arbitration of Commercial Disputes supra at 7.20). An “arbitration agreement is a distinct agreement that may be subject to its own governing law” (Williams and Kawharu on Arbitration at 4.8). “ … an arbitration is taken to be autonomous and to be separable from other clauses … if necessary, it may stand alone … it is this separability of an arbitration clause that opens the way to the possibility that it may be governed by a different law from that which governs the main contract. The New York Convention points towards this conclusion. In the provisions relating to enforcement, the Convention stipulates that the agreement under which the award is made must be valid ‘under the law to which the parties have subjected it’, or failing any indication thereon, ‘under the law of the country’ (which will be the law of the seat of the 90 FC-02(f)-91-12/2015 arbitration)” (Redfern and Hunter on International Arbitration Fifth Edition at 3.13 – 3.14). 169. Russell supra at 2-121 commented, “Where the parties have agreed a seat of the arbitration, that is likely to be the law of the country of the seat, being the place where the arbitration is to be held and the courts in that jurisdiction which will exercise the supporting and supervisory jurisdiction … ” (Russell supra at 2- 121). 170. Redfern and Hunter on International Arbitration Fifth Edition at 3.16 - 3.19 effectively said that “it is fairly settled in English law” that the seat of the arbitration is the appropriate law to govern the parties’ arbitration, on the basis of the decision in C v D [2007] EWHC 1541 (Comm), where the English Court of Appeal affirmed that by providing for arbitration in London under the auspices of the Arbitration Act 1996, the parties had chosen English law to govern not only matters arising under the Act, but also issues concerning the formal validity of the arbitration clause and the jurisdiction of the arbitral clause. In C v D, the court of first instance cited XL Insurance Ltd v Owens Corning [2000] Lloyd’s Rep 500, Noble Assurance Company and Shell Petroleum Inc v Gerling Konzern General Insurance Company UK Branch [2007] EWHC 25322, where the English Court of Appeal held that notwithstanding that the choice of governing law was New York law, the fact that the parties had agreed to refer disputes to 91 FC-02(f)-91-12/2015 arbitration in England under the auspices of the English Arbitration Act 1996 meant that the arbitration agreement was governed by English law, and the Court of Appeal cited Black-Clawson v Papierwerke [1981] 2 Lloyd’s Rep 446, 483, where it was ruled that “it would be a rare case in which the law of the arbitration agreement was not the same as the law of the place or seat of the arbitration”. 171. Redfern and Hunter on International Arbitration Fifth Edition at 3.24 further remarked that “the importance of the seat is particularly marked in the United States”. Lex arbitrii 172. Parties “are free to agree on the seat of arbitration (section 22(1) of AA 2005). 173. “The seat of the arbitration … establishes the curial law of the arbitration … ” (Russell supra at 5-077). “The arbitration law (lex arbitrii) encompasses all provisions governing the arbitration in a given country, particularly the formal validity of the arbitration agreement, the arbitrability of the dispute, the composition of the arbitral tribunal, fundamental procedural guarantees, assistance from the courts and judicial review of the award” (Comparative Law of International Arbitration supra at 112). “The lex arbitrii is a set of mandatory rules of law applicable to the arbitration at the seat of the arbitration. The curial or 92 FC-02(f)-91-12/2015 procedural law is the law that governs the procedure of the arbitration ... in most cases the procedural law and the lex arbitrii will be the same. It would be rare to encounter a situation where the parties have chosen a procedural law different to that of the law of the seat of the arbitration” (Arbitration of Commercial Disputes supra at 7.39). “All that needs to be understood … is that there is a great difference between the general provisions of the law governing the arbitration (lex arbitrii) and the detailed procedural rules … ” (Redfern and Hunter on International Arbitration Fifth Edition at 3.48). “ … once a place of arbitration has been chosen, it brings its own law. If that law contains provisions that are mandatory so far as arbitrations are concerned, those provisions must be obeyed. It is not a matter of choice, any more than the notional motorist is free to choose which local traffic laws to obey and which to disregard” (Redfern and Hunter on International Arbitration Fifth Edition at 3.62). 174. In Paul Smith v H & S International Holding Inc [1991] 2 Lloyd’s Rep 127, 130, Steyn J described lex arbitrii as follows: “What then is the law governing the arbitration? It is, as Martin Hunter and Alan Redfern, International Commercial Arbitration, p. 53, trenchantly explain, a body of rules which sets a standard external to the arbitration agreement, and the wishes of the parties, for the conduct of the arbitration. The law governing the arbitration comprises the rules governing interim measures (e.g. Court orders for the preservation or storage of goods), the rules empowering the exercise by 93 FC-02(f)-91-12/2015 the Court of supportive measures to assist an arbitration which has run into difficulties (e.g. filling a vacancy in the composition of the arbitral tribunal if there is no other mechanism) and the rules providing for the exercise by the Court of its supervisory jurisdiction over arbitrations (e.g. removing an arbitrator for misconduct).” The governing law of the mining contracts and the PDA 175. Inter alia, the 1st Mining Contract provided: (a) “Cooperation by both parties shall be subject to this agreement with their sincerity under the rules, procedures and law of the People’s Democratic Republic of Laos” (section 2); (b) “Conditions of cancellation of the agreement and dissolution of the operation or premature cancellation of the agreement shall be subject to the law of Foreign Investment in Laos” (section 30); and (c) “Should there arise any dispute, both parties shall discuss and agree to settle it well. Should it be not basically solved, the dispute shall be preferred to the Laotian Board of Economic Reconciliation or Laotian Court or International Dispute Settlement Organization” (section 31). 176. Inter alia, the 2nd Mining Contract provided: (a) the area of survey and mining shall be increased from 20 to 60 square kilometres and to a time frame of 2 years to survey the “increased area” (sections 1 and 2); 94 FC-02(f)-91-12/2015 (b) Terms of mineral exploration in the 2nd plot and 3rd plot shall be subject to power station agreement or a separate agreement (section 2); (c) Should the power station construction proceed according to the plan, the term of concession for the 1st plot in the area of 20 square kilometers, for which the license has been granted by the Government according to the Agreement, shall be binding the power station as the increased area of the 2nd plot and 3rd plot will be. Should the power station construction be impossible, or should it have not yet been done, the concession for the 1st plot shall be subject to the original agreement (section 2); (d) Should the power station construction be impossible, the Investor shall return the increased area to the Governmental Party together with survey report free of charge. The Governmental Party shall be entitled to utilize the said document (section 3); (e) The Investor shall contribute to the construction of the roads as specified in Section 25 of the Agreement from 12 million baht to 19 million baht under the terms of Section 25 mentioned above (clause 4). 177. Appended to the 2nd Mining Contract was a “memorandum” between the Respondent and the 1st Appellant on the construction of a lignite power plant in Hongsa, Laos. 178. Evidently, the parties chose Laotian law to govern the 1st Mining Agreement. There was no indication of the law to govern the 2nd Mining Contract. But given that the 2nd Mining Contract 95 FC-02(f)-91-12/2015 was a supplementary contract to add to the terms of the 1st Mining Contract, it should follow the parties must have intended Laotian law to govern both mining contracts. 179. The 1st Mining Contract indicated a seat/s but did not specify the arbitral procedure. 180. Inter alia, the PDA contained the following Articles: “14.1. Arbitration (i) In the event that a dispute arises out of this Agreement including any matter relating to the interpretation of this Agreement, each party shall use its best efforts to settle the dispute amicably through consultation in good faith with the other party or, if both parties agree, through ad hoc non- binding mediation in the Lao People’s Democratic Republic to be structured by the parties in order to provide a framework for the Government and TLL to attempt to arrive at a settlement which is acceptable to both of them. Whether amicable consultations, ad hoc non-binding mediation, or neither is used by the parties, if no settlement is reached within thirty days of the date of which such dispute first arises, then either party may submit the dispute to arbitration conducted in Malaysia at the Kuala Lumpur Regional Centre for Arbitration in accordance with the UNCITRAL Rules; provided, that, this clause shall not be construed to prevent any party from bringing any action in a court of competent jurisdiction for injunctive or other provisional relief. It is specifically understood by the parties that such dispute may be submitted by either party to arbitration regardless of the magnitude thereof, the amount in dispute, or 96 FC-02(f)-91-12/2015 whether such dispute would otherwise be considered justiciable or ripe for resolution by any court or arbitral tribunal. In the event that such dispute has been submitted to arbitration as described herein, any ad hoc mediation efforts shall immediately cease. (ii) The arbitration shall take place at a time noticed by the arbitral panel regardless of whether any of the parties fails to participate. The proceedings shall be conducted in the English language. There shall be three arbitrators appointed with the UNCITRAL Rules. (iii) Each arbitration shall be conducted in Kuala Lumpur, Malaysia, and the parties agree to exclude any right of application to any court or tribunal of competent jurisdiction in connection with any question of law arising in the course of any arbitration. (iv) The Director of Kuala Lumpur Regional Centre for Arbitration shall appoint the arbitrators for each arbitration. Only persons who are attorney or former judges with experience in international commercial agreements and, in particular, the implementation and interpretation of power purchase agreements under New York law shall be appointed as arbitrators. No arbitrator shall be a present or former employee or agent of, or consultant or counsel to, either party or an affiliate of either party. In no case shall admission to practice law in Malaysia be a requirement to service as an arbitrator.” “17.1. Assignment. 97 FC-02(f)-91-12/2015 Neither the Government nor TLL may assign this Agreement, in whole or in part, without the written consent of the other party, which consent shall not be unreasonably withheld, except that (i) TLL shall have the right to assign this Agreement without consent to the Company; (ii) TLL shall have the right to assign any of the rights or benefits contained in this Agreement (including any schedules and exhibits hereto) to Hongsa Lignite including without limitation any rights to lignite or other minerals and the exploitation thereof; and (iii) TLL shall have the right to assign this Agreement or the Prior Contracts without consent to the Lenders and Investors in connection with the financing of the Project; provided that any assignee of this Agreement shall comply with all of the terms and conditions hereof.” “18.1. Governing Law. The laws of the Lao People’s Democratic Republic shall apply (i) with respect to the authorization and execution of this Agreement by the Government, (ii) with respect to the fil in force on the date of execution of this Agreement by the Government, (iii) with respect to any of the laws of the Lao People’s Democratic Republic and the specified consents specifically referred to by name in this Agreement as being applicable; and (iv) with respect to the lease and the mineral rights deed. With respect to overall governing law and construction and to all other matters not specifically mentioned in the preceding clauses (i) – (iv), this Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, United States of America, without reference to principles of conflict of laws, unless otherwise agreed to by both parties hereto.” 181. Article 18.1 of the PDA provided that Laotian law governed (i) “the authorization and execution of this Agreement by 98 FC-02(f)-91-12/2015 the Government”, (ii) “the FIL in force on the date of execution of this Agreement by the Government”, (iii) “the specified consents specifically referred to by name in this Agreement as being applicable”; and (iv) the “lease and the mineral rights deed”. Article 18.1(iv) of the PDA reiterated that Laotian law governed the mining contracts. 182. But Article 18.1 of the PDA equally provided that the “overall governing law and construction and to all other matters not specifically mentioned in the preceding clauses (i) – (iv), this Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, United States of America, without reference to principles of conflict of laws, unless otherwise agreed to by both parties hereto.” 183. The parties chose different laws to govern different parts of the PDA. While Laotian law governed the ‘mining rights’ (Article 18.1(iv) of the PDA emphasised that), New York law governed all matters not mentioned in article 18.1(i) – (iv) of the PDA. 184. The parties chose Kuala Lumpur as the seat and the UNCITRAL rules as the procedural rules of the arbitration. The governing law of the PDA, the seat, and the arbitral procedure were all designated. Only the law governing the arbitration agreement was left unspecified, and which must be settled before interpretation of the arbitration agreement. The PDA – the law governing the arbitration agreement 99 FC-02(f)-91-12/2015 185. As said, where there is no express choice of the governing law of the arbitration agreement, the choice then is usually between the law of the seat and the governing law of the contract. The Appellants submitted that the governing law of the arbitration agreement should follow the law applicable to the PDA. The Respondent submitted that the law governing the arbitration agreement should follow the seat. 186. Ostensibly, it was a choice between the governing law of the contract and the law of the seat. But in truth, the choice was dictated by the conflict of laws rules. The arbitration agreement provided that “either party may submit the dispute to arbitration conducted in Malaysia at the Kuala Lumpur Regional Centre for Arbitration in accordance with the UNCITRAL Rules”. Article 33(1) of UNCITRAL Arbitration Rules 1976 (revised 2010) provided that where parties failed to designate the law applicable to the substance of the dispute, “the arbitral tribunal shall apply the law determined by the conflict of laws rules which it considers applicable”. Section 30(4) of AA 2005 provides that where the parties failed to designate the law applicable to the substance of the dispute, “the arbitral tribunal shall apply the law determined by the conflict of laws rules”. The UNCITRAL Arbitration Rules 1976 was silent and the AA 2005 is silent on the approach to be adopted where parties failed to designate the law applicable to the arbitration agreement. But given that the UNCITRAL Arbitration Rules 1976 adopted, and AA 2005 adopts the conflict of laws rules 100 FC-02(f)-91-12/2015 approach to determine the law applicable to the substance of the dispute, then it should follow that the conflict of laws rules approach should also determine the law applicable to the arbitration agreement. The UNCITRAL Arbitration Rules 1976 subscribed to the conflict of laws rules approach to determine applicable law. When the parties adopted the UNCITRAL rules, they implicitly accepted the conflict of laws rules approach to determine applicable law. In any case, when the parties designated Kuala Lumpur as the seat, they also implicitly accepted the conflict of laws rules approach to determine the applicable law. In the instant case, it was fortuitous there was no conflict between the UNCITRAL Arbitration Rules 1976 and AA 2005. But in the event of any conflict between the agreed procedure and AA 2005, AA 2005 must necessarily prevail. Under AA 2005, the law applicable to the arbitration agreement is not tied to the law applicable to the contract. Rather, the law applicable to the arbitration agreement is determined by the conflict of laws rules of the seat. 187. Under the conflict of laws rules, the law that has the closest and most real connection to the arbitration agreement is the law applicable to the arbitration agreement. In the instant case, the arbitration was conducted in Malaysia at the Kuala Lumpur Regional Centre for Arbitration. Since the arbitration was conducted in Malaysia, AA 2005 (with the exception of Part III) was the lex arbitrii. Since the seat was Kuala Lumpur, AA 2005 101 FC-02(f)-91-12/2015 was also the curial law (see Government of India v Cairn Energy India Pty Ltd & Anor [2011] 6 MLJ 441 at [25] where Richard Malanjum CJ (Sabah and Sarawak), delivering the judgment of the court, agreed that the curial law ought to be that of the seat of arbitration, and Government of India v Petrocon India Ltd [2016] 3 MLJ 435 at [33], where Arifin Zakaria CJ, delivering judgment of the court, said that “the seat of arbitration will determine the curial law that will govern the arbitration proceeding”). AA 2005 was the lex arbitrii and the curial law. That pointed to the law of Malaysia with the closest connection to the arbitration agreement. New York law had no connection to the arbitration agreement. The PDA required the arbitral tribunal to be trained in New York law. But that was because New York law governed the substance of the dispute. The parties submitted on New York law. But that was to address the third party beneficiary issue. Only the law of Malaysia had the connection, the closest and most real at that, to the arbitration agreement. Under the conflict of laws rules, the law applicable to the arbitration agreement should be the law of Malaysia. That conclusion on the applicable law should be the same even if the three stage test espoused in Sulamerica were applied, as the parties’ adoption of the UNCITRAL Arbitration Rules 1976 implied a choice of the law applicable to the seat. There was a tacit choice of Malaysian law to govern the arbitration agreement. Malaysian law, namely ordinary contract law principles, would govern the interpretation of the arbitration agreement. “However, the general principles of interpretation are 102 FC-02(f)-91-12/2015 very similar under the various national laws, so that the determination of the law applicable to the arbitration agreement will not play a vital role as far as its interpretation is concerned” (Comparative Law of International Arbitration, supra at 304). Interpretation of the PDA arbitration agreement 188. The arbitration agreement provided “In the event that a dispute arises out of this Agreement including any matter relating to the interpretation of this Agreement ... either party may submit the dispute to arbitration conducted in Malaysia at the Kuala Lumpur Regional Centre for Arbitration in accordance with the UNCITRAL Rules ... ”. Article 1 of the PDA defined ‘agreement’ as “this agreement”. The Appellants submitted “the dispute [which arose] out of this Agreement” to arbitration. Ordinary contract law principles would read “a dispute [which] arises out of this Agreement” as “a dispute which arises out of the PDA”. US law should also read “arises out of this contract” as arises “out of the instant contract” and not some other contract. “In Sweet Dreams Unlimited v Dial-a-Mattress Intern 1 F 3d 639 (7th Circuit 1993) ... the United States Court of Appeals held that the words ‘arising out of’ reached “all disputes having their origin or genesis in the contract, whether or not they implicate interpretation or performance of the contract per se” ... In Manufacturer (Finland) v Building Supplier (USA) (2000) XXV Ybk Comm Arbn 311-23, the arbitral tribunal reviewed the law regarding the meaning of the 103 FC-02(f)-91-12/2015 words ‘under’ or ‘hereunder’ ... [and] referred to the cases of Mediterranean Enterprise Inc v Ssagyong 708 F 2d 1458,1464 (9th Circuit 1983) and In re Kinoshita Co 287 F 2d 951 (2nd Cir 1961) in which the wording of the arbitration clause was held not to be sufficiently broad enough to allow the dispute to be referred to arbitration. In these cases the United States courts accepted the submission that such clauses only encompass disputes relating to the interpretation and performance of the contract itself” (Arbitration of Commercial Disputes supra at 5.67 - 5.68). Even the US cases cited in [110] of the award would read “this agreement” as “the PDA”. “ ... follow the plain text ... my job is to apply the law you write” (Justice Neil Gorsuch, as reported in Yahoo News dated 17.4.2017). Following the plain text, only a dispute that arose out of the PDA could be arbitrable under Article 14.1 of the PDA. 189. But if the PDA had subsumed the mining contracts, then “this Agreement” could read as “the PDA and mining contracts”. If read as “the PDA and mining contracts”, then would it not be that all disputes under the PDA and mining contracts could be arbitrable under Article 14.1 of the PDA, and that the amalgamation of claims under the mining contracts and claims under the PDA might not be out of order? In [5] of this judgment, we noted that the PDA also incorporated terms which touched on the mining venture and which required those terms to be read together with the mining contracts, and vice versa. A case in point was Article 4.12 of the 104 FC-02(f)-91-12/2015 PDA which provided that “pursuant to section 25 of the First [mining] Contract, TLL will construct a fourth class road from Hongsa, Udomxay to Muang Ngern over a three year period. TLL shall build, transfer, and operate the roads as toll ways according to normal BTO scheme practices. The toll way roads shall be the property of and turned over to the Government upon completion ... ” 190. But Article 19.11 of the PDA provided that “both parties acknowledge the existence, and continuing validity of the [mining contracts]: “19.11. Integration. This Agreement contains the entire agreement between the parties concerning the subject matter hereof, except that both parties acknowledge the existence, and continuing validity of, the Prior Contracts. The rights and benefits of TLL contained in this Agreement may not be limited in any way by any statements made in the Prior Contracts, which are intended to be with Hongsa Lignite, but may be broadened or made more extensive by the Prior Contracts including, without limitation, such matters as the Sayaburi-Hongsa and Hongsa-Muang Ngern road construction projects and the exploitation of lignite and other minerals on the Site. The parties agree that the diagram contained in Exhibit …….. hereto generally describes the conceptual relationship between this Agreement and the Prior Contracts vis-à-vis the respective exploration, mining, and power plant transactions between the Government and Hongsa Lignite or TLL, as the case may be, subject to any assignments of such rights between Hongsa Lignite or TLL. Such diagram is for convenience of reference only. 105 FC-02(f)-91-12/2015 191. Article 19.13 of the PDA provided that the PDA “shall supersede and govern any previous understandings between the parties except that any of Hongsa Lignite’s and/or TLL’s rights under the Prior Contracts that are more broad or extensive than what is contained herein shall remain in full force and effect and undisturbed this Agreement”. At the same time, Article 19.13 of the PDA provided that “neither this Agreement nor the [mining contracts] shall detract from the other but rather that they reflect two separate but related projects”: “19.13. Conflict. This Agreement shall supersede and govern any previous understandings between the parties except that any of Hongsa Lignite’s and/or TLL’s rights under the Prior Contracts that more broad or extensive than what is contained herein shall remain in full force and effect and undisturbed by this Agreement. The parties intend that neither this Agreement nor the Prior Contracts shall detract from the other but rather that they reflect two separate but related projects; this Agreement and the Prior Contracts should be read and construed so as to maximize the rights and benefits to TLL or Hongsa Lignite as the case may be and not to subtract from them in any way. On the other hand, regardless of whether or not this Project is determined to be feasible, or subject to force majeure, termination, default, or any other event, happening, or contingency, Hongsa Lignite’s rights and benefits under the Prior Contracts shall remain intact.” 192. Both parties agreed that there were “two separate but related projects”. Both parties acknowledged the separate existence and continuing validity of the mining contracts. There 106 FC-02(f)-91-12/2015 were “two separate but related projects”. There were two separate sets of agreements. The mining contracts were not subsumed under the PDA. 193. Since the mining contracts and the PDA remained separate, and the respective arbitration agreements in tow also remained separate, Article 14.1 of the PDA would read that only a dispute which arose out of the PDA could be submitted to arbitration conducted in Malaysia at the Kuala Lumpur Regional Centre for Arbitration in accordance with the UNCITRAL Rules ... ”. The parties agreed that only a dispute which arose out of the PDA could be submitted to arbitration conducted in Malaysia at the Kuala Lumpur Regional Centre for Arbitration in accordance with the UNCITRAL Rules. 194. Article 14.1 of the PDA determined the jurisdiction that the parties gave to the Arbitral Tribunal. “The scope of the arbitration agreement ratione materiae determines which disputes the parties intended to submit to arbitration. It is governed by the law applicable to the arbitration agreement” (Comparative Law of International Arbitration supra at 305). “ … an arbitral tribunal's jurisdiction depends on the scope of the arbitration agreement” (Econet Satellite Services Ltd v Vee Networks Ltd (formerly known as Econet Wireless Nigeria Ltd) [2006] EWHC 1664 (Comm) per Field J). “A non-statutory arbitrator derives his jurisdiction from the agreement of the parties at whose instance he is appointed. He has such jurisdiction as they agree to give him and none that 107 FC-02(f)-91-12/2015 they do not” (Ashville Investments v Elmer Contractors [1988] 37 BLR 55, 78 per Bingham J). “The scope or mandate of the arbitral tribunal is determined by the wording of the arbitration agreement. Where the parties have made an agreement to arbitrate then they will be held to that agreement and the arbitral tribunal’s jurisdiction, once established, will be interpreted broadly (Mitsubishi Motors Corp v Soler Chrysler-Plymouth Inc 473 US 614, 628 (1985))” (Arbitration of Commercial Disputes supra at 5.63). 195. Undoubtedly, Article 14.1 of the PDA would not cover disputes which arose out of the mining contracts. If claims which arose out of the mining contracts were indeed allowed, then the Arbitral Tribunal acted without jurisdiction, and the award could be set aside. 196. Pertinent to the setting aside of an arbitral award, section 37 of AA 2005 provides as follows: “(1) An award may be set aside by the High Court only if- (a) the party making the application provides proof that- … (iv) the award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration; 108 FC-02(f)-91-12/2015 (v) subject to subsection (3), the award contains decisions on matters beyond the scope of the submission to arbitration; or ... ” 197. In relation to “the award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration” and “the award contains decisions on matters beyond the scope of the submission to arbitration”, William & Kawharu supra at 17.5.4 thus commented on the first limb of art 34(2)(a)(iii) of the NZ Arbitration Act (the equivalent of section 37(1)(a)(iv) and (v) of AA 2005): “This ground for setting aside is directed at situations in which a tribunal has jurisdiction under a valid arbitration agreement, but has exceeded the authority by dealing in the award with matters that go beyond the terms of the arbitration agreement or the scope of the issues referred by the parties for resolution ... The tribunal also has an obligation to take particular care to keep within the confines of these matters that the parties have plainly put in issue ... If the tribunal exceeds its authority in respect of some matters only, and its decisions on those matters are severable from decisions on matters made within the submission to arbitration, the High Court may only set those parts of the award containing the decisions on matters not submitted to arbitration 198. Section 37(3) of AA 2005 correspondingly provides “Where the decision on matters submitted to arbitration can be separated from those not so submitted, only that part of the award which contains decisions on matters not submitted to arbitration 109 FC-02(f)-91-12/2015 may be set aside] ... when an issue is clearly put before the tribunal there is no excess of authority if the tribunal applies its own view of the law in respect of that issue ... ” 199. Both courts below held that the award (i) dealt with a dispute not contemplated by or not falling within the terms of the submission to arbitration and (ii) contained decisions on matters beyond the scope of the submission to arbitration. It was strange that learned counsel for the Appellants made no attempt to show that the award was within jurisdiction. Rather, learned counsel for the Appellants devoted much of his entire submission to the claim that the challenge of the Respondent to the jurisdiction of the Arbitral Tribunal was bad. To that end, learned counsel for the Appellants argued (i) that the Respondent did not object to the jurisdiction of the Arbitral Tribunal within time, (ii) that objection to the standing of parties was not an objection to the jurisdiction of the Arbitral Tribunal, (iii) that the objection was not a challenge to the jurisdiction of the Arbitral Tribunal but to its arbitral power to hear and determine the claim, (iv) that whatever objection to the jurisdiction of the Arbitral Tribunal was waived by the counter- claim, and (v) that the purported challenge to jurisdiction was in fact an issue of interpretation of the PDA with respect to the standing of HLL and the counter-claims. ‘Plea not within time’ 110 FC-02(f)-91-12/2015 200. Pertinent to ‘time to object’, Article 21(3) and (4) of the UNCITRAL Arbitration Rules 1976 then provided: “(3) A plea that the arbitral tribunal does not have jurisdiction shall be raised not later than in the statement of defence or, with respect to a counter- claim, in the reply to the counter-claim. (4) In general, the arbitral tribunal should rule on a plea concerning its jurisdiction as a preliminary question. However, the arbitral tribunal may proceed with the arbitration and rule on such a plea in their final award.” 201. Article 21(3) and (4) of the UNCITRAL Arbitration Rules 1976 was revised by Article 22(2) and (3) of the UNCITRAL Arbitration Rules 2010, to read as follows: “(2) A plea that the arbitral tribunal does not have jurisdiction shall be raised no later than in the statement of defence or, with respect to a counterclaim or a claim for the purpose of a set-off, in the reply to the counterclaim or to the claim for the purpose of a set-off. A party is not precluded from raising such a plea by the fact that it has appointed, or participated in the appointment of, an arbitrator. A plea that the arbitral tribunal is exceeding the scope of its authority shall be raised as soon as the matter alleged to be beyond the scope of its authority is raised during the arbitral proceedings. The arbitral tribunal may, in either case, admit a later plea if it considers the delay justified. 111 FC-02(f)-91-12/2015 (3) The arbitral tribunal may rule on a plea referred to in paragraph 2 either as a preliminary question or in an award on the merits. The arbitral tribunal may continue the arbitral proceedings and make an award, notwithstanding any pending challenge to its jurisdiction before a court.” 202. Article 21(3) and (4) of the UNCITRAL Arbitration Rules 1976 were not revised in time to be applicable in the instant case. But yet the purport of Article 23(2) and (3) of the UNCITRAL Arbitration Rules 2010 was ever present in the instant case. Section 18(3), (5), (7), and (8) of AA 2005 provides: “(3) A plea that the arbitral tribunal does not have jurisdiction shall be raised not later than the submission of the statement of defence. (5) A plea that the arbitral tribunal is exceeding the scope of its authority shall be raised as soon as the matter alleged to be beyond the scope of its authority is raised during the arbitral proceedings. (7) The arbitral tribunal may rule on a plea referred to in subsection (3) or (5), either as a preliminary question or in an award on the merits. (8) Where the arbitral tribunal rules on such a plea as a preliminary question that it has jurisdiction, any party may, within thirty days after having received notice of that ruling appeal to the High Court to decide the matter. (9) While an appeal is pending, the arbitral tribunal may continue the arbitral proceedings and make an award.” 112 FC-02(f)-91-12/2015 203. It was so submitted, and we agree that “a plea that the arbitral tribunal does not have jurisdiction shall be raised not later than in the statement of defence” (Article 21(3) of the UNCITRAL Arbitration Rules 1976, which is the equivalent of Section 18(3) of AA 2005). But in relation to a plea that the arbitral tribunal is exceeding the scope of its authority, that “shall be raised as soon as the matter alleged to be beyond the scope of its authority is raised during the arbitral proceedings” (section 18(5) of AA 2005). In other words, a plea that the arbitral tribunal is exceeding the scope of its authority could be raised during the arbitral proceedings. Hence, ‘time to object’ depends on whether it is a plea under section 18(3) or 18(5) of AA 2005. But that was not distinguished in the submissions before us. 204. But whichever the plea, the arbitral tribunal may rule on the plea as a preliminary question or in the award on the merits. Parties cannot insist on an immediate ruling. But where the arbitral tribunal rules on such a plea as a preliminary question that it has jurisdiction, any party may, within thirty days after having received notice of that ruling, appeal to the High Court to decide the matter. While an appeal is pending against the ruling, the arbitral tribunal may continue the arbitral proceedings and make an award. 205. In the instant case, there was no immediate ruling on the plea, be it under section 18(3) or (5) of AA 2005. Without an immediate ruling by the Arbitral Tribunal that it had jurisdiction, 113 FC-02(f)-91-12/2015 the Respondent could not invoke section 18(8) of AA 2005 and appeal to the High Court to decide the matter. The Respondent could only await a ruling in the award, and meanwhile participate in the arbitration, which was one of the options open to the Respondent (see Redfern and Hunter on International Arbitration 5th Edition at 5.120 and 5126). 206. But what if there were an immediate ruling by the Arbitral Tribunal that it had jurisdiction? To challenge that immediate ruling, the Respondent must appeal to the High Court or the Respondent would not later be able to challenge the award on the ground that “the award [dealt] with a dispute not contemplated by or not falling within the terms of the submission to arbitration” (section 37(1)(a)(iv) of AA 2005) or that “the award [contained] decisions on matters beyond the scope of the submission to arbitration” (section 37(1)(a)(v) of AA 2005). 207. But if the Respondent could be bound by failure to appeal under section 18(8) of AA 2005, then how should it pan out if the “not within time’ argument of the Appellants were not raised in their pleadings or during the arbitral proceedings? 208. We have closely perused the statement of defence and the reply. In the opening memorial to paragraph 3.1 of the statement of defence, the Respondent stated that TLL had no standing to bring claims under the PDA. 114 FC-02(f)-91-12/2015 209. In paragraph 3.1.2 of the statement of defence, the Respondent asserted that the PDA provided that the PDA was intended to be with HLL and that TLL had “no standing to bring claims under the mining contracts”. In footnote (97) to paragraph 3.1.2 of the statement of defence, the Respondent thus amplified on the objection to the standing of TLL to bring claims under the mining agreements and on the jurisdiction of the Arbitral Tribunal to adjudicate on disputes arising under the mining contracts: “If TLL does not have standing to bring claim under the prior agreements, then HLL may. However, the Tribunal's jurisdiction over such claims would not come from the arbitration clause of the PDA, which applies only to "dispute[s] aris[ing] out of this Agreement ... '' (PDA, Art. 14.1). That language is not broad enough to encompass disputes arising out of the Prior Contracts. (See Paragraph 7.1, infra.). Rather, the Tribunal's jurisdiction over such claims would come from the dispute settlement clause (Paragraph 31) of the First Contract ... ” 210. In paragraph 7.1 of the statement of defence, the Respondent asserted that Article 15.1 of the PDA, which provided that termination of the PDA must have the prior approval of the arbitration panel constituted in accordance with Article 14 of the PDA, had no application to the mining contracts. 211. In paragraph 7.2 of the statement of defence, the Respondent asserted that the mining contracts were governed by Laotian law. 115 FC-02(f)-91-12/2015 212. And in paragraph 2 of the Respondent’s closing memorial, the Respondent asserted that TLL or TLP could assert claims under the PDA, and that HLL had no right to enforce the PDA. 213. The arbitral tribunal perceived that those pleadings in the statement of defence to mean (a) “Respondent contends, first that neither claimant has standing to bring the present claims. GOL argues that TLL lacks capacity to enforce the PDA, that HLL has no right to claim under the PDA and that other affiliated organizations that are not parties to the arbitration, namely TLP and SEAP, have asserted no claims and have no rights to claim under the PDA” (see [56] of the award), and (b) “The Respondent challenges HLL’s standing because HLL is not a signatory of the PDA, and, even if HLL is an intended beneficiary of the PDA, HLL has no right to enforce the PDA because HLL’s Laos investment licence mentions only the second agreement and not the PDA” (see [62] of the award). But in fact, the Respondent asserted not only that TLL, HLL, TLP and SEAP lacked standing to bring claims under the PDA, but also that claims under the mining contracts could not be brought under the PDA (see paragraph 3.1.2 of the statement of defence, and footnote 97). 214. In the statement of defence, there was a clear challenge to the adjudication of mining claims by the Arbitral Tribunal. Yet, in their reply, there was no objection by the Appellants that the plea under section 18(3) and or (5) of AA 2005 was made out of 116 FC-02(f)-91-12/2015 time. There was also nothing in the award to suggest that an objection was ever raised by the Appellants to the plea under section 18(3) and or (5) of AA 2005 being made out of time. It could only be surmised that ‘out of time’ was never an issue during the arbitral proceedings. “A party that fails to raise a plea as to jurisdiction within the time limited provided by art 16(2) of sch 1 to the NZ Act [the equivalent of section 18(3) and (5) of AA 2005], but continues to participate in the arbitration, will be deemed to have waived the right to later object to an award under art 34 [the equivalent of section 37 of AA 2005] or art 36 on grounds that should have been pleaded within those time limits, unless the matter is mandatory in nature (for instance, the arbitrability of the dispute or public policy). 215. The Arbitration Act 2005 by Sundra Rajoo and WSW Davidson at 171 proposed that whether a jurisdictional issue could be later raised would depend on the nature of the jurisdictional issue; see also A Guide to the UNCITRAL Model Law on International Commercial Arbitration by Howard M. Holtzmann & Joseph E. Neuhaus at 482 -483]. Equally, if a party raises an out of time challenge but the other party does not object to the lateness of the challenge, and the tribunal rules on the plea, the other party cannot rely on the delay to prevent the High Court from deciding the matter under art 16(3) [the equivalent of section 18(8) of AA 2005]” (Williams & Kawharu supra at 7.4.6). On the facts, even if the plea under section 18(3) or (5) of AA 2005 were 117 FC-02(f)-91-12/2015 made out of time, the Appellants could not rely on delay, which was not an issue during the arbitral proceedings, to prevent the High Court from deciding the matter under section 37 of AA 2005. On the facts, where there was no objection to lateness, the Appellants could not raise the ‘out of time’ argument. As such, we reject the ‘out of time’ argument. Objection to standing was not objection to the jurisdiction of the arbitral tribunal 216. The Respondent asserted that the claimants were not parties to the mining contracts or PDA. The Appellants argued that the objection to the standing of the claimants was not an objection to the jurisdiction of the arbitral tribunal. 217. In LG Caltex Gas Co. Ltd and anor v China National Petroleum Corpn and anor [2001] 1 WLR 1892, two sets of arbitral proceedings were commenced in 1997 before the same sole arbitrator pursuant to a supply agreement dated 18.10.1995 and a charterparty dated 17.10.1995, both of which provided for non- institutional arbitration in London. The respondents reserved their position with respect to jurisdiction, contending that they were not party to the alleged contracts and that the arbitration agreements were not binding on them. By two awards dated 24.5.1999, the arbitrator held that the respondents were not parties to or bound by either the supply agreement or the charterparty. The appellants challenged both awards pursuant to section 67 of the 118 FC-02(f)-91-12/2015 Arbitration Act 1996, on the basis that the awards concerned the arbitrator's jurisdiction and that, by virtue of section 67, the court had the final say on matters of jurisdiction. The judge ordered the trial of various preliminary issues and held, inter alia, (i) that the parties had made ad hoc submissions to the arbitrator by exchange of communications in writing on the issue of whether the respondents were parties to the contracts, and that therefore section 67 did not apply; and (ii) that the awards were not awards as to substantive jurisdiction for the purposes of section 67(1)(a), which provided that a party to arbitral proceedings might apply to the court to challenge an award of the arbitral tribunal as to its substantive jurisdiction, as the awards made were awards on the merits. The appellant companies appealed. In allowing the appeal, Lord Philips MR (Pill and Keene LJJ in full agreement) said: “An arbitration agreement is often contained in the contract that sets out the substantive rights and obligations of the parties. Where a respondent denies that he is party to such a contract, that challenge raises simultaneously (1) the procedural issue of whether the arbitrator has jurisdiction; and (2) the substantive issue of whether the respondent is liable for breach of contract.” 218. We agree with Lord Phillips and therefore reject the argument that objection to standing was not objection to the jurisdiction of the Arbitral Tribunal. The objection was not a challenge to the jurisdiction of the Arbitral Tribunal but to its arbitral power to hear and determine the claim 119 FC-02(f)-91-12/2015 219. As said, the objection to standing of the claimants was simultaneously an objection to the jurisdiction of the Arbitral Tribunal. The instant objection was also an objection to the adjudication of claims that arose under the mining contracts. That was not an objection to the jurisdiction of the Arbitral Tribunal to hear claims that arose under the PDA. That was an objection that went to the heart of the jurisdiction of the Arbitral Tribunal to adjudicate on claims that arose under the mining contracts via the PDA arbitration. The objection must be viewed in totality. And when viewed in totality, there was no arguable merit in the argument that the jurisdictional objection of the Respondent was nothing but a challenge to the arbitral power “to hear and determine the claim”. An objection to the arbitral power to hear and determine a claim is a challenge to the jurisdiction of an arbitral tribunal. With respect, it was splitting hairs to say that the objection to the arbitral power to hear and determine the claim was not a challenge to the jurisdiction of the Arbitral Tribunal. Objection to jurisdiction was waived by the counter-claim 220. The argument that objection to the jurisdiction of the Arbitral Tribunal was waived by the counter-claim was premised on the alleged fact that there was a counter-claim. But was there a counter-claim in the first place? Both courts below held that there was no counter-claim. 221. Paragraph 11 of the ‘counter-claim’ read: 120 FC-02(f)-91-12/2015 “Given the uncertainty as to identity and standing of the various claimants and potential claimants, the GOL is uncertain of the parties against whom it should assert its counterclaims. Accordingly, the GOL sets forth in this section descriptions of its counterclaims, rather than particular claims against particular parties and reserves the right to later identify the respondent or respondents to particular claims.” 222. The alleged ‘counter-claim’ stated that “GOL [was] uncertain of the parties against whom it should assert its counter- claim”, and that “GOL set forth in this section descriptions of its counterclaims, rather than particular claims against particular parties and reserve[d] the right to later identify the respondent or respondents to particular claims”. The ‘counter-claim’ stated that “it set forth … the descriptions of its counterclaims” but not “particular claims against particular parties”. A counter-claim is a claim by a defendant against the plaintiff (see order 15 rule 1(b) of the Rules of Court 2012). But the ‘counter-claim’ named no party to answer “the descriptions of counter-claims”. The ‘counter-claim’ was dismissed by the Arbitral Tribunal. But the dismissal of the ‘counter-claim’ proved nothing. For only if the ‘counter-claim’ were allowed, could it be proved that there was or there was not a counter-claim. If the ‘counter-claim’ were allowed, who was the party named to honour the award? There must be a party named to answer a ‘counter-claim’. But given that no party was named to answer the ‘counter-claim’, there was no counter-claim in fact or law. In any event, we hasten to add that whether an objection to 121 FC-02(f)-91-12/2015 jurisdiction has been waived by a counter-claim must necessarily depend on the facts of each case. Purported challenge to jurisdiction was in fact an issue of interpretation of the PDA with respect to the standing of HLL and the counter-claims 223. With respect, the challenge by the Respondent was not only to the standing of the claimants and also to the adjudication of mining claims via the PDA by the arbitral tribunal. But that is not to say that the interpretation of the PDA and how HLL stood in relation to the PDA were not material. After all, a challenge to jurisdiction invariably involves interpretation of the arbitration agreement. The purported amalgamation of damages was in fact the Arbitral Tribunal’s interpretation of ‘total investment cost.’ 224. Both courts below held that the award was an amalgamation of claims that arose under the mining contracts and claims that arose under the PDA. In what was the only argument that had nothing to do with the jurisdictional challenge of the Respondent, learned counsel for the Appellants argued that the purported amalgamation of damages was in fact the Arbitral Tribunal’s interpretation of ‘total investment cost.’ 225. Thus far, we have intentionally avoided any use of the expression “Hongsa Project”. That is because “Hongsa Project” could not be found in any of the agreements. 122 FC-02(f)-91-12/2015 226. Inter alia, Article 1 of the PDA defined, “Agreement” “Company”, “Complex”, “First Contract”, “Foreign Investors”, “Hongsa Lite”, “Investors”, “Lenders”, “Plant or Plant”, “Prior Agreements”, “Project”, and “Second Contract”. But “Hongsa Project” could not to be found in the mining contracts or the PDA. The closest to “Hongsa Project” was the following intitulement, in the following format, on the front page of the 2nd mining contract: “Additional Agreement Lignite Mine Survey and Exploration Project Hongsa – Chianghon Special Area … ” And Memorandum Lignite Power Station Construction Project In Hongsa – Chianghon Special Area … ” 227. “Hongsa Project” was however freely used by the Arbitral Tribunal. It first appeared at the very first paragraph of the award where the Arbitral Tribunal said “TLL … was established specifically to develop a project to locate, extract, and convert suspected lignite coal reserves in the underdeveloped area of Hongsa area of Laos into electricity for sale [to] Thailand (the Hongsa Project) … ”. 228. “Hongsa Project” also appeared in the award, 123 FC-02(f)-91-12/2015 (a) at [2] where the arbitral tribunal said that “HLL [was incorporated] for the purpose of exploring and facilitating the development of a mining concession related to the Hongsa Project”; (b) at [5] where the arbitral tribunal said that “the Hongsa Project is a plan, with associated rights, to dig mines, construct and operate lignite-fired electricity generation plants … construct roads and transmission lines … and build other infrastructure to support the operation … ”; and, (c) at [15] to [37], where in relating the history of the Hongsa Project, the arbitral tribunal said “there has not been any additional physical development of the Hongsa Project beyond the work done by Claimants although Banpu has commissioned additional studies. No mines have been dug and no power construction has begun”. 229. Thus, according to the Arbitral Tribunal, “Hongsa Project” encompassed the extraction of lignite (see [1] of the award), the development of a mining concession (see [2] of the award), the “digging” of mines (see [5] of the award), and the mines (see [37] of the award), or in short, both mines and power plant. That was the reason why “Hongsa Project” was used throughout the award (see [12], [44], [45], [68], [70], [76], [87] – [90], [96], [99] - [101], [103], [104], [106], [124], [130] of the award) without regard for the fact that there were 3 agreements and that the mining contracts were not the subject of arbitration. 230. To the Arbitral Tribunal, “Hongsa Project” was the subject of the arbitration. That was confirmed at [102] of the 124 FC-02(f)-91-12/2015 award, where the Arbitral Tribunal awarded the total investment cost of TLL, HLL and TLP in the “Hongsa Project” without distinction as to whether the claimed ‘total investment cost’ was expended under the mining contracts or the PDA, and at [114] of the award, where the Arbitral Tribunal said that ‘total investment cost’ means “the total amount of money that the claimants together, on behalf of TLL, reasonably and unavoidably actually expended out-of- pocket in the normal course of performance or in performance up until the date of the breach”. 231. Perhaps the Arbitral Tribunal was lulled into the belief that “Hongsa Project” was the subject of arbitration, by paragraph 5.1.1 of the Appellants’ opening memorial, where the Appellants contended that “the termination of the [mining contracts were] subsumed under the larger question of the purported termination of the PDA”, and by paragraph 3.2 of the Appellants’ closing memorial, where the Appellants stated that the costs of the project previously incurred by TLL and HLL and capitalized as Project Development Assets were sold to TLP at book value: “The Project originated in May 1992 under TLL when TLL entered into the "Exploration and Lignite Mining Contract" with the Lao Government. HLL was incorporated in 1992 to exploit the mining concessions. Pursuant to the PDA, which was executed in July 1994, TLP was incorporated to undertake aspects of the Project. As a result, costs of the Project which has been previously incurred by TLL and HLL and capitalized as Project Development Assets were in effect "sold" to TLP 125 FC-02(f)-91-12/2015 at book values, the consideration being the recording of debts owing to TLL and HLL in TLP's books. GT testified that this was a perfectly appropriate and proper accounting procedure.” 232. Grant Thorton’s report on ‘total investment cost’ in the “Hongsa Project” also did not help to correct the misconception that “Hongsa Project” was the subject of the arbitration: “Hongsa Project Investment Cost (Project) The Hongsa Project (Project) is the development and operation of a lignite mine and a mine-mouth electric power generating plant in Hongsa in the Peoples Democratic Republic of Lao close to the border with Thailand.” 233. Incidentally, Grant Thorton’s response (page 2098 of the Appeal Record) to the query by Ernst & Young confirmed that expenses under the mining contracts were ultimately capitalized in the books of TLP as expenses under the PDA: “The Project Costs were incurred over a period of years during which time the structure of the group evolved. Initially in 1992 there was only TLL and then HLL was formed to explore and develop the lignite mine. When the PDA was signed granting the rights to develop a mine mouth power plant in addition to exploiting the lignite reserves, and as specifically required by the PDA, TLP was formed in 1994 to take over the Project. Project costs incurred at various stages by the different entities were recorded in their respective books. The costs were capitalized as assets in the balance sheets as project development. The amounts initially recorded in TLL and HLL were ultimately ‘sold’ or ‘transferred’ at 126 FC-02(f)-91-12/2015 book cost to TLP. Many of the project cost paid by TLL benefited both the mine and the power plant. TLL re- charged these to TLL and HLL on the ratio of 65:35 being management’s estimate of the fair apportionment. Later, when in 2002 it was decided that HLL assign the mining concession to TLP, on the basis that it would be easier to obtain finance if the entire project if it were contained within one entity, HLL transferred all the accumulated project costs from its books to TLP in exchange for a receivable from TLP of the same amount.” 234. Whether in genuine belief or not that they were so entitled, the Appellants’ claimed the ‘total investment cost’ of the entire group of companies in the “Hongsa Project”. But with respect, the Arbitral Tribunal failed to appreciate that was a world of difference between ‘total investment cost’ in the “Hongsa Project” and ‘total investment cost’ in the PDA. The ‘total investment cost’ in the “Hongsa Project” included the ‘total investment cost’ in the mining contracts and the PDA. But only disputes that arose out of the PDA were submitted to arbitration. The Appellants could claim the ‘total investment cost’ in the PDA. But the Appellants could not claim ‘total investment cost’ in the “Hongsa Project”. Even if the doctrine of ‘third party beneficiary’ applied, the Appellants could only claim the ‘total investment cost’ of the entire group of companies in the PDA. No matter what, the Arbitral Tribunal had no jurisdiction to allow claims expended or incurred under the mining contracts. The Arbitral Tribunal could rule on what would fall within the meaning of ‘total investment 127 FC-02(f)-91-12/2015 cost’ in the PDA. But the Arbitral Tribunal had no jurisdiction to interpret ‘total investment cost’ in the PDA to include losses “suffered by TLL-HLL due to the wrongful termination of the PDA” as contended. 235. The learned JC held that “the Arbitral Tribunal seemed to have lumped together or co-mingled the claims and disputes under the mining contracts with the claims and disputes under the PDA”. It was not “seemed to have lumped together … the claims … ”. The Arbitral Tribunal actually awarded “the total amount of money that the claimants together, on behalf of TLL, reasonably and unavoidably actually expended out-of-pocket in the normal course of performance or in performance up until the date of the breach” in the “Hongsa Project”. In so doing, the Arbitral Tribunal lumped together and then allowed claims under the mining contracts in the PDA arbitration. That was revealed in [112] of the award, where the Arbitral Tribunal awarded US$7,552,248 for road construction and US$8,032,042 for survey expenses, even though the road was constructed pursuant to section 25 of the 1st mining contract and before the advent of the PDA in 1994, and the survey expenses were incurred pursuant to the 1st mining contract. 236. We should make this clear. We could accept the finding of the Arbitral Tribunal that the doctrine of ‘third party beneficiary’ applied. We could accept that third parties could possibly invoke Article 14.1 of the PDA. But yet all claims, be they by parties to 128 FC-02(f)-91-12/2015 the arbitration agreement or third parties, must arise from the PDA, that is, even if the doctrine of ‘third party beneficiary’ applied. That expenses and outgoings were incurred, either under the mining contracts or the PDA, were stubborn facts. The accounting device, namely the purchase of expenses and outgoings expended or incurred under the mining contracts, might be regular for accounting purposes. But the purchase of expenses and outgoings incurred in the mining venture could not transform expenses and outgoings, from being expended or incurred under the mining contracts to being expended or incurred under the PDA. No accounting device could also change the fact that all expenses and outgoings incurred under the mining contracts were governed by a different law and, in the event of dispute, by a different dispute resolution clause. The said accounting device could also not unilaterally impose a different arbitration agreement on the Respondent. 237. We agree that an error of fact or law is not enough to set aside an arbitral award. We would uphold the award, if the sum awarded was wholly made up of claims under the PDA. But an arbitral tribunal must not stray beyond the arbitration agreement. In the instant case, in arbitrating on the “Hongsa Project”, the Arbitral Tribunal failed to stick to disputes that arose under the PDA. 129 FC-02(f)-91-12/2015 238. Learned counsel for the Appellants submitted that “Malaysian courts ought to ensure that their decisions are in line with the Model Law principles and within international arbitration framework. This appeal has far reaching consequences beyond the parties … it is a test of whether the Malaysian judiciary indeed recognises and supports arbitration in order to provide satisfactory resolutions to disputes … The parties … chose Malaysia as the seat … even though there were no factors connecting the parties or their relationship … because they expected the Malaysian judiciary to uphold their bargain and the sanctity of the arbitral process.” 239. We leave it to others to comment on the bearing and tone of that latter submission and the legitimacy of it. But we need to say this much. ‘Support for arbitration’ is not ‘no disturbance’. There are always two sides to the same coin. The loser will call for ‘disturbance’. If an arbitral award is a sacred cow and cannot be disturbed, that will not engender confidence in arbitration. ‘No disturbance’ may appear, at least superficially, to support arbitrators. But in truth, ‘no disturbance’ is anathema to arbitration. “Do not disturb’ will kill confidence in arbitration. Once confidence is lost, both arbitration and arbitrators will be the worst for it. For arbitration to continue to be relevant, it must be accepted that arbitral awards are not sacrosanct. Arbitral awards will be reviewed by the supervisory court of the seat. Arbitration will be dead, in Malaysia and elsewhere, if a supervisory court will to rubber stamp arbitral awards. 130 FC-02(f)-91-12/2015 240. But that is not to say that the court has a free hand to intervene. Section 8 of AA 2005 provides that “No court shall intervene in matters governed by this Act, except where so provided in this Act”. Unless so provided by AA 2005, the court shall not intervene in the arbitral process or in arbitral awards. Whether the UNCITRAL Model law promotes more or less curial interference does not arise. 241. Items 1 and 7 substantiated that the award dealt with claims under the mining contracts, which was a dispute not contemplated by or not falling within the terms of the submission to arbitration, and that the award contained decisions that pertained to the mining contracts, which were matters beyond the scope of the submission to arbitration. 242. Section 37(3) of AA provides that “Where the decision on matters submitted to arbitration can be separated from those not so submitted, only that part of the award which contains decisions on matters not submitted to arbitration may be set aside”. That would mean that claims under the PDA could not be set aside. ‘Road’ and ‘survey’ could be separated from the award. But ‘road’ and ‘survey’ were not the only matters that should be separated from the award. The learned JC held that the award was “so co- mingled and computed together that it was impossible to excise and extract that which stem[med] from the PDA as opposed to that which [was] traceable to the mining contracts”. Learned 131 FC-02(f)-91-12/2015 counsel for the Respondents submitted that items 1 - 7 were incurred before the advent of the PDA, and that items 2 – 6 were incurred on account of items 1 and 7. If so, then items 2 – 6 should also be separated from the award. 243. But we could not say with certainty that only items 1 and 7 should be separated from the award. For other than ‘road’ and ‘survey’, it was not possible to separate the wheat from the chaff. Claims were lumped together. It was highly conceivable that parts of items 2 – 6 were awarded for expenses incurred under the PDA. But given that it was all so mixed, it was not possible to separate the matters not so submitted from the award. Section 37(3) of AA 2005 could not be applied. 244. We need not answer leave questions 2 – 6, as we do not agree that there was a counter-claim and or that a challenge to standing is not a challenge to jurisdiction. But we will answer leave question 1, in the following terms: Question 1: “Where the governing law of the contract is foreign law and the seat of arbitration [seat] is Malaysia, does the parties’ stipulation of Malaysia as the seat constitute an express agreement that the law governing the arbitration agreement is Malaysian law?” Answer: The seat of the arbitration establishes the lex arbitrii and the curial law of the arbitration. 132 FC-02(f)-91-12/2015 Where the seat is Malaysia, AA 2005 is the lex arbitrii. Section 30(4) of AA 2005 provides that where parties failed to designate the law applicable to the substance of the dispute, the arbitral tribunal shall apply the law determined by the conflict of laws rules. It follows, that where parties failed to designate the law applicable to the arbitration agreement, the arbitral tribunal shall apply the law as determined, also, by the conflict of laws rules. Under the conflict of laws rules, the law with the closest and most real connection to the arbitration agreement is the law applicable to the arbitration agreement. More often than not, the law of the seat has the closest and most real connection to the arbitration agreement. The stipulation of Malaysia as the seat is not an express agreement that the law applicable to the arbitration agreement is the law of Malaysia. But under the conflict of laws rules, the stipulation of the seat is usually decisive in the determination of the law applicable to the arbitration agreement. Unless it is shown to be the contrary, the stipulation of Malaysia as the seat is a tacit agreement that the law applicable to the arbitration agreement is the law of Malaysia. 245. The Appellants might be right on the third party beneficiary point. But even so, the 2nd Appellant could only be an intended third party beneficiary under the mining contracts. As such, the 2nd Appellant could not invoke Article 14.1 of the PDA. That added reason to set aside the award. But the High Court had no powers to order re-arbitration. 133 FC-02(f)-91-12/2015 246. For reasons stated, we unanimously dismiss this appeal with costs and set aside the order for a re-arbitration. Dated this 17th day of August 2017. Tan Sri Jeffrey Tan Hakim Mahkamah Persekutuan Malaysia C O U N S E L For the Appellants : Lim Chee Wee (Sharon Chong Tze Ying, Kwan Will Sen and Nimalan Devaraja with him) Solicitors: Tetuan Skrine For the Respondent : Cyrus Das (Lam Ko Luen, Lee Lyn-Ni and Nina Lai with him) Solicitors: Tetuan Shook Lin & Bok

Tika 2.6.0

WA-28NCC-3-01/2017

PLAINTIF 1. NASSER ALI AZAYEZ MAKTOUM AL SHERAIFI (United Arab Emirates Passport No.: A1636274) 2. ABDULLA SALEM SALEH NASSRA AL SHAREEFI AL AMERI (United Arab Emirates Passport No.: A00000876) 3. NASSER SALEM SAID MEADHED LKHRAIBANI AL NUAMI (United Arab Emirates Passport No.: A00000650) …PETITIONERS DEFENDAN AFFINITY HEIGHTS SDN BHD … RESPONDEN T

17/08/2017

YA TUAN MOHD NAZLAN BIN MOHD GHAZALI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=64226277-71e4-4ee0-ad7f-50c71cefd652&Inline=true

IN THE HIGH COURT OF MALAYA KUALA LUMPUR (COMMERCIAL DIVISION) COMPANIES (WINDING-UP) NO.: WA-28NCC-3-01/2017 In the matter of Section 218 (1)(f) and/or Section 218 (1)(i) of the Companies Act, 1965; And In the matter of the Companies (Winding-up) Rules, 1972; And In the matter of Affinity Heights Sdn Bhd (Company No.: 315930-A) BETWEEN 1. NASSER ALI AZAYEZ MAKTOUM AL SHERAIFI (United Arab Emirates Passport No.: A1636274) 2. ABDULLA SALEM SALEH NASSRA AL SHAREEFI AL AMERI (United Arab Emirates Passport No.: A00000876) 3. NASSER SALEM SAID MEADHED LKHRAIBANI AL NUAMI (United Arab Emirates Passport No.: A00000650) …PETITIONERS AND AFFINITY HEIGHTS SDN BHD …RESPONDENT (Company No.: 315930-A) (In Receivership) BEFORE YANG ARIF TUAN MOHD NAZLAN MOHD GHAZALI JUDGE JUDGMENT Introduction [1] This is an application in enclosure 27 by the Respondent seeking to cross-examine the Petitioners who are deponents of the affidavits supporting their winding up petition against the Respondent. At the conclusion of the hearing, I dismissed the application. This judgment contains the full reasons for my decision. Key Background Facts [2] The Petitioners, all of whom are UAE nationals, had on 9 June 2008 entered into a Shareholders Agreement with Low Koon Chuan, Low Say Boon, Low Bee Lay and Elsie Yeo Lai Cheng (“the Local Parties”), for the purpose of developing a piece of land held under Hakmilik Tanah No. PN 180, Lot 463, Seksyen 0019, Bandar Kuala Lumpur into a 33 storey-condominium known as “St John’s Wood Residence” (“the Project”). [3] This resulted in the Petitioners holding 49% of the entire share capital of the Respondent, being the property development company for the Project, and with the Local Partners collectively owning the majority stake of 51% in the Respondent. [5] The Project failed. The Respondent is now in receivership. [6] On 18 February 2013, the Petitioners filed a minority oppression suit under Section 181 of the Companies Act 1965 against the Local Partners. However, the parties managed to agree to record a Consent Order on 25 April 2013. [7] Pursuant to the said Consent Order, Pricewaterhouse Coopers (PwC) undertook a forensic audit on the Respondent and issued a forensic audit report dated 25 June 2014. [8] On 24 September 2014, the Petitioners commenced a writ claim by way of a derivative action against, among others, the Local Partners and the Respondent. This suit was struck out by the Court but subsequently filed afresh on 8 November 2016. The defendants in the suit then filed a striking out application against the claim. [9] On 3 January 2017, the Petitioners filed a winding up petition against the Respondent. The petition is premised on Section 218 (1) (f) and (i) of the Companies Act 1965 (“the CA”) which concerns the grounds of the directors having acted in the affairs of the company in their own interests, or in any manner which appears to be unfair or unjust to the members, and that it is just and equitable that the company be wound up. The Contention of Parties [10] The Respondent is making this application in pursuance of Order 38 r 2 (2) of the Rules of Court 2012 (“the RC 2012”). The Respondent contends that the basis of the Respondent’s application to examine the three Petitioners in respect of the averments made by the first Petitioner on behalf of all three Petitioners in their petition and affidavits is to determine the truthfulness of the facts and issues deposed by them therein, which are disputed by the Respondent. [11] The Petitioners had alleged misappropriation of sum of monies and fraud against the Local Partners who were the directors of the Respondent at the material time (apart from Elsie Yeo). The directors were claimed to have misappropriated sums of monies while the Respondent was under their control. The Respondent thus contended that it would be necessary for the Respondent to be allowed to cross-examine the first Petitioner, being the deponent of the affidavits filed to support the winding up petition, together with the second and third Petitioners, in order to adduce their oral statements, as well as to determine the accuracy of each and every statement made in their affidavits. [12] The Petitioners resisted this application. They submitted that the application under the Rules of Court 2012 is not recognised under the Companies Winding-Up Rules 1972. They asserted that their allegations in the averments of the first Petitioner as the deponent on behalf of all three Petitioners are based on facts which are supported by documents exhibited to the petition. The affidavits in opposition and other affidavits for the Respondent merely denied the allegations without credible explanations. I will now discuss the issues. Evaluation & Findings by this Court [13] But first, a brief mention of the law governing the subject of the instant application. Order 38 r 2(2) of the RC 2012 states:- (2) In any cause or matter begun by originating summons and on any application made by notice of application, evidence shall be given by affidavit unless in the case of any such cause, matter or application any provision of these Rules otherwise provides or the Court otherwise directs, but the Court may, on the application of any party, order the attendance for cross-examination of the person making any such affidavit, and where, after such an order has been made, the person in question does not attend, his affidavit shall not be used as evidence without the leave of the Court. [14] In Leisure & Allied Industries Pty Ltd v Udaria Sdn Bhd [1980] 1 MLJ 189, Salleh Abas FJ (later Lord President) said thus:- “To allow or not to allow the respondent's application to cross-examine the appellant's witnesses upon their affidavits, I take it, is a matter of court's discretion. In appropriate circumstances, there is no reason why such application should be refused merely because the deponent is a foreigner living outside the jurisdiction ( Re Lucas [1952] 1 All ER 102); "otherwise foreigners would have an advantage" (Strauss v Goldschmidt 8 SLR 239). It is really a matter of common sense and an elementary legal principle that a party who swears an affidavit much be prepared to stand up to it by cross-examination unless the application to cross-examine him is without just cause vexatious or motivated by desire to delay the proceedings (Allen v Allen [1894] P 239). In view of the appellant's application for judgment under Order 32 Rule 6, I am not, however, prepared to hold the respondent's application to cross-examine the appellant's witnesses as being without just cause or motivated by desire to delay the proceedings or without bona fide or sham or vexatious”. [15] The Respondent claimed that there was no misappropriation or fraud as alleged by the Petitioners. The directors had provided the requisite explanations to PWC auditors in the course of the forensic audit exercise. The Respondent reiterated that there are conflict of facts raised between the parties in their respective affidavits which thus necessitated cross-examination be done against the deponent for the Petitioners, and referred to the Federal Court case of Seruan Gemilang Makmur Sdn Bhd v Kerajaan Negeri Pahang Darul Makmur & Anor [2016] 3 MLJ 1 in support. Winding-up hearing by way of affidavit evidence [16] In the leading authority of the case of Tay Bok Choon v Tahansan Sdn Bhd [1987] 1 MLJ 433, Lord Templeman, delivering the opinion of the Privy Council stated:- “The Company's (Winding Up) Rules 1972 provide for a winding up petition to be verified by affidavits and for affidavits in opposition and reply to be sworn and filed. This procedure was followed in the present case. In civil proceedings the trial judge has no power to dictate to a litigant what evidence he should tender. In winding up proceedings the trial judge cannot refuse to read affidavits which have been properly sworn, filed and produced to him unless some opposing party has applied for the attendance for cross-examination of the deponent and that application has been granted and the deponent does not attend. The Court cannot give a direction about evidence unless one of the litigants desires such direction to be made. Of course a judge may indicate to a petitioner that unless he calls oral evidence or to prove a disputed fact, his petition is likely to fail. The judge may equally indicate to a respondent that unless he calls oral evidence or applies to cross-examine the petitioner's deponents for the purposes of disproving an allegation made by the petitioner, then the petitioner is likely to succeed. At the end of the day the judge must decide the petition on the evidence before him. If allegations are made in affidavits by the petitioner and those allegations are credibly denied by the respondent's affidavits, then in the absence of oral evidence or cross-examination, the judge must ignore the disputed allegations. The judge must then decide the fate of the petition by consideration of the undisputed facts. On behalf of the respondent in the present case it was submitted that the trial judge paid some attention to the petitioner's disputed allegations of an express assurance but the Board is satisfied that the judge confined his consideration of the petition to the undisputed facts and rightly concluded that the petitioner had made out his case that it was just and equitable to wind up the company”. [17] This case thus clearly explains and reiterates that a winding up petition is heard by way of affidavit evidence. This is the primary rule. [18] Thus, only in exceptional cases will the Court permit the cross-examination of the deponent of the affidavits. This was further underscored in the High Court decision of Dato Ting Check Sii v Datuk Haji Mohamad Tufail bin Mahmud & Anor [2007] 7 MLJ 618, where Hamid Sultan JC (as he then was) made this important finding on considerations to permit cross-examination of a deponent in the context of a winding up proceeding :- “[5] The hearing of the petition commenced by the petitioner giving evidence. I realised during the course of hearing the petition that the respondents were attempting to restate what was in the affidavit. I informed them that s 218(1)(i) petition is meant to be petition to be tried by affidavits. Only in exceptional cases that too with the permission of court, can the deponent be cross-examined. I have informed the parties that I will give my grounds in my judgment after hearing why oral evidence in principle should not be allowed in hearing a s 218 petition. My reasons are as follows: (a) In Tay Bok Choon v Tahansan Sdn Bhd [1987] 1 MLJ 433 Lord Templeman sitting on the Privy Council observed: ……………………………. (b) Tahansan's case is not authority for the proposition that oral evidence must be given for purpose of hearing the petition. In fact the law which governs the mode of trial in a winding up petition is set out in s 221(2) of CA 1965 which states as follows: (2) The Court may on the petition coming on for hearing or at any time on the application of the petitioner, the company, or any person who has given notice that he intends to appear on the hearing of the petition. (a) direct that any notices be given or any steps taken before or after the hearing of the petition; (b) dispense with any notices being given or steps being taken which are required by this Act, or by the rules, or by any prior order of the court; (c) direct that oral evidence be taken on the petition or any matter relating thereto; (d) direct a speedy hearing or trial of the petition or any issue or matter; (e) allow the petition to be amended or withdrawn; and (f) give such directions as to the proceedings as the court thinks fit. (c) Any party who intends to adduce oral evidence at the trial of the hearing must make an application under s 221 of CA 1965 and the court must direct to do so. Thus, it is not a substantive right to adduce oral evidence. (d) There is no inflexible rule or practice prohibiting the adducing of oral evidence or the cross-examination of the deponents of affidavits in winding up applications. Where necessity suggests or expediency requires, it is open to the Judge trying winding up proceedings, to allow oral evidence. Where the application for calling oral evidence is not only belated but is intended to retard and delay the progress of the winding up application the court must refuse to exercise the discretion to allow oral evidence, as in winding up petition, expedition is absolutely necessary (see Veeramachineni Seethiah v Bode Venkatasubbiah & Ors AIR (36) 1949 Madras 675). (e) In Chappel House Colliery & Co [1883] 24 ChD 259, it was stated that the court will not as a rule order a petition to stand over for a long period as it would not be just to the company. To expedite the hearing of winding up proceedings is not only in the interest of the company but also an element of public policy in regard to commercial morality to dispose of the petition early (see Veeramachineni's case).” [19] Apart from the important rule that the petitions for winding up are heard on affidavit evidence, the fact that the Companies Act 1965 and the Companies Winding-up Rules 1972 do not expressly provide for a similar right to apply for the cross-examination of the affidavits as found in the RC 2012 cannot be emphasised enough. This should rightfully mean that the granting of such order for cross-examination in a winding up context ought to be exceptional and only rarely to be granted. For the expeditious hearing of a winding up petition is also an element of public policy. [20] The basis for this proposition may also be sourced by analogy from what had been made clear by Abdul Hamid Mohamed JCA (later Chief Justice) in the Court of Appeal case of Maril-Rionebel (M) Sdn Bhd & Anor v. Perdana Merchant Bankers Bhd & Other Appeals [2001] 3 CLJ 248, in the following terms:- “One of the most abused procedure adopted in winding up proceedings is the application to strike out the petition under O. 18 r. 19 of the RHC 1980 and/or the inherent jurisdiction of the court. In Buildcon-Cimaco Concrete Sdn Bhd v. Filotek Sdn Bhd [1999] 4 CLJ 135 I pointed out the undesirability of applying such procedure to a winding up petition: Besides, the Companies (Winding-up) Rules 1972 provides its own scheme of procedure for a s. 218 winding-up petition which is more simplified and geared for speedy disposal. RHC 1980, for example, provides for appearance (conditional and unconditional), discoveries, interrogatories, judgment in default of pleading, summary judgment (O. 14), striking out of pleadings (O. 18 r. 19), summons for directions and setting down for trial. Hearing date is only given after the directions made in the summons for directions are complied with and the case has been set down for trial. Perhaps because of these requirements which take some time to be complied since the filing of a writ, that procedures for judgment in default of pleading, summary judgment and the striking out of the writs and pleadings are provided, for quick disposal in clear-cut cases. The scheme under the Companies (Winding-up) Rules 1972 is different. When the petition is issued out of court, a hearing date is given straight away. Whatever has to be done, eg, service, advertisement, compliance with r. 32, will have to be done before the hearing date. The court is supposed to hear the petition straight away on the date fixed for hearing, the very first time it comes up before it. If everything is done as scheduled, the petition is heard on the date first fixed for hearing. That is what the rules envisage. In the circumstances, there is no necessity for provisions for judgment in default, summary judgment or striking out the pleading or trial on issues. I am of the view that that is the reason why the Companies (Winding-up) Rules 1972 do not provide for such procedures. They are not necessary. Furthermore, more often than not, resort to O. 18 r. 19 of RHC 1980 in a winding-up proceedings results in the delay in the hearing of the petition. The application is usually filed one or two weeks before the date fixed for the hearing of the petition. Application is made for it to be heard first, supposedly, to save the court's time. In reality, it delays the hearing of the petition. Whenever there is such an application, inevitably, the hearing of the petition is delayed. Not only will the petition be adjourned for the application to be heard first, but if dismissed, there will be an appeal to the higher court(s)”. [emphasis added] [21] Whilst the said decision was critical of striking out application against petitions, I take the view that the underlying basis for such a stance would apply equally to the application to cross-examine, as it is not specifically provided for in the CA or the Companies Winding-Up Rules 1972, which have been promulgated to achieve expeditious disposal of the petitions in the first place. [22] The law has already made the prescription that winding up petition is to be heard by way of affidavit evidence. There are no specific provisions on the examination of deponents of affidavits to be used at the hearing of a winding up petition. But I accept that it does not mean that such an application under Order 38 of the RC is prohibited or without legal basis. Further, in any event, as shown in Dato Ting Check Sii v Datuk Haji Mohamad Tufail bin Mahmud & Anor, a not dissimilar application could be made for a direction that oral evidence be taken on a petition, in pursuance of Section 469 (3) of the Companies Act 2016 (formerly Section 221 of the Companies Act 1965). Order 38 r 2 further refers its applicability to action by way of originating summons in a notice of application, which the petition is clearly not. However in the same way that a striking out under the RC 2012 may be applied for against a winding up petition despite the absence of any provision in the Companies Winding-Up Rules 1972 and the Companies Act 1965, I do not think it justifiable that any application for cross-examination in a winding up proceedings is to be outrightly rejected. I would follow the observation of Anuar J (later CJ (Malaya)) in Kumagai Gumi Co Ltd v Zanecon-Kumagai Sdn Bhd & Ors and another application [1994] 2 MLJ 789 that whether cross-examination should be ordered in any matter including a winding up petition is within the discretion of the Court. Power is discretionary [23] Having considered the case law authorities on applications to cross-examine, much of which on Order 38, the principles of which should similarly apply in winding up proceedings which are also heard an affidavit evidence, in my judgment, the application by the Respondent in this instant matter before me is lacking in both merit and substance. First, it must be reiterated that the exercise of the Court's power to order or refuse cross-examination of a deponent of an affidavit is discretionary. [24] Case law authorities more than amply suggest that Courts are generally slow to allow cross-examination of a deponent in an interlocutory matter (see for examples, the High Court decisions in Balwant Singh Purba v. R Rajasingam [1987] CLJ (Rep) 468 and Syarikat Tunggaring Kilang Papan Sdn Bhd v. Sabah Forest Industries Sdn Bhd [1990] 2 MLJ 38). In the instant case, the cross-examination is in the context of a winding up proceedings which are governed under the CA and the Companies Winding-Up Rules 1972. Thus Order 38 r 2 or such a power of the Court to order cross-examination should be invoked on an even more exceptional basis. Burden on applicant, the Respondent herein [25] Secondly, and no less importantly, it is the applicant for leave to cross-examine a deponent who bears the legal burden to convince the Court to exercise its discretion to grant leave, as reiterated by the Court of Appeal in Tetuan Kumar Jaspal Quah & Aishah v The Co-Operative Central Bank Ltd [2007] 4 CLJ 487 (see also the High Court case of Charles Koo Ho-Tung & Ors v. Koo Lin Shen & Ors [2016] 2 CLJ 267).  Must be made in good faith [26] Thirdly, a key consideration to be weighed by a Court called upon to exercise its discretion for the purpose is the need to ensure that the application to cross-examine a deponent is made in good faith, as was stated in the passage attributed to Salleh Abas FJ (as he then was) in Leisure & Allied Industries Pty Ltd v. Udaria Sdn Bhd referred to earlier. In the instant application however, it is difficult to see the true basis for the same, for the Respondent seemed to be disputing every single averment made by the Petitioners. Exactly 28 paragraphs which had been affirmed by the Petitioners in the 48-paged petition were challenged and sought to be verified by the Respondent by way of the cross-examination of the deponent. For clarity, I set out only 10 of the paragraphs below:- a) Paragraph 7 of the Petition:- “Catherine Low and Simon Low are the children of Michael Low and are used to acting under the directors or instructions of Michael Low. As such, Michael Low is the de factor or shadow director of the respondent and the Board of Directors of the respondent are controlled by Michael Low, Simon Low and Catherine Low.” d) Paragraph 15:- “It is clear that Michael Low, Simon Low and/or Catherine Low caused the RM1,500,000.00 paid by the petitioners as advanced for working capital to be siphoned to Michael Low instead. This was done by inserting an entry in the respondent’s general account ledger under “amount due to shareholder”, that the sum of RM1,500,000.00 advanced by the petitioners is attributed to Michael Low as a cash deposit from him purportedly made on 22 December 2008 (again it has a remark that “fund came from Arabs”). Then, Michael Low, Simon Low and/or Catherine Low caused another entry that the sum of RM1,500,000.00 was paid to Michael Low on 2 January 2009 purportedly to reimburse then loan from Michael Low. Taking these 2 transactions together, the ledger prepared by Michael Low, Simon Low and/or Catherine Low gives an impression that the amount of RM1,500,000.00 was advanced to the respondent by Michael Low on 22 December 2008 and was ‘repaid’ to him on 2 January 2009. This is blatant fraud.” e) Paragraph 35:- “The petitioners contend and will contend that Michael Low and Simon Low’s attempted explanations regarding the different awards in the sum of RM82,530,000.00 and RM59,356,500.00 are mere afterthoughts. The petitioners further contend and will contend that Michael Low, Simon Low and/or Catherine Low have forged contractual documents purely for the purpose of misleading the petitioners.” j) Paragraph 52:- “The purported reimbursement or payment of the purported Final D.O. Charges is clearly fictitious based on the facts and matters set out in the petition. It is thus clear that Michael Low, Simon Low and/or Catherine Low has made illegally enriched themselves and/or their connected persons/companies by a sum of RM386,325.00 at the expense of the respondent and/or petitioners.” n) Paragraph 58:- “It is clear that they ran the respondent’s affairs as if the respondent was Michael Low and his family members’ private enterprise and treated the respondent’s money as if it were their own.” r) Paragraph 71:- “The petitioners contend that Michael Low, Simon Low and/or Catherine Low intended and intends to appropriate the sum of RM724,726.20 for their own or their family’s benefit and it appears that they have enlisted one Wong Yee Shiong to collude with them in this exercise and to further mislead PWC. PWC was in fact, mislead. This is shown by the fact that Wong Yee Shiong of KCYS issued conflicting/contradictory documents regarding the receipt of payments from the respondent.” t) Paragraph 76:- “One of the footnotes to all the Annual Reports also states that “[t]he amount due to a director and a shareholder is unsecured, interest free and with no fixed terms of repayment.” The reference “a director and a shareholder” refers to Simon Low and Michael Low respectively.” w) Paragraph 83:- “It is also significant that Elsie Yeo did not receive any financial benefits from the respondent. Michael Low, Simon Low and/or Catherina Low and their connected persons had used the monies of the respondent as if it was their personal fortune to be used and inflated at will. This is fortified by the fact that Michael Low, Simon Low and/or Catherine Low treated the respondent as part of their AM-EL Group of Companies and represented as such to the world at large.” z) Paragraph 91:- “In this purported settlement exercise, if true, then Catherine Low, by virtue of being a shareholder of AM-EL Holdings Sdn Bhd, a shareholder of AM-EL Construction Sdn Bhd, had also acted in conflict of interest and in breach of her duties and fiduciary duties as director of the respondent.” bb) Paragraph 95:- “Based on the facts and matter set out hereinabove, Catherine Low and Simon Low, the directors of the respondent have acted in the affairs of the company in their own interests and/or that of their family members, connected persons and/or Michael Low, rather than in the interests of the members as a whole, or in a manner which appears to be unfair or unjust to the petitioners.” [27] The point to note is that the Petitioners had produced by way of exhibits, supporting documents to strengthen their averments vis-à-vis the petition which runs into five thick volumes. On the other hand, in contradistinction, many of the averments in reply made by the Respondent were not accompanied by documents in support. Thus the true motivation of the Respondent in filing this instant application is in some doubt, and good faith cannot readily be imputed. Must identify relevant issues [28] Fifthly, and more critically, the relevant issue for cross-examination must be identified with sufficient clarity by the applicant to ensure that the proposed cross-examination does not constitute a harassment, intimidation and or oppression of the deponent. Thus in the Court of Appeal case of Indrani a/p Rajaratnam & Ors v. Fairview Schools Bhd [2002] 1 CLJ 1, Siti Norma Yaakob FCJ (as she then was) held:- “The grant or the refusal of an application under O. 38 r. 2(3) is very much an exercise of a judge's power of discretion and the question that must be determined is whether Abdul Malek J (as he then was) had exercised his discretion judicially. From his written judgment, it is very clear that the learned judge considered the following factors when exercising his discretion. (1) That the appellants never identified the issues for which they maintain cross-examination had become necessary. This is not surprising as no formal application was made by them. Even so a perusal of the proceedings recorded by the trial judge fails to disclose what the issues are to warrant cross-examination. Apart from stating orally that the respondent's many affidavits by various deponents raise many disputes as to facts, such disputes have not been identified by the appellants. If indeed there are factual disputes, the appellants have also failed to show whether they are relevant to the petition to warrant cross-examination. On the contrary the learned trial judge found that the cross-examination would not advance the cause of justice as there is sufficient affidavit evidence supported by contemporaneous documents to enable the petition to be heard properly without the need of cross-examination. (2) That the appellants delayed in making the application to cross-examine. The oral application was made on 24 January 1995, the second time the petition was adjourned to be heard on its merits. The learned trial judge considered that the application should have been made earlier when the petition was initially fixed to be heard on its merits on 20 December 1994. There was no indication then that the appellants intended to cross-examine any of the respondent's deponents even though their affidavits had already been filed in court. Under these circumstances, I do not consider that the learned trial judge had erred in law or in principle when he exercised his discretion as he had put his mind to relevant considerations in deciding as he did. To that extent I see no justification in interfering with the order he had made in the court below”. [29] This is the most critical consideration in an application to cross-examine a deponent of an affidavit, what more in a winding up petition. In the Court of Appeal decision in Tetuan Kumar Jaspal Quah & Aishah v The Co-Operative Central Bank Ltd [2007] 4 CLJ 487, Tengku Baharudin Shah JCA, in a majority judgment, held instructively as follows:- “[24] You can discern from the authorities referred by the parties that 3 prime considerations would influence the court in the exercise of its discretion to allow or disallow cross-examination on affidavit. Firstly, the truth of the averment in the affidavit must be challenged or the issues of fact identified. Secondly, cross-examination should only be allowed if the disputed fact is relevant to the issue to be decided and must be limited to that issue only. And thirdly, cross-examination would not advance the cause of justice and should be refused if there is sufficient affidavit evidence or contemporaneous documents to enable the court to properly decide without the need of cross-examination”. [30] The Court of Appeal, from the above-said passage, thus emphasised on the need for the conflict in affidavit evidence in respect of the relevant issue to be so identified in order to justify a cross-examination of the deponent in question where the truth of the averment in an affidavit must be challenged.  [31] As such, in the instant case, the Respondent, who bears the burden of justifying the need for cross-examination must demonstrate with specificity the issues in dispute arising from the affidavits and that once identified, must also show that the disputed issues are truly relevant to be decided in the petition. This, the Respondent has patently failed to do. I do not for a moment question that the Respondent did dispute the overarching basis for the petition presented by the Petitioners, in that the Respondent had denied any mismanagement and misappropriation of company funds. [32] But the Respondent never condescended into the details of the averments to identify the specific issues to be challenged, let alone to demonstrate whether those issues were actually relevant to the determination of the petition. Instead, the Respondent, in the affidavit in support of this application, merely reproduced the entirety of most of the paragraphs which appeared in the petition, without more. This is demonstrably deficient and cannot progress, what more justify, the Respondent’s application to cross-examine the deponents. [33] It is a pre-requisite to an application under Order 38 that an applicant like the Respondent herein must identify the facts in issue that warrant the cross-examination of the Petitioners. Such facts in issue must be shown to be in turn relevant to the determination of the disputed issues in the proceeding. The Respondent did not in its notice of application or affidavit filed herein identify the facts and whether these are relevant. Such omission is fatal. [34] The Respondent cannot just dispute but not provide any basis for refuting the averments by the Petitioners. Yet, no reasons were given by the Respondent to even suggest that the Petitioners are not telling the truth, what more when the allegations in the petition are based on documents, some of which were prepared and produced by the Respondent. As such, there is no basis for a cross-examination of the Petitioners on the truthfulness of the issues and facts deposed in the petition or affidavits for the Petitioners. Whether contemporaneous documents sufficient [35] Sixthly, and yet another consideration referred to in Tetuan Kumar Jaspal Quah & Aishah is that the cross-examination applied for must be able to promote the cause of justice. This will not be achieved if the said conflict in affidavit evidence could instead be resolved by undisputed contemporaneous documents. As mentioned, the Petitioners had exhibited volumes of documents in support of their petition. Such affidavit evidence will be duly examined for the purposes of the hearing of the petition. Nothing has been shown by the Respondent to even suggest that any of the documents so exhibited is to be rejected. [36] Thus, the attempt to cross examine is both pre-mature because the documents have not been evaluated, and the examination is also potentially superfluous because it adds nothing to the proceedings in the instant case the nature of which is to be heavily reliant on contemporaneous documents in any event. [37] The proposed cross-examination of the Petitioners would in all likelihood only result in the Petitioners repeating their averments and making reference to the documents already exhibited. Moreover, there is no doubt that the best evidence rule applies in respect of the key documents exhibited in the petition and affidavits, such as the agreements, forensic report, correspondences and cause papers. That these are contemporaneous documents that concern the matters existing at that point in time cannot be emphasised enough. In that sense, they even have higher evidential value relative to oral evidence. [38] The importance and superiority of contemporaneous documents had been made clear by the Federal Court in Tindok Besar Estate Sdn Bhd v. Tinjar Co [1979] 2 MLJ 229. After all, oral evidence involves a testimony as to events that happened in the past whilst contemporaneous documents speak of matters then existing at the time such documents were issued or made (see the Court of Appeal decision in Guan Teik Sdn Bhd v Hj Mohd Noor Hj Yakob & Ors [2000] 4 CLJ 324). It goes without saying that undisputed documentary evidence in this sense enjoys an even more superior status (see Kumagai Gumi Co Ltd v Zenecon-Kumagai Sdn Bhd & Ors and another application [1994] 2 MLJ 789). In short, the cross-examination would not likely assist the winding up proceeding any more than what the exhibited documents already readily would. Thus, a cross-examination in this case would hardly promote the cause of justice. [39] It is imperative to state that the mere fact that the Respondent claimed to dispute the relevant averments of the Petitioners is manifestly insufficient a basis to warrant cross-examination. The Petitioners had exhibited various documents; the Respondent must do more that merely dispute without adequate substantiation by producing its own documentary evidence to furnish a basis for its disputation. In the absence thereof, the Petitioners would likely stand by their petition and affidavits exhibiting the various contemporaneous documents. In my view, in this situation, no useful purpose would be served by ordering them to be cross-examined. Conclusion [40] In view of the above-stated reasons, I find that the Respondent has not sufficiently established its case to justify this Court exercising its discretion to order the Petitioners be cross-examined on their petition and affidavits pursuant to Section 221 of the CA or Order 38 r 2 (2) of the RC 2012. I therefore dismiss the instant application in enclosure 27, with costs. Dated: 17 August 2017 (MOHD NAZLAN BIN MOHD GHAZALI) Judge High Court NCC1 Kuala Lumpur Counsel: For the Petitioners Jeremy Khalif with Olivia Lee Messrs Nadzrin Kuok Puthucheary & Tan Kuala Lumpur For the Respondent Mohd Reza with RM Yeoh Messrs Mohd Imtiaz Choong & Partners Penang Page 14 of 17

Tika 2.6.0

WA-28NCC-3-01/2017

PLAINTIF 1. NASSER ALI AZAYEZ MAKTOUM AL SHERAIFI (United Arab Emirates Passport No.: A1636274) 2. ABDULLA SALEM SALEH NASSRA AL SHAREEFI AL AMERI (United Arab Emirates Passport No.: A00000876) 3. NASSER SALEM SAID MEADHED LKHRAIBANI AL NUAMI (United Arab Emirates Passport No.: A00000650) …PETITIONERS DEFENDAN AFFINITY HEIGHTS SDN BHD … RESPONDEN T

17/08/2017

YA TUAN MOHD NAZLAN BIN MOHD GHAZALI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=64226277-71e4-4ee0-ad7f-50c71cefd652&Inline=true

IN THE HIGH COURT OF MALAYA KUALA LUMPUR (COMMERCIAL DIVISION) COMPANIES (WINDING-UP) NO.: WA-28NCC-3-01/2017 In the matter of Section 218 (1)(f) and/or Section 218 (1)(i) of the Companies Act, 1965; And In the matter of the Companies (Winding-up) Rules, 1972; And In the matter of Affinity Heights Sdn Bhd (Company No.: 315930-A) BETWEEN 1. NASSER ALI AZAYEZ MAKTOUM AL SHERAIFI (United Arab Emirates Passport No.: A1636274) 2. ABDULLA SALEM SALEH NASSRA AL SHAREEFI AL AMERI (United Arab Emirates Passport No.: A00000876) 3. NASSER SALEM SAID MEADHED LKHRAIBANI AL NUAMI (United Arab Emirates Passport No.: A00000650) …PETITIONERS AND AFFINITY HEIGHTS SDN BHD …RESPONDENT (Company No.: 315930-A) (In Receivership) BEFORE YANG ARIF TUAN MOHD NAZLAN MOHD GHAZALI JUDGE JUDGMENT Introduction [1] This is an application in enclosure 27 by the Respondent seeking to cross-examine the Petitioners who are deponents of the affidavits supporting their winding up petition against the Respondent. At the conclusion of the hearing, I dismissed the application. This judgment contains the full reasons for my decision. Key Background Facts [2] The Petitioners, all of whom are UAE nationals, had on 9 June 2008 entered into a Shareholders Agreement with Low Koon Chuan, Low Say Boon, Low Bee Lay and Elsie Yeo Lai Cheng (“the Local Parties”), for the purpose of developing a piece of land held under Hakmilik Tanah No. PN 180, Lot 463, Seksyen 0019, Bandar Kuala Lumpur into a 33 storey-condominium known as “St John’s Wood Residence” (“the Project”). [3] This resulted in the Petitioners holding 49% of the entire share capital of the Respondent, being the property development company for the Project, and with the Local Partners collectively owning the majority stake of 51% in the Respondent. [5] The Project failed. The Respondent is now in receivership. [6] On 18 February 2013, the Petitioners filed a minority oppression suit under Section 181 of the Companies Act 1965 against the Local Partners. However, the parties managed to agree to record a Consent Order on 25 April 2013. [7] Pursuant to the said Consent Order, Pricewaterhouse Coopers (PwC) undertook a forensic audit on the Respondent and issued a forensic audit report dated 25 June 2014. [8] On 24 September 2014, the Petitioners commenced a writ claim by way of a derivative action against, among others, the Local Partners and the Respondent. This suit was struck out by the Court but subsequently filed afresh on 8 November 2016. The defendants in the suit then filed a striking out application against the claim. [9] On 3 January 2017, the Petitioners filed a winding up petition against the Respondent. The petition is premised on Section 218 (1) (f) and (i) of the Companies Act 1965 (“the CA”) which concerns the grounds of the directors having acted in the affairs of the company in their own interests, or in any manner which appears to be unfair or unjust to the members, and that it is just and equitable that the company be wound up. The Contention of Parties [10] The Respondent is making this application in pursuance of Order 38 r 2 (2) of the Rules of Court 2012 (“the RC 2012”). The Respondent contends that the basis of the Respondent’s application to examine the three Petitioners in respect of the averments made by the first Petitioner on behalf of all three Petitioners in their petition and affidavits is to determine the truthfulness of the facts and issues deposed by them therein, which are disputed by the Respondent. [11] The Petitioners had alleged misappropriation of sum of monies and fraud against the Local Partners who were the directors of the Respondent at the material time (apart from Elsie Yeo). The directors were claimed to have misappropriated sums of monies while the Respondent was under their control. The Respondent thus contended that it would be necessary for the Respondent to be allowed to cross-examine the first Petitioner, being the deponent of the affidavits filed to support the winding up petition, together with the second and third Petitioners, in order to adduce their oral statements, as well as to determine the accuracy of each and every statement made in their affidavits. [12] The Petitioners resisted this application. They submitted that the application under the Rules of Court 2012 is not recognised under the Companies Winding-Up Rules 1972. They asserted that their allegations in the averments of the first Petitioner as the deponent on behalf of all three Petitioners are based on facts which are supported by documents exhibited to the petition. The affidavits in opposition and other affidavits for the Respondent merely denied the allegations without credible explanations. I will now discuss the issues. Evaluation & Findings by this Court [13] But first, a brief mention of the law governing the subject of the instant application. Order 38 r 2(2) of the RC 2012 states:- (2) In any cause or matter begun by originating summons and on any application made by notice of application, evidence shall be given by affidavit unless in the case of any such cause, matter or application any provision of these Rules otherwise provides or the Court otherwise directs, but the Court may, on the application of any party, order the attendance for cross-examination of the person making any such affidavit, and where, after such an order has been made, the person in question does not attend, his affidavit shall not be used as evidence without the leave of the Court. [14] In Leisure & Allied Industries Pty Ltd v Udaria Sdn Bhd [1980] 1 MLJ 189, Salleh Abas FJ (later Lord President) said thus:- “To allow or not to allow the respondent's application to cross-examine the appellant's witnesses upon their affidavits, I take it, is a matter of court's discretion. In appropriate circumstances, there is no reason why such application should be refused merely because the deponent is a foreigner living outside the jurisdiction ( Re Lucas [1952] 1 All ER 102); "otherwise foreigners would have an advantage" (Strauss v Goldschmidt 8 SLR 239). It is really a matter of common sense and an elementary legal principle that a party who swears an affidavit much be prepared to stand up to it by cross-examination unless the application to cross-examine him is without just cause vexatious or motivated by desire to delay the proceedings (Allen v Allen [1894] P 239). In view of the appellant's application for judgment under Order 32 Rule 6, I am not, however, prepared to hold the respondent's application to cross-examine the appellant's witnesses as being without just cause or motivated by desire to delay the proceedings or without bona fide or sham or vexatious”. [15] The Respondent claimed that there was no misappropriation or fraud as alleged by the Petitioners. The directors had provided the requisite explanations to PWC auditors in the course of the forensic audit exercise. The Respondent reiterated that there are conflict of facts raised between the parties in their respective affidavits which thus necessitated cross-examination be done against the deponent for the Petitioners, and referred to the Federal Court case of Seruan Gemilang Makmur Sdn Bhd v Kerajaan Negeri Pahang Darul Makmur & Anor [2016] 3 MLJ 1 in support. Winding-up hearing by way of affidavit evidence [16] In the leading authority of the case of Tay Bok Choon v Tahansan Sdn Bhd [1987] 1 MLJ 433, Lord Templeman, delivering the opinion of the Privy Council stated:- “The Company's (Winding Up) Rules 1972 provide for a winding up petition to be verified by affidavits and for affidavits in opposition and reply to be sworn and filed. This procedure was followed in the present case. In civil proceedings the trial judge has no power to dictate to a litigant what evidence he should tender. In winding up proceedings the trial judge cannot refuse to read affidavits which have been properly sworn, filed and produced to him unless some opposing party has applied for the attendance for cross-examination of the deponent and that application has been granted and the deponent does not attend. The Court cannot give a direction about evidence unless one of the litigants desires such direction to be made. Of course a judge may indicate to a petitioner that unless he calls oral evidence or to prove a disputed fact, his petition is likely to fail. The judge may equally indicate to a respondent that unless he calls oral evidence or applies to cross-examine the petitioner's deponents for the purposes of disproving an allegation made by the petitioner, then the petitioner is likely to succeed. At the end of the day the judge must decide the petition on the evidence before him. If allegations are made in affidavits by the petitioner and those allegations are credibly denied by the respondent's affidavits, then in the absence of oral evidence or cross-examination, the judge must ignore the disputed allegations. The judge must then decide the fate of the petition by consideration of the undisputed facts. On behalf of the respondent in the present case it was submitted that the trial judge paid some attention to the petitioner's disputed allegations of an express assurance but the Board is satisfied that the judge confined his consideration of the petition to the undisputed facts and rightly concluded that the petitioner had made out his case that it was just and equitable to wind up the company”. [17] This case thus clearly explains and reiterates that a winding up petition is heard by way of affidavit evidence. This is the primary rule. [18] Thus, only in exceptional cases will the Court permit the cross-examination of the deponent of the affidavits. This was further underscored in the High Court decision of Dato Ting Check Sii v Datuk Haji Mohamad Tufail bin Mahmud & Anor [2007] 7 MLJ 618, where Hamid Sultan JC (as he then was) made this important finding on considerations to permit cross-examination of a deponent in the context of a winding up proceeding :- “[5] The hearing of the petition commenced by the petitioner giving evidence. I realised during the course of hearing the petition that the respondents were attempting to restate what was in the affidavit. I informed them that s 218(1)(i) petition is meant to be petition to be tried by affidavits. Only in exceptional cases that too with the permission of court, can the deponent be cross-examined. I have informed the parties that I will give my grounds in my judgment after hearing why oral evidence in principle should not be allowed in hearing a s 218 petition. My reasons are as follows: (a) In Tay Bok Choon v Tahansan Sdn Bhd [1987] 1 MLJ 433 Lord Templeman sitting on the Privy Council observed: ……………………………. (b) Tahansan's case is not authority for the proposition that oral evidence must be given for purpose of hearing the petition. In fact the law which governs the mode of trial in a winding up petition is set out in s 221(2) of CA 1965 which states as follows: (2) The Court may on the petition coming on for hearing or at any time on the application of the petitioner, the company, or any person who has given notice that he intends to appear on the hearing of the petition. (a) direct that any notices be given or any steps taken before or after the hearing of the petition; (b) dispense with any notices being given or steps being taken which are required by this Act, or by the rules, or by any prior order of the court; (c) direct that oral evidence be taken on the petition or any matter relating thereto; (d) direct a speedy hearing or trial of the petition or any issue or matter; (e) allow the petition to be amended or withdrawn; and (f) give such directions as to the proceedings as the court thinks fit. (c) Any party who intends to adduce oral evidence at the trial of the hearing must make an application under s 221 of CA 1965 and the court must direct to do so. Thus, it is not a substantive right to adduce oral evidence. (d) There is no inflexible rule or practice prohibiting the adducing of oral evidence or the cross-examination of the deponents of affidavits in winding up applications. Where necessity suggests or expediency requires, it is open to the Judge trying winding up proceedings, to allow oral evidence. Where the application for calling oral evidence is not only belated but is intended to retard and delay the progress of the winding up application the court must refuse to exercise the discretion to allow oral evidence, as in winding up petition, expedition is absolutely necessary (see Veeramachineni Seethiah v Bode Venkatasubbiah & Ors AIR (36) 1949 Madras 675). (e) In Chappel House Colliery & Co [1883] 24 ChD 259, it was stated that the court will not as a rule order a petition to stand over for a long period as it would not be just to the company. To expedite the hearing of winding up proceedings is not only in the interest of the company but also an element of public policy in regard to commercial morality to dispose of the petition early (see Veeramachineni's case).” [19] Apart from the important rule that the petitions for winding up are heard on affidavit evidence, the fact that the Companies Act 1965 and the Companies Winding-up Rules 1972 do not expressly provide for a similar right to apply for the cross-examination of the affidavits as found in the RC 2012 cannot be emphasised enough. This should rightfully mean that the granting of such order for cross-examination in a winding up context ought to be exceptional and only rarely to be granted. For the expeditious hearing of a winding up petition is also an element of public policy. [20] The basis for this proposition may also be sourced by analogy from what had been made clear by Abdul Hamid Mohamed JCA (later Chief Justice) in the Court of Appeal case of Maril-Rionebel (M) Sdn Bhd & Anor v. Perdana Merchant Bankers Bhd & Other Appeals [2001] 3 CLJ 248, in the following terms:- “One of the most abused procedure adopted in winding up proceedings is the application to strike out the petition under O. 18 r. 19 of the RHC 1980 and/or the inherent jurisdiction of the court. In Buildcon-Cimaco Concrete Sdn Bhd v. Filotek Sdn Bhd [1999] 4 CLJ 135 I pointed out the undesirability of applying such procedure to a winding up petition: Besides, the Companies (Winding-up) Rules 1972 provides its own scheme of procedure for a s. 218 winding-up petition which is more simplified and geared for speedy disposal. RHC 1980, for example, provides for appearance (conditional and unconditional), discoveries, interrogatories, judgment in default of pleading, summary judgment (O. 14), striking out of pleadings (O. 18 r. 19), summons for directions and setting down for trial. Hearing date is only given after the directions made in the summons for directions are complied with and the case has been set down for trial. Perhaps because of these requirements which take some time to be complied since the filing of a writ, that procedures for judgment in default of pleading, summary judgment and the striking out of the writs and pleadings are provided, for quick disposal in clear-cut cases. The scheme under the Companies (Winding-up) Rules 1972 is different. When the petition is issued out of court, a hearing date is given straight away. Whatever has to be done, eg, service, advertisement, compliance with r. 32, will have to be done before the hearing date. The court is supposed to hear the petition straight away on the date fixed for hearing, the very first time it comes up before it. If everything is done as scheduled, the petition is heard on the date first fixed for hearing. That is what the rules envisage. In the circumstances, there is no necessity for provisions for judgment in default, summary judgment or striking out the pleading or trial on issues. I am of the view that that is the reason why the Companies (Winding-up) Rules 1972 do not provide for such procedures. They are not necessary. Furthermore, more often than not, resort to O. 18 r. 19 of RHC 1980 in a winding-up proceedings results in the delay in the hearing of the petition. The application is usually filed one or two weeks before the date fixed for the hearing of the petition. Application is made for it to be heard first, supposedly, to save the court's time. In reality, it delays the hearing of the petition. Whenever there is such an application, inevitably, the hearing of the petition is delayed. Not only will the petition be adjourned for the application to be heard first, but if dismissed, there will be an appeal to the higher court(s)”. [emphasis added] [21] Whilst the said decision was critical of striking out application against petitions, I take the view that the underlying basis for such a stance would apply equally to the application to cross-examine, as it is not specifically provided for in the CA or the Companies Winding-Up Rules 1972, which have been promulgated to achieve expeditious disposal of the petitions in the first place. [22] The law has already made the prescription that winding up petition is to be heard by way of affidavit evidence. There are no specific provisions on the examination of deponents of affidavits to be used at the hearing of a winding up petition. But I accept that it does not mean that such an application under Order 38 of the RC is prohibited or without legal basis. Further, in any event, as shown in Dato Ting Check Sii v Datuk Haji Mohamad Tufail bin Mahmud & Anor, a not dissimilar application could be made for a direction that oral evidence be taken on a petition, in pursuance of Section 469 (3) of the Companies Act 2016 (formerly Section 221 of the Companies Act 1965). Order 38 r 2 further refers its applicability to action by way of originating summons in a notice of application, which the petition is clearly not. However in the same way that a striking out under the RC 2012 may be applied for against a winding up petition despite the absence of any provision in the Companies Winding-Up Rules 1972 and the Companies Act 1965, I do not think it justifiable that any application for cross-examination in a winding up proceedings is to be outrightly rejected. I would follow the observation of Anuar J (later CJ (Malaya)) in Kumagai Gumi Co Ltd v Zanecon-Kumagai Sdn Bhd & Ors and another application [1994] 2 MLJ 789 that whether cross-examination should be ordered in any matter including a winding up petition is within the discretion of the Court. Power is discretionary [23] Having considered the case law authorities on applications to cross-examine, much of which on Order 38, the principles of which should similarly apply in winding up proceedings which are also heard an affidavit evidence, in my judgment, the application by the Respondent in this instant matter before me is lacking in both merit and substance. First, it must be reiterated that the exercise of the Court's power to order or refuse cross-examination of a deponent of an affidavit is discretionary. [24] Case law authorities more than amply suggest that Courts are generally slow to allow cross-examination of a deponent in an interlocutory matter (see for examples, the High Court decisions in Balwant Singh Purba v. R Rajasingam [1987] CLJ (Rep) 468 and Syarikat Tunggaring Kilang Papan Sdn Bhd v. Sabah Forest Industries Sdn Bhd [1990] 2 MLJ 38). In the instant case, the cross-examination is in the context of a winding up proceedings which are governed under the CA and the Companies Winding-Up Rules 1972. Thus Order 38 r 2 or such a power of the Court to order cross-examination should be invoked on an even more exceptional basis. Burden on applicant, the Respondent herein [25] Secondly, and no less importantly, it is the applicant for leave to cross-examine a deponent who bears the legal burden to convince the Court to exercise its discretion to grant leave, as reiterated by the Court of Appeal in Tetuan Kumar Jaspal Quah & Aishah v The Co-Operative Central Bank Ltd [2007] 4 CLJ 487 (see also the High Court case of Charles Koo Ho-Tung & Ors v. Koo Lin Shen & Ors [2016] 2 CLJ 267).  Must be made in good faith [26] Thirdly, a key consideration to be weighed by a Court called upon to exercise its discretion for the purpose is the need to ensure that the application to cross-examine a deponent is made in good faith, as was stated in the passage attributed to Salleh Abas FJ (as he then was) in Leisure & Allied Industries Pty Ltd v. Udaria Sdn Bhd referred to earlier. In the instant application however, it is difficult to see the true basis for the same, for the Respondent seemed to be disputing every single averment made by the Petitioners. Exactly 28 paragraphs which had been affirmed by the Petitioners in the 48-paged petition were challenged and sought to be verified by the Respondent by way of the cross-examination of the deponent. For clarity, I set out only 10 of the paragraphs below:- a) Paragraph 7 of the Petition:- “Catherine Low and Simon Low are the children of Michael Low and are used to acting under the directors or instructions of Michael Low. As such, Michael Low is the de factor or shadow director of the respondent and the Board of Directors of the respondent are controlled by Michael Low, Simon Low and Catherine Low.” d) Paragraph 15:- “It is clear that Michael Low, Simon Low and/or Catherine Low caused the RM1,500,000.00 paid by the petitioners as advanced for working capital to be siphoned to Michael Low instead. This was done by inserting an entry in the respondent’s general account ledger under “amount due to shareholder”, that the sum of RM1,500,000.00 advanced by the petitioners is attributed to Michael Low as a cash deposit from him purportedly made on 22 December 2008 (again it has a remark that “fund came from Arabs”). Then, Michael Low, Simon Low and/or Catherine Low caused another entry that the sum of RM1,500,000.00 was paid to Michael Low on 2 January 2009 purportedly to reimburse then loan from Michael Low. Taking these 2 transactions together, the ledger prepared by Michael Low, Simon Low and/or Catherine Low gives an impression that the amount of RM1,500,000.00 was advanced to the respondent by Michael Low on 22 December 2008 and was ‘repaid’ to him on 2 January 2009. This is blatant fraud.” e) Paragraph 35:- “The petitioners contend and will contend that Michael Low and Simon Low’s attempted explanations regarding the different awards in the sum of RM82,530,000.00 and RM59,356,500.00 are mere afterthoughts. The petitioners further contend and will contend that Michael Low, Simon Low and/or Catherine Low have forged contractual documents purely for the purpose of misleading the petitioners.” j) Paragraph 52:- “The purported reimbursement or payment of the purported Final D.O. Charges is clearly fictitious based on the facts and matters set out in the petition. It is thus clear that Michael Low, Simon Low and/or Catherine Low has made illegally enriched themselves and/or their connected persons/companies by a sum of RM386,325.00 at the expense of the respondent and/or petitioners.” n) Paragraph 58:- “It is clear that they ran the respondent’s affairs as if the respondent was Michael Low and his family members’ private enterprise and treated the respondent’s money as if it were their own.” r) Paragraph 71:- “The petitioners contend that Michael Low, Simon Low and/or Catherine Low intended and intends to appropriate the sum of RM724,726.20 for their own or their family’s benefit and it appears that they have enlisted one Wong Yee Shiong to collude with them in this exercise and to further mislead PWC. PWC was in fact, mislead. This is shown by the fact that Wong Yee Shiong of KCYS issued conflicting/contradictory documents regarding the receipt of payments from the respondent.” t) Paragraph 76:- “One of the footnotes to all the Annual Reports also states that “[t]he amount due to a director and a shareholder is unsecured, interest free and with no fixed terms of repayment.” The reference “a director and a shareholder” refers to Simon Low and Michael Low respectively.” w) Paragraph 83:- “It is also significant that Elsie Yeo did not receive any financial benefits from the respondent. Michael Low, Simon Low and/or Catherina Low and their connected persons had used the monies of the respondent as if it was their personal fortune to be used and inflated at will. This is fortified by the fact that Michael Low, Simon Low and/or Catherine Low treated the respondent as part of their AM-EL Group of Companies and represented as such to the world at large.” z) Paragraph 91:- “In this purported settlement exercise, if true, then Catherine Low, by virtue of being a shareholder of AM-EL Holdings Sdn Bhd, a shareholder of AM-EL Construction Sdn Bhd, had also acted in conflict of interest and in breach of her duties and fiduciary duties as director of the respondent.” bb) Paragraph 95:- “Based on the facts and matter set out hereinabove, Catherine Low and Simon Low, the directors of the respondent have acted in the affairs of the company in their own interests and/or that of their family members, connected persons and/or Michael Low, rather than in the interests of the members as a whole, or in a manner which appears to be unfair or unjust to the petitioners.” [27] The point to note is that the Petitioners had produced by way of exhibits, supporting documents to strengthen their averments vis-à-vis the petition which runs into five thick volumes. On the other hand, in contradistinction, many of the averments in reply made by the Respondent were not accompanied by documents in support. Thus the true motivation of the Respondent in filing this instant application is in some doubt, and good faith cannot readily be imputed. Must identify relevant issues [28] Fifthly, and more critically, the relevant issue for cross-examination must be identified with sufficient clarity by the applicant to ensure that the proposed cross-examination does not constitute a harassment, intimidation and or oppression of the deponent. Thus in the Court of Appeal case of Indrani a/p Rajaratnam & Ors v. Fairview Schools Bhd [2002] 1 CLJ 1, Siti Norma Yaakob FCJ (as she then was) held:- “The grant or the refusal of an application under O. 38 r. 2(3) is very much an exercise of a judge's power of discretion and the question that must be determined is whether Abdul Malek J (as he then was) had exercised his discretion judicially. From his written judgment, it is very clear that the learned judge considered the following factors when exercising his discretion. (1) That the appellants never identified the issues for which they maintain cross-examination had become necessary. This is not surprising as no formal application was made by them. Even so a perusal of the proceedings recorded by the trial judge fails to disclose what the issues are to warrant cross-examination. Apart from stating orally that the respondent's many affidavits by various deponents raise many disputes as to facts, such disputes have not been identified by the appellants. If indeed there are factual disputes, the appellants have also failed to show whether they are relevant to the petition to warrant cross-examination. On the contrary the learned trial judge found that the cross-examination would not advance the cause of justice as there is sufficient affidavit evidence supported by contemporaneous documents to enable the petition to be heard properly without the need of cross-examination. (2) That the appellants delayed in making the application to cross-examine. The oral application was made on 24 January 1995, the second time the petition was adjourned to be heard on its merits. The learned trial judge considered that the application should have been made earlier when the petition was initially fixed to be heard on its merits on 20 December 1994. There was no indication then that the appellants intended to cross-examine any of the respondent's deponents even though their affidavits had already been filed in court. Under these circumstances, I do not consider that the learned trial judge had erred in law or in principle when he exercised his discretion as he had put his mind to relevant considerations in deciding as he did. To that extent I see no justification in interfering with the order he had made in the court below”. [29] This is the most critical consideration in an application to cross-examine a deponent of an affidavit, what more in a winding up petition. In the Court of Appeal decision in Tetuan Kumar Jaspal Quah & Aishah v The Co-Operative Central Bank Ltd [2007] 4 CLJ 487, Tengku Baharudin Shah JCA, in a majority judgment, held instructively as follows:- “[24] You can discern from the authorities referred by the parties that 3 prime considerations would influence the court in the exercise of its discretion to allow or disallow cross-examination on affidavit. Firstly, the truth of the averment in the affidavit must be challenged or the issues of fact identified. Secondly, cross-examination should only be allowed if the disputed fact is relevant to the issue to be decided and must be limited to that issue only. And thirdly, cross-examination would not advance the cause of justice and should be refused if there is sufficient affidavit evidence or contemporaneous documents to enable the court to properly decide without the need of cross-examination”. [30] The Court of Appeal, from the above-said passage, thus emphasised on the need for the conflict in affidavit evidence in respect of the relevant issue to be so identified in order to justify a cross-examination of the deponent in question where the truth of the averment in an affidavit must be challenged.  [31] As such, in the instant case, the Respondent, who bears the burden of justifying the need for cross-examination must demonstrate with specificity the issues in dispute arising from the affidavits and that once identified, must also show that the disputed issues are truly relevant to be decided in the petition. This, the Respondent has patently failed to do. I do not for a moment question that the Respondent did dispute the overarching basis for the petition presented by the Petitioners, in that the Respondent had denied any mismanagement and misappropriation of company funds. [32] But the Respondent never condescended into the details of the averments to identify the specific issues to be challenged, let alone to demonstrate whether those issues were actually relevant to the determination of the petition. Instead, the Respondent, in the affidavit in support of this application, merely reproduced the entirety of most of the paragraphs which appeared in the petition, without more. This is demonstrably deficient and cannot progress, what more justify, the Respondent’s application to cross-examine the deponents. [33] It is a pre-requisite to an application under Order 38 that an applicant like the Respondent herein must identify the facts in issue that warrant the cross-examination of the Petitioners. Such facts in issue must be shown to be in turn relevant to the determination of the disputed issues in the proceeding. The Respondent did not in its notice of application or affidavit filed herein identify the facts and whether these are relevant. Such omission is fatal. [34] The Respondent cannot just dispute but not provide any basis for refuting the averments by the Petitioners. Yet, no reasons were given by the Respondent to even suggest that the Petitioners are not telling the truth, what more when the allegations in the petition are based on documents, some of which were prepared and produced by the Respondent. As such, there is no basis for a cross-examination of the Petitioners on the truthfulness of the issues and facts deposed in the petition or affidavits for the Petitioners. Whether contemporaneous documents sufficient [35] Sixthly, and yet another consideration referred to in Tetuan Kumar Jaspal Quah & Aishah is that the cross-examination applied for must be able to promote the cause of justice. This will not be achieved if the said conflict in affidavit evidence could instead be resolved by undisputed contemporaneous documents. As mentioned, the Petitioners had exhibited volumes of documents in support of their petition. Such affidavit evidence will be duly examined for the purposes of the hearing of the petition. Nothing has been shown by the Respondent to even suggest that any of the documents so exhibited is to be rejected. [36] Thus, the attempt to cross examine is both pre-mature because the documents have not been evaluated, and the examination is also potentially superfluous because it adds nothing to the proceedings in the instant case the nature of which is to be heavily reliant on contemporaneous documents in any event. [37] The proposed cross-examination of the Petitioners would in all likelihood only result in the Petitioners repeating their averments and making reference to the documents already exhibited. Moreover, there is no doubt that the best evidence rule applies in respect of the key documents exhibited in the petition and affidavits, such as the agreements, forensic report, correspondences and cause papers. That these are contemporaneous documents that concern the matters existing at that point in time cannot be emphasised enough. In that sense, they even have higher evidential value relative to oral evidence. [38] The importance and superiority of contemporaneous documents had been made clear by the Federal Court in Tindok Besar Estate Sdn Bhd v. Tinjar Co [1979] 2 MLJ 229. After all, oral evidence involves a testimony as to events that happened in the past whilst contemporaneous documents speak of matters then existing at the time such documents were issued or made (see the Court of Appeal decision in Guan Teik Sdn Bhd v Hj Mohd Noor Hj Yakob & Ors [2000] 4 CLJ 324). It goes without saying that undisputed documentary evidence in this sense enjoys an even more superior status (see Kumagai Gumi Co Ltd v Zenecon-Kumagai Sdn Bhd & Ors and another application [1994] 2 MLJ 789). In short, the cross-examination would not likely assist the winding up proceeding any more than what the exhibited documents already readily would. Thus, a cross-examination in this case would hardly promote the cause of justice. [39] It is imperative to state that the mere fact that the Respondent claimed to dispute the relevant averments of the Petitioners is manifestly insufficient a basis to warrant cross-examination. The Petitioners had exhibited various documents; the Respondent must do more that merely dispute without adequate substantiation by producing its own documentary evidence to furnish a basis for its disputation. In the absence thereof, the Petitioners would likely stand by their petition and affidavits exhibiting the various contemporaneous documents. In my view, in this situation, no useful purpose would be served by ordering them to be cross-examined. Conclusion [40] In view of the above-stated reasons, I find that the Respondent has not sufficiently established its case to justify this Court exercising its discretion to order the Petitioners be cross-examined on their petition and affidavits pursuant to Section 221 of the CA or Order 38 r 2 (2) of the RC 2012. I therefore dismiss the instant application in enclosure 27, with costs. Dated: 17 August 2017 (MOHD NAZLAN BIN MOHD GHAZALI) Judge High Court NCC1 Kuala Lumpur Counsel: For the Petitioners Jeremy Khalif with Olivia Lee Messrs Nadzrin Kuok Puthucheary & Tan Kuala Lumpur For the Respondent Mohd Reza with RM Yeoh Messrs Mohd Imtiaz Choong & Partners Penang Page 14 of 17

Tika 2.6.0

01(f)-20-06-2016(B)

PERAYU CIMB BANK BERHAD (NO. SYARIKAT: 13491-P) … PERAYU RESPONDEN 1. AMBANK (M) BERHAD (NO. SYARIKAT: 8515-D) 2. PENTADBIR TANAH DAERAH KLANG 3. PENGARAH TANAH DAN GALIAN SELANGOR … RESPONDEN RESPONDEN

Land Law — Indefeasibility of title and interests— Deferred indefeasibility — Whether there is entitlement to protection under principle of deferred indefeasibility when registration of property was obtained by forgery — Chargee — Whether a chargee comes within the meaning of 'purchaser' under s 340(3) National Land Code — Whether a charge is valid and indefeasible as a subsequent purchaser within s 340(3) National Land Code

16/08/2017

YAA TUN MD RAUS BIN SHARIFKorumYAA TUN MD RAUS BIN SHARIFYA TAN SRI DATUK ZAINUN BINTI ALIYA TAN SRI DATO' SRI ABU SAMAH BIN NORDINYA TAN SRI DATO' WIRA AZIAH BINTI ALIYA TAN SRI JEFFREY TAN KOK WHA

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=dc36ef5f-6f02-4c5f-a7e2-b8ca7bfe08c5&Inline=true

kjhggjj 1 FC-01-20-06/2016 IN THE FEDERAL COURT OF MALAYSIA AT PUTRAJAYA CIVIL APPEAL NO. 01-20-06/2016 BETWEEN CIMB Bank Berhad ... Appellant AND 1. AmBank (M) Berhad 2. Pentadbir Tanah Daerah Klang 3. Pengarah Tanah dan Galian Selangor ... Respondents CORAM: Raus Sharif CJ Zainun Ali FCJ Abu Samah Nordin FCJ Aziah Ali FCJ Jeffrey Tan FCJ MINORITY JUDGMENT 1. This is an appeal against the decision of the Court of Appeal who reversed the decision of the trial court and held that the charge of the 1st Respondent over land held under GM7794 for Lot 23223 Seksyen 21 Mukim Bandar Klang, District of Klang, Selangor (said land) was indefeasible and thus prevailed over the prior charge in favour of the Appellant. 2 FC-01-20-06/2016 2. The following background facts are not in dispute. By a loan agreement dated 17.3.2006, Southern Bank Berhad (SBB) granted loan facilities to one Ching Ting Seng and Ching Chong Lup (the Chings). As security for the loan, the Chings executed a charge of the said land, which was registered on 23.3.2006, in favour of SBB. On 6.9.2006, the business of SBB was vested unto the Appellant. 3. On 14.11.2008, one Wong Chee Kong (Wong) applied for a loan from the 1st Respondent to finance his purchase of the said land, with the said land as the security. The 1st Respondent appointed Messrs KK Lim & Associates (KK Lim) to prepare the charge of the said land in favour of the 1st Respondent. Messrs Ku Abdul Rahman & Associates (Ku Abdul Rahman) prepared the sale and purchase agreement between the Chings and Wong. Later, Ku Abdul Rahman informed KK Lim that Wong had settled the differential sum between the purchase price and the loan sum and that the Chings had settled the loan sum due to the Appellant and were awaiting receipt of the original document of title and the discharge of charge. Ku Abdul Rahman gave an undertaking to forward the duly adjudicated and stamped memorandum of transfer together with the original document of title and discharge of charge to KK Lim. 4. On 10.3.2009, KK Lim received from Ku Abdul Rahman the purported document of title (Version 6) of the said land, the 3 FC-01-20-06/2016 duly stamped memorandum of transfer of the said land, and the purported discharge of charge executed by the Appellant. On 17.3.2009, KK Lim received what purported to be the duplicate charge from Ku Abdul Rahman. On 19.3.2009, KK Lim presented the purported discharge of charge, the memorandum of transfer by the Chings to Wong, and the memorandum of charge by Wong in favour of the 1st Respondent together with what purported to be the original document of title (Version 6) (hereinafter collectively referred to as the security documents) for registration. 5. On 7.4.2009, 1st Respondent, through KK Lim, forwarded a Cashier’s Order No 724209 for RM1,910,000.00, it being the purported balance purchase price, to Ku Abdul Rahman who credited that sum into its account. 6. Upon enquiry on 17.9.2009, KK Lim was informed that the security documents were rejected for registration by reason of the letter of Ku Abdul Rahman dated 30.3.2009. On 25.11.2009, the security documents were again presented for registration. This time, the registering authority registered the purported discharge of charge, the transfer by the Chings to Wong, and the charge by Wong in favour of the 1st Respondent. 7. On or about 2.5.2012, the Appellant commenced proceedings to declare the charge in favour of the 1st Respondent as null and void, and to reinstate its charge of the said land. That 4 FC-01-20-06/2016 was followed by the counter-claim of the 1st Respondent against the registering authority, for breach of duty. 8. After a full trial, without Wong as litigant or witness, the trial court found (i) “as a fact that the discharge of charge purportedly signed by the [Appellant] had been forged”, (ii) the purported document of title (Version 6) was not issued by the registering authority, and (iii) the registering authority was negligent to have acted on the Version 6 document of title. The trial court additionally found “that [Wong] created a charge of the said land by forging the signature of the attorney of the [Appellant] and registering the same as a discharge of charge to enable the current charge over the said land in favour of the [1st] Respondent to be registered”. 9. The Court of Appeal agreed that “at the trial it was established that the discharge of charge had been forged”. Both courts below held that the discharge of charge was a forgery. But the courts below differed as to whether the Respondent was an immediate or a subsequent purchaser. 10. The trial court stated that section 340 of the National Land Code (NLC) “affords protection to a subsequent purchaser”. The trial court was of the view that “the position of the [1st Respondent] vis-a-vis the [Appellant], in my view is that the [1st Respondent] is not a subsequent purchaser but a direct purchaser 5 FC-01-20-06/2016 of the interest registered as a charge for the creation of a charge in favour of the [1st Respondent], based on a discharge of charge purportedly executed by the [Appellant] (which is denied) which then allowed a charge to be registered in the name of the [1st Respondent]. It follows therefore that the [1st Respondent] is an immediate purchaser of the interest and is subject to immediate indefeasibility. This however is liable to be set aside in the event [that] section 340 subsection (2)(b) has been breached”. Given its finding that the discharge of charge was a forgery, the trial court went on to hold that section 278 of the NLC had not been complied to effect a discharge of the said land, and that the charge in favour of the 1st Respondent should be set aside. 11. Before the trial court, the 1st Respondent argued that the 1st Respondent was a purchaser in good faith and for valuable consideration, and that the proviso (proviso) to subsection (3) of section 340 of the NLC applied, as the immediate purchaser, Wong, and the creation of the charge had put the 1st Respondent in the position of a subsequent purchaser. But the trial court held that given that the discharge of charge was a forgery and that section 278 of the NLC had not been complied, all issue of the 1st Respondent being a subsequent purchaser could not arise and that the proviso could not apply. 6 FC-01-20-06/2016 12. At page 17 of its judgment, the trial court thus enunciated on the defeasibility or indefeasibility of title of the 1st Respondent: “In view of my finding that the said discharge of charge and the signature on the same were forged, the purported transfer of interest from the [Appellant] to the [1st Respondent] is one of immediate indefeasibility and the proviso in subsection (3) of 340 of the NLC does not apply, and 340(2)(b) of the NLC would kick in and the interest of the [1st Respondent] would not be indefeasible and would be liable to be set aside. The [1st Respondent] was the immediate holder of its charge and that being the case, the [1st Respondent] cannot take advantage of the proviso ... ” 13. The trial court granted the orders sought by the Appellant against the 1st Respondent and the orders sought by the 1st Respondent against the registering authority. 14. At the Court of Appeal, the 1st Respondent submitted that the trial court failed to appreciate that the 1st Respondent derived interest from Wong and not the Appellant, that the charge in favour of the Appellant was discharged before Wong was registered as proprietor, and that “the financing of the property involved a two stage transaction”. 15. The Court of Appeal expressed total agreement with the latter submission of the 1st Respondent: 7 FC-01-20-06/2016 “We found merit in the aforesaid contention and our reasons were these. As pointed out by learned counsel, the sequence of presentation of the dealing on 25.11.2009 was as follows: (a) The lodgement of the Discharge of CIMB’s Charge via Form 16N. (b) Then the lodgement of the memorandum of transfer from the Chings to Wong; and (c) Finally the lodgement and registration of Ambank’s Charge. Though the above dealings were on the same day and were done simultaneously, it cannot be disputed nor can we ignore the fact that the lodgement of the AmBank’s Charge could not have been created until the first two steps had been executed. That being the case, the only way AmBank obtained their interest was from Wong and not from CIMB. CIMB’s interest in the property had been then extinguished by the forged discharge resulting in Wong becoming the immediate purchaser. AmBank then derived their interest in the property from the charge executed from Wong. Under such circumstances, there cannot be any relationship between CIMB and AmBank, hence the learned Judge, with respect, erred when he said “...it is clear that the relationship between the Plaintiff (CIMB) and the 1st Defendant (AmBank) was that of an immediate purchaser and not a subsequent purchaser ...” When AmBank became the chargee from Wong’s memorandum of charge, AmBank became the subsequent purchaser. Further, we said that the fact that Wong’s interest being an immediate purchaser was defeasible by CIMB did not, in our view, affect the indefeasibility of AmBank’s interest. Our view is supported by two decisions of the apex Court, namely Kamarulzaman Omar & Ors v. Yakub 8 FC-01-20-06/2016 Husin & Ors reported in [2014] 1 CLJ 987 and Tan Ying Hong v Tan Sian San & Ors [2010] 2 MLJ 1.” 16. For those reasons, the Court of Appeal allowed the intermediate appeal and set aside all orders of the trial court. 17. The Appellant obtained leave to appeal to this Court on the following question of law: “Whether a chargee comes within the meaning of ‘purchaser’ under the proviso to section 340(3) of the National Land Code?” 18. Before us, the Appellant submitted as follows. The question of law ought to be answered in the negative. A chargee cannot be regarded as a subsequent purchaser. A charge is subservient to the title to the land. Where the chargor’s title is defeasible, he cannot create any interest in favour of a 3rd party. The 1st Respondent could not be a subsequent purchaser and was not entitled to the proviso, as the 1st Respondent’s charge, which could not subsist on its own, was dependent on the title of Wong who was the fraudster and who acquired no title whatsoever by the presentation of false instruments. The 1st Respondent’s charge, being a derivative interest from a title obtained by forgery, was tainted with the same forgery. The defeasibility of title to the said land rendered the charge created out of such defeasible title also defeasible and liable to be set aside. The charge of the 1st Respondent was defeasible because its registration was obtained 9 FC-01-20-06/2016 by forged documents. The case was not within the proviso, even if the 1st Respondent were innocent. Whether the 1st Respondent was complicit in the forgery was irrelevant. The following could be concluded from the undisputed facts: (a) the discharge of charge was a forgery, and its registration was void ab initio, (b) the transfer of the said land and the charge were registered on the basis of the forged discharge of charge, (c) a forged document of title was used to procure registration of the transfer and the charge, (d) the Appellant had not parted with possession of the document of title (Version 2) and the duplicate charge, (e) consequently, registration of the transfer to Wong and the charge in favour of the 1st Respondent were procured by forged documents and were void ab initio, (f) the document of title (Version 3) in the possession of the 1st Respondent was tainted with illegality, as it was procured by the presentation of forged instruments with a forged Pelan Tanah. The argument that the 1st Respondent was a subsequent purchaser in good faith and for valuable consideration and the attempt to separate the 2 transactions, namely, the transfer by the Chings to Wong on the one part and the charge in favour of the 1st Respondent of the other part, was untenable for the following reasons: (i) removal of the Appellant as chargee and registration of the 1st Respondent as chargee were carried out in one continuous transaction together with the transfer of the said land by means of forged documents, (ii) the charge in favour of the 1st Respondent could not have been registered but for the forged discharge of charge and forged document of title (Version 10 FC-01-20-06/2016 6), (iii) the document of title (Version 3) in the possession of the 1st Respondent was issued on 21.12.2009, that is, after creation of the charge in favour of the 1st Respondent on 25.11.2009, as a direct consequence of the registration of forged instruments, (iv) Tan Ying Hong at [26] was inconsistent with itself at [8], [10] and [11], (v) the 1st Respondent failed to properly investigate the circumstances of the sale from the Chings to Wong; a search would have revealed that there were pending foreclosure proceedings and that the Appellant had an interest in the said land. The argument that the 1st Respondent was a subsequent purchaser in good faith and for valuable consideration was unmaintainable, as Wong, who procured title by forged documents from which he created a charge in favour of the 1st Respondent, acquired no title to the land. In Bank of Nova Scotia Berhad v Saunah Kasni and Ors [2016] 1 CLJ 505, the court held that the charge created out of a defeasible transfer must necessarily be avoided. In Rajamani Meyappa Chettiar v Eng Beng Development Sdn Bhd & Ors [2016] 4 CLJ 510, the Court of Appeal drew a distinction between indefeasibility and validity of title. The Court of Appeal held that the fact that the defendant purchased the said land in good faith and for value did not confer indefeasibility if the title to such land was void at inception, that is, that the second document of title was a void document of title, it being issued during the subsistence of the valid document of title. Following the reasoning in Rajamani, the document of title (Version 3) in the instant case was void, as it was issued during the subsistence of the real document 11 FC-01-20-06/2016 of title (Version 2) in the possession of the Appellant. Pursuant to section 294(2) read together with section 306(a) of the NLC, the presentation of the discharge of charge must be accompanied by the document of title and duplicate charge. In the instant case, both signature and attestation of the discharge of charge as well as the document of title (Version 6) with the Pelan Tanah were forgeries. The discharge of charge was an invalid instrument to determine the Appellant’s interest in the said land in accordance with section 206 of the NLC. Registration of the charge in favour of the 1st Respondent, which was based on forged and invalid documents, was defeasible under section 340(2)(b) of the NLC. Forgery under section 340(2)(b) of the NLC is a distinct ground of defeasibility, where knowledge is wholly irrelevant. Forgery per se suffices to render a registered title defeasible, irrespective of the knowledge of the 1st Respondent. Forgery as a distinct ground of defeasibility is clear from the express wording of section 340(2)(b) of the NLC. That position in law was endorsed in Tenure and Land Dealings in the Malay States (Singapore University Press 1975) at 361 to 363 by David S Y Wong, and adopted by the Court of Appeal in OCBC Bank (Malaysia) Bhd v Pendaftar Hakmilik Negeri Johor Darul Takzim [1999] 2 CLJ 949. The 1st Respondent’s charge was similar to OCBC as analysed by Tan Ying Hong. In Tan Ying Hong, the Federal Court held that the immediate holder of the registered charge procured by a forged power of attorney could not take advantage of the proviso. The Federal Court overruled Adorna Properties Sdn Bhd v Boonsom Boonyanit @ Sun Yok Eng 12 FC-01-20-06/2016 [2001] 1 MLJ 214, where it was held that the proviso was available to an immediate purchaser in good faith and for valuable consideration. In Kamarulzaman bin Omar & Ors v Yakub bin Husin & Ors [2014] 2 MLJ 768, the Federal Court held that immediate purchasers were not entitled to the proviso. Wong, who procured title by the forged discharge of charge and forged document of title (version 6) with the forged Pelan Tanah, could not be an immediate purchaser. Wong acquired no title whatsoever to create the charge in favour of the 1st Respondent. Following the reasoning in Kamarulzaman, the 1st Respondent was an immediate purchaser, and the title, which was procured by forged instruments, was defeasible. The 1st Respondent was not a bona fide purchaser, as registration of the charge was obtained by forged documents, and as the 1st Respondent failed to properly investigate all matters that pertained to the sale and creation of the charge (counsel cited Gibbs v Messer [1891] AC 248 and Au Meng Nam & Ung Yak Chew & ors [2007] 5 MLJ 136). A proper search would have disclosed (i) that the purchase by Wong was completed on 25.11.2009, when the said land was then the subject of foreclosure proceedings by the Appellant, and (ii) that there was an obvious irregularity on the face of the discharge of charge which wrongly stated that CIMB was formerly known as Southern Bank Berhad. There was no CTOS or CCRIS search conducted on the Chings. The loan was disbursed before the transfer to Wong and the charge to 1st Respondent were confirmed. The entire transaction which led to the removal of the charge in favour of the 13 FC-01-20-06/2016 Appellant was set in motion by the grant of the loan to Wong. The Appellant had no relationship with Wong who was the 1st Respondent’s customer. Yet the 1st Respondent failed to procure Wong to testify, to prove that the 1st Respondent was a subsequent purchaser. The Court of Appeal was mistaken that the only issue was whether the 1st Respondent was an immediate or subsequent purchaser. The Court of Appeal failed to consider that the document of title (Version 6) with the Pelan Tanah was a forgery, and that a charge cannot subsist on its own. The charge, which was obtained by forgery, should be set aside. 19. The 1st Respondent submitted as follows. ‘Interest’ in land includes a charge (counsel cited T. Damodaran v Choe Kuan Him [1979] 2 MLJ 267b, Tan Ying Hong at [26], Daito Kogyo (Sarawak) Sdn Bhd v Port Dickson Land Development Sdn Bhd[2001] 2 MLJ 531, and sections 205, 214, 221, 241, 282, 340(1) of the NLC). The term ‘purchaser’ extends to all with an interest in the land. That is supported by section 5 of the NLC which defines ‘purchaser’ as “a person or body who in good faith and for valuable consideration acquires title to, or any interest in land”. In Score Options Sdn Bhd v Mexaland Development Sdn Bhd [2012] 6 MLJ 475, the Federal Court applied Luggage Distributor (M) Sdn Bhd v Tan Hor Teng [1995] 1 MLJ 719, where it held that interest under the NLC are leases, charges and easements. In Tan Ying Hong, the Federal Court analysed the decision in OCBC where it was held by the Court of Appeal that the 14 FC-01-20-06/2016 title of the chargee bank was not indefeasible, and held at [26] that the reasoning in OCBC was flawed. In Tan Ying Hong, the Federal Court expressly referred to the chargee bank as a subsequent purchaser protected by the proviso, and explicitly accepted that a chargee was a purchaser. In Teh Cheng Choo v Malayan Banking Berhad [2009] 5 CLJ 46, the land was fraudulently transferred to one Lim Ong Ah who fraudulently charged the land. At [27], the Court of Appeal held that Malayan Banking was a bona fide purchaser and thus was protected by the proviso. In Heveaplast Marketing Sdn Bhd v See Leong Chye & ors[2017] 2 CLJ 43, the Court of Appeal likewise decided that a chargee bank is a purchaser within the meaning of the proviso. In Kasai Reiko v Annie Lor Fong & ors (Public Bank Bhd - Intervenor) [2014] 7 MLJ 652, Lee Swee Seng J came to the same conclusion that a chargee bank who derived interest from a fraudster fell within the definition of ‘purchaser’. In ‘National Land Code – A Commentary (2nd Edition)’ at 826, Judith Sihombing stated that the term purchaser “extends to all taking an interest in the land, for example a lessee or charge”. In ‘Indefeasibility of Title in Malaysia – The Revivification of Deferred Indefeasibility under the Torrens Systems – Focus on Fraudulently Obtained and Forged Titles” at 139, Grace Xavier said that “the persons in whose name the title had been registered, then transfers the title to another ... or creates a charge on the property, then the subsequent person will obtain indefeasibility, or indefeasibility of the charge ... ”. Under the principle of deferred indefeasibility, so long as the financial 15 FC-01-20-06/2016 institution is bona fide, its interest is protected by the proviso. It would have far reaching consequences if financial institutions were excluded as purchasers. In M & J Frozen Food Sdn Bhd & anor v Siland Sdn Bhd & anor [1994] 1 MLJ 294, the former Supreme Court qualified the nemo dat principle and said that a bona fide purchaser for value without notice of the defeasible nature of the vendor’s title acquires an immediate indefeasible title. The Appellant had strayed from the leave question. At no time was it argued in the courts below that a charge would not come within the meaning of ‘purchaser’. The sole question in the court below was whether the Respondent was an immediate or subsequent purchaser. Both courts below held that a chargee is a purchaser. There was no finding that the 1st Respondent was not a bona fide chargee/purchaser. The trial court held that the 1st Respondent and solicitors acted properly, and that the Appellant and 1st Respondent were defrauded by a third party. The Court of Appeal did not find that there was any lack of bona fides on the part of the 1st Respondent. On the issue of whether the 1st Respondent was an immediate or subsequent purchaser, the Court of Appeal said that that was a matter of fact. The analysis of OCBC in Tan Ying Hong made the former case squarely within the instant case. The decision in Tan Ying Hong, to wit, that a chargee bank has an interest and is entitled to protection under the proviso, was wholly applicable to the instant case. 16 FC-01-20-06/2016 20. In its reply submission, the Appellant responded as follows. A charge is not an interest acquired by a purchaser within the meaning of the proviso. A charge is dependent on the validity of the title of the charger. In M & J Frozen Food, the former Supreme Court referred to Taylor v Land Mortgage Bank of Victoria Ltd (1886) 12 VLR 748, where it was said that in the Torrens system, “the estate and interest in the land remains with the proprietor until he has done all that is necessary to divest the estate out of himself and vest it in the transferee”. The former Supreme Court said that the aforesaid principle was embodied in section 267(1)(a) of the NLC, and that section 267(1)(a) of the NLC “clearly negates any judicial proposition that the charger abdicates his proprietary rights at the stage of the auction sale”. In Mahadevan & Anor v Manilal & Sons (M) Sdn Bhd, the Federal Court held that “the mortgagor retains ownership whilst the mortgagee acquires a statutory right to enforce his security” (on the rights of a chargor and chargee, counsel also referred to Malayan United Finance Bhd v Liew Yet Lan (1990) 1 MLJ 317, Development & Commercial Bank Ltd v Kim Ling Choon [1991] 1 CLJ 732, Kuala Lumpur Finance Bhd v Yap Poh Khian [1992] 1 MLJ 472, Public Bank Bhd v Phan Seng Kee & ors [1991] 3 CLJ 2560, Malayan United Finance Bhd v Tan Lay Soon [1991] 1 MLJ 504). In M & J Frozen Food, the former Supreme Court referred to and followed Gibbs v Messer, where the vendor’s title was good but the instrument used by the purchaser for registration was void and or voidable, and where the Privy Council held that the effect of 17 FC-01-20-06/2016 registration of such instrument only conferred deferred indefeasibility. The principles enunciated in M & J Frozen Food established that a charge is a species of security transaction where the chargor remains the registered proprietor until registration of a valid transfer in the name of a purchaser under a judicial sale. Wong acquired a defeasible title. Once it was established that Wong acquired no title, then Wong could not create a charge out of his title. Following the principles in M & J Frozen Food, Wong had not abrogated his rights to the said land. In OCBC, the Court of Appeal held that the registered title or interest of an acquirer obtained by forgery was defeasible. A forged instrument is a nullity which does not confer any right or title to the transferee. Such transferee has no right to charge or create any interest in land which is not his. A chargee who claims title through an immediate acquirer who obtained his title by forgery is not protected by the proviso. Following OCBC, a chargee cannot be a ‘purchaser’ within the meaning of the proviso, as the chargee takes his interest through the immediate acquirer whose title is tainted by forgery. Implicit in OCBC is that a charge is a species of derivative interest that is subject to the infirmities of the title of the proprietor. The contention that the 1st Respondent was a subsequent purchaser in good faith and for valuable consideration was unmaintainable, as Wong who procured title by forged documents had not acquired any interest whatsoever. The 1st Respondent was not a subsequent purchaser, and whose charge was defeasible. To hold that the 1st Respondent as a subsequent 18 FC-01-20-06/2016 purchaser would return to Adorna Properties, where it was held that the purchaser obtained a good title, albeit that the title was procured by a forged transfer. In Tan Ying Hong, the Federal Court ruled that the charge was liable to be set aside, as the charge as created by the use of a forged power of attorney, and held that the immediate holder of the charge procured by the forged power of attorney could not take advantage of the proviso. The statement of law in Tan Ying Hong with respect to OCBC was flawed, as it was an opinion in respect of a hypothetical question and is no authority that OCBC could be decided differently if the same facts were to arise. In Tan Ying Hong, the Federal Court answered that an acquirer of a registered charge by means of a forged instrument does not acquire an immediate indefeasible interest or title. OCBC was consistent with the ratio decidendi in M & J Frozen Food which was referred to with approval in Tan Ying Hong. In Bank of Nova Scotia Berhad v Saunah Kasni and Ors, it was held that the charge created by the chargor who obtained title by forgery was defeasible, and that a charge is not an interest in land. Teh Cheng Choo v Malayan Banking Berhad was decided before Tan Ying Hong. The decision in Heveaplast Marketing Sdn Bhd v See Leong Chye & ors, where the title of the chargor was defeasible and it was held that the chargee was a subsequent purchaser, was wrong in law. The decision in Kasai Reiko v Annie Lor Fong & ors (Public Bank Bhd - Intervenor), where the charge was created after the chargor was registered as proprietor and it was held that the chargee was a purchaser in good faith, is 19 FC-01-20-06/2016 untenable in law. The 1st Respondent had the burden to prove that it was a purchaser in good faith and for valuable consideration, and that the transfer to Wong was valid. 21. In its reply submission, the 1st Respondent submitted as follows. All proposed leave questions to do with forgery were rejected by the leave panel. All findings of the Court of Appeal remained intact. The leave question only required an affirmative or negative answer. The Appellant could not ventilate issues on forgery (counsel cited Ho Tack Sien & ors v Rotta Research Laboratorium SpA & anor [2015] 4 MLJ 186, where the appellant was confined to the 2 leave questions which incorporated a point of law and not permitted to seek a reversal of the findings of fact of the courts below). The Appellant could not go beyond the leave question. A chargee is a purchaser (learned counsel again cited sections 5, 205, 241, 340(1) of the NLC, Score Options Sdn Bhd v Mexaland Development Sdn Bhd, Tan Ying Hong at [26], T. Damodaran v Choo Kuan Him at 269, Teh Cheng Choo v Malayan Banking Berhad, Heveaplast Marketing Sdn Bhd v See Leong Chye & ors). A bona fide purchaser for value who acquires title from the immediate purchaser obtains an indefeasible title (learned counsel cited Kamarulzaman at [16] and [46]). A registered proprietor, even though he does not possess an indefeasible title, may give an indefeasible title to a bona fide purchaser (learned counsel cited Tan Ying Hong at [46] which cited ‘Sale and Purchase of Real Property in Malaysia’ by Visu Sinnadurai). The argument that a 20 FC-01-20-06/2016 charge is dependent on the validity of the chargor’s title is contrary to section 340(2) and (3) of the NLC. It was settled by Tan Ying Hong and Kamarulzaman that a defeasible title can be the root of good title to a bona fide purchaser. M & J Frozen Food recognised that the nemo dat principle had been modified. The facts in M & J Frozen Food were different. In M & J Frozen Food, it was a one stage transaction, and the proviso did not come into play. In the present case, it was a two stage transaction, first the transfer and then the charge. The Appellant relied on OCBC, a decision that was held as flawed. It was incorrect to suggest that the 1st Respondent advocated a return to Adorna Properties. “We are simply applying the deferred indefeasibility principles under the proviso to the facts of the present case, to the 1st Respondent who was a subsequent purchaser in a two stage transaction. Adorna Properties was wrongly decided because it applied the proviso to section 340(2) ... That was set right in Tan Ying Hong ... where the Federal Court held that the proviso was only applicable to section 340(3), ie to subsequent purchaser and not to the immediate purchaser.” In line with that, the Federal Court was of the view that OCBC’s charge was indefeasible, as OCBC was a subsequent purchaser. As in OCBC, the 1st Respondent’s charge came about from a two stage transaction. Section 340(3) of the NLC did not require the 1st Respondent to prove that Wong was an immediate bona fide purchaser. The trial court found that the 1st Respondent had made all inquiry and searches. The 1st Respondent had discharged the burden of proof. 21 FC-01-20-06/2016 22. The 2nd and 3rd Respondents, who filed a separate appeal (B01(NCVC(W)-327-08/2014) against the decision of the trial court, but which separate appeal was struck out by reason of the success of the 1st Respondent at the Court of Appeal, took the stand that it was mutually agreed they would file a fresh appeal at the Court of Appeal against the decision of the trial court in the event that the decision here should be against the 1st Respondent. But other than that, the 2nd and 3rd Respondents agreed to abide by any order of this court with respect to the competing charges. 23. It was submitted Tan Ying Hong at [26] overruled OCBC which held that the chargee bank had not acquired an indefeasible title, and that OCBC as analysed in Tan Ying Hong was on all fours with the facts of the instant case. 24. In OCBC, the appellant was the chargee. The charge was created by one Ng See Chow who acquired title through a forged transfer. Ng See Chow failed to repay the loan. The appellant applied and obtained an order for sale of the land. Ng Kim Hwa claimed that the land belonged to him and that he had not executed any transfer of the land to Ng See Chow. A registrar's caveat was entered against the land to prevent sale by the appellant. Contending that its charge was indefeasible, the appellant applied to have the caveat removed. That application was refused. The appellant appealed. In dismissing the appeal, NH Chan JCA held as follows: 22 FC-01-20-06/2016 “Now, if we apply this to the facts of the present case, what we have is this. If the registered title of the land (which is in Ng See Chow's name) is defeasible under s 340(2)(b) because its registration was obtained by forgery, it (ie Ng See Chow's title) is liable to be set aside at the instance of the true owner Mr Ng Kim Hwa (even though Ng See Chow was an innocent purchaser for value) and any interest (for example, any charge or lease) granted by Ng See Chow is similarly liable to be set aside. This is because in s 340(2) there is no proviso (as there is in s 340(3)) to protect the innocent purchaser (who is the immediate acquirer) for value or to protect anyone claiming through or under the immediate acquirer (even though that person be an innocent purchaser for value). So that, the chargee which Ng See Chow has granted thereout to the appellant bank (OCBC Bank (M) Bhd) as chargee is not protected because there is no proviso in sub-s (2) to protect the chargee bank which is a person claiming through or under Ng See Chow. The charge, therefore, is also liable to be set aside by Mr Ng Kim Hwa” (Emphasis added). 25. NH Chan JCA held the proviso applies only to section 340(3) and not to section 340(2) of the NLC, and that the proviso does not protect an innocent immediate purchaser, or anyone claiming through or under the immediate purchaser –“... in s 340(2) there is no proviso (as there is in s 340(3)) to protect the innocent purchaser (who is the immediate acquirer) for valuable consideration or to protect anyone claiming through or under the immediate acquirer (even though that person be an innocent purchaser for value)”. 23 FC-01-20-06/2016 26. In Tan Ying Hong, Arifin Zakaria CJ (Malaya) as he then was, thus remarked on the judgment of NH Chan in OCBC: “[26] NH Chan JCA in delivering the judgment of the Court of Appeal was of the opinion that the proviso to s 340(3) of the NLC applies exclusively to those situations which are covered by sub-s (3). The court then went on to hold that the charge granted by Ng See Chow to the appellant was liable to be set aside by the true owner since the title was obtained by forgery. On the facts of that case, we agree that the title of Ng See Chow is defeasible under s 340(2) of the NLC as he obtained his title through a forged instrument. However, we are of the opinion that the appellant bank, being the holder of subsequent interest in the land is protected by the proviso to s 340(3) of the NLC. For that reason we are of the view that the finding of the Court of Appeal in that case is to that extent flawed.” 27. On account of Tan Ying Hong at [26], it was submitted that the 1st Respondent, who likewise was a chargee bank, was also a subsequent purchaser protected by the proviso. 28. To the contrary, it was submitted that Tan Ying Hong at [26] was inconsistent with itself at [8], [9] and [11]. For a better understanding of Tan Ying Hong at [8],[9] and [11], the judgment of Zaki Azmi CJ should be read from [5]: “[5] Let us refer to the first owner of a piece of land as 'A' who then transfers the same piece of land to 'B' and which subsequently is transferred to 'C'. 24 FC-01-20-06/2016 [6] As far as s 340(1) of the NLC is concerned, A's title to the land is totally indefeasible. In short if A's name appears on the registration, no one can come and claim for that title. The law will not entertain it at all. [7] Now comes the next person, B, whose name appears in the register. If it can be shown that the title or interests obtained by B was obtained by fraud or misrepresentation by him or anyone else to which he was a party or privy then his claim to the title or interest can be defeated (see s 340(2)(a) of the NLC). Otherwise, B stands in the same position as A. [8] The situation where it is proved that the registration in B's name was obtained by forgery or by means of an insufficient or void instrument is the same (see s 340(2)(b) of the NLC). His title or interest to the land is liable to be set aside by the previous owner who has a good title. In this latter instance, there is no need to show that B was a party or privy to that forgery or to obtaining the title or interest by a void instrument. [9] The third instance where B's title or interest could be defeated is where it was unlawfully acquired through the exercise of any power or authority conferred by any law. Section 340(2)(c) of the NLC deals with one who was for example acting in his capacity as an agent to a power of attorney. Even if C is in the same position as B, sub- s (3) also does not give protection to C unless he can show that he had acquired the title or interest in good faith and for valuable consideration. Any title or interest gained by any person thereafter is also liable to be set aside unless it could be shown that he had acquired it in good faith and for valuable consideration. This is what is called deferred indefeasibility of title. If his title or interest is challenged on similar grounds, the burden of proving there was valuable consideration and good faith lies on him. (Emphasis added) 25 FC-01-20-06/2016 [10] As far as I am concerned, that is the simplest way of looking at s 340 of the NLC. I totally agree with the learned Chief Judge of Malaya's view that the error committed by the Federal Court in Adorna Properties Sdn Bhd v Boonsom Boonyanit @ Sun Yok Eng [2001] 1 MLJ 241 was to read the proviso to sub-s (3) as being a proviso to sub-s (2) as well. The error is very obvious because the proviso expressly refers to 'this sub-section' which must in the context of that subsection be read as proviso to sub-s (3) only. [11] I am legally obligated to restate the law since the error committed in Adorna Properties is so obvious and blatant. It is quite a well known fact that some unscrupulous people have been taking advantage of this error by falsely transferring titles to themselves. I hope that with this decision, the land authorities will be extra cautious when registering transfers.” 29. At [7], Zaki Azmi CJ held that the title or interest of B, who obtained the same “by fraud or misrepresentation by him or anyone else to which he was a party or privy” could be defeated. At [8], Zaki Azmi CJ held that the title or interest of B, who obtained the same “by forgery or by means of an insufficient or void instrument” could similarly be defeated and that in the instance of forgery or an insufficient instrument “there is no need to show that B was a party or privy to that forgery or to obtaining the title or interest by a void instrument”. 30. Together, at [7] and [8], Zaki Azmi CJ made a distinction between ‘title or interest obtained by fraud or misrepresentation’ and ‘title or interest obtained by forgery or an 26 FC-01-20-06/2016 insufficient instrument’ and held that in the case of ‘title or interest obtained by forgery or an insufficient instrument’ “there is no need to show that B was a party or privy to that forgery or to obtaining the title or interest by a void instrument”, which implied that in the case of ‘title or interest obtained by fraud or misrepresentation’ there is need to show that B was party or privy to the fraud or misrepresentation. 31. At [9], Zaki Azmi CJ held that B's title or interest could be defeated where it was unlawfully acquired through the exercise of any power or authority conferred by any law, that section 340(2)(c) of the NLC deals with the situation where one, for example, acted in his capacity as an agent to a power of attorney, and that the proviso “does not give protection to C unless he can show that he had acquired the title or interest in good faith and for valuable consideration. Any title or interest gained by any person thereafter is also liable to be set aside unless it could be shown that he had acquired it in good faith and for valuable consideration” (Emphasis added). 32. At [10] and [11], Zaki Azmi CJ agreed with Arifin Zakaria CJ (Malaya), as he then was, that the proviso only applied to section 340(3) of the NLC, and that Adorna Properties was wrongly decided. 27 FC-01-20-06/2016 33. It would not appear that Tan Ying Hong at [26] was at odds with itself at [8], [9] or [11]. But what was fascinating in Tan Ying Hong at [26] was the view that the chargee in OCBC acquired a subsequent interest. A subsequent interest does not spring out of a vacuum. A subsequent interest is acquired from a preceding title or interest. In OCBC, the charge was acquired by the chargee from the chargor. By stating that the chargee in OCBC acquired a subsequent interest, Tan Ying Hong at [26] accepted that the chargor in OCBC was the holder of the preceding title or interest, or was the immediate purchaser. It should be noted that there was no finding that the chargor in OCBC was party or privy to the forgery. Indeed, it was the finding of NH Chan JCA – “even though Ng See Chow was an innocent purchaser for value” - that the chargor in OCBC was a bona fide purchaser. As the chargor in OCBC was “an innocent purchaser for value”, it followed that the chargee in OCBC was a subsequent purchaser. Given that the chargor in OCBC was “an innocent purchaser for value”, Tan Ying Hong at [26] was absolutely warranted to the view that the charge in OCBC acquired a subsequent interest. It should be emphasized that in OCBC, there was an immediate purchaser and a subsequent purchaser, both in good faith and for valuable consideration. It was on account of those facts that Tan Ying Hong at [26] said that the chargee in OCBC was a subsequent purchaser. In no way was it said in Tan Ying Hong at [26] that a chargee per se is a subsequent purchaser. It would be fallacious to read Tan Ying Hong at [26] to mean that a 28 FC-01-20-06/2016 chargee per se is a subsequent purchaser. If a chargee per se is a subsequent purchaser, then the result in Tan Ying Hong would have been for the chargee bank. But it was not. The result was in favour of Tan Ying Hong, which should scotched all interpretation or belief that Tan Ying Hong at [26] ruled that a chargee per se is a subsequent purchaser. 34. Whether a chargee is a subsequent purchaser must be decided on a case to case basis. The instant facts were different from OCBC. For in the instant case, it was the finding of the trial court, which was wholly undisturbed by the Court of the Appeal, and not challenged by the 1st Respondent that (i) “as a fact that the discharge of charge purportedly signed by the [Appellant] had been forged”, (ii) the purported document of title (Version 6) was not issued by the registering authority, and (iii) “that [Wong] created a charge of the said land by forging the signature of the attorney of the [Appellant] and registering the same as a discharge of charge to enable the current charge over the said land in favour of the [1st] Respondent to be registered”. 35. The finding of the trial court was that Wong forged the signature of the attorney of the Appellant on the discharge of charge, and that the document of title (Version 6) together with the Pelan Tanah presented for registration of the transfer to Wong and charge in favour of the 1st Respondent was not issued by the issuing authority. There was no evidence that the transfer was a 29 FC-01-20-06/2016 forgery. But the discharge of charge was a forgery authored by Wong. As author of the forgery, could Wong be a purchaser, let alone a purchaser in good faith and for valuable consideration? If Wong were not a purchaser in good faith and for valuable consideration, then could the 1st Respondent be a subsequent purchaser? If the 1st Respondent were not a subsequent purchaser, then would not its charge be defeasible? Those were the decisive questions that laid at the heart and core of the dispute and its resolution. 36. With respect, the issue was not “whether a chargee comes within the meaning of section 340(3) of the NLC” as proposed by the leave question. As rightly said by the Court of Appeal and agreed to by the 1st Respondent before us, the issue was whether the 1st Respondent was an immediate or subsequent purchaser. For if the 1st Respondent, though purchaser, were not a subsequent purchaser, then the 1st Respondent only acquired a defeasible interest. But of course, if the answer to the leave question were that a chargee does not come within the meaning of ‘purchaser’ under the proviso, then this appeal should be decided against the 1st Respondent. 37. This is the appropriate juncture, perhaps even overdue in point of time, to refer to section 340 of the NLC, which provides: “(1) The title or interest of any person or body for the time being registered as proprietor of any land, or in 30 FC-01-20-06/2016 whose name any lease, charge or easement is for the time being registered, shall, subject to the following provisions of this section, be indefeasible. (2) The title or interest of any such person or body shall not be indefeasible- (a) in any case of fraud or misrepresentation to which the person or body, or any agent of the person or body, was a party or privy; or (b) where registration was obtained by forgery, or by means of an insufficient or void instrument; or (c) where the title or interest was unlawfully acquired by the person or body in the purported exercise of any power or authority conferred by any written law. (3) Where the title or interest of any person or body is defeasible by reason of any of the circumstances specified in sub-section (2)- (a) it shall be liable to be set aside in the hands of any person or body to whom it may subsequently be transferred; and (b) any interest subsequently granted thereout shall be liable to be set aside in the hands of any person or body in whom it is for the time being vested: Provided that nothing in this sub-section shall affect any title or interest acquired by any purchaser in good faith and for valuable consideration, or by any person or body claiming through or under such a purchaser. (4) Nothing in this section shall prejudice or prevent- 31 FC-01-20-06/2016 (a) the exercise in respect of any land or interest of any power of forfeiture or sale conferred by this Act or any other written law for the time being in force, or any power of avoidance conferred by any such law; or (b) the determination of any title or interest by operation of law. 38. The proviso provides “that nothing in this sub-section shall affect any title or interest acquired by any purchaser in good faith and for valuable consideration, or by any person or body claiming through or under such a purchaser”. Apparently, the charge was acquired by the 1st Respondent in good faith and for valuable consideration. There was no issue on that. However, it was contended that “a charge is not an interest acquired by a purchaser within the meaning of the proviso”. 39. ‘Interest’ is not explicitly defined in sections 5 or 340 of the NLC. But that is not to say that the meaning of ‘interest’ is not spelt out in the NLC. For what is ‘interest’ could be gathered from the NLC, that is, if the provisions were only read together. Section 205(1) of the NLC provides that “the dealings capable of being effected under this Act with respect to alienated lands and interests therein shall be those specified in Parts Fourteen to Seventeen, and no others”. And when read together with Parts Fourteen to Seventeen of the NLC, section 205(1) of the NLC provides that the dealings capable of being effected under the NLC with respect to alienated lands and interest therein shall be 32 FC-01-20-06/2016 transfers, leases and tenancies, charges and liens, and easements. A transfer, for want of a better word, transfers the alienated land. But a lease, tenancy, charge, lien or easement does not transfer the alienated land. A lease, tenancy, charge, lien or easement creates an interest in the alienated land which does not pass but remains with the registered proprietor. And that interest in the alienated land, be it lease, tenancy, charge, lien or easement, is the ‘interest’ stated in the proviso. 40. Besides section 205(1) read together with Parts Fourteen to Seventeen of the NLC, the authorities cited by the 1st Respondent also settled it that a charge is an interest in alienated land. In T. Damodaran v Choe Kuan Him, it was held by the Privy Council per Lord Diplock, delivering the opinion of the Board, that “interests in land, short of proprietorship, which are capable of being registered are leases, charges and easements”. In Tan Ying Hong at [26], it was held that the chargee in OCBC had a [subsequent] interest. In Daito Kogyo (Sarawak) Sdn Bhd v Port Dickson Land Development Sdn Bhd, it was held by Abdul Malik Ishak J, as he then was, that “once a charge is registered it takes effect immediately as security in the form of a legal interest in the land”. In Score Options Sdn Bhd v Mexaland Development Sdn Bhd, the Federal Court per Arifin Zakaria CJ, delivering judgment of the court, cited Luggage Distributor (M) Sdn Bhd v Tan Hor Teng where it held by the Court of Appeal per Gopal Sri Ram JCA, as he then was (VC George JCA, Abu Mansor JCA, as he then was, in 33 FC-01-20-06/2016 agreement) that “registrable interests falling short of ownership … are leases, charges and easements”. 41. Other authorities not cited by the 1st Respondent also plainly said that a charge is an interest within the proviso. To cite just a few, in Malaysia Building Society Bhd v KCSB Konsortium Sdn Bhd[2017] 2 MLJ 557, it was held by the Federal Court per Arifin Zakaria CJ, delivering the judgment of the court, that “under the NLC, a charge is an interest in land”. In Dial Kaur a/p Tara Singh v Mann Foong Realty[2000] 3 MLJ 153, it was held by the Court of Appeal per NH Chan JCA, delivering the judgment of the court, that “a charge is a registered interest in land that is charged to the creditor (chargee) as security for a loan”. And in Lian Keow Sdn Bhd (in liquidation) & anor v Overseas Credit Finance (M) Sdn Bhd & ors[1988] 2 MLJ 449, it was held by the former Supreme Court per Seah SCJ that “a charge which affects the company's beneficial interest in land is a charge under section 108(3)(e) of the Companies Act” (section 108(3)(e) of the Companies Act, since repealed by the Companies Act 2016, read “a charge on land wherever situate or any interest therein”). 42. It is irrefragable that a charge is an interest and that a chargee is a purchaser, both within the meaning of the proviso. The 1st Respondent was a purchaser of interest in the said land. But as said, the real issue was not whether the 1st Respondent was 34 FC-01-20-06/2016 a purchaser, but whether the 1st Respondent was an immediate or a subsequent purchaser. 43. It is now settled that an immediate purchaser acquires a defeasible interest. Only a subsequent purchaser in good faith and for valuable consideration acquires an indefeasible interest. There was a period however when an immediate purchaser acquired an immediate indefeasible interest. That was because of Adorna Properties, where it was held by the Federal Court that the proviso also applied to sub-section 340(2), with the result that a purchaser of a title or interest, which was defeasible by any one the vitiating elements specified in s 340(2), acquired an indefeasible title or interest. Adorna Properties ruled in favour of immediate indefeasibility. Then came Tan Ying Hong, where it was held by the Federal Court that “the Federal Court in Adorna Properties misconstrued s 340(1), (2) and (3) of the NLC and came to the erroneous conclusion that the proviso appearing in sub-s (3) equally applies to sub-s (2). By so doing, the Federal Court gave recognition to the concept of immediate indefeasibility under the NLC which we think is contrary to the provision of s 340 of the NLC”. In effect, Tan Ying Hong put our Torrens system back to deferred indefeasibility, to where it was before, where “it was the orthodox understanding that Malaysia’s National Land Code provides for deferred rather than immediate indefeasibility” (‘A law which favours forgers: Land fraud in two Torrens jurisdictions’ by Tang Hang Wu and Loh Khian Chung (2011) 19 APLJ 130) (for 35 FC-01-20-06/2016 further reading on our Torrens system before Adorna Properties, see Tan Ying Hong at [18 – 26] and Kamarulzaman at [15 – 28]). 44. What is the difference between deferred and immediate indefeasibility? In ‘Forgeries and Land Registration’ (The Law Quarterly Review 1985 Vol 101 at 79) R. J. Smith explained that forgeries are seen as raising the distinction between immediate indefeasibility and deferred indefeasibility: “In Torrens systems, forgeries are seen as raising the distinction between immediate indefeasibility and deferred indefeasibility. Immediate indefeasibility protects the registered proprietor simply because he is so described on the register. In our example concerning dispute between A, C and D, both C and D appear on the register and therefore prevail over A who no longer is on the register. Deferred indefeasibility is more subtle. Its analysis is that only when a purchaser relies on a statement in the register does he deserve or receive statutory protection. Thus C’s difficulty is that he relies on the transfer wrongly executed by B who forged A’s signature. Nothing in the register misled C. As the purpose of the legislation is to cure defects in title rather than defects in conveyances, C’s title will not prevail against A. D, however, is in a different position. As C’s chargee, he has relied on C’s registered title. Accordingly, his title will be defeasible. This is what is called deferred indefeasibility: statutory protection on the next disposition after the forged transfer. After a fierce dispute lasting many decades, the Privy Council ruled in favour of immediate indefeasibility in 1967: Frazer v Walker. The Torrens system would today protect the interest of C against A, although the result was reached after considerable uncertainty.” 36 FC-01-20-06/2016 45. But in Malaysia, it is deferred indefeasibility, where “the registered proprietor does not acquire indefeasible title upon registration but is postponed to one transaction removed from the original transaction involving the use of a defective instrument” (‘A law which favours forgers: Land fraud in two Torrens jurisdictions’ supra). The Torrens system here would not protect C against A. 46. In ‘Tan Sook Yee’s Principles of Singapore Land Law’ (3rd Ed) at page 285,the learned authors thus illustrated (i) the difference between immediate and deferred indefeasibility, and (ii) the defeasibility of title or interest of an immediate purchaser in good faith and for valuable consideration, who would be C in ‘Forgeries and Land Registration’ (supra) at 79: “In the early days of Torrens jurisprudence, there was some uncertainty as to whether a registered proprietor obtained an immediate indefeasible title or merely a deferred indefeasible title. An immediate indefeasible title means that the registered proprietor's title becomes indefeasible once his title is registered, notwithstanding that the source of the new registered proprietor's title might be the result of forgery. A deferred indefeasible title, on the other hand, defers the shield of indefeasibility until the next purchaser. An illustration of the difference between both theories is as follows: X is the original owner. Y forges X's signature and sells the property to Z, who was not privy to the forgery. Z registers the transfer and becomes the new registered proprietor. If indefeasibility were conferred immediately, Z's rights over the land will prevail over X's, notwithstanding that Z's title was derived from forged documents. In 37 FC-01-20-06/2016 contrast, under the theory of deferred indefeasibility, Z's rights will not prevail as against X. However, should Z then sell the land to A, A will be able to claim indefeasibility as against X. Indefeasibility of title is thus conferred to the next purchaser” (Emphasis added). 47. Deferred as opposed to immediate indefeasibility was also explained in Tan Ying Hong at [20], by espousal of the following commentary in ‘The National Land Code, A Commentary’ (Vol 2) by Judith Sihombing at para 404: “[20] Indefeasibility can be immediate or deferred. The distinction between the two is well explained in para 404 of The National Land Code, A Commentary (Vol 2) by Judith Sihombing which reads: ‘There are two types of indefeasibility; immediate and deferred. The factor which distinguishes the two is the common law effect given to the instrument even after registration; in addition; in a regime of deferred indefeasibility, the role of registered volunteer might be more relevant than under an immediate indefeasibility system. If, after registration has occurred, the system then ignores the substance, form and probity of the instrument used to support the registration, the system is likely that of immediate indefeasibility. Thus, registration has cured any defect in the instrument being registered. If the instrument, despite registration, still has the power to affect the registered interest or estate, the system will probably be that of deferred indefeasibility.’ (Emphasis added) 38 FC-01-20-06/2016 [21] In short, immediate indefeasibility means that the immediate registered title or interest of the proprietor or transferee immediately to the vitiating circumstances will be conferred statutory protection despite the existence of any vitiating circumstances. In the case of deferred indefeasibility, the indefeasibility only comes to be attached to the title or interest upon a subsequent transfer. Thus, the difference between immediate and deferred indefeasibility hinges on the effect of registration vis-a-vis the title or interest” (Emphasis added). 46. That indefeasibility is not absolute and that only a subsequent purchaser in good faith and for valuable consideration acquires an indefeasible title or interest was explained in ‘Tenure and Land Dealings in the Malay States’ by David Wong at p 374 as follows: “When a registered title or interest in land is rendered defeasible in any of the circumstances considered above, it is liable to be set aside not only in the hands of its immediate holder but also in the hands of any person to whom it may subsequently be transferred: so is any lesser interest subsequently granted thereout. But, such continuing defeasibility will end with respect to any title or interest when it comes to be acquired by 'any purchaser in good faith and for valuable consideration' in whose hands the title or interest will be cured of its past defeasibility, which accordingly will also not affect any person 'claiming through or under such a purchaser'. All this is stated in section 340(3). Thus, so long as a defeasible title or interest remains on the register and has not been set aside, it is capable of subsequent dealings by its holder. 39 FC-01-20-06/2016 And, indeed, it can be a root of good title in favour of any subsequent purchaser 'in good faith and for valuable consideration” (Emphasis added). 47. Tan Ying Hong at [52] was categorical that the proviso only applies to a subsequent dealing: “[52] Furthermore, even though sub-s (3)(a) and (b) refer to the circumstances specified in sub-s (2) they are restricted to subsequent transfer or to interest in the land subsequently granted thereout. So it could not apply to the immediate transferee of any title or interest in any land. Therefore, a person or body in the position of Adorna Properties could not take advantage of the proviso to the sub-s (3) to avoid its title or interest from being impeached. It is our view that the proviso which expressly stated to be applicable solely to sub-s (3) ought not to be extended as was done by the court in Adorna Properties, to apply to sub-s (2)(b). By so doing, the court had clearly gone against the clear intention of Parliament. This error needs to be remedied forthwith in the interest of all registered proprietors. It is, therefore, highly regrettable that it had taken some time, before this contentious issue is put to rest.” 48. Kamarulzaman at [15]was equally explicit that indefeasibility under the regime of deferred indefeasibility is not absolute, that a title or interest that is not indefeasible continues to be defeasible (section 340(2)(a) of the NLC), that any interest subsequently granted thereout is liable to be set aside in the hands of any person or body in whom it is for the time being vested (section 340(2)(b) of the NLC), and that a defeasible title or interest continues to be defeasible and will only become 40 FC-01-20-06/2016 indefeasible when title is acquired by a subsequent purchaser in good faith and for valuable consideration, or by any person or body claiming through or under such a purchaser (proviso): “[15] … Before Adorna Properties, the law on s 340 could be broadly summarised as follows. 'Upon registration, the party in whose favour the registration has been effected will obtain an indefeasible title to or interest in the land, that is a title or an interest which is free of all adverse claims or encumbrances not noted on the register. The effect of registration then is to defeat all prior unregistered claims. Indefeasibility is however not absolute … ' (Land Law in Malaysia, Cases and Commentary by Teo Keang Sood & Khaw Lake Tee, (2nd Ed) at p 134). Indefeasibility is subject to the exceptions in s 340(2). Under s 340(2), the title or interest shall not be indefeasible (a) in any case of fraud or misrepresentation to which the person or body, or any agent of the person or body, was a party or privy; or (b) where registration was obtained by forgery, or by means of an insufficient or void instrument; or (c) where the title or interest was unlawfully acquired by the person or body in the purported exercise of any power or authority conferred by any written law. A title or interest that is not indefeasible continues to be defeasible and is 'liable to be set aside in the hands of any person or body to whom it may subsequently be transferred' (s 340(2)(a)) and any interest subsequently granted thereout is liable to be set aside in the hands of any person or body in whom it is for the time being vested (s 340(2)(b)). A defeasible title or interest continues to be defeasible and will only become indefeasible when title is acquired by a subsequent purchaser in good faith and for valuable consideration, or by any person or body claiming through or under such a purchaser (proviso to s 340(3))” (Emphasis added). 41 FC-01-20-06/2016 49. No room was left in Kamarulzaman at [43 - 44] for doubt that the defeasible title or interest of an immediate purchaser is liable to be set aside, and that the defeasible title or interest of an immediate purchaser only becomes indefeasible when it is subsequently passed to a bona fide subsequent purchaser: “[43] In the instant case, both the trial court and the Court of Appeal held that the fifth and sixth respondents were bona fide purchasers. But unfortunately, both the trial court and the Court of Appeal failed to inquire whether the fifth and or sixth respondents were immediate or subsequent purchasers. Only a subsequent purchaser is entitled to raise the shield of indefeasibility. An immediate purchaser of a title tainted by any one of the vitiating elements acquires a title that is not indefeasible. It flows from Tan Ying Hong that the bona fides of an immediate purchaser is not a shield to defeasibility. The defeasible title of a bona fide immediate purchaser is still liable to be set aside. The defeasible title of a bona fide immediate purchaser only becomes indefeasible when it is subsequently passed to a bona fide subsequent purchaser. That the fifth and sixth respondents were bona fide purchasers could not by that fact alone give a shield of indefeasibility. The fifth and or sixth respondents only acquired an indefeasible title if they were bona fide subsequent purchasers. But for the fifth and sixth respondents to have been bona fide subsequent purchasers, there must have been an immediate purchaser in the first place. The first to fourth respondents, from whom the fifth and sixth respondents obtained title, were not immediate purchasers. Rather, they were imposters of those entitled to the estate of the deceased. They, like the 42 FC-01-20-06/2016 fake Boonsom who impersonated the true Boonsom, had no title to pass to the fifth and sixth respondents. The fifth and sixth respondents who were the immediate purchasers, acquired a title that was not indefeasible. But when the fraudulent title of the first to fourth respondents were set aside by the default judgment, the defeasible title of the fifth and sixth respondents was also defeated (Emphasis added). [44] Accordingly, in relation to leave question 1, which should read as 'What was the effect of the judgment in default, which set aside the (order of distribution of) the estate of the deceased, to the transfers (by the first to fourth respondents) to the fifth and sixth respondents?', we would answer that the defeasible title of the first to fourth respondents was set aside by the default judgment, and that on the instant facts, the defeasible title of the fifth and sixth respondents was swept aside along with that of the first to fourth respondents. In relation to leave question 3, which should read as 'Whether the transfers by (the first to fourth respondents) to the fifth and sixth respondents were protected by s 340 of the National Land Code?', we would answer that the fifth and sixth respondents were immediate purchasers and so were not protected by the proviso to s 340(3). We need not answer leave question 2, as our aforesaid answers are already more than sufficient to dispose of this appeal.” 50. To acquire an indefeasible interest, the 1st Respondent must be a subsequent purchaser in good faith and for valuable consideration. Let it be assumed arguendo, that the 1st Respondent was a subsequent purchaser. But if the 1st Respondent were a subsequent purchaser, then who was the immediate purchaser? Was Wong that immediate 43 FC-01-20-06/2016 purchaser? If Wong were not that immediate purchaser, then the 1st Respondent could not be a subsequent purchaser. Now whether Wong was a purchaser must be judged from section 5 of the NLC which provides “purchaser means a person or body who in good faith and for valuable consideration acquires title to, or any interest in land”. Could Wong wear the hat of purchaser? Could a forger of pertinent instruments of dealing be a purchaser in good faith in the first place? “ … the basic element of good faith is the absence of fraud, deceit or dishonesty and the knowledge or means of knowledge of such at the time of entry into a transaction. But the overriding consideration is 'the particular circumstances of each case' (See Pekan Nenas Industries Sdn Bhd v Chang Ching Chuen & Ors [1998] 1 MLJ 465; Ong Ban Chai & Ors v Seah Siang Mong [1998] 3 MLJ 346)” (State Tailor Sdn Bhd v Nallapan[2005] 2 MLJ 589 per Richard Malanjum JCA, as he then was, delivering judgment of the court). 51. To repeat, the undisturbed finding of the trial court was that Wong forged the signature of the attorney of the Appellant on the discharge of charge that Wong presented together with a forged document of title and false Pelan Tanah to enable registration of the forged discharge of charge, transfer, and charge. In fact, the 1st Respondent submitted that the leave question was “not a fact sensitive question at all”. The 1st Respondent accepted that Wong was the forger, albeit of the discharge of charge. There was no evidence that the transfer was 44 FC-01-20-06/2016 forged. But both the transfer to Wong and charge to the 1st Respondent could not and would not have been registered in the first place without the forged discharge of charge. Wong, who authored the forgery, knew that. And Wong, who authored and presented the forgery for registration that opened the way for registration of the transfer and charge, could not have acted in good faith. The transfer was not forged. But the transfer could not have been registered without the forged document of title (Version 6). Even when viewed in isolation, the transfer was not in good faith. But the entire transaction should be viewed as a single transaction. Transactions which are practically contemporaneous should be considered a single transaction (see Home Trust Co v Zivic (2007) 277 DLR (4th) 349). Also, the conduct of Wong should be viewed in totality and as a whole. The transfer would not have been registered but for the forgery of the discharge of charge. Wong surely knew that the Chings had not redeemed the said land from the Appellant to effect a transfer of the said land, free of the charge, to him. That however was no obstacle to Wong, who forged the discharge of charge to engineer a transfer free of the charge. There could be no question about it. Wong defrauded the Appellant of its charge. When viewed in totality, the overall conduct of Wong was criminal. It would rub salt to the wound if it were held that Wong was a purchaser in good faith. The cruelest cut of all would be that Wong, the forger, would have the right to redeem the said land if it were held that the charge was indefeasible. 45 FC-01-20-06/2016 52. Wong was not a purchaser. Even if Wong could be a purchaser, he was not a purchaser in good faith. Since Wong was not a purchaser in good faith, Wong could not be the immediate purchaser in good faith and for valuable consideration. 53. I would answer the leave question as follows: a chargee is a purchaser within the meaning of the proviso. But the interest of a charge is defeasible, if the chargee were not a subsequent purchaser in good faith and for valuable consideration. Whether a purchaser is an immediate or subsequent purchaser is not determined by a tally of the number of transactions. Transactions could be contrived by fraudsters and accomplices (see ‘Deferred and Immediate Indefeasibility: Bijural Ambiguity in Registered Land Title Systems’ by Pamela O’Connor, Edin LR Vol 13 pages 194-223). A purchaser is a subsequent purchaser only if his title or interest were derived from an immediate purchaser (his vendor) in good faith and for valuable consideration. For the title or interest of the subsequent purchaser to be indefeasible, both immediate and subsequent purchasers must be purchasers in good faith and for valuable consideration (see Wright v Lawrence 278 D.L.R. (4th) 698 at [39] per Gillese JA, delivering the judgment of the court). 54. In the instant case, as there was no immediate purchaser in good faith and for valuable consideration, the 1st 46 FC-01-20-06/2016 Respondent was Z in the final illustration of Tan Sook Yee. The interest of the 1st Respondent was immediate and defeasible. 55. I would allow the appeal with costs and restore the orders of the trial court against the 1st Respondent. As for the orders of the trial court against the 2nd and 3rdRespondents, they should be settled by the fresh appeal to be filed by the 2nd and 3rd Appellants against the decision of the trial court, and further appeal, if any. 56. Immediate indefeasibility gives certainty. But unless a security system is statutorily in place to prevent fraud and forgery, such as, but not limited to, the attendance of parties before the registering authority, as well as an indemnity scheme to compensate proprietors for the errors of the registering authority, deferred indefeasibility should remain, to protect innocent proprietors against fraud and forgery. Dated this 16th day of August 2017. Tan Sri Jeffrey Tan Hakim Mahkamah Persekutuan Malaysia 47 FC-01-20-06/2016 C O U N S E L For the Appellant: Karen Wilfred Solicitors: Tetuan Rashid Zulkifli For the 1st Respondent: Benjamin John Dawson (Koh San Tee And Chan Shao Kang with him) Solicitors: Tetuan Benjamin Dawson For the 2nd and 3rd Respondents: Hj Nik Suhaimi Nik Sulaiman (Naziah Mokhtar with him) Attorney-General’s Chambers Malaysia

Tika 2.6.0

01(f)-20-06-2016(B)

PERAYU CIMB BANK BERHAD (NO. SYARIKAT: 13491-P) … PERAYU RESPONDEN 1. AMBANK (M) BERHAD (NO. SYARIKAT: 8515-D) 2. PENTADBIR TANAH DAERAH KLANG 3. PENGARAH TANAH DAN GALIAN SELANGOR … RESPONDEN RESPONDEN

Land Law — Indefeasibility of title and interests— Deferred indefeasibility — Whether there is entitlement to protection under principle of deferred indefeasibility when registration of property was obtained by forgery — Chargee — Whether a chargee comes within the meaning of 'purchaser' under s 340(3) National Land Code — Whether a charge is valid and indefeasible as a subsequent purchaser within s 340(3) National Land Code

16/08/2017

YAA TUN MD RAUS BIN SHARIFKorumYAA TUN MD RAUS BIN SHARIFYA TAN SRI DATUK ZAINUN BINTI ALIYA TAN SRI DATO' SRI ABU SAMAH BIN NORDINYA TAN SRI DATO' WIRA AZIAH BINTI ALIYA TAN SRI JEFFREY TAN KOK WHA

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=dc36ef5f-6f02-4c5f-a7e2-b8ca7bfe08c5&Inline=true

kjhggjj 1 FC-01-20-06/2016 IN THE FEDERAL COURT OF MALAYSIA AT PUTRAJAYA CIVIL APPEAL NO. 01-20-06/2016 BETWEEN CIMB Bank Berhad ... Appellant AND 1. AmBank (M) Berhad 2. Pentadbir Tanah Daerah Klang 3. Pengarah Tanah dan Galian Selangor ... Respondents CORAM: Raus Sharif CJ Zainun Ali FCJ Abu Samah Nordin FCJ Aziah Ali FCJ Jeffrey Tan FCJ MINORITY JUDGMENT 1. This is an appeal against the decision of the Court of Appeal who reversed the decision of the trial court and held that the charge of the 1st Respondent over land held under GM7794 for Lot 23223 Seksyen 21 Mukim Bandar Klang, District of Klang, Selangor (said land) was indefeasible and thus prevailed over the prior charge in favour of the Appellant. 2 FC-01-20-06/2016 2. The following background facts are not in dispute. By a loan agreement dated 17.3.2006, Southern Bank Berhad (SBB) granted loan facilities to one Ching Ting Seng and Ching Chong Lup (the Chings). As security for the loan, the Chings executed a charge of the said land, which was registered on 23.3.2006, in favour of SBB. On 6.9.2006, the business of SBB was vested unto the Appellant. 3. On 14.11.2008, one Wong Chee Kong (Wong) applied for a loan from the 1st Respondent to finance his purchase of the said land, with the said land as the security. The 1st Respondent appointed Messrs KK Lim & Associates (KK Lim) to prepare the charge of the said land in favour of the 1st Respondent. Messrs Ku Abdul Rahman & Associates (Ku Abdul Rahman) prepared the sale and purchase agreement between the Chings and Wong. Later, Ku Abdul Rahman informed KK Lim that Wong had settled the differential sum between the purchase price and the loan sum and that the Chings had settled the loan sum due to the Appellant and were awaiting receipt of the original document of title and the discharge of charge. Ku Abdul Rahman gave an undertaking to forward the duly adjudicated and stamped memorandum of transfer together with the original document of title and discharge of charge to KK Lim. 4. On 10.3.2009, KK Lim received from Ku Abdul Rahman the purported document of title (Version 6) of the said land, the 3 FC-01-20-06/2016 duly stamped memorandum of transfer of the said land, and the purported discharge of charge executed by the Appellant. On 17.3.2009, KK Lim received what purported to be the duplicate charge from Ku Abdul Rahman. On 19.3.2009, KK Lim presented the purported discharge of charge, the memorandum of transfer by the Chings to Wong, and the memorandum of charge by Wong in favour of the 1st Respondent together with what purported to be the original document of title (Version 6) (hereinafter collectively referred to as the security documents) for registration. 5. On 7.4.2009, 1st Respondent, through KK Lim, forwarded a Cashier’s Order No 724209 for RM1,910,000.00, it being the purported balance purchase price, to Ku Abdul Rahman who credited that sum into its account. 6. Upon enquiry on 17.9.2009, KK Lim was informed that the security documents were rejected for registration by reason of the letter of Ku Abdul Rahman dated 30.3.2009. On 25.11.2009, the security documents were again presented for registration. This time, the registering authority registered the purported discharge of charge, the transfer by the Chings to Wong, and the charge by Wong in favour of the 1st Respondent. 7. On or about 2.5.2012, the Appellant commenced proceedings to declare the charge in favour of the 1st Respondent as null and void, and to reinstate its charge of the said land. That 4 FC-01-20-06/2016 was followed by the counter-claim of the 1st Respondent against the registering authority, for breach of duty. 8. After a full trial, without Wong as litigant or witness, the trial court found (i) “as a fact that the discharge of charge purportedly signed by the [Appellant] had been forged”, (ii) the purported document of title (Version 6) was not issued by the registering authority, and (iii) the registering authority was negligent to have acted on the Version 6 document of title. The trial court additionally found “that [Wong] created a charge of the said land by forging the signature of the attorney of the [Appellant] and registering the same as a discharge of charge to enable the current charge over the said land in favour of the [1st] Respondent to be registered”. 9. The Court of Appeal agreed that “at the trial it was established that the discharge of charge had been forged”. Both courts below held that the discharge of charge was a forgery. But the courts below differed as to whether the Respondent was an immediate or a subsequent purchaser. 10. The trial court stated that section 340 of the National Land Code (NLC) “affords protection to a subsequent purchaser”. The trial court was of the view that “the position of the [1st Respondent] vis-a-vis the [Appellant], in my view is that the [1st Respondent] is not a subsequent purchaser but a direct purchaser 5 FC-01-20-06/2016 of the interest registered as a charge for the creation of a charge in favour of the [1st Respondent], based on a discharge of charge purportedly executed by the [Appellant] (which is denied) which then allowed a charge to be registered in the name of the [1st Respondent]. It follows therefore that the [1st Respondent] is an immediate purchaser of the interest and is subject to immediate indefeasibility. This however is liable to be set aside in the event [that] section 340 subsection (2)(b) has been breached”. Given its finding that the discharge of charge was a forgery, the trial court went on to hold that section 278 of the NLC had not been complied to effect a discharge of the said land, and that the charge in favour of the 1st Respondent should be set aside. 11. Before the trial court, the 1st Respondent argued that the 1st Respondent was a purchaser in good faith and for valuable consideration, and that the proviso (proviso) to subsection (3) of section 340 of the NLC applied, as the immediate purchaser, Wong, and the creation of the charge had put the 1st Respondent in the position of a subsequent purchaser. But the trial court held that given that the discharge of charge was a forgery and that section 278 of the NLC had not been complied, all issue of the 1st Respondent being a subsequent purchaser could not arise and that the proviso could not apply. 6 FC-01-20-06/2016 12. At page 17 of its judgment, the trial court thus enunciated on the defeasibility or indefeasibility of title of the 1st Respondent: “In view of my finding that the said discharge of charge and the signature on the same were forged, the purported transfer of interest from the [Appellant] to the [1st Respondent] is one of immediate indefeasibility and the proviso in subsection (3) of 340 of the NLC does not apply, and 340(2)(b) of the NLC would kick in and the interest of the [1st Respondent] would not be indefeasible and would be liable to be set aside. The [1st Respondent] was the immediate holder of its charge and that being the case, the [1st Respondent] cannot take advantage of the proviso ... ” 13. The trial court granted the orders sought by the Appellant against the 1st Respondent and the orders sought by the 1st Respondent against the registering authority. 14. At the Court of Appeal, the 1st Respondent submitted that the trial court failed to appreciate that the 1st Respondent derived interest from Wong and not the Appellant, that the charge in favour of the Appellant was discharged before Wong was registered as proprietor, and that “the financing of the property involved a two stage transaction”. 15. The Court of Appeal expressed total agreement with the latter submission of the 1st Respondent: 7 FC-01-20-06/2016 “We found merit in the aforesaid contention and our reasons were these. As pointed out by learned counsel, the sequence of presentation of the dealing on 25.11.2009 was as follows: (a) The lodgement of the Discharge of CIMB’s Charge via Form 16N. (b) Then the lodgement of the memorandum of transfer from the Chings to Wong; and (c) Finally the lodgement and registration of Ambank’s Charge. Though the above dealings were on the same day and were done simultaneously, it cannot be disputed nor can we ignore the fact that the lodgement of the AmBank’s Charge could not have been created until the first two steps had been executed. That being the case, the only way AmBank obtained their interest was from Wong and not from CIMB. CIMB’s interest in the property had been then extinguished by the forged discharge resulting in Wong becoming the immediate purchaser. AmBank then derived their interest in the property from the charge executed from Wong. Under such circumstances, there cannot be any relationship between CIMB and AmBank, hence the learned Judge, with respect, erred when he said “...it is clear that the relationship between the Plaintiff (CIMB) and the 1st Defendant (AmBank) was that of an immediate purchaser and not a subsequent purchaser ...” When AmBank became the chargee from Wong’s memorandum of charge, AmBank became the subsequent purchaser. Further, we said that the fact that Wong’s interest being an immediate purchaser was defeasible by CIMB did not, in our view, affect the indefeasibility of AmBank’s interest. Our view is supported by two decisions of the apex Court, namely Kamarulzaman Omar & Ors v. Yakub 8 FC-01-20-06/2016 Husin & Ors reported in [2014] 1 CLJ 987 and Tan Ying Hong v Tan Sian San & Ors [2010] 2 MLJ 1.” 16. For those reasons, the Court of Appeal allowed the intermediate appeal and set aside all orders of the trial court. 17. The Appellant obtained leave to appeal to this Court on the following question of law: “Whether a chargee comes within the meaning of ‘purchaser’ under the proviso to section 340(3) of the National Land Code?” 18. Before us, the Appellant submitted as follows. The question of law ought to be answered in the negative. A chargee cannot be regarded as a subsequent purchaser. A charge is subservient to the title to the land. Where the chargor’s title is defeasible, he cannot create any interest in favour of a 3rd party. The 1st Respondent could not be a subsequent purchaser and was not entitled to the proviso, as the 1st Respondent’s charge, which could not subsist on its own, was dependent on the title of Wong who was the fraudster and who acquired no title whatsoever by the presentation of false instruments. The 1st Respondent’s charge, being a derivative interest from a title obtained by forgery, was tainted with the same forgery. The defeasibility of title to the said land rendered the charge created out of such defeasible title also defeasible and liable to be set aside. The charge of the 1st Respondent was defeasible because its registration was obtained 9 FC-01-20-06/2016 by forged documents. The case was not within the proviso, even if the 1st Respondent were innocent. Whether the 1st Respondent was complicit in the forgery was irrelevant. The following could be concluded from the undisputed facts: (a) the discharge of charge was a forgery, and its registration was void ab initio, (b) the transfer of the said land and the charge were registered on the basis of the forged discharge of charge, (c) a forged document of title was used to procure registration of the transfer and the charge, (d) the Appellant had not parted with possession of the document of title (Version 2) and the duplicate charge, (e) consequently, registration of the transfer to Wong and the charge in favour of the 1st Respondent were procured by forged documents and were void ab initio, (f) the document of title (Version 3) in the possession of the 1st Respondent was tainted with illegality, as it was procured by the presentation of forged instruments with a forged Pelan Tanah. The argument that the 1st Respondent was a subsequent purchaser in good faith and for valuable consideration and the attempt to separate the 2 transactions, namely, the transfer by the Chings to Wong on the one part and the charge in favour of the 1st Respondent of the other part, was untenable for the following reasons: (i) removal of the Appellant as chargee and registration of the 1st Respondent as chargee were carried out in one continuous transaction together with the transfer of the said land by means of forged documents, (ii) the charge in favour of the 1st Respondent could not have been registered but for the forged discharge of charge and forged document of title (Version 10 FC-01-20-06/2016 6), (iii) the document of title (Version 3) in the possession of the 1st Respondent was issued on 21.12.2009, that is, after creation of the charge in favour of the 1st Respondent on 25.11.2009, as a direct consequence of the registration of forged instruments, (iv) Tan Ying Hong at [26] was inconsistent with itself at [8], [10] and [11], (v) the 1st Respondent failed to properly investigate the circumstances of the sale from the Chings to Wong; a search would have revealed that there were pending foreclosure proceedings and that the Appellant had an interest in the said land. The argument that the 1st Respondent was a subsequent purchaser in good faith and for valuable consideration was unmaintainable, as Wong, who procured title by forged documents from which he created a charge in favour of the 1st Respondent, acquired no title to the land. In Bank of Nova Scotia Berhad v Saunah Kasni and Ors [2016] 1 CLJ 505, the court held that the charge created out of a defeasible transfer must necessarily be avoided. In Rajamani Meyappa Chettiar v Eng Beng Development Sdn Bhd & Ors [2016] 4 CLJ 510, the Court of Appeal drew a distinction between indefeasibility and validity of title. The Court of Appeal held that the fact that the defendant purchased the said land in good faith and for value did not confer indefeasibility if the title to such land was void at inception, that is, that the second document of title was a void document of title, it being issued during the subsistence of the valid document of title. Following the reasoning in Rajamani, the document of title (Version 3) in the instant case was void, as it was issued during the subsistence of the real document 11 FC-01-20-06/2016 of title (Version 2) in the possession of the Appellant. Pursuant to section 294(2) read together with section 306(a) of the NLC, the presentation of the discharge of charge must be accompanied by the document of title and duplicate charge. In the instant case, both signature and attestation of the discharge of charge as well as the document of title (Version 6) with the Pelan Tanah were forgeries. The discharge of charge was an invalid instrument to determine the Appellant’s interest in the said land in accordance with section 206 of the NLC. Registration of the charge in favour of the 1st Respondent, which was based on forged and invalid documents, was defeasible under section 340(2)(b) of the NLC. Forgery under section 340(2)(b) of the NLC is a distinct ground of defeasibility, where knowledge is wholly irrelevant. Forgery per se suffices to render a registered title defeasible, irrespective of the knowledge of the 1st Respondent. Forgery as a distinct ground of defeasibility is clear from the express wording of section 340(2)(b) of the NLC. That position in law was endorsed in Tenure and Land Dealings in the Malay States (Singapore University Press 1975) at 361 to 363 by David S Y Wong, and adopted by the Court of Appeal in OCBC Bank (Malaysia) Bhd v Pendaftar Hakmilik Negeri Johor Darul Takzim [1999] 2 CLJ 949. The 1st Respondent’s charge was similar to OCBC as analysed by Tan Ying Hong. In Tan Ying Hong, the Federal Court held that the immediate holder of the registered charge procured by a forged power of attorney could not take advantage of the proviso. The Federal Court overruled Adorna Properties Sdn Bhd v Boonsom Boonyanit @ Sun Yok Eng 12 FC-01-20-06/2016 [2001] 1 MLJ 214, where it was held that the proviso was available to an immediate purchaser in good faith and for valuable consideration. In Kamarulzaman bin Omar & Ors v Yakub bin Husin & Ors [2014] 2 MLJ 768, the Federal Court held that immediate purchasers were not entitled to the proviso. Wong, who procured title by the forged discharge of charge and forged document of title (version 6) with the forged Pelan Tanah, could not be an immediate purchaser. Wong acquired no title whatsoever to create the charge in favour of the 1st Respondent. Following the reasoning in Kamarulzaman, the 1st Respondent was an immediate purchaser, and the title, which was procured by forged instruments, was defeasible. The 1st Respondent was not a bona fide purchaser, as registration of the charge was obtained by forged documents, and as the 1st Respondent failed to properly investigate all matters that pertained to the sale and creation of the charge (counsel cited Gibbs v Messer [1891] AC 248 and Au Meng Nam & Ung Yak Chew & ors [2007] 5 MLJ 136). A proper search would have disclosed (i) that the purchase by Wong was completed on 25.11.2009, when the said land was then the subject of foreclosure proceedings by the Appellant, and (ii) that there was an obvious irregularity on the face of the discharge of charge which wrongly stated that CIMB was formerly known as Southern Bank Berhad. There was no CTOS or CCRIS search conducted on the Chings. The loan was disbursed before the transfer to Wong and the charge to 1st Respondent were confirmed. The entire transaction which led to the removal of the charge in favour of the 13 FC-01-20-06/2016 Appellant was set in motion by the grant of the loan to Wong. The Appellant had no relationship with Wong who was the 1st Respondent’s customer. Yet the 1st Respondent failed to procure Wong to testify, to prove that the 1st Respondent was a subsequent purchaser. The Court of Appeal was mistaken that the only issue was whether the 1st Respondent was an immediate or subsequent purchaser. The Court of Appeal failed to consider that the document of title (Version 6) with the Pelan Tanah was a forgery, and that a charge cannot subsist on its own. The charge, which was obtained by forgery, should be set aside. 19. The 1st Respondent submitted as follows. ‘Interest’ in land includes a charge (counsel cited T. Damodaran v Choe Kuan Him [1979] 2 MLJ 267b, Tan Ying Hong at [26], Daito Kogyo (Sarawak) Sdn Bhd v Port Dickson Land Development Sdn Bhd[2001] 2 MLJ 531, and sections 205, 214, 221, 241, 282, 340(1) of the NLC). The term ‘purchaser’ extends to all with an interest in the land. That is supported by section 5 of the NLC which defines ‘purchaser’ as “a person or body who in good faith and for valuable consideration acquires title to, or any interest in land”. In Score Options Sdn Bhd v Mexaland Development Sdn Bhd [2012] 6 MLJ 475, the Federal Court applied Luggage Distributor (M) Sdn Bhd v Tan Hor Teng [1995] 1 MLJ 719, where it held that interest under the NLC are leases, charges and easements. In Tan Ying Hong, the Federal Court analysed the decision in OCBC where it was held by the Court of Appeal that the 14 FC-01-20-06/2016 title of the chargee bank was not indefeasible, and held at [26] that the reasoning in OCBC was flawed. In Tan Ying Hong, the Federal Court expressly referred to the chargee bank as a subsequent purchaser protected by the proviso, and explicitly accepted that a chargee was a purchaser. In Teh Cheng Choo v Malayan Banking Berhad [2009] 5 CLJ 46, the land was fraudulently transferred to one Lim Ong Ah who fraudulently charged the land. At [27], the Court of Appeal held that Malayan Banking was a bona fide purchaser and thus was protected by the proviso. In Heveaplast Marketing Sdn Bhd v See Leong Chye & ors[2017] 2 CLJ 43, the Court of Appeal likewise decided that a chargee bank is a purchaser within the meaning of the proviso. In Kasai Reiko v Annie Lor Fong & ors (Public Bank Bhd - Intervenor) [2014] 7 MLJ 652, Lee Swee Seng J came to the same conclusion that a chargee bank who derived interest from a fraudster fell within the definition of ‘purchaser’. In ‘National Land Code – A Commentary (2nd Edition)’ at 826, Judith Sihombing stated that the term purchaser “extends to all taking an interest in the land, for example a lessee or charge”. In ‘Indefeasibility of Title in Malaysia – The Revivification of Deferred Indefeasibility under the Torrens Systems – Focus on Fraudulently Obtained and Forged Titles” at 139, Grace Xavier said that “the persons in whose name the title had been registered, then transfers the title to another ... or creates a charge on the property, then the subsequent person will obtain indefeasibility, or indefeasibility of the charge ... ”. Under the principle of deferred indefeasibility, so long as the financial 15 FC-01-20-06/2016 institution is bona fide, its interest is protected by the proviso. It would have far reaching consequences if financial institutions were excluded as purchasers. In M & J Frozen Food Sdn Bhd & anor v Siland Sdn Bhd & anor [1994] 1 MLJ 294, the former Supreme Court qualified the nemo dat principle and said that a bona fide purchaser for value without notice of the defeasible nature of the vendor’s title acquires an immediate indefeasible title. The Appellant had strayed from the leave question. At no time was it argued in the courts below that a charge would not come within the meaning of ‘purchaser’. The sole question in the court below was whether the Respondent was an immediate or subsequent purchaser. Both courts below held that a chargee is a purchaser. There was no finding that the 1st Respondent was not a bona fide chargee/purchaser. The trial court held that the 1st Respondent and solicitors acted properly, and that the Appellant and 1st Respondent were defrauded by a third party. The Court of Appeal did not find that there was any lack of bona fides on the part of the 1st Respondent. On the issue of whether the 1st Respondent was an immediate or subsequent purchaser, the Court of Appeal said that that was a matter of fact. The analysis of OCBC in Tan Ying Hong made the former case squarely within the instant case. The decision in Tan Ying Hong, to wit, that a chargee bank has an interest and is entitled to protection under the proviso, was wholly applicable to the instant case. 16 FC-01-20-06/2016 20. In its reply submission, the Appellant responded as follows. A charge is not an interest acquired by a purchaser within the meaning of the proviso. A charge is dependent on the validity of the title of the charger. In M & J Frozen Food, the former Supreme Court referred to Taylor v Land Mortgage Bank of Victoria Ltd (1886) 12 VLR 748, where it was said that in the Torrens system, “the estate and interest in the land remains with the proprietor until he has done all that is necessary to divest the estate out of himself and vest it in the transferee”. The former Supreme Court said that the aforesaid principle was embodied in section 267(1)(a) of the NLC, and that section 267(1)(a) of the NLC “clearly negates any judicial proposition that the charger abdicates his proprietary rights at the stage of the auction sale”. In Mahadevan & Anor v Manilal & Sons (M) Sdn Bhd, the Federal Court held that “the mortgagor retains ownership whilst the mortgagee acquires a statutory right to enforce his security” (on the rights of a chargor and chargee, counsel also referred to Malayan United Finance Bhd v Liew Yet Lan (1990) 1 MLJ 317, Development & Commercial Bank Ltd v Kim Ling Choon [1991] 1 CLJ 732, Kuala Lumpur Finance Bhd v Yap Poh Khian [1992] 1 MLJ 472, Public Bank Bhd v Phan Seng Kee & ors [1991] 3 CLJ 2560, Malayan United Finance Bhd v Tan Lay Soon [1991] 1 MLJ 504). In M & J Frozen Food, the former Supreme Court referred to and followed Gibbs v Messer, where the vendor’s title was good but the instrument used by the purchaser for registration was void and or voidable, and where the Privy Council held that the effect of 17 FC-01-20-06/2016 registration of such instrument only conferred deferred indefeasibility. The principles enunciated in M & J Frozen Food established that a charge is a species of security transaction where the chargor remains the registered proprietor until registration of a valid transfer in the name of a purchaser under a judicial sale. Wong acquired a defeasible title. Once it was established that Wong acquired no title, then Wong could not create a charge out of his title. Following the principles in M & J Frozen Food, Wong had not abrogated his rights to the said land. In OCBC, the Court of Appeal held that the registered title or interest of an acquirer obtained by forgery was defeasible. A forged instrument is a nullity which does not confer any right or title to the transferee. Such transferee has no right to charge or create any interest in land which is not his. A chargee who claims title through an immediate acquirer who obtained his title by forgery is not protected by the proviso. Following OCBC, a chargee cannot be a ‘purchaser’ within the meaning of the proviso, as the chargee takes his interest through the immediate acquirer whose title is tainted by forgery. Implicit in OCBC is that a charge is a species of derivative interest that is subject to the infirmities of the title of the proprietor. The contention that the 1st Respondent was a subsequent purchaser in good faith and for valuable consideration was unmaintainable, as Wong who procured title by forged documents had not acquired any interest whatsoever. The 1st Respondent was not a subsequent purchaser, and whose charge was defeasible. To hold that the 1st Respondent as a subsequent 18 FC-01-20-06/2016 purchaser would return to Adorna Properties, where it was held that the purchaser obtained a good title, albeit that the title was procured by a forged transfer. In Tan Ying Hong, the Federal Court ruled that the charge was liable to be set aside, as the charge as created by the use of a forged power of attorney, and held that the immediate holder of the charge procured by the forged power of attorney could not take advantage of the proviso. The statement of law in Tan Ying Hong with respect to OCBC was flawed, as it was an opinion in respect of a hypothetical question and is no authority that OCBC could be decided differently if the same facts were to arise. In Tan Ying Hong, the Federal Court answered that an acquirer of a registered charge by means of a forged instrument does not acquire an immediate indefeasible interest or title. OCBC was consistent with the ratio decidendi in M & J Frozen Food which was referred to with approval in Tan Ying Hong. In Bank of Nova Scotia Berhad v Saunah Kasni and Ors, it was held that the charge created by the chargor who obtained title by forgery was defeasible, and that a charge is not an interest in land. Teh Cheng Choo v Malayan Banking Berhad was decided before Tan Ying Hong. The decision in Heveaplast Marketing Sdn Bhd v See Leong Chye & ors, where the title of the chargor was defeasible and it was held that the chargee was a subsequent purchaser, was wrong in law. The decision in Kasai Reiko v Annie Lor Fong & ors (Public Bank Bhd - Intervenor), where the charge was created after the chargor was registered as proprietor and it was held that the chargee was a purchaser in good faith, is 19 FC-01-20-06/2016 untenable in law. The 1st Respondent had the burden to prove that it was a purchaser in good faith and for valuable consideration, and that the transfer to Wong was valid. 21. In its reply submission, the 1st Respondent submitted as follows. All proposed leave questions to do with forgery were rejected by the leave panel. All findings of the Court of Appeal remained intact. The leave question only required an affirmative or negative answer. The Appellant could not ventilate issues on forgery (counsel cited Ho Tack Sien & ors v Rotta Research Laboratorium SpA & anor [2015] 4 MLJ 186, where the appellant was confined to the 2 leave questions which incorporated a point of law and not permitted to seek a reversal of the findings of fact of the courts below). The Appellant could not go beyond the leave question. A chargee is a purchaser (learned counsel again cited sections 5, 205, 241, 340(1) of the NLC, Score Options Sdn Bhd v Mexaland Development Sdn Bhd, Tan Ying Hong at [26], T. Damodaran v Choo Kuan Him at 269, Teh Cheng Choo v Malayan Banking Berhad, Heveaplast Marketing Sdn Bhd v See Leong Chye & ors). A bona fide purchaser for value who acquires title from the immediate purchaser obtains an indefeasible title (learned counsel cited Kamarulzaman at [16] and [46]). A registered proprietor, even though he does not possess an indefeasible title, may give an indefeasible title to a bona fide purchaser (learned counsel cited Tan Ying Hong at [46] which cited ‘Sale and Purchase of Real Property in Malaysia’ by Visu Sinnadurai). The argument that a 20 FC-01-20-06/2016 charge is dependent on the validity of the chargor’s title is contrary to section 340(2) and (3) of the NLC. It was settled by Tan Ying Hong and Kamarulzaman that a defeasible title can be the root of good title to a bona fide purchaser. M & J Frozen Food recognised that the nemo dat principle had been modified. The facts in M & J Frozen Food were different. In M & J Frozen Food, it was a one stage transaction, and the proviso did not come into play. In the present case, it was a two stage transaction, first the transfer and then the charge. The Appellant relied on OCBC, a decision that was held as flawed. It was incorrect to suggest that the 1st Respondent advocated a return to Adorna Properties. “We are simply applying the deferred indefeasibility principles under the proviso to the facts of the present case, to the 1st Respondent who was a subsequent purchaser in a two stage transaction. Adorna Properties was wrongly decided because it applied the proviso to section 340(2) ... That was set right in Tan Ying Hong ... where the Federal Court held that the proviso was only applicable to section 340(3), ie to subsequent purchaser and not to the immediate purchaser.” In line with that, the Federal Court was of the view that OCBC’s charge was indefeasible, as OCBC was a subsequent purchaser. As in OCBC, the 1st Respondent’s charge came about from a two stage transaction. Section 340(3) of the NLC did not require the 1st Respondent to prove that Wong was an immediate bona fide purchaser. The trial court found that the 1st Respondent had made all inquiry and searches. The 1st Respondent had discharged the burden of proof. 21 FC-01-20-06/2016 22. The 2nd and 3rd Respondents, who filed a separate appeal (B01(NCVC(W)-327-08/2014) against the decision of the trial court, but which separate appeal was struck out by reason of the success of the 1st Respondent at the Court of Appeal, took the stand that it was mutually agreed they would file a fresh appeal at the Court of Appeal against the decision of the trial court in the event that the decision here should be against the 1st Respondent. But other than that, the 2nd and 3rd Respondents agreed to abide by any order of this court with respect to the competing charges. 23. It was submitted Tan Ying Hong at [26] overruled OCBC which held that the chargee bank had not acquired an indefeasible title, and that OCBC as analysed in Tan Ying Hong was on all fours with the facts of the instant case. 24. In OCBC, the appellant was the chargee. The charge was created by one Ng See Chow who acquired title through a forged transfer. Ng See Chow failed to repay the loan. The appellant applied and obtained an order for sale of the land. Ng Kim Hwa claimed that the land belonged to him and that he had not executed any transfer of the land to Ng See Chow. A registrar's caveat was entered against the land to prevent sale by the appellant. Contending that its charge was indefeasible, the appellant applied to have the caveat removed. That application was refused. The appellant appealed. In dismissing the appeal, NH Chan JCA held as follows: 22 FC-01-20-06/2016 “Now, if we apply this to the facts of the present case, what we have is this. If the registered title of the land (which is in Ng See Chow's name) is defeasible under s 340(2)(b) because its registration was obtained by forgery, it (ie Ng See Chow's title) is liable to be set aside at the instance of the true owner Mr Ng Kim Hwa (even though Ng See Chow was an innocent purchaser for value) and any interest (for example, any charge or lease) granted by Ng See Chow is similarly liable to be set aside. This is because in s 340(2) there is no proviso (as there is in s 340(3)) to protect the innocent purchaser (who is the immediate acquirer) for value or to protect anyone claiming through or under the immediate acquirer (even though that person be an innocent purchaser for value). So that, the chargee which Ng See Chow has granted thereout to the appellant bank (OCBC Bank (M) Bhd) as chargee is not protected because there is no proviso in sub-s (2) to protect the chargee bank which is a person claiming through or under Ng See Chow. The charge, therefore, is also liable to be set aside by Mr Ng Kim Hwa” (Emphasis added). 25. NH Chan JCA held the proviso applies only to section 340(3) and not to section 340(2) of the NLC, and that the proviso does not protect an innocent immediate purchaser, or anyone claiming through or under the immediate purchaser –“... in s 340(2) there is no proviso (as there is in s 340(3)) to protect the innocent purchaser (who is the immediate acquirer) for valuable consideration or to protect anyone claiming through or under the immediate acquirer (even though that person be an innocent purchaser for value)”. 23 FC-01-20-06/2016 26. In Tan Ying Hong, Arifin Zakaria CJ (Malaya) as he then was, thus remarked on the judgment of NH Chan in OCBC: “[26] NH Chan JCA in delivering the judgment of the Court of Appeal was of the opinion that the proviso to s 340(3) of the NLC applies exclusively to those situations which are covered by sub-s (3). The court then went on to hold that the charge granted by Ng See Chow to the appellant was liable to be set aside by the true owner since the title was obtained by forgery. On the facts of that case, we agree that the title of Ng See Chow is defeasible under s 340(2) of the NLC as he obtained his title through a forged instrument. However, we are of the opinion that the appellant bank, being the holder of subsequent interest in the land is protected by the proviso to s 340(3) of the NLC. For that reason we are of the view that the finding of the Court of Appeal in that case is to that extent flawed.” 27. On account of Tan Ying Hong at [26], it was submitted that the 1st Respondent, who likewise was a chargee bank, was also a subsequent purchaser protected by the proviso. 28. To the contrary, it was submitted that Tan Ying Hong at [26] was inconsistent with itself at [8], [9] and [11]. For a better understanding of Tan Ying Hong at [8],[9] and [11], the judgment of Zaki Azmi CJ should be read from [5]: “[5] Let us refer to the first owner of a piece of land as 'A' who then transfers the same piece of land to 'B' and which subsequently is transferred to 'C'. 24 FC-01-20-06/2016 [6] As far as s 340(1) of the NLC is concerned, A's title to the land is totally indefeasible. In short if A's name appears on the registration, no one can come and claim for that title. The law will not entertain it at all. [7] Now comes the next person, B, whose name appears in the register. If it can be shown that the title or interests obtained by B was obtained by fraud or misrepresentation by him or anyone else to which he was a party or privy then his claim to the title or interest can be defeated (see s 340(2)(a) of the NLC). Otherwise, B stands in the same position as A. [8] The situation where it is proved that the registration in B's name was obtained by forgery or by means of an insufficient or void instrument is the same (see s 340(2)(b) of the NLC). His title or interest to the land is liable to be set aside by the previous owner who has a good title. In this latter instance, there is no need to show that B was a party or privy to that forgery or to obtaining the title or interest by a void instrument. [9] The third instance where B's title or interest could be defeated is where it was unlawfully acquired through the exercise of any power or authority conferred by any law. Section 340(2)(c) of the NLC deals with one who was for example acting in his capacity as an agent to a power of attorney. Even if C is in the same position as B, sub- s (3) also does not give protection to C unless he can show that he had acquired the title or interest in good faith and for valuable consideration. Any title or interest gained by any person thereafter is also liable to be set aside unless it could be shown that he had acquired it in good faith and for valuable consideration. This is what is called deferred indefeasibility of title. If his title or interest is challenged on similar grounds, the burden of proving there was valuable consideration and good faith lies on him. (Emphasis added) 25 FC-01-20-06/2016 [10] As far as I am concerned, that is the simplest way of looking at s 340 of the NLC. I totally agree with the learned Chief Judge of Malaya's view that the error committed by the Federal Court in Adorna Properties Sdn Bhd v Boonsom Boonyanit @ Sun Yok Eng [2001] 1 MLJ 241 was to read the proviso to sub-s (3) as being a proviso to sub-s (2) as well. The error is very obvious because the proviso expressly refers to 'this sub-section' which must in the context of that subsection be read as proviso to sub-s (3) only. [11] I am legally obligated to restate the law since the error committed in Adorna Properties is so obvious and blatant. It is quite a well known fact that some unscrupulous people have been taking advantage of this error by falsely transferring titles to themselves. I hope that with this decision, the land authorities will be extra cautious when registering transfers.” 29. At [7], Zaki Azmi CJ held that the title or interest of B, who obtained the same “by fraud or misrepresentation by him or anyone else to which he was a party or privy” could be defeated. At [8], Zaki Azmi CJ held that the title or interest of B, who obtained the same “by forgery or by means of an insufficient or void instrument” could similarly be defeated and that in the instance of forgery or an insufficient instrument “there is no need to show that B was a party or privy to that forgery or to obtaining the title or interest by a void instrument”. 30. Together, at [7] and [8], Zaki Azmi CJ made a distinction between ‘title or interest obtained by fraud or misrepresentation’ and ‘title or interest obtained by forgery or an 26 FC-01-20-06/2016 insufficient instrument’ and held that in the case of ‘title or interest obtained by forgery or an insufficient instrument’ “there is no need to show that B was a party or privy to that forgery or to obtaining the title or interest by a void instrument”, which implied that in the case of ‘title or interest obtained by fraud or misrepresentation’ there is need to show that B was party or privy to the fraud or misrepresentation. 31. At [9], Zaki Azmi CJ held that B's title or interest could be defeated where it was unlawfully acquired through the exercise of any power or authority conferred by any law, that section 340(2)(c) of the NLC deals with the situation where one, for example, acted in his capacity as an agent to a power of attorney, and that the proviso “does not give protection to C unless he can show that he had acquired the title or interest in good faith and for valuable consideration. Any title or interest gained by any person thereafter is also liable to be set aside unless it could be shown that he had acquired it in good faith and for valuable consideration” (Emphasis added). 32. At [10] and [11], Zaki Azmi CJ agreed with Arifin Zakaria CJ (Malaya), as he then was, that the proviso only applied to section 340(3) of the NLC, and that Adorna Properties was wrongly decided. 27 FC-01-20-06/2016 33. It would not appear that Tan Ying Hong at [26] was at odds with itself at [8], [9] or [11]. But what was fascinating in Tan Ying Hong at [26] was the view that the chargee in OCBC acquired a subsequent interest. A subsequent interest does not spring out of a vacuum. A subsequent interest is acquired from a preceding title or interest. In OCBC, the charge was acquired by the chargee from the chargor. By stating that the chargee in OCBC acquired a subsequent interest, Tan Ying Hong at [26] accepted that the chargor in OCBC was the holder of the preceding title or interest, or was the immediate purchaser. It should be noted that there was no finding that the chargor in OCBC was party or privy to the forgery. Indeed, it was the finding of NH Chan JCA – “even though Ng See Chow was an innocent purchaser for value” - that the chargor in OCBC was a bona fide purchaser. As the chargor in OCBC was “an innocent purchaser for value”, it followed that the chargee in OCBC was a subsequent purchaser. Given that the chargor in OCBC was “an innocent purchaser for value”, Tan Ying Hong at [26] was absolutely warranted to the view that the charge in OCBC acquired a subsequent interest. It should be emphasized that in OCBC, there was an immediate purchaser and a subsequent purchaser, both in good faith and for valuable consideration. It was on account of those facts that Tan Ying Hong at [26] said that the chargee in OCBC was a subsequent purchaser. In no way was it said in Tan Ying Hong at [26] that a chargee per se is a subsequent purchaser. It would be fallacious to read Tan Ying Hong at [26] to mean that a 28 FC-01-20-06/2016 chargee per se is a subsequent purchaser. If a chargee per se is a subsequent purchaser, then the result in Tan Ying Hong would have been for the chargee bank. But it was not. The result was in favour of Tan Ying Hong, which should scotched all interpretation or belief that Tan Ying Hong at [26] ruled that a chargee per se is a subsequent purchaser. 34. Whether a chargee is a subsequent purchaser must be decided on a case to case basis. The instant facts were different from OCBC. For in the instant case, it was the finding of the trial court, which was wholly undisturbed by the Court of the Appeal, and not challenged by the 1st Respondent that (i) “as a fact that the discharge of charge purportedly signed by the [Appellant] had been forged”, (ii) the purported document of title (Version 6) was not issued by the registering authority, and (iii) “that [Wong] created a charge of the said land by forging the signature of the attorney of the [Appellant] and registering the same as a discharge of charge to enable the current charge over the said land in favour of the [1st] Respondent to be registered”. 35. The finding of the trial court was that Wong forged the signature of the attorney of the Appellant on the discharge of charge, and that the document of title (Version 6) together with the Pelan Tanah presented for registration of the transfer to Wong and charge in favour of the 1st Respondent was not issued by the issuing authority. There was no evidence that the transfer was a 29 FC-01-20-06/2016 forgery. But the discharge of charge was a forgery authored by Wong. As author of the forgery, could Wong be a purchaser, let alone a purchaser in good faith and for valuable consideration? If Wong were not a purchaser in good faith and for valuable consideration, then could the 1st Respondent be a subsequent purchaser? If the 1st Respondent were not a subsequent purchaser, then would not its charge be defeasible? Those were the decisive questions that laid at the heart and core of the dispute and its resolution. 36. With respect, the issue was not “whether a chargee comes within the meaning of section 340(3) of the NLC” as proposed by the leave question. As rightly said by the Court of Appeal and agreed to by the 1st Respondent before us, the issue was whether the 1st Respondent was an immediate or subsequent purchaser. For if the 1st Respondent, though purchaser, were not a subsequent purchaser, then the 1st Respondent only acquired a defeasible interest. But of course, if the answer to the leave question were that a chargee does not come within the meaning of ‘purchaser’ under the proviso, then this appeal should be decided against the 1st Respondent. 37. This is the appropriate juncture, perhaps even overdue in point of time, to refer to section 340 of the NLC, which provides: “(1) The title or interest of any person or body for the time being registered as proprietor of any land, or in 30 FC-01-20-06/2016 whose name any lease, charge or easement is for the time being registered, shall, subject to the following provisions of this section, be indefeasible. (2) The title or interest of any such person or body shall not be indefeasible- (a) in any case of fraud or misrepresentation to which the person or body, or any agent of the person or body, was a party or privy; or (b) where registration was obtained by forgery, or by means of an insufficient or void instrument; or (c) where the title or interest was unlawfully acquired by the person or body in the purported exercise of any power or authority conferred by any written law. (3) Where the title or interest of any person or body is defeasible by reason of any of the circumstances specified in sub-section (2)- (a) it shall be liable to be set aside in the hands of any person or body to whom it may subsequently be transferred; and (b) any interest subsequently granted thereout shall be liable to be set aside in the hands of any person or body in whom it is for the time being vested: Provided that nothing in this sub-section shall affect any title or interest acquired by any purchaser in good faith and for valuable consideration, or by any person or body claiming through or under such a purchaser. (4) Nothing in this section shall prejudice or prevent- 31 FC-01-20-06/2016 (a) the exercise in respect of any land or interest of any power of forfeiture or sale conferred by this Act or any other written law for the time being in force, or any power of avoidance conferred by any such law; or (b) the determination of any title or interest by operation of law. 38. The proviso provides “that nothing in this sub-section shall affect any title or interest acquired by any purchaser in good faith and for valuable consideration, or by any person or body claiming through or under such a purchaser”. Apparently, the charge was acquired by the 1st Respondent in good faith and for valuable consideration. There was no issue on that. However, it was contended that “a charge is not an interest acquired by a purchaser within the meaning of the proviso”. 39. ‘Interest’ is not explicitly defined in sections 5 or 340 of the NLC. But that is not to say that the meaning of ‘interest’ is not spelt out in the NLC. For what is ‘interest’ could be gathered from the NLC, that is, if the provisions were only read together. Section 205(1) of the NLC provides that “the dealings capable of being effected under this Act with respect to alienated lands and interests therein shall be those specified in Parts Fourteen to Seventeen, and no others”. And when read together with Parts Fourteen to Seventeen of the NLC, section 205(1) of the NLC provides that the dealings capable of being effected under the NLC with respect to alienated lands and interest therein shall be 32 FC-01-20-06/2016 transfers, leases and tenancies, charges and liens, and easements. A transfer, for want of a better word, transfers the alienated land. But a lease, tenancy, charge, lien or easement does not transfer the alienated land. A lease, tenancy, charge, lien or easement creates an interest in the alienated land which does not pass but remains with the registered proprietor. And that interest in the alienated land, be it lease, tenancy, charge, lien or easement, is the ‘interest’ stated in the proviso. 40. Besides section 205(1) read together with Parts Fourteen to Seventeen of the NLC, the authorities cited by the 1st Respondent also settled it that a charge is an interest in alienated land. In T. Damodaran v Choe Kuan Him, it was held by the Privy Council per Lord Diplock, delivering the opinion of the Board, that “interests in land, short of proprietorship, which are capable of being registered are leases, charges and easements”. In Tan Ying Hong at [26], it was held that the chargee in OCBC had a [subsequent] interest. In Daito Kogyo (Sarawak) Sdn Bhd v Port Dickson Land Development Sdn Bhd, it was held by Abdul Malik Ishak J, as he then was, that “once a charge is registered it takes effect immediately as security in the form of a legal interest in the land”. In Score Options Sdn Bhd v Mexaland Development Sdn Bhd, the Federal Court per Arifin Zakaria CJ, delivering judgment of the court, cited Luggage Distributor (M) Sdn Bhd v Tan Hor Teng where it held by the Court of Appeal per Gopal Sri Ram JCA, as he then was (VC George JCA, Abu Mansor JCA, as he then was, in 33 FC-01-20-06/2016 agreement) that “registrable interests falling short of ownership … are leases, charges and easements”. 41. Other authorities not cited by the 1st Respondent also plainly said that a charge is an interest within the proviso. To cite just a few, in Malaysia Building Society Bhd v KCSB Konsortium Sdn Bhd[2017] 2 MLJ 557, it was held by the Federal Court per Arifin Zakaria CJ, delivering the judgment of the court, that “under the NLC, a charge is an interest in land”. In Dial Kaur a/p Tara Singh v Mann Foong Realty[2000] 3 MLJ 153, it was held by the Court of Appeal per NH Chan JCA, delivering the judgment of the court, that “a charge is a registered interest in land that is charged to the creditor (chargee) as security for a loan”. And in Lian Keow Sdn Bhd (in liquidation) & anor v Overseas Credit Finance (M) Sdn Bhd & ors[1988] 2 MLJ 449, it was held by the former Supreme Court per Seah SCJ that “a charge which affects the company's beneficial interest in land is a charge under section 108(3)(e) of the Companies Act” (section 108(3)(e) of the Companies Act, since repealed by the Companies Act 2016, read “a charge on land wherever situate or any interest therein”). 42. It is irrefragable that a charge is an interest and that a chargee is a purchaser, both within the meaning of the proviso. The 1st Respondent was a purchaser of interest in the said land. But as said, the real issue was not whether the 1st Respondent was 34 FC-01-20-06/2016 a purchaser, but whether the 1st Respondent was an immediate or a subsequent purchaser. 43. It is now settled that an immediate purchaser acquires a defeasible interest. Only a subsequent purchaser in good faith and for valuable consideration acquires an indefeasible interest. There was a period however when an immediate purchaser acquired an immediate indefeasible interest. That was because of Adorna Properties, where it was held by the Federal Court that the proviso also applied to sub-section 340(2), with the result that a purchaser of a title or interest, which was defeasible by any one the vitiating elements specified in s 340(2), acquired an indefeasible title or interest. Adorna Properties ruled in favour of immediate indefeasibility. Then came Tan Ying Hong, where it was held by the Federal Court that “the Federal Court in Adorna Properties misconstrued s 340(1), (2) and (3) of the NLC and came to the erroneous conclusion that the proviso appearing in sub-s (3) equally applies to sub-s (2). By so doing, the Federal Court gave recognition to the concept of immediate indefeasibility under the NLC which we think is contrary to the provision of s 340 of the NLC”. In effect, Tan Ying Hong put our Torrens system back to deferred indefeasibility, to where it was before, where “it was the orthodox understanding that Malaysia’s National Land Code provides for deferred rather than immediate indefeasibility” (‘A law which favours forgers: Land fraud in two Torrens jurisdictions’ by Tang Hang Wu and Loh Khian Chung (2011) 19 APLJ 130) (for 35 FC-01-20-06/2016 further reading on our Torrens system before Adorna Properties, see Tan Ying Hong at [18 – 26] and Kamarulzaman at [15 – 28]). 44. What is the difference between deferred and immediate indefeasibility? In ‘Forgeries and Land Registration’ (The Law Quarterly Review 1985 Vol 101 at 79) R. J. Smith explained that forgeries are seen as raising the distinction between immediate indefeasibility and deferred indefeasibility: “In Torrens systems, forgeries are seen as raising the distinction between immediate indefeasibility and deferred indefeasibility. Immediate indefeasibility protects the registered proprietor simply because he is so described on the register. In our example concerning dispute between A, C and D, both C and D appear on the register and therefore prevail over A who no longer is on the register. Deferred indefeasibility is more subtle. Its analysis is that only when a purchaser relies on a statement in the register does he deserve or receive statutory protection. Thus C’s difficulty is that he relies on the transfer wrongly executed by B who forged A’s signature. Nothing in the register misled C. As the purpose of the legislation is to cure defects in title rather than defects in conveyances, C’s title will not prevail against A. D, however, is in a different position. As C’s chargee, he has relied on C’s registered title. Accordingly, his title will be defeasible. This is what is called deferred indefeasibility: statutory protection on the next disposition after the forged transfer. After a fierce dispute lasting many decades, the Privy Council ruled in favour of immediate indefeasibility in 1967: Frazer v Walker. The Torrens system would today protect the interest of C against A, although the result was reached after considerable uncertainty.” 36 FC-01-20-06/2016 45. But in Malaysia, it is deferred indefeasibility, where “the registered proprietor does not acquire indefeasible title upon registration but is postponed to one transaction removed from the original transaction involving the use of a defective instrument” (‘A law which favours forgers: Land fraud in two Torrens jurisdictions’ supra). The Torrens system here would not protect C against A. 46. In ‘Tan Sook Yee’s Principles of Singapore Land Law’ (3rd Ed) at page 285,the learned authors thus illustrated (i) the difference between immediate and deferred indefeasibility, and (ii) the defeasibility of title or interest of an immediate purchaser in good faith and for valuable consideration, who would be C in ‘Forgeries and Land Registration’ (supra) at 79: “In the early days of Torrens jurisprudence, there was some uncertainty as to whether a registered proprietor obtained an immediate indefeasible title or merely a deferred indefeasible title. An immediate indefeasible title means that the registered proprietor's title becomes indefeasible once his title is registered, notwithstanding that the source of the new registered proprietor's title might be the result of forgery. A deferred indefeasible title, on the other hand, defers the shield of indefeasibility until the next purchaser. An illustration of the difference between both theories is as follows: X is the original owner. Y forges X's signature and sells the property to Z, who was not privy to the forgery. Z registers the transfer and becomes the new registered proprietor. If indefeasibility were conferred immediately, Z's rights over the land will prevail over X's, notwithstanding that Z's title was derived from forged documents. In 37 FC-01-20-06/2016 contrast, under the theory of deferred indefeasibility, Z's rights will not prevail as against X. However, should Z then sell the land to A, A will be able to claim indefeasibility as against X. Indefeasibility of title is thus conferred to the next purchaser” (Emphasis added). 47. Deferred as opposed to immediate indefeasibility was also explained in Tan Ying Hong at [20], by espousal of the following commentary in ‘The National Land Code, A Commentary’ (Vol 2) by Judith Sihombing at para 404: “[20] Indefeasibility can be immediate or deferred. The distinction between the two is well explained in para 404 of The National Land Code, A Commentary (Vol 2) by Judith Sihombing which reads: ‘There are two types of indefeasibility; immediate and deferred. The factor which distinguishes the two is the common law effect given to the instrument even after registration; in addition; in a regime of deferred indefeasibility, the role of registered volunteer might be more relevant than under an immediate indefeasibility system. If, after registration has occurred, the system then ignores the substance, form and probity of the instrument used to support the registration, the system is likely that of immediate indefeasibility. Thus, registration has cured any defect in the instrument being registered. If the instrument, despite registration, still has the power to affect the registered interest or estate, the system will probably be that of deferred indefeasibility.’ (Emphasis added) 38 FC-01-20-06/2016 [21] In short, immediate indefeasibility means that the immediate registered title or interest of the proprietor or transferee immediately to the vitiating circumstances will be conferred statutory protection despite the existence of any vitiating circumstances. In the case of deferred indefeasibility, the indefeasibility only comes to be attached to the title or interest upon a subsequent transfer. Thus, the difference between immediate and deferred indefeasibility hinges on the effect of registration vis-a-vis the title or interest” (Emphasis added). 46. That indefeasibility is not absolute and that only a subsequent purchaser in good faith and for valuable consideration acquires an indefeasible title or interest was explained in ‘Tenure and Land Dealings in the Malay States’ by David Wong at p 374 as follows: “When a registered title or interest in land is rendered defeasible in any of the circumstances considered above, it is liable to be set aside not only in the hands of its immediate holder but also in the hands of any person to whom it may subsequently be transferred: so is any lesser interest subsequently granted thereout. But, such continuing defeasibility will end with respect to any title or interest when it comes to be acquired by 'any purchaser in good faith and for valuable consideration' in whose hands the title or interest will be cured of its past defeasibility, which accordingly will also not affect any person 'claiming through or under such a purchaser'. All this is stated in section 340(3). Thus, so long as a defeasible title or interest remains on the register and has not been set aside, it is capable of subsequent dealings by its holder. 39 FC-01-20-06/2016 And, indeed, it can be a root of good title in favour of any subsequent purchaser 'in good faith and for valuable consideration” (Emphasis added). 47. Tan Ying Hong at [52] was categorical that the proviso only applies to a subsequent dealing: “[52] Furthermore, even though sub-s (3)(a) and (b) refer to the circumstances specified in sub-s (2) they are restricted to subsequent transfer or to interest in the land subsequently granted thereout. So it could not apply to the immediate transferee of any title or interest in any land. Therefore, a person or body in the position of Adorna Properties could not take advantage of the proviso to the sub-s (3) to avoid its title or interest from being impeached. It is our view that the proviso which expressly stated to be applicable solely to sub-s (3) ought not to be extended as was done by the court in Adorna Properties, to apply to sub-s (2)(b). By so doing, the court had clearly gone against the clear intention of Parliament. This error needs to be remedied forthwith in the interest of all registered proprietors. It is, therefore, highly regrettable that it had taken some time, before this contentious issue is put to rest.” 48. Kamarulzaman at [15]was equally explicit that indefeasibility under the regime of deferred indefeasibility is not absolute, that a title or interest that is not indefeasible continues to be defeasible (section 340(2)(a) of the NLC), that any interest subsequently granted thereout is liable to be set aside in the hands of any person or body in whom it is for the time being vested (section 340(2)(b) of the NLC), and that a defeasible title or interest continues to be defeasible and will only become 40 FC-01-20-06/2016 indefeasible when title is acquired by a subsequent purchaser in good faith and for valuable consideration, or by any person or body claiming through or under such a purchaser (proviso): “[15] … Before Adorna Properties, the law on s 340 could be broadly summarised as follows. 'Upon registration, the party in whose favour the registration has been effected will obtain an indefeasible title to or interest in the land, that is a title or an interest which is free of all adverse claims or encumbrances not noted on the register. The effect of registration then is to defeat all prior unregistered claims. Indefeasibility is however not absolute … ' (Land Law in Malaysia, Cases and Commentary by Teo Keang Sood & Khaw Lake Tee, (2nd Ed) at p 134). Indefeasibility is subject to the exceptions in s 340(2). Under s 340(2), the title or interest shall not be indefeasible (a) in any case of fraud or misrepresentation to which the person or body, or any agent of the person or body, was a party or privy; or (b) where registration was obtained by forgery, or by means of an insufficient or void instrument; or (c) where the title or interest was unlawfully acquired by the person or body in the purported exercise of any power or authority conferred by any written law. A title or interest that is not indefeasible continues to be defeasible and is 'liable to be set aside in the hands of any person or body to whom it may subsequently be transferred' (s 340(2)(a)) and any interest subsequently granted thereout is liable to be set aside in the hands of any person or body in whom it is for the time being vested (s 340(2)(b)). A defeasible title or interest continues to be defeasible and will only become indefeasible when title is acquired by a subsequent purchaser in good faith and for valuable consideration, or by any person or body claiming through or under such a purchaser (proviso to s 340(3))” (Emphasis added). 41 FC-01-20-06/2016 49. No room was left in Kamarulzaman at [43 - 44] for doubt that the defeasible title or interest of an immediate purchaser is liable to be set aside, and that the defeasible title or interest of an immediate purchaser only becomes indefeasible when it is subsequently passed to a bona fide subsequent purchaser: “[43] In the instant case, both the trial court and the Court of Appeal held that the fifth and sixth respondents were bona fide purchasers. But unfortunately, both the trial court and the Court of Appeal failed to inquire whether the fifth and or sixth respondents were immediate or subsequent purchasers. Only a subsequent purchaser is entitled to raise the shield of indefeasibility. An immediate purchaser of a title tainted by any one of the vitiating elements acquires a title that is not indefeasible. It flows from Tan Ying Hong that the bona fides of an immediate purchaser is not a shield to defeasibility. The defeasible title of a bona fide immediate purchaser is still liable to be set aside. The defeasible title of a bona fide immediate purchaser only becomes indefeasible when it is subsequently passed to a bona fide subsequent purchaser. That the fifth and sixth respondents were bona fide purchasers could not by that fact alone give a shield of indefeasibility. The fifth and or sixth respondents only acquired an indefeasible title if they were bona fide subsequent purchasers. But for the fifth and sixth respondents to have been bona fide subsequent purchasers, there must have been an immediate purchaser in the first place. The first to fourth respondents, from whom the fifth and sixth respondents obtained title, were not immediate purchasers. Rather, they were imposters of those entitled to the estate of the deceased. They, like the 42 FC-01-20-06/2016 fake Boonsom who impersonated the true Boonsom, had no title to pass to the fifth and sixth respondents. The fifth and sixth respondents who were the immediate purchasers, acquired a title that was not indefeasible. But when the fraudulent title of the first to fourth respondents were set aside by the default judgment, the defeasible title of the fifth and sixth respondents was also defeated (Emphasis added). [44] Accordingly, in relation to leave question 1, which should read as 'What was the effect of the judgment in default, which set aside the (order of distribution of) the estate of the deceased, to the transfers (by the first to fourth respondents) to the fifth and sixth respondents?', we would answer that the defeasible title of the first to fourth respondents was set aside by the default judgment, and that on the instant facts, the defeasible title of the fifth and sixth respondents was swept aside along with that of the first to fourth respondents. In relation to leave question 3, which should read as 'Whether the transfers by (the first to fourth respondents) to the fifth and sixth respondents were protected by s 340 of the National Land Code?', we would answer that the fifth and sixth respondents were immediate purchasers and so were not protected by the proviso to s 340(3). We need not answer leave question 2, as our aforesaid answers are already more than sufficient to dispose of this appeal.” 50. To acquire an indefeasible interest, the 1st Respondent must be a subsequent purchaser in good faith and for valuable consideration. Let it be assumed arguendo, that the 1st Respondent was a subsequent purchaser. But if the 1st Respondent were a subsequent purchaser, then who was the immediate purchaser? Was Wong that immediate 43 FC-01-20-06/2016 purchaser? If Wong were not that immediate purchaser, then the 1st Respondent could not be a subsequent purchaser. Now whether Wong was a purchaser must be judged from section 5 of the NLC which provides “purchaser means a person or body who in good faith and for valuable consideration acquires title to, or any interest in land”. Could Wong wear the hat of purchaser? Could a forger of pertinent instruments of dealing be a purchaser in good faith in the first place? “ … the basic element of good faith is the absence of fraud, deceit or dishonesty and the knowledge or means of knowledge of such at the time of entry into a transaction. But the overriding consideration is 'the particular circumstances of each case' (See Pekan Nenas Industries Sdn Bhd v Chang Ching Chuen & Ors [1998] 1 MLJ 465; Ong Ban Chai & Ors v Seah Siang Mong [1998] 3 MLJ 346)” (State Tailor Sdn Bhd v Nallapan[2005] 2 MLJ 589 per Richard Malanjum JCA, as he then was, delivering judgment of the court). 51. To repeat, the undisturbed finding of the trial court was that Wong forged the signature of the attorney of the Appellant on the discharge of charge that Wong presented together with a forged document of title and false Pelan Tanah to enable registration of the forged discharge of charge, transfer, and charge. In fact, the 1st Respondent submitted that the leave question was “not a fact sensitive question at all”. The 1st Respondent accepted that Wong was the forger, albeit of the discharge of charge. There was no evidence that the transfer was 44 FC-01-20-06/2016 forged. But both the transfer to Wong and charge to the 1st Respondent could not and would not have been registered in the first place without the forged discharge of charge. Wong, who authored the forgery, knew that. And Wong, who authored and presented the forgery for registration that opened the way for registration of the transfer and charge, could not have acted in good faith. The transfer was not forged. But the transfer could not have been registered without the forged document of title (Version 6). Even when viewed in isolation, the transfer was not in good faith. But the entire transaction should be viewed as a single transaction. Transactions which are practically contemporaneous should be considered a single transaction (see Home Trust Co v Zivic (2007) 277 DLR (4th) 349). Also, the conduct of Wong should be viewed in totality and as a whole. The transfer would not have been registered but for the forgery of the discharge of charge. Wong surely knew that the Chings had not redeemed the said land from the Appellant to effect a transfer of the said land, free of the charge, to him. That however was no obstacle to Wong, who forged the discharge of charge to engineer a transfer free of the charge. There could be no question about it. Wong defrauded the Appellant of its charge. When viewed in totality, the overall conduct of Wong was criminal. It would rub salt to the wound if it were held that Wong was a purchaser in good faith. The cruelest cut of all would be that Wong, the forger, would have the right to redeem the said land if it were held that the charge was indefeasible. 45 FC-01-20-06/2016 52. Wong was not a purchaser. Even if Wong could be a purchaser, he was not a purchaser in good faith. Since Wong was not a purchaser in good faith, Wong could not be the immediate purchaser in good faith and for valuable consideration. 53. I would answer the leave question as follows: a chargee is a purchaser within the meaning of the proviso. But the interest of a charge is defeasible, if the chargee were not a subsequent purchaser in good faith and for valuable consideration. Whether a purchaser is an immediate or subsequent purchaser is not determined by a tally of the number of transactions. Transactions could be contrived by fraudsters and accomplices (see ‘Deferred and Immediate Indefeasibility: Bijural Ambiguity in Registered Land Title Systems’ by Pamela O’Connor, Edin LR Vol 13 pages 194-223). A purchaser is a subsequent purchaser only if his title or interest were derived from an immediate purchaser (his vendor) in good faith and for valuable consideration. For the title or interest of the subsequent purchaser to be indefeasible, both immediate and subsequent purchasers must be purchasers in good faith and for valuable consideration (see Wright v Lawrence 278 D.L.R. (4th) 698 at [39] per Gillese JA, delivering the judgment of the court). 54. In the instant case, as there was no immediate purchaser in good faith and for valuable consideration, the 1st 46 FC-01-20-06/2016 Respondent was Z in the final illustration of Tan Sook Yee. The interest of the 1st Respondent was immediate and defeasible. 55. I would allow the appeal with costs and restore the orders of the trial court against the 1st Respondent. As for the orders of the trial court against the 2nd and 3rdRespondents, they should be settled by the fresh appeal to be filed by the 2nd and 3rd Appellants against the decision of the trial court, and further appeal, if any. 56. Immediate indefeasibility gives certainty. But unless a security system is statutorily in place to prevent fraud and forgery, such as, but not limited to, the attendance of parties before the registering authority, as well as an indemnity scheme to compensate proprietors for the errors of the registering authority, deferred indefeasibility should remain, to protect innocent proprietors against fraud and forgery. Dated this 16th day of August 2017. Tan Sri Jeffrey Tan Hakim Mahkamah Persekutuan Malaysia 47 FC-01-20-06/2016 C O U N S E L For the Appellant: Karen Wilfred Solicitors: Tetuan Rashid Zulkifli For the 1st Respondent: Benjamin John Dawson (Koh San Tee And Chan Shao Kang with him) Solicitors: Tetuan Benjamin Dawson For the 2nd and 3rd Respondents: Hj Nik Suhaimi Nik Sulaiman (Naziah Mokhtar with him) Attorney-General’s Chambers Malaysia

Tika 2.6.0

BA-24NCVC-35-05/2017

PLAINTIF BECON ENTERPRISE SDN BHD (Company No.: 82256-V) DEFENDAN BINTANG CARCARE (GLENMARIE) SDN BHD (Company No.: 417736-X)

16/08/2017

YA DATUK AZIMAH BINTI OMAR

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=fd113079-d5e6-440d-ab6e-6140816d7553&Inline=true

1 IN THE HIGH COURT OF MALAYA AT SHAH ALAM IN THE STATE OF SELANGOR DARUL EHSAN ORIGINATING SUMMONS NO: BA-24NCVC-35-05/2017 Dalam perkara Perjanjian untuk Membeli bertarikh 2.5.2017 antara Becon Enterprise Sdn Bhd dengan Bintang Carcare (Glenmarie) Sdn Bhd untuk hartanah yang dipegang di bawah Geran No. 215289, Lot 61911, Bandar Glenmarie, Daerah Petaling, Negeri Selangor dengan 1 ½ tingkat kilang teres tepi yang didirikan di atasnya yang mempunyai alamat pos di No. 59, Jalan U1/35, Hicom-Glenmarie Industrial Park, 40150 Shah Alam, Selangor Dan Dalam perkara Aturan 7, 29 dan Aturan 92 Kaedah 4 Kaedah-Kaedah Mahkamah 2012 Dan Dalam perkara Seksyen 11, 18, 19, 51 dan lain-lain seksyen yang berkenaan dalam Akta Spesifik Relif 1950 2 BETWEEN BECON ENTERPRISE SDN BHD (Company No.: 82256-V) … PLAINTIFF AND BINTANG CARCARE (GLENMARIE) SDN BHD …DEFENDANT (Company No.: 417736-X) GROUNDS OF JUDGMENT (Enclosure 8) A. INTRODUCTION [1] The Plaintiff, had on 29.5.2017 filed an originating summons (Enclosure 2) seeking inter alia for specific performance of an agreement pertaining to a piece of land held under Geran No. 215289, Lot 61911, Bandar Glenmarie, Daerah Petaling, Negeri Selangor, together with 1 1/2 storey factory built on it, with the postal address at No. 59, Jalan U1/35, Hicom-Glenmarie Industrial Park, 40150 Shah Alam, Selangor (“the said property”). 3 [2] However, pending the disposal of its Enclosure 2, the Plaintiff on 2.6.2017 filed a notice of application (Enclosure 8) applying for an ex parte injunction to restrain the Defendant through himself or his agents from dealing or disposing the said property. [3] This Court had on 20.6.2017 had granted the Plaintiff an ad-interim injunction order pending the inter parte hearing of Enclosure 8. [4] The Plaintiff’s application for an interim injunction in Enclosure 8 was supported by affidavits deposed by Tee Bock Toh (the Plaintiff’s Managing Director) namely; (i) Plaintiff’s Affidavit in Support affirmed by Tee Bock Toh on 02.06.2017 (Enclosure 7) (ii) Plaintiff’s Additional Affidavit affirmed by Tee Bock Toh on 13.06.2017 (Enclosure 12); (iii) Plaintiff’s Affidavit in Reply affirmed by Tee Bock Toh on 30.06.2017 (Enclosure 17). [5] The Plaintiff had also filed a Notice Of Intention To Use Affidavit (Enclosure 24) to use the Plaintiff’s Affidavit in Reply (2) affirmed by Tee Bock Toh on 21.7.2017 (Enclosure 27) to support its Enclosure 8. 4 [6] In opposing the Plaintiff’s application, the Defendant had filed an Affidavit in Reply affirmed by Chan Kit Sang (the Defendant’s Director) on 19.5.2017 (Enclosure 14). B. Background facts [7] The background facts which has led the Plaintiff to file Enclosure 8 as well as Enclosure 2 are as follows: i. The Plaintiff (Becon Enterprise Sdn Bhd) and the Defendant (Bintang Carcare (Glenmarie) Sdn Bhd) are companies registered under the Companies Act 1965. ii. The Defendant is the registered owner of the said property. iii. Vide an Authorisation Letter for Sale No.003827 dated 2.5.2017, the Defendant had appointed realty agent, Oriental Realty to sell off the said property on behalf of the Defendant for the sum which has been agreed at RM 3,550,000.00. iv. Vide an Agreement to Purchase No.24883 dated 2.5.2017 (the said Agreement to Purchase), the Defendant has agreed 5 to sell and the Plaintiff has agreed to purchase the said property at a purchase price of RM 3,550,000.00. v. Mr Lee Chuang Jong, the director of the Plaintiff had signed the said Agreement to Purchase on behalf of the Plaintiff (Purchaser) and while for the Defendant, two of its director namely; Mr Chan Kit Sang and Mr Yusof Bin Othman had signed the said Agreement to Purchase on behalf of the Defendant. Witnesses to the three signatures of the signatories are Lau Yuke Lian and Tan Kim Hee. vi. Pursuant to the said Agreement to Purchase, the Plaintiff has paid to the Defendant the sum of RM 71,000.00 as earnest deposit to Oriental Realty. vii. Upon the execution of the said Agreement to Purchase, the Plaintiff (the purchaser) has thereafter appointed Messrs. Low Vignesh & Co (Messrs. Low Vignesh) as its solicitor. Whereas the Defendant (the vendor) had appointed Messrs. Amy Chen & Partners (Messrs. Amy Chen) as its solicitor. viii. The said Agreement to Purchase contained inter alia the following terms: 6 a. Clause 3 “3. The SPA must be signed by both parties within fifteen (15) full working days from the date of acceptance by the vendor(s). In default of signing the SPA within the above validity date: a) by the Purchaser(s) (provided that there is no undue delay on the part of the vendor(s) or vendor(s) solicitor) the said earnest deposit sum paid herewith shall be forfeited by the vendor(s) which shall be shared equally between the vendor(s) and Oriental Realty; b) by the vendor(s), the vendor(s) shall refund the said earnest deposit sum to the Purchaser(s) together with a compensation sum of equivalent amount which shall be shared equally between the Purchaser(s) and Oriental Realty, failing which the Purchaser(s) shall be entitled to seek for specific performance at the cost and expense of the vendor(s). b. Clause 8 “This offer letter shall constitute a binding contract which shall be superseded only upon the execution of the formal SPA.” ix. Seven (7) days after the execution of the said Agreement to Purchase, i.e on 9.5.2017, Messrs. Low Vignesh had forwarded an email enclosing a copy of the draft Sale and Purchase Agreement (SPA draft agreement dated 9.5.2017) to Messrs. Amy Chen for their comments. 7 x. Messrs. Low Vignesh did not receive any response from Messrs. Amy Chen. Thereafter, Messrs. Low Vignesh sent several reminders to Messrs. Amy Chen through emails and follow up calls namely on 18.5.2017, 19.5.2017 and 22.5.2017 requesting Messrs. Amy Chen to return the draft agreement dated 9.5.2017. Despite those reminders, Messrs. Low Vignesh still did not receive any comments on the draft SPA agreement from Messrs. Amy Chen. x. Messrs. Low Vignesh subsequently received a letter dated 23.5.2017 from Messrs. Amy Chen informing them that the Defendant were unable to proceed with the sale of the said property. Messrs. Amy Chen had also informed Messrs. Low Vignesh that the Defendant was prepared to compensate the Plaintiff the sum of RM71,000.00, in addition to returning the earnest deposit of RM71,000.00 to the Plaintiff which was earlier paid to Oriental Realty. xi. Pursuant to the Defendant’s agreement to return the Plaintiff the earnest deposit of RM71,000.00 as well as the compensation amount of RM71,000.00, Messrs. Amy Chen issued a cheque of RM142,000.00 to Messrs. Low Vignesh. However, Messrs. Low Vignesh refused to accept the 8 cheque on the ground that there was no instruction from their client of any proposal for settlement. xii. Following the Plaintiff’s refusal to accept the sum, the Defendant had instructed their solicitors to place the money into an interest bearing account pending the disposal of this matter. [8] Following the refusal, the Plaintiff then commenced Enclosure 2 against the Defendant seeking specific performance of the said Agreement to Purchase. [9] This Court also take note that before the filing of Enclosure 8 (Enclosure 8 was filed at 16:13:46 pm on 2.6.2017) the Plaintiff had also lodged a private caveat on the said property on the same date i.e 2.6.2017 at 02:45:23 pm. Enclosure 8 The legal principles in the granting of an interim injunction [10] The principles governing the exercise of court’s discretionary power in the granting of an interim injunction are trite and well settled. Suffice for this Court to refer to the following cases: 9 i. American Cyanamid Co v. Ethicon Ltd [1975] 1 All ER 504 The House of Lords had propounded the governing principles in granting interlocutory injunction. When the court has to consider whether to grant or not to grant an applicant’s application for an interlocutory prohibitory injunction, the Court must consider whether the Plaintiff has satisfied the following four (4) conditions: i. there is a serious question to be tried; ii. damages would not be an adequate compensation for the Plaintiff but would be an adequate compensation for the Defendant; iii. the balance of convenience lies in favour of the Plaintiff's; and iv. there are special circumstances in favour of the Plaintiff or there are no special circumstances in favour of the Defendant. ii. Keet Gerald Francis Noel John v Mohd Noor [1995] 1 MLJ 1993. Gopal Sri Ram JCA (as he then was) said at pages 206-207:- “ To summarize, a judge hearing an application for an interlocutory injunction should undertake an inquiry along the following lines: 1. He must ask himself whether the totality of the facts presented before him discloses a bona fide serious issue to be tried. He must, when considering this question, bear in mind that the pleadings and evidence are incomplete at that stage. Above all, he must refrain from making any determination on the merits of the claim or any defence to it. It is sufficient if he identifies with precision the issues raised on the joinder and decides whether these are serious enough to merit a trial. If he finds, upon a consideration of all the relevant material before him, including submissions of counsel, that no serious question is disclosed, that is an end of the matter and the relief is refused. On the 10 other hand if he does find that there are serious questions to be tried, he should move on to the next step of his inquiry; 2. having found that an issue has been disclosed that requires further investigation, he must consider where the justice of the case lies…” 3. the judge must have in the forefront of his mind that the remedy that he is asked to administer is discretionary, intended to produce a just result for the period between the date of the application and the trial proper and intended to maintain the status quo…” iii. Alor Janggus Soon Seng Trading Sdn Bhd v Sy Hoe Sdn Bhd [1995] 1 MLJ 241 iv. Sunrise Sdn Bhd v First Profile (M) Sdn Bhd [1996] 3 MLJ 533. The Plaintiff’s Contention [11] The learned counsel for the Plaintiff submitted that the Plaintiff had fulfilled the “3 stage test” enunciated in the celebrated case of Keet Gerald Francis Noel John. [12] It was contended on behalf of the Plaintiff that the said Agreement to Purchase is a binding agreement between the Plaintiff and the Defendant where the parties, the subject matter of the land, the price and the essential terms of the sale and purchase of the 11 Property have been clearly identified. According to the counsel for the Plaintiff, the said Agreement to Purchase binds both the Plaintiff and the Defendant even though the formal agreement of sale and purchase has not been executed. This is the reason behind the Plaintiff’s claim for specific performance of the said Agreement to Purchase. [13] It was further contented by the Plaintiff’s counsel that at all material time, the Plaintiff is ready and willing to fulfill its obligation under the Agreement to Purchase. This could clearly be seen when the Plaintiff has approached Public Bank to obtain facilities for the purchase of the Property and the letter of offer has also been issued by the Bank. This is also supported by the fact that the earnest deposit of RM71,000.00 has been paid upon execution of the Agreement to Purchase. [14] In this regard, the Plaintiff’s counsel has relied heavily on clause 8 of the Agreement to Purchase. According to the counsel for the Plaintiff, clause 8 has clearly spelt out that the offer letter shall constitute a binding contract which only can be superseded upon the execution of the formal SPA. 12 [15] On these arguments, the counsel for the Plaintiff contends that there are clearly serious issues to be tried in this case, therefore satisfying the first limb of the test. [16] The Plaintiff’s counsel had also submitted that if the interim injunction is not granted, there is an inherent risk that the Defendant may sell the property to a third party. The Plaintiff’s counsel further contended that the interim injunction will not result in damages to the Defendant which cannot be compensated by costs. The Plaintiff has given its undertaking as to damages. [17] It was further submitted on behalf of the Plaintiff that the dispute in this case is a dispute as to land and relying on the Court of Appeal’s decision in the case the case of Kho Ah Soon v Ooi Kar Seng (Properties) Sdn Bhd [1995] 3 CLJ 812, the counsel for the Plaintiff submitted that the application by the Plaintiff for an interim injunction should be granted by this Court. (The Court of Appeal in Kho Ah Soon held at paragraphs (3) and (4): 13 [3] The fact that there was in existence an impending threat to dispose of the property is in itself sufficient for the status quo to be maintained. This being the case, and the fact that the learned Judge rightly held that there are serious issues to be tried as to whether a concluded contract existed, the balance of convenience must tilt in favour of the appellant. Further, land being a valuable and special commodity, once lost, may not be adequately compensated by damages. The appellant, hence, ought to be held entitled to maintain the caveat and the injunction. [4] There is no reason why the appellant should be deprived of the benefit of a specific performance of the agreement which he says was concluded. All that he is asking for is for his claim to be tried and until then the respondent should not jeopardise the position by disposing of the property. To maintain the status quo, the fact that the appellant has averred that he is at all material time ready and willing to conclude the sale is good enough, and questions of financial ability should not affect the position of the essential justice between the parties. (a) The Plaintiff has suffered losses and damages as a result of the Defendant’s breach of the Agreement to Purchase. The Defendant’s Contention [18] On the contrary, the Defendant contended that there is no binding contract or agreement between the parties yet. It was contended by the counsel for the Defendant that the question whether or not there is a concluded agreement between the parties can be 14 determined by the terms and conditions contained in the said Agreement to Purchase. [19] The counsel for the Defendant has further contended that in the present case, the Plaintiff and the Defendant had signed the Agreement to Purchase. Having signed the Agreement to Purchase, the Plaintiff had agreed to all the terms and conditions contained in the Agreement to Purchase. [20] The counsel for the Defendant had relied to clause 3(b) of the Agreement to Purchase and submitted that clause 3(b) has clearly provides that to conclude the sale of the said property a formal SPA must be signed by the parties within fifteen (15) full working days from the date of acceptance by the vendor(s). [21] The Defendant’s counsel further argued that clause 3(b) permits or allows the Defendant not to proceed with the sale if within fifteen (15) full working days from the date of acceptance by the vendor (the Defendant), no SPA has been signed yet by both the Plaintiff and the Defendant. The Defendant is at liberty to withdraw from the Agreement to Purchase subject to the refund of earnest deposit paid by the Plaintiff together with a compensation sum of 15 equivalent amount which the Defendant at all time is ready and willing to pay. [22] It was further submitted by the counsel for the Defendant that the Plaintiff was the one who refused to comply with clause 3(b) of the Agreement to Purchase. Defendant was willing and prepared to pay the compensation sum of RM71,000.00 as agreed in pursuant to clause 3(b) of the Agreement to purchase. The Plaintiff’s refusal in accepting the return of earnest deposit of RM71,000.00 as well compensation amount of RM71, 000.00 is contrary to the wordings of the Clause 3(b) of the Agreement to Purchase. D. Court’s Analysis and Findings [23] The Plaintiff’s counsel had heavily relied on the general legal proposition that when parties of the transaction have been identified with sufficient clarity, together with the subject matter of the contract in question, the price and the terms that parties considered essential, it constitutes a valid and enforceable contract. 16 [24] This legal proposition can be seen in the decision of the Federal Court in the case Charles Grenier Sdn Bhd v Lau Wing Hong [1997] 1 CLJ 625. The Federal Court has held inter alia that: “[1] Generally, an agreement to make an agreement does not result in a contract. It is for the Court, in each case, to construe the correspondence exchanged between the parties and to say whether that is the result intended by the parties. If, however, the Court reaches an opposite conclusion, then there is an enforceable contract. …… [5] The parties to the transaction, the property, the price, and the essential terms have all been identified with sufficient clarity. Such an agreement is commonly termed as an 'open contract'. It is enforceable as if it was embodied in a document with all the attendant solemnity. And in order to give it effect, the law will, acting out of necessity, imply terms into the contract for sale in order to make it work”. [25] The Federal Court in Charles Grenier Sdn Bhd had referred to the joint judgment of Dixon CJ, Mc Tiernan and Kitto JJ, in Masters v. Cameron [1954] 91 CLR 353 where it was emphasized that: 17 “Where parties who have been in negotiation reach agreement upon terms of a contractual nature and also agree that the matter of their negotiation shall be dealt with by a formal contract, the case may belong to any of three classes. It may be one in which the parties have reached finality in arranging all the terms of their bargain and intend to be immediately bound to the performance of those terms, but at the same time propose to have the terms restated in a form which will be fuller or more precise but not different in effect. Or, secondly, it may be a case in which the parties have completely agreed upon all the terms of their bargain and intend no departure from or addition to that which their agreed terms express or implied, but nevertheless have made performance of one or more of the terms conditional upon the execution of a formal document. Or, thirdly, the case may be one in which the intention of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract. In each of the first two cases there is a binding contract: in the first case a contract binding the parties at once to perform the agreed terms whether the contemplated formal document comes into existence or not, and to join (if they have so agreed) in settling and executing the formal document; and in the second case a contract binding the parties to join in bringing the formal contract into existence and then to carry it into execution. 18 [26] The question this Court must ask itself is; whether the general legal proposition is applicable in the present case. [27] Reverting back to the present case. This Court must not lose sight of the very crucial aspect in the transaction between the Plaintiff and the Defendant i.e before the formal execution of the SPA, the parties had actually entered into a written agreement that they called an Agreement to Purchase. This Agreement to Purchase has set out the terms and conditions of the purchase of the said property before the formal SPA is executed. [28] This Court agrees with the counsel for the Defendant that when both the Plaintiff and the Defendant signed the Agreement to Purchase, they have agreed to be bound by the terms and conditions contained in the said Agreement to Purchase. [29] Here, the Plaintiff had heavily relied on clause 8 of the said Agreement to Purchase which says that the letter of offer constitute a binding agreement / contract between the parties and what is left now is only the execution of a formal Sale and Purchase Agreement. 19 [30] This Court opines that the Plaintiff here cannot just rely on clause 8 of the said Agreement to Purchase in isolation of other terms and conditions contained in the Agreement to Purchase. [31] Clause 8 further stipulates that constitution of a binding contract through the letter of offer shall be superseded only upon the execution of the formal SPA. [32] In relation to the execution of a formal SPA, in the very same Agreement to Purchase there is also a term that requires that the formal SPA must be signed by both the Plaintiff and the Defendant within fifteen (15) full working days from the date of acceptance by the vendor. [33] In other words within 15 days from the date the Defendant signed the Agreement to Purchase (2.5.2017) i.e both Plaintiff and the Defendant must execute a formal SPA to give effect to the Agreement to Purchase. [34] Clause 3 further stipulates if the SPA is not signed within the validity period (within 15 days of the Defendant’s acceptance i.e 20 from the date Defendant signed the Agreement to Purchase) then these three consequences will arise: (i) if the default of not signing the SPA within the validity period lies on the Plaintiff (purchaser) {provided that there is no undue delay on the part of the vendor(s) or vendor(s) solicitor)}, then the earnest deposit sum paid by the Plaintiff, shall be forfeited by the vendor the Defendant. The earnest deposit sum of RM 71, 000.00 shall then be shared equally between the vendor (the Defendant) and Oriental Realty (the broker). (ii) if the default of the inability to sign the SPA within the validity period lies on the Defendant (the vendor(s), the Defendant as the vendor shall refund the said earnest deposit sum to the Purchaser(s) together with a compensation sum of equivalent amount which shall be shared equally between the Plaintiff (Purchaser) and Oriental Realty. (iii) if the Defendant (vendor) failed to return the earnest deposit of RM71,000.00 and pay the compensation sum of RM71,000.00, then the Plaintiff (Purchaser) shall be entitled 21 to seek for specific performance at the cost and expense of the Defendant (vendor). [35] This Court’s reading of clause 3 of the said Agreement to Purchase is simply this; clause 3 gives an option to both the Plaintiff (Purchaser) and the vendor (Defendant) to withdraw from the sale if in case, within 15 days (validity period of the Agreement to Purchase) parties are unable to sign the formal SPA. In other words, clause 3 provides remedy in cases where either parties to the agreement had failed to sign the formal SPA within the stipulated time of 15 days from the Defendant’s acceptance. [36] In the present case, the Defendant here do not intend to proceed with the sale and had exercised the option open to the Defendant provided under clause 3. And when the Defendant did not sign the SPA within the time stipulated then what remedy the Plaintiff is entitled to is provided under clause 3 (b) namely; is for the return of the deposit together with an award of compensation of equal amount with the deposit paid. [37] By virtue of the terms and conditions contained / set out in the said Agreement to Purchase, this Court agrees with the counsel for the 22 Defendant that there was no issue with regards to whether there was concluded contract between the parties. [38] In the present case, it is not in dispute that the SPA has not been executed and the parties had agreed that from the date of the signing of the said Agreement to Purchase a formal SPA must be signed within the period of 15 days from the date of the Defendant’s acceptance (i.e the date the Defendant signed the Agreement to Purchase - 2.5.2017). The parties were in fact still in the negotiation process before the finalization of the SPA and there was an option open to both the parties to withdraw from the sale by not executing a formal SPA within the time stipulated time under the Agreement to Purchase. (See: Chong Siat Yong & Ors V Yee Mun Ying & Anor [1986] CLJ (Rep) 320) [39] It was the Plaintiff who did not want to comply the terms spelt out under clause 3(b) and had refused to accept the refund of the earnest deposit together with compensation sum. The Plaintiff had, instead filed Enclosure 2 to compel or to force the Defendant to proceed with the sale which is against the spirit of clause 3 of the Agreement to Purchase. 23 [40] In the light of the above mentioned reasons, it is thus clear in this case that there was no serious issue to be tried. When the Plaintiff had failed to satisfy the first limb of the “3 stage test”, then the consideration of the remaining issues would no longer be necessary. [41] Based on the reason above stated, the Plaintiff’s application in Enclosure 8 is hereby dismissed with costs of RM5,000.00. t.t. ………………………………………………………………………. (DATUK AZIMAH BINTI OMAR) Judge High Court of Malaya Shah Alam Selangor Darul Ehsan Dated 16th August 2017 For the Plaintiff - Messrs Low, Vignesh & Co Chew Pey Ying For the Defendant - Messrs Lee & Koh Koh Yew Chong 24 Justin Leong

Tika 2.6.0

01(f)-20-06-2016(B)

PERAYU CIMB BANK BERHAD (NO. SYARIKAT: 13491-P) … PERAYU RESPONDEN 1. AMBANK (M) BERHAD (NO. SYARIKAT: 8515-D) 2. PENTADBIR TANAH DAERAH KLANG 3. PENGARAH TANAH DAN GALIAN SELANGOR … RESPONDEN RESPONDEN

Reported in [2017] 5 MLJ 142 Land Law — Indefeasibility of title and interests — Sale of land — Removal of appellant as chargee by forged documents — Claim of appellant and first respondent banks as chargees of same land — Whether chargee comes under meaning of purchaser under proviso to s 340(3) of the National Land Code — Whether first respondent acquired indefeasible title to property — Whether title of chargor obtained by void instrument — Whether first respondent subsequent bona fide purchaser or immediate purchaser — Whether respondent entitled to protection under proviso in s 340 of the National Land Code

16/08/2017

YAA TUN MD RAUS BIN SHARIFKorumYAA TUN MD RAUS BIN SHARIFYA TAN SRI DATUK ZAINUN BINTI ALIYA TAN SRI DATO' SRI ABU SAMAH BIN NORDINYA TAN SRI DATO' WIRA AZIAH BINTI ALIYA TAN SRI JEFFREY TAN KOK WHA

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Failed Extraction

01(f)-20-06-2016(B)

PERAYU CIMB BANK BERHAD (NO. SYARIKAT: 13491-P) … PERAYU RESPONDEN 1. AMBANK (M) BERHAD (NO. SYARIKAT: 8515-D) 2. PENTADBIR TANAH DAERAH KLANG 3. PENGARAH TANAH DAN GALIAN SELANGOR … RESPONDEN RESPONDEN

Reported in [2017] 5 MLJ 142 Land Law — Indefeasibility of title and interests — Sale of land — Removal of appellant as chargee by forged documents — Claim of appellant and first respondent banks as chargees of same land — Whether chargee comes under meaning of purchaser under proviso to s 340(3) of the National Land Code — Whether first respondent acquired indefeasible title to property — Whether title of chargor obtained by void instrument — Whether first respondent subsequent bona fide purchaser or immediate purchaser — Whether respondent entitled to protection under proviso in s 340 of the National Land Code

16/08/2017

YAA TUN MD RAUS BIN SHARIFKorumYAA TUN MD RAUS BIN SHARIFYA TAN SRI DATUK ZAINUN BINTI ALIYA TAN SRI DATO' SRI ABU SAMAH BIN NORDINYA TAN SRI DATO' WIRA AZIAH BINTI ALIYA TAN SRI JEFFREY TAN KOK WHA

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Failed Extraction

WA-12BNCvC-194-12/2016

PLAINTIF MANIAM A/L SUBRAMANIAM DEFENDAN 1. COLD CHAIN NETWORK (M) SDN BHD 2. EMPLOYEE PROVIDENT FUND BOARD

14/08/2017

YA DATUK S. NANTHA BALAN

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D.\MM MAIIK \MAlI11NGG| DI K DALAM WILAYAH 1=ER<EKU AN VIL N . \ LUMFUR A,\1T,\RA MANIAM A/L SUBRAMANIAM (N().K/P 590503 275119; DAN 1. COLD CHAIN NETWORK (M) SDN EH!) 2. EMPLOYEE FROVIDENT FUND BOARD JIESPONDEN-RESPONDEN (Da.|:un Mzhkumh Stsxtn d| Kufla Lumpux Imam \\'umh Pczsckuruan Mala m \s * 0 Dalam perkzm sekncn-seksyen 2. 41 mngg; 50 dan jaduzl Keugn Am Kumpulm mug Sunpurmn Pckcna‘l‘791 Dan Dnlzm pcrlun s:k:.\cn—sek>y.'xI 2 Am Ken.'|19?§ um Dnlam pzxkara Kasdah ‘ I cdnh— Kncdah l\I:l1k2rmh 2012 Dan Dalzm bldzngkunsn .\I:<hkm-nah mgscdnada mama Anum Maniam A/L submnamam (N0, K/P 5'1n5o5ro2r51m) Plainrif mu 1. Oak! Chain Network (M) Sdn Bhd 2. Employee Pxmidenr Fund Board . Defnndzn-Defendan NI Inlroducriun Thzse are my grounds of mdgnenl m respect or an appeal 1:, the appellant/plaintiff against (11: dncmnn ofrhc Hons Court on <2 Disemlzcr am dlsmxmng the plnlnnffi rmgumnng Summons dmd an my 2015 Mb: 05”) For cnn\cmcn:L~, I shall min («I my mum 19' than nngmnl uric: m the Scsswns Conn. Thus, 111: appellant shall be rufenml m u. "the plaindfl" nnd me {irsl mspondzm and second rcspondcnl as “am d.cf¢ndan("(“Dl") and “second defendant" (“D2”) rtsptcuvcly. D2 15 d1: Employre Pmvxdcm Fund Band The Sessions Cuurrjudgc mu be xefcrrcd m as “the sq" and me scys grounds of gudgnem .1. “the 60]" The Appeal Record <1nll be referral m a< “AR“ vnalviu Ill II-I [||| 12 EksIb1\.‘/ISVI ..1...w Eks1b1IMS-II .1... am... 1.15.1: xhmgga 51...... MS-36 Veperummn ,...g .1....,..1. .1..1.1.... Midnvil s..k......... 1>1......r..1..1. .1.,...1...1....,.;1..... schugnl xahh mu do1......... am... .12.. .1.....1a.. Defmdzn 1<..1... 1..1..... "mp ..~1...»....<....... ,...,. .1. ....... .1... 1>1....1.1 ..1..1.:. rncrupdmn mu .1..... pm1....... .1... 1...... km: 1.1.... .......1-...e.1.....-m..g.1.1.1...1.... .1... 1>1......r. 7: s..,. ......g..1...g. pcnngyn-puevvgguu 5.1. 52 5: .1... so ..1....«. ,......,..... ......1.. ,.c........................ 1 ..1....g... 13 Afidm .1 saknnpn 1=1......r Izlm-Juk um. mm. 1» Afdawl Snkungm 1>1......r. .a...1.u.. r1....1.1' dengzn um um. 1m...1 .1=..g.... ..1:..g....1.....;1.... gap mm mg 1.1.1. .1.1...mc..-......... war .1... —...,. .e....1....s=......r yang am... ..1.1.n mu .1“... ..:.,.1...... .1... hnynnn k..1.. 1.1.1. ....... r~...........~» .1... ...1.1. ..-....1.1..1. 1.:p...1. camnun Kwsr ..1.1.1. 5.... .....1.1.... .......1...a ks.....,..1... xndm .1... ...1.:. ..y... 1......,.k um... p.....gg... 1s Alidaml Snkangan m.....«.u.. .m.k1..1.1.c....1.;...=..1m..9 /.aa....1.w.p.... n.r....1.... 1>m....... siys ......,....1.... hnhzv-xi Ddendan Pmamz 1:1... ...z...1...... u......... n. um upqh yang a. 1... 1-1. 111 kcuuzh -1.... ......1,...s¢.......* .1....... ....,. .1...=........um ...¢........ Aim »......,,..1... w....; s............ 1-.1"... m1 s¢11...,.....,. schagm ,m.,... 1...“... pe(znggIn—p:z:nggan 1.. .1... 11 /.«.1....sn1.....,... 1>1....1.1. sayu ...=..,z1.x... Vzpmi 1....1.u.. Iul 12.1.»... n1.....1.1>.1=........ ......u.....pm. ...a1.:. -»......1.-> kepda “mp .:....n....:=.......- .m1. ...e1a.1.:...1g1.... 1......“ .1.,........1...... 1:1.-rm... Kamila, 1o.z Say:m<ngu|u1gy<M1ggm\»peru1gg1m6 1, 62.63.64 2 a....~: ;¢1..g....w...... k:pndzpcImguu1—yvu:ngyIl1 1...... 11 Afldnm s..1......»... 1>1.....1.L m.u1..1. um. pHm§gar\—|:u:1\gg:n 11 sehmgy 21 Afidavll Soknngu r1......z, ..,.......y1...1.....,.,,.... 1m.n..1 . 11 1 n.p.....1-...1.a. mug: Km‘: 1,»... u<....e...m... s.....1». Mum.11IIm¢ncn1s1<\1m r«..u..1.>. I6/S/Z016 1.1.1. am... .1.-1. n.r....1... 1...... ......<...s. 9.... :.=r1..11.1. 1/721115 ..pc........... .1.:x..a..1..s.4o. 112 M:v1:m5\ pnmggan 2 51...... .49. ..1.1. .1.,.1.s1..... 1.1.... M1... . 11.... ...n1...1»....... .1 1...1..... 1.. .... mun 1-u..1..111 .1 . ,....:1...... |x¢1¢1m.. rm...-, ~..1p rciuhunuunl“ 1...: 11...," 1...... v1. .11 mm. .... n.1....1.. 1».n..... ......1..y... .1. 1 .1. .....- ¢~w...1...¢~1 1.....a v|.1.111r. 1-. 1..... 5...; .....g....1..11<... ......a.. up ......1....s=..m.r .1.».......11.... »...11.nu 13. m1 ml u 1 r:..m.s....p...,.1;.... am mum." Panama rzrpcflimam ylng um»-k .1. mm... mm 4... gm... any m.........m..g dalam .1...-..... ncr=..a.... Kenn. s¢1...... ......,....\. pcrnnggwv-y-elcnggnn 2: .....m. 3» Am... Sokanyn m.....c gm mtnyzuknnxcpuu mu...’ :1 w Imp... Mzmm Kewangmu ycrxtlinunl .1.......k .1. rm... MS-M mm. :.......... .1... pm...y.... -..:.m. Anpu .....m. m.....e....m... gm... pcqnhmm W... ....—r......u... .............. mbvsxx dahm gap mm. Ion) danyldz pcnglrivm jumlnh ............ Kwsv W... pm. 4...,” my 9). pemrmdu 1.... :22 :mp.... y.... dnbtn mm. berhrmuk mm rlanr Imp: ...:...,..1. kuueks D/dwn Plamllf recur: .p.sn-n. .1... huduurknn kewula .¢............ ,....., ...g....u~..m... :2: n.;....... Drfvmlln Kedum n....m "lnp mmb1u3emcnI' 3.1.}... M...“ xm. mm. mm .1... elamv pcnllln n ..i......... y: m,.m.. .... a.m...m.. dznpadl uh «up.»-’ haw-In wksym 2 Aklu K\ImpuI:n w....., sm.p...... Pckeql mt (pzxznggnn z .m,.... Mrmen x=.........».1 .2» s.k...n,. ....m.... kupadm .......... yang .1 seknllpun. .....a,. w......r mt... lebvh km... 2.. in .x«..... .1... M... scnmm .24.... Mcmjuk mun. pwtngun-ptlellgguw :2 hmgg: 35 Arm... Snkmuim w......r. 5... mnnlnknn xptnn hm... . m Dglrmlm x<....... mrngulwux ,,r.-..y........,......,......... .1... a....... mum “win uimhunemnl” mun bu. rm: .......u km. mm: mm dul .n...... ,,«;.n..... .1... Ii-ink .I.u.....u.... c.......... KWSP" H.134: AR Vol 2. 1 w] ‘Emphasis ward! DZ also filed 1 mm. .r.'.dm. zffiuned on 14 November 2016 m Lhe same d.po..=... stanng m pzmgrnphs [6.1]. (5.21. [$.31 nnd [$.41 as follows . >.;.u.,m 14, mm} Iadul! xuym. mg dvkelmrhn «kn new." Pmnmn sepnumnm yang umpnl a. Ekshibu AB-4 mun durwuk dan blyann mi mm mumn... dlktcuxhknl dun mknfnn“up1h“-II mun szksyen 2 ARI: Kumpuhn Wing Snny-Inn Pektqa mu S2;/A mmyxlzlrzn mm“ mum Kzdun lelah m.,.|..m (Ind-Ian mum ms mm dun Irlulv d|p<m\\nIl<knu .1. hnwnh Aka Knmpulm Wing Sxmpanun P:k¢ua mm mmuu a....m. mm... D:k‘:m.m mu Tegunn m.....m. ptlnnggun n 2 yang m=n;u.k... mm. Mnhkanuh mink pm» bcrganmng kw. dnpzlan Itmuduga d.u| susum ymg duMu:|kn|\ olzh Ddzmtln Kedu: mm. sum Hhlw nyuu dxmml um um:-n...p.. dmgpn Iujuun Akiakumpuun Wing Sunpumn Ptkzul ml dlmqmlkan scnanmm ugnsanvmglnn mum: mum. 1.1.: bzvunlmgnn dengln .»=.u.m.k... m dalnm Akin :<u»-mm... ‘Wing Slmpunnn P:ku3a mu se.;m........ mum. Awal ylng a.x.:..mm ol=h DrkndunKcL1uA" FIJI [MI (9 s: ARV:-I 2m) [anphnis added] The pnsuunn mm wzx uken by m and D2 hm hm surcmuly mm m the zffidnvns mm were am on um. bdmlf As such. 1 Mn no! make sperjfiz nfercnc: lo the comnmpomntous 1:11:15 which captured |h-'4: Izspscnve positions or find.|I\.gs as an case may be But u .5 x mm. highly mlcvznl to mfu (0 Dr; substantive response to an mvesugznons um wzzc cnmcd out by D2 and mas 15 to be found m DI’: lam: dmd 2; October 2014 [at p‘I3Z-163 AR 2(2)]. Dl’s nplmacinn or ymttficauon Fm rh: payment arm: “mp rcxlnbursemcnl" ,5 III p.135 .-\R V0 2) what rh= cxphnnlmn for the pzymcnt mm undcr an hendsng “:Lnm ,».7.mm' and (ads 13:’ ~~x mm... m .u,,..., — Tugn: Punandn ma ulahh mzhkuhn pznynlwmu hinng pclnnunn x.- mm pdnnggnu nvengukul .«...m..... ptlangun Ias:l7uL . Smuplugnsan yang dwbcnknn mun mamm,m.| Iakm mg duempknn vauumu 15. Fenxhnnuun luring K: .=....... pelauyn aa..|..v. ...x.p.... .m..... .....p..... .1... lunr \....a.. bevgmmng kzpudn perrmmnn Wm .;.\...H... am... Iugann alnn mcnylnbil 1.... may p........gg...... .1... ptmnndunn ..-....... p...g:.......... .......... s.«....._.. \.....1....'. p:.......gg...... mmgambxl mm yang 1...... ....... .....,...x. .....u... jug; .......s..k mu... am... x>¢.....m La.. 13... lekimnyn ...... pcmlndmn juga ,n..,..¢ okh krmna pmgh-\vlI'l\ K: 1.... 1...»... ....n.. .m..».. mas... j...... ...m... ...........x m... bekcqa r........a.. 1.... mm yang 4.... ...., m.......k......w... alum ...=....:.... ....... ylng p......n: yang an... ...¢|.....1.... ken: lebm mas. kcnsna lanpnh .....x. ......ya....u.... sump mgunn .a...... ....m..».. x~:1....w.=ri.........|. Sax!-In mm. yznghanluml, ...... ...=|.....x... a... ..s...:. v.:...,........; Impala u.«..m.... |>......a.. Inn .....»... .......k m¢..g............\.a...;.......«. Eng! ..........x. r........... ....., ...¢..«. .2... mmyunbil M... .......k ..a... .1. pcnmgalm pcunluun 7...... kn ,..,.b.. ..u....... ...¢:..»m.... a... seulnh ulna p...g......m.. 1... .k... m...g.s..b.«.... ......».. ......... .»<...r............ ....; a.m:...=.u-.1. nay... p...,..»,y|...u. Sn|IlllllIl.‘(IIlp|I¢lIghl11l|lfllV ylnuwh ...... .m.>...|.... .1... 2 .....g p......m.. Lon. 1... ...=......u...|1.... s.....x..=.. ......s. ...........L.... ...... ,x............... .1... .w........... .......... .4... km. .......y...g .:.|.......... ..=.. .. r.......a.. L... M;.......a....;u.. u..:ap....y. bnhgm u.......... 4... .,¢...u...... .1. am... mmnnul pasu 1...... ...... .“.....v... .-.m\..,..... ylng szw.,....y. .......:. k..,.rk¢.,. ma... ...... ylng Mzpmkun olfll :-.......n... ..n...:. .,...k.. .1... r>........a.. 1... mlnh a..s¢...... mp... bayann keg: Iekynh ...... n>.......d.. L... ...g......... am... :|..... ......|...... c..... .... ....xm....... um. zfisyen t...g.;,.1..:. .y...1...a... 1-¢......1...,.=.....u.. Lon Km. :1... v=.......... ,u..g.¢:.n m.:u.;:.... .a.|.:. .....m..x W... ....1. Vukasi .1... ...u.... m... .....,u.......... ...|.......... on... m... ...,u.. .s.| a... ......... alum peqalznnu .... .a...:. ...m.. 5...... km: lsbnh ......, ........ .1. nm. ........... KWSP ...:.1.a........u.... ..,..m....... .,.y..... kzua 1.2.... nma yunglum" [9135 AR2(2H D2 nppcus Io have accepted D1‘: explanation and concluded as (allow. .n .he.. Ieuer to due plan-mff dmd II Felmm, 2016 where .1... ma-. ..;. u uiu "3 um maklumnn ...=1=1111 sum mlnkan herlanlh as/mzou mcnjclaxlan mm. mp mmbmsemznf yang 11111.1“ mm. mm ymunndu km .1 :11 um sun can any”... .1111. ..m.1..m. 11... ‘avmzmd 1».g.' mnnanvpmxg kus dm pabelunjun xnunn y..¢1.m1... 1...»... a..,..-... 1.1.. v:1mbun1nmenI’ lxxggmmng kcpsda lnkzm. lzmwh penlungpluu hanngun .13.. bihnnym pnmmdn ham yzlup pnnynanluin o Schubungan 1..., 1mm Uldungrunduxg Kwsr m1.1.11 Akm xwsv wm 1»«,1.n.1m1m mm W mm1s«mn.mr yin; 1111111.. 111:». mm mm kcpda .x.......11. lan ndak berlingxung umuk -liurum awn Kwsr krrlmu 1. 1.1.11 mrmpnhm xwuu =1a1....;=ga1...... 11... hayamnkerju km. man 11:11 pcmnrdu Inn ' 1.. 17: /111 11121211 I6, In snaking .1; prove dm the "mp xumburtemem" was pm of "wages". 11 was axgued for .11: plaintiff (km 11.5 .91: pexformanc: ms ma closely to 111: amount nf mp: made. This saved as an 1n==..1m ca. 11.: plainmTm am :1 funlwr mud more frequently. 1-111- mp munbuzsuxncnl Formed 11m: 55 5% of an pla1nu'fl"s 101111 mcomt [mm July 2010 an 1 gust 2011 31.1, D1 only made 1a1=1-' mnnnbuuons bzscd on Lhe plamulfs hm: salary In mnpllficauon, counsel submmtd dur me plmnuffs 101; scape wins (0 dnve lomes b¢1ony.r.g to D1 m dghver gouds m 11.: mqmd desunauom as 1ns\n.1cted by D1 11 was unphaslzed that 11.: plzinuff did not have any rrguhz or am houxs oiwork. For 1111; purprzst, DI gave me 1 GD cud plnxnnffa Pclmnax curd :0 [my for pcuul 1.1.11 aTou.c1I to pay rm mu chnlgci. He was nox rcqmrcd tn aw am‘ expenses on Ixhxlf oi DI duuug the cunrss: of lus woxk. Thus, H is the pmurrs use am 131 15 requutd 10 mak: EPF conmbuuons fox ms mp mmnmmmuu {tom 11.1; 2010 In August 2013 amounnng m 111111279100 pummu :0 sccuon 43(1) .1; 121: EFF Act whuth mds as‘~ 9:9! as mu -‘m Subjm m In: |7u>v«|xmns afia:1|(m5Z.¢\1!y m..u..,e¢ ma every empluytr an pawn who 1; an cmplvyu wuhm I»: mnnlng arm Au mu r. r nu m may munlhty mnlnhuchm u. ch: .m...... ..n ...u rm an Imnlh m In: nu napecdmly sex mu m um um sane-ml: -- 17, um, D1 contended am my are no! uquncd (0 mm EPF conmbunons on L11: plmnuffi mp zumbursrrnznt because n was a “Lnp mmbmsanenf’ and/or “averumc payment". And. D2 zcctptcd mg ms exphnnnan and ma not order DI to make EPF conmbunnn mud on am my n.'imbuxs¢m:m Thug II): plmnuff was nggntvcd ma filed am as rm nrnung nlhczs, n dczlzmunn um um Lnp Immburscmcnt falls wnlun (Inc dcfimuon or -wages" under aecuon 2 of me EPF nu ma Sucuon 2 of Lhe Employmuu Act 1955 and for an oxdcl um D1 mzkzs EPF conmbuunna on ma mp tcunbuxsement m D2. However, on 9 Dectmbcr 2015, the Szssmns Court dismissed the plaxnuffs 05 mm cosxs of m3.ooo.oo. The Sun m Conn‘: dccilion us The dcusmn mm sq \vn:1nrgr:ly hzicd an me rm um D2 ma Invtsngucd {hr mum: and am the Sessions Court xhoukl not mmrfuc wllh D2‘: findings (sec pzgu ts AR Tambnhm). Accurdmg m uh: plzmufl. me sq Ended to appreciate d1: xssuts and me argument: bcfoz: hu. 1:“. us alu 19 20. I! was argued for the plaintiff rlm mu sq wrongly look the new Ihnt the cnun should not dcfcnz Plu1.iaml:nt’s Intention lmuusc pawn‘! had bccrl gmnlcd 10 (ll: l\l.ll-mm undcz Sccuun 72 (b) or Lhc EFF Act to dcclue «mu. pnvrntnrs to be pm of “\\/ages" lu muou 2 of due EFF Ac: (sac: pamguph 23 of mg G0), at pig: 3 of AR Tambzhany It was azgued for mu plzmuif dm (hls vlzw is moumus bncsluc l2;ulumm:'s role IS [0 mnkc law and me lua.lclm/s ml: 15 IO lnterprcl and declare me law (saw 11»: Kn .Ynm_z « Dal0'.Ym Dr Mailer/rir.’\{rl/lnrnarf [mm] 1 ML] 333 II’ 335). Counsel [nu ma plaunnffarguzd mu. m any mm S=clion 72a») cf an EFF Ac: dues non slam Lhlu thc Muum has power [0 Inmlpxct du: px0\'lsA<)ns of the EPF Act. It was col-ltmdrd am fl-A: sq exzcd In nkmg Ch: View um Khc Court should not xmetfue wul. am nlsk of D2. becaus: u IS smumul, nspanxiblz to ensure that EFF conmbunons :1: mad: (vent parslgjaphs 24 . :5 G0], M pzgc ll of AR Taxnbahnn) Cnullscl for the plunufl xubmlucd lluu Lhc puuncnt Issue IS an dcfimuun of “\vag:s" under me EFF Act II was argued fox lhc plnlnufi Lhst nu sq fmlcd [0 nddxcss d1: key mug of whcdmer um 1|]; within an defimuon 0f‘\J/Lges" undzr 5:cuun 2 of (he EFF Au and section 2 of mg Employmml Act wss. 1: was comcnded that me sc_l and m finding mar Lh: D1 IS "mp lalmbursemcnf nor Ilzbk to make EFF canmbuum-ls on the “mp ueuubuusemeuw l):cmLxc D1 rellcd On .11: dccismn nf D: (ie:: pnuyupl. 29 . so G0]. at page: 9 10 ufAR Tzmbnlunj. r... 17 and 21 23 1: was argued for me plzmnff. mm mg "mp r:lrnl>urscrncm" is n “xcmunrrnuon n. mun:_\' mm m an cmployce under in; conmcl ur servI4:c" and u 2 “bonus, communion or allowance payable undc: I...» contract of service, upprcnuccslup on crhcrwlse". 1. was .150 Azgucd ma: dun “Lnp mmbmzmmr‘ doc» not fall under any of due exccpuons undu sccuon 2 oi [ht EPF Act Howcvd, the azreudms comma m an century and zxgued (hat the “mp rulnbuxscnncnl” fall: wnhln m: cxcepuon n[“n\'cmmc payment" :5 par secuun 20:) or (J1: EFF Act or “my umumg 1|1u\\'nncv; at an value or any Luvclhng conoesuon" under sccubn 20) of ma EPF Act. In response. u WIS med for me plamuff ma: Lhe posxnon mm by me dmfcudanu is ex-mucous and Lllngul because quvrz aside (mm in bcmg nurhcr. rcould not be hath m the sum: vem. In an; mlpect, to am cum: Ilur u wns nrgucd far the dcfuldnnts am the mp xumbunsemtnz was m ma nature of an "ovcmmc pnjnnenx", counsd for m plnnuff ma ma: lefucnce must 5: ma: to sccnon 2 of the EFF Ac: where “ovuume paymtn!" .5 deem is: “oxrfllmz paymmr man: my p-ymem due from an mpnom m u. ..».m..,.. my wan mum on! 1.. non: ma. nnruul vmrldng hmln nfwch ......uy.....a mcludns ..w.,mm mm anemployez foruvrk mm: nuumpwbhc holudnyund lssxdnyx," Page u mu 24 25 26. .-kmrding .0 counsel r0. 0.: pI......rr, refemncc .00.. ..|..0 ho made .0 m...... rm am.) cf the Employrnmt An: 1955 which .<......- “(In 1.. .1... 50...... Auvrnime 0...... u.. number ufluun 01.0.4. ......a 0... .. mu. .. .... ........: huunulwnk ..m.., (cu For In: vnrposu .1 ms s¢t1Ion.wcuun M. ,.a......,».. sun mm me .01.... am, —.....-.....| hams nrwm. 0...... the number 01.0.... ..r 0.... .. ....«.: Ixm-rn ... 0.001.... ....: ... ....,.n..y.¢ a. m. 0......“- nflcniwe .. he m. ......I no.0 ..r.....1. ptrdly ma ...:n r....... r .....u ....n ........0.: .2.» ...n. ..u.....- pnwnhsd .. ......«......u; - 1.. the 0.00.. cue, .. .5 common g...0..d ma. me plainuffhzd no and workmg houm 14.. employ-mcnr umuact am.-d 20 Sepltmbur 2010 states .1...’ «v. Warking llo-us y.... .....-x..._., ha-an will b: .:=..........: hy your sum... .01 mu 0. ivnelcd .. yw upxm .0... .c,........; 0. 0.. «ms: Wwkmg »...... ..... 0.- mm 2: 0.0 .40.. nsded .0 0... m: cums:-0.‘. ..p.........: .0............... - V [,0 7. 76 .\R v01z(z)| The cvxdcncz befmc rhe court a..c10..d ma. D1 Ihemsclves 1.... confirmed 0... I0... 4...... were ..n0w0d .0 be 0.. ..:...n., at khcn honus 2...: 0.0.. 0... ..-......ca .0 be 0. 0.. am“ 0...... .00.. were 00. .c|..-.x..1..J .0 .1. .0 0. .1 mm .. no d:l.|\/cry .0 be made by 0.0.. And .0 t(€()ld 0.... attendance, Lhcy W. .¢q....0d .0 000.1. .. when .1... came .0 .0 W00. and punch 0... whnn the) zomplcltd rhe1r}ob(se .p 132 7 ms AR V01 2(2)). >..m...u 27. lama an [ht ahuvc. (hr: woxking hours nr (I1: plalnuff depulded on whether D! Kequued hxm to woxk. Thu n rrldcnz fmm lhc facl flu! m Jul nan pzy‘ (II: plnlnnrr . hlghnl mt: wlm-l um plmnuff W working, as rtqnued umlcx Sccuun mm (3)9) of Lhe Employnlent Act 1955 which states, "(3)(ay Fanny awnlln: vwzk mined um n. :xl:<s: fifth: Immlal hour: nl nwk, an nnpln,nn --.n In mu nl . m. n... In: Illa: am ....a null “Its an huuriy nk nlpiy lrrcsvcclnc ohhchzsls nn vl/mch lm ml: nl’ pm .5 mm’ Thus. n wu ngnnn for lh: plnnumlnn lfrh: pllunuffwas H1 fact wollul-lg ovznilne. unn he would luvc recelved a pay an the me of “om and hall nmns hls hourly pny" Bur. am wns not so. Counsel fox me plalnufi further ml that DI (hnrlsclves had ntver unmnl the cup relxnbnlscmzl-at as “o\'nLil'n: pzvment" and this W25 ckar (mm an plnnners munthllj pay slip as n was nun: classlfied as such (see p.53. 56. 73. 70, 71. 74, 77. 33, 35. 37. 90, 9:, 77, 102. :03, ms, 109, 1 I1 nnd llx nfAR Vol 2 (2)) Th: n:\l Argument (hm was zldvunccd by [he anrcnnnnll wax that the “trip mlmhurszIm:nI" was : “lnvclllng a|lo\A'rll-Act". In response, n m. argued by counsel rm d1¢ plalnniff am as n loxry mm, the plnnnrr was required to Lmval long dlsmnces or Lravelllng is the ram»: lure of an pllnnnrrs lob unhke, for zxalrlplc, n lz\vv:.r where nmulng ls manly and » .0 an Lawyer’: lob Pa|< to all! The Dispult 2 Tlm p1..n.nwn cmplond by D! as a lony dnver from July 2010 nnnl August 2012 He wns pm snhry nn n dash‘ basxs. In addluon, Lhe plamuiils also pm n sum of monlzs whsch M: dcscnbed, nvlav A/ta, as "mp relmbursemenl". The Issuz In an appeal bcfozr ml: 1: whether “mp ztsrnbutsrrnmr" falls mmn due d:fimum\ of wzgcs for purposrs of sntunxy conmbunons under the Employee»: Fmndenl Fund An 1991. Mar: specifically. the dispute .5 \I.1th regard n, me illcgcd nonvpaymcnl nr sulumx} conmbuunm by m In an Employccs l’2o\'1dtn{ Fund cap:-*') punuanl to an; Employcts Proudcm Fund An 1991 (--an EPF Act”) m lnhuon .0 “mp xcunbursemenl". Bawkgxound 3. m 1: n. (hr: business nr provldmg logjsnc seruces. Thcy pmvldc me lomzs for men dnvzrx. nl and-I mp LI-m an plmnuff1n1Ja:»,hc :5 pmd . basin (am,-1 salary and nn nddnuonal amount whuh rm been vanously [and 1 nughl. add, cunouslv) duscnbad as --mp reimbursement , Luvellang commission , Enp a.Llownnct", “mp mzzenuvz" and “ovemme parrnent" Fm convemence, I shall mu (0 an amount pm gtnmcally as “trip 1-cimhurscm:nt"alI|IoughI must qualify (his dtscnpnon by swung um xn reality it n nnr n rtunbursemcnr for my expenses mm were mcunrd by me plnmnrr. This IS elaborated funhu .n the 1m part n|'(hxs uxdgncm vagpsmu 30 31. Cnunxel md ma: a dnmncrlml mus. bc drawn bclwccn Itzvclflng .. ....a. ,..I. nnd lta\v:ll\ng ... oxdcr ... an .....'. inb. Hence, on .1... analog‘. .. was argued .J.m1..»1.I;.....rr:..u ...»..1.... .1» first cucgnry whclus n my” would an ...u.... .1... xccond category. 1.. zmplxficanon. cuunszl for the plnlnnff .1... sand that due Inp mxmbuxsemmt ms not "Knve1|.I.ng allowance" for ma rouowmg masons» 0) (b) (c) (4) (e) (0 1'... plzinuffs got. was .0 uzvcli T... plnnufi nnlv 4...... lomcs 1..1D..g...g ro D1: The plm.u’(( was gjvcn a "Touch ‘n’ Go” cam for loll put-poscs; The plainulf wzs gven . pttrul zard .0 an m: lorucs up V/id’! pcuolz The plamuffwas nut allowed .0 s.._. owmlghr and was required .0 some back to am office immedmely mg. he had mud: the delivery: The plsnnuffwas not Allowed to ulmm my upcnscs mcuncd dunng um dclwcryz and 1.. my rvcnr. (hue win no mason [or am pIa1n{\|T m zxprnd ms own personal resources fol .1.e purposc or tallying our ms ‘ab 1: no 0... ofpcxkct niprnsts one 2; ...u 33 34 Further cmmscl ma am, as an ma m mlcrprcnng um concept gr “nravcllxng allmmmca“, rcfcmncc sluuuld :J\o made In mg answer gwen by the Mxrusmr of Fxmncc, m 2 parhalnuxlazy qucsuon to hnn, wl-nch cuunsel for the plmnulf sand, 1: of zssxsunce. In this regald. Lhe poaluon mkm 5, an Malnysmn Govcmmeut ,3 that EPF wrnuibunon should bc made no [host who fall wnhm (hr plzinuffs cxrcumsnnccs Th: l\|1mstcr’s answer m PadIam:nr was as fnllaws» mu...“ m mclwhuhzn jwcmuvdu Inn kub nnnyn ..»m..,..: 4.... m...n.. pznlbirnngll up nun upnh _\mgd|1nkukzn |:uu— Prmandu Inn ung mm: W voknl mu. jug: swam dlun pm-:;..;... su......,. elmn .mj.|...... mmbulflihuynrumuk .=.......-....; 1.... a... ,..m|...;.. . ulna n..:.u..k.. human. n.,.n... luuhnt mm. a nun: 1.... am,...:. carumln Kws .u.u Pcmnmlu Ion «mm em... p<u:|||mn .m mguan yxng dflakukm. claun Icmtbul mm.¢.uk.i:x. mug». uyp|h' dllam cm knm Akin K 'sr :99: am: d|k¢m.k:n mm Kwsr ....m....:....;.... ».,m.. lcruhul ..m.....u... ..m.....'... mu. x... mm tnpun yang duhknlun. Sebzgm mm... tlnun pt-qxlarnn hag: ptwuvdu Inn unmk kalcgnn W. Lu 4. us ..umm.m.m.m a... unggungm\ cammmv xwsp mmm. knlcsud us» mm. dvknukuw clnwun xww (mlakluk kwnda lnkw Iakm Me bmmam " IP as 12: ARVol 2(2); 1.»u.pru.m mm] n was pmnmd out am at no prnm m umn: mg the p|:uIuuT mquuud to spend 1“: own money for the pulposes of tuvclllng. Page 22 12144 35. 37 Funhu, n was pmntcd out am in mm welwpagz, D2 mu xuppons 1).. pumum cumcncinxl Ihnz (hr: mp xcu1-Ahurscmcnzwns not . “lmvrllmg aUc\\/ante" as Lhcyc \\/one nu cxpcnses Ancurxcd by :11: plzmufl m .11: course of cmymg nut ms ‘yob. DZ's zxplznzuon on “Lu\‘el.L\n.g nllowzncc" (pg: us xwbpzge) mad: as fol.lo\vs:— ~apIa..ano.. x.:g.mu.g ramenu Exunplcd Fmm EFF Cunlnlmlinn 6 Any Inullmg Ilkvw-nccnr mg :01 mu nfxmy Lnvzl sanocnmm Am paymenl .....u by m; anpluyer In III: unplo;/ea for that puryuse .7: travelling and mnspun rxp<nx:x" Counsel for Lhe plalnufl pomttd our mu m p.146 AR \'ol.Z(Z), D1 dascnbcd Lhc pnymenl 25 “mp mcmuve" mhaz am. “mp 1llowm-me" or -‘mp r¢|mb\nsement" Hnwevcr. 1:: none of me numemus “ovenime and nip allowance" daun forms ms me amount demibed 25 “ov:mm¢". Counsel for Lb: plzxnuff emphasized that m D1’: leuu dated 2 September 2014 co D2, D1 clllcd u “(kip xnmburstmtm” and txplamcd the (annual: for "(Hp xeunbuzsemcnt" as Follows? “Tnp x.....m.....m- m dlh-ynr um. iemun p:......a.. loan a. Synnkil ms yang muxjalankuu W “wk. .......k mtmkyul p..u:........r.... mmnu ylrllnunu lmm knlcmpnl pclungyn .1“ ,¢............. wlallggzn ms:bn1.P:zn.u|du Inn am am," ~r..,, Reimbursem:1u' m...m..: kzdu Am. gang mm. aumuum um nuklunun plluk rm... Symkzl kum mcnuknlkm ’Tnp Rr1mImlsulImI"ndnIIh mnnrwru “'lmvi|:nrI/l’mnI Allnwwwe"/Flnun Pcdalanan am. Ptmandu Inn dibnyarelaun pezjalamn mu xluv .;=.,*::..m .1... ptnghlnllnn ymg mm. dmlylikln \:pud.I mack: manta 33 39 Pzvknuan “mp” am: mm aleh smm hmi bum mu.y.uk... panggunnan pclklun '|l1l\spml'l mr Dxlam em km Lam “Tnp Relmhurxmum‘ m. dianggw gum. ”TmmpuI\/Tnvcl Al\awaM¢"/Ehun !’<r}|Ilnm\ Imps-in Pemamlu Lan |:lAun Fmalnnnn im mam. hen-‘nun ....-nu .....:.m ,...5..... mm... .»«;.|...... .1... penflllnunl 3... mum. am: am. P:-nudn-prlnllldn um ,...; diunlnknn -...z..u nlellyennpumnlurl mm... mervkn up .m..;...m.... n.y..... my. nun. mu. Snap duknmzn p¢r1alan|n;.Inglzl:IJ\-ixlmal om: Prnundu Lnn mmmkul pm: )ang mm dueupknn um. dxkumpul uleh Enlugwn Lugvxhk unmk dvscnuk dun mm am... :1..." ptqxlxmn temlml mu dvpmxex dun dvbayarbenuna-nmagjfl lmhnan ‘P mm ‘\RVul2(Z]} L;....r....:m.q 1-rm, accmnng m counsel for the puma“, D1’: cxplannnon as per Its mm am: 2 sepmtm zrm sxrnply Incms um m 5.; far as m was cnnczmcd. rho mp allowance .5 in but of uvcnzrnc Thcxefum, u M. also nnslcndmg rm m w classify xx .5 “am: vcnnbununcnl them was m rm nmhing Lo nlmbuzs: and ham on um analysts, (he paymcnt could not no be "u'zveI.L\n_g a.Uo\van(e". D1 took the posmm\ um rhry are not lmblc ta pay cnnrribuuoni for lnp rclmburscmznr n. 1 .5 not Included under the dcfinmnn cf wngts According .0 DI, 1: ms been the cnnsmcm xund of D1 lhm they do not ma m pay um: conmbuuon: for me Lnp (eunbuxscmem pm :0 me pm..ua'.m1 ans snnd has been taken by D! since 22 May 2014 nu. u mu 41. 42 It was mntended um trip alluvvtmcc mm am am: manning H! {m\'c|l.mg alluwancc 2. rntnunncd in pnmynpll (2) nfsccuon 2 of me EPF An and us such Ll-ms: pgmcnts are c -mpmd from EFF tonlrlbuuons. Funhcnnorc, counsel for m pointed nut mm m Lhuz lenu datcd B Octobu 2014 (:1 p.132 AR Vol.2 (2). D1 ma explained m DZ mu Lhc mam and onginal mtennon of 111: mp allvwnnce .5 m replace uvemme allowance. Counxzl for m nmphasxied (hm \n(:r\vmv/Invutlgarions “cl: mum: nu! by D2 ma D1 and coop:-ratcd and providnd us cxpl.-unuun mud dommcms m D2 and mm .5 no mm [or nus Conn :0 Interfere mu. D2's d:c1sAon,2s am has not been any mmmu ofmlsuse of power; mzln fide, conspmq, hm, excess or pmms etc. Sxgnxfieandy. counsel argued am D2 has hem mum: powers under suuon 34 and 35 of mg EFF Ac: :0 appoint rxaminers .9 carry out rm statutory rluucs undcr aw EPI-' Act. Sccnun :4 md 35 ma )5. Aypnn-Km:-|ol ..p..um. mm ...mu,r...u..u.- nd mm. (1; Th: Enanl mu) uppmnl mm ....,..m at lmpeclun M in may oonsukr mumy in me purposes of ms An am my omen ma grvan|appmrnalund<rsubsacIIon 3013) and such appninnvlml mu Iwp\vh|IsMd m the (‘nznle :2) sum: m mhmcnun 41), M Inspcrmr npplvlnlrd unkl nlbixinnn u) mu have all m: pawns. ilmcnmu and dunes confcnvd mm mm An. ngpumu 431 An lnspcdor sun b: mm to I)»: am chief cxacunv: ofliocr. m a: such omer o ::r m serum of Ihc Board as my bclullmnkd by lhcthvclzxtclnuvenlliae nut! an scnurarmm, and nflny mm Impeclmx suyenurm mm m mm mm mu mm. lm ,..m..., perfonn nu nmcnuns. .u.\a.m...yg,e ms mm; xefavrd lo 1.. subx:m1n(2) mmphlncz wun such dmemom ymmslxwns, mndllmns. rulnumns av limmmcnsu Ila: chief =x.=..n.»: oifiur. or m (vfliur .7: srrvznl M the Bvlvd ...mu.m m an on mmronum, Bl an lmpttlw sllptnnr in NIIL ml) specify mu, m m wmmg. :uh:r .,em.u,, u w my ,,.mma« ms: or cxrcunlsutczs. (4. mg chef zxecuhw olficu mu have all me pmwr: of an lnwcuuv. m Thzfioardmayinvlvilinguteasxnanyoificrrnfllnefioanduisoxs nut awmmgd ...... Inxpetlurundcr ;uhsccnnu(Iyn.1|urnny um: pawns, iumlmm and dung: olnn lnspeclur '- "Sevlmnli rmn ufenlry, u.......n... ...: xnul 35. Subjm m any zegulalmns mid: my nclmn 7| ... Inspector or .., «mm vcdxd mm ow pawns uf .. lnxpeclur my n In) masuuhltltme L.) emu my yremxses or plwz mm puma: us helmmd lo be engaged u cmplnyeeg, lb) mnk: wch cxnmmaliml and ma-..ry _ may hr msczswl) fa! xsoevulnmg mm. (ht pmnxvom mm; Act M uh: rzgulnlmu onulexmmt mneundcr m btmx mm: b:=n comphnd mm m myxuch perms Drpln-ct m ax:-mn.:um«u1m= arm mg preamp: Many mm mm. wulh In-peuln . mums ....4:ym.s Iv¢| on whichhe may rusnnabw mm: mfnmulum rvrry prison wlm be has (rum: In behevz can mformumn .ew«m lhz mm. multr aim: Im1u1ry.qnd uquun: awry mn r-umvn lo I): oummzd and tax Lhz purpnsu nf inch exzmuulwn ...., summun uh) such person In alhend .. ma um: aml pl:-x [pacified m nick mmwlons. ma (.1) mm mch mhu pawns as mi) ht Iveussavry an curymgx |:As:lmlu»:!lvcI" n...2s..:u 41 According to D1, through .n ex1\m\nr:xs, D2 ma canduued lhcu’ In\'c§tIg'munI wnh lhc zouptuuon nr D1 and had cunccdy concluded am the Lrlp xumbunscmeuts 1:: not consumed as wages. in Wis zccozdmgly submntcd ro. D1 rim to qucsnon the decision of an cxmniuers of D2 on an absence of my zllegauon afnususe of pnwen nnla fidc; mnspim, ztc) would unncccssznly 0pm on flood guts to question all decxslons made not only by D2 hm nu statutory bodsn, And nzvurdlng to m, manuals nr anmnon and yudgmcm xhonld he Inf: wuh an pusans duly zuthonsed under an law to do so. Counsul men argued um (11: Cmlxts should not be put m a posmon to qucsuon each ma (very decmon mm by such audlonsed pcrsuns unless I1-mrcns allngauon 0; misuse of now, mzh Ede :1: And in Lh|s use. mm are no such zlleganons made before ll-us Conn bg me plzinuff Lastly, D1 also contend (km Lhty had :11 Umes obtained and (shed on the advice of D2 In this mauu and had not mknn this man-ct lightly and made a decmon Mbxuanly For D2, n was subrnmt-d am based nn sccuon 723:) of the EFF Act, II}: Mmistu mzy by nouficmlon in the Gnxzm: dcclar: any type of payment or xcmuncnnion pzld or payable by any cmpluytl to In: zmployee m be mu-d as wages for the purpose of an EFF Act. Sccuon 729;; [:ads as:— Page 21 alu 48 ~72‘ Pvwan nl Miniuer Ia mum mm pnrvmn .0 m..e..-mm ml mm my plymenl nr rt-Iuwnrun u wlgu Nmwnlmamtmg unylhmg m mu Au 0. am mm wnuen Van, m: Muuilrr mnyby rmxficallmn m m Gun!/:— flu ym dacluw my \_\pI: uIpn_\m:n| ... m..um...w. plld or payahlc h\ nu} emplmer mm unplug-tr under: cmxlmcl nfscrvvcrvr uwm\u:e1hip.z\ Wlgtj. .r IJK Mmmzl x: mm: mm, luving mgald m In mum: ur yumnse nf mch piymtnl or lrmunsnlinn nr my mum wlrvlnl rm. u ougln m lhc clmxnslanus In be (ruled as ways In! mg purposes ohms M. M .. cm.un...ng with his sulzrnlsswnx, toumcl In: D2 xrud nu. [max on srcuun ‘/2(1)) at me EFF Au. spcuflt powm wm vcsled to ma Munster rm the purpose ofdtclaung my Ivpz of payment at Lcmunemuon pm 01 payable by any cmployu [0 hi unployee as wagts Thus, Arwas submlmed for D2 um um Conn cmnot usurp ch: Mmxstcfs power unden secuon 720,) of the EPF Au Thueiore, mg xthcfs sought by the plzinuii vn the as at: flnvmd as n 1: conn-adiclnry m the proflslon nfrhe EPF Act 1: WM xubmmr.-:1 for D2 um based on the outcome of mm |nvzsL\gILion.“Lnp rumbunscmcnl" has bzen classified as “tnvclllng n.llovn:nv:A" ma "ovgtumc payment" whueby ms “Lup xcumbnisemem" 15 In cxcepuon to an dcfimuryn u[“wzges" under secnon 2 of the EPF Act V...)-.,m 49. Actotdlng :0 D2, pursuant in Salmon 65 of the EFF Au. D2 Is vcsxrd wk absolute pnwcr m m.uiruIe/col-nmcn(c ml pxurscdxngs m rccuvu cunmhuunnx M a mu deb: aguml an cmplnyzr who :19 lmblc m conmbutc towards me =mployet.;\nd 111 new ox me powu under sacuun 55(1) of me l:l’F Act, d1: findmgs of the Anvtsugmons conducted by D2 concemmg ch: defimnon of ‘\vn.g:s" are conduslvc, and only D2 can decide whether there .5 my lxnbuluy againsun :mp1o_\rx and m pmma funhzx with cml pxocccdxngx m rccovu conmbunrms. Fmnlly, :2 was subnurtcd rhar only the mmm affitun of 1:2 duly nulhunscd or wxth powers confound pursuant to sccuon 55(2) of the EFF Au may "um: cm] mun against my emplaytzs who u: lmblc to mm EFF conmbuuon :0 mm :rnplo_\ces whue such «men 1: :ncapsD.h\(cd under secuon 67 of uh: F.PF Act. Anlfynil and conclluiun 51. 'lhc am. of ms pnmmm complunl ,5 am DI did not mike my EFF conmbununs based on me mp xurnlzulscmens um Wu: pnld :0 an plamuff dunng ma um: mm. 1.: was anployed by D1. Accoxd.\ng m the plaintiffs calculation, D1 1; liable in pay EFF canmbutions Lnmllmg m1z,791.oo (see p. 117 AR Vol 2(2) y... 29a! 11 3a 51. The dispute hen mm: on (hr qucsnon whether "mp rcunlzunwmcm" is pan‘ ur “w:Igcs" rm put-past: ur the 12H-- .m. Apart [mm mlllng u "Lnp rewnlzunnmcnl", DI has usu ducnbzd u as Lup allnwancc, uap mcenuve, unveiling Allowance and u.h:imn(cly as “ovenamc phymuu". D2 Invesugamd Lhe pluuum complaint and condudrd um mp reimbursement 15 not part of wagzs because u is z mvdlmg allowance and an ovcmm: paymrm. 1'hus,r>2 lack the view than mp Icxxnbuurmanl as not pan‘ ofwmzrs. Punhu D2 maintains um Lhxputcs or quesuons or am nanlrc nu wltlun them gunsdntuon and rhar the Conn should not usurp Ihe pom.-n and yunsdmuon awz. 1u nus ngazd D2’s counszl zcfuxcd Io secnnn 720:) of Lhe EFF Act (0 support Ins argument mm the dlsputt hue falls wxnhm the sol: pmnnce 0; d1: Minister concerned. The hm pmm that was nmculared on bdmlf of D2. was am purunnt up secuou 69(1) and (2) and secuon ()7 of rhc E?!’ An. I\‘ u rm D2 to comment: mu proceedings zgmnst DI and pmxncurt (ham, for any nun-cnnlnbuuon or EFF conulbuuons. 1: Wu zmphnslztd um D2‘: finding is an: “mp xcunbursemtm" does not fall uuuuu du ambit of “wzgcs" undcx secuon 2 of the EFF Au and um £1-mreioxe D! I: not lnble to cmunbutc so; the “mp xexmbulszment" char uus pztd m the plamuff pm xn um The arnoum or mp rtimbnrsamenl pnpblc for mu. mp dcpcnds on lh: deaummnn. The hug“ me dcnummun, the lugllex lhn lrip 1c1mbuzscmcnt.TlIr mp rcixuburstmcm Klulwas pm by Dl no the plmxiuffconsutulcs about 55% of {he ml amount of pnymtm that was zecnvcd by us: plsmmr duung the period or ms zmployrncnt wan. D1 from July 2010 to \ugust 2013 Howzvcx. D1 amp made EFF conmbunons based on Lhc p1smu‘rPs basic salary, Thus was no EFF conmbudouls by on m mspncl oflhr txip mrnburscmtnl Thm in a nutshell is lhc gtntsls nf me dlxpure bctxwcn rh= pnmu m the 05, 1. is sxgruficmt am tax purposes of mmng uut ms dunes as a lorry driver, die plamufi was gvun a px&—pmd “Touch—N-<30" card \\'h1:.h ms to h: used to pay mgnswsp mu charges and 2 pemal cud to an petrol for Drs lorry Thus, ms plzxnufi ncvtr mcumd any out-oflpockcl expenses whilst dnvmg um Imp for D1 mud \vhawvex payrnentx am he tecclved as “mp xclmbnflemcnx” wss not msuy by Wu} oi “xzxnubursemcnt” for “u\|t~u[-pocket" cxpemcs. Thus. the plrunuffcanlcnds um D1‘: ducxlpuon of the pnymcm as “mp munbunemenz" As 2 rmsnumu use is Inxslmdsng The plmnuff further contends um Lb: so-called mp mxnburstmmt 15 pm or “\vag<s" rm purposes of the EFF A11 The pimm memos: filed m 05 and sought dzclzmuons am EFF ms payable on (hr nip rtlmbmsnnenl. Fzgelviu 54. As such. D2 mamt:uns .1... srulon 43(2) of the EFF Ac! .5 not applicable that wen: ruuowmg goundx (. ..;....... the pl...-...rr. 71.. sq accepted an arguments .....a. 1.. m ...-.4 D2 mu ...........-.1 me 05 on duc Plus"-Ph [15]. [25]. [17]. [13]. [29] and [30] 5,9 AR 'r....b..h...). qzsl ml I17l I131 ml [340] om. kznna KWSP (KA<pm\dn\ Kzdul) ......p...... mm... ylng .,............5 W... 4...... .......... ...=...:.p..u.... a... ................ canlnmn am... ....1.. pk: Rupumen pa... nu... ...:....|...k... lugs: .....u... .....x. r./m.km..ah nu... ...... .....,.... u....... ......a..k... x-....a)..... mu... .............m.. n..v..w. Rrsyundtu Kadxn man .........a.. 4. n... ma... km mama I... mm. udnk a.r...n......... nI:h .-=........... mu... ,...;.. .:.............. ......w.. .....y. m............. .....=......... .m.:..... um um. mznnnkum .......k M.n.k.....). ...:......... ¢.....y..:...... ......w. -...p ...........;e...<..r .... mempakan mm my"... 1...... run ..... ehun «m.......... y... ....kn.....k... am... Aha kmna w....... .x..:....g......... rm. ...u.. r¢....r..... .1... n............. m...... ......;=..... ~........~ 1...... .»............ on... kcmu M.:........» ..a.... ...p.......¢ .......k m... ..u..... yang .....:....<... ..m. R=.pn..a... Kcdua ..... ms .x...........g... memkn am... ...e...:..... x:........... ..p........... ying u.p........... ...k..d.m. ..a.k xx... .......z. ..... ,,......... dcklnuxv duhcnkun .<..:.........- yang ....z. a.,,....... Ans sthnb .... pcnvyznn n.........s... ma... yang lrlah ................. .......a...;.. .......:... .............4...n......... .4... mm. ........1...:.... xuuztzu. 1......“ ‘-u._....... mm. .mn1......-~ mam. baynnn 1.»... Islam ...... .1... ex... p-:na|:|L1n yang ....... dikenaknn ........... semmsvlyl bola. ........... piku 1...a..... Rupnn-Ian Prrumn nan. nwnyumluug .4... ........,..... :........... :da.L!h ..a.k h..g........; kepad: ..:,.....;... ylng am... ....-.. a;.......a... Kedlu xehagn plluk ,..... ....w....». I... mmmkm 5.... .....m.... yang M... .1... nclak mm:/Ilnhu .........r ....... ,.........m.. am... An. xwsr. om. ... a..s...... mp...»-.. Mada alasan ya... ........s.1..r. ...n.;.....k.x.... okh Pemohon ......u Muhhmnh mrnunnliu ..... ...=.......:. ..zp......... nu.-W...u.. xea... Jxkwnm m........... ...=..,.. krplub ........ mug a...y......... .1... M....... Kcwlnynn. M.........v. ..a..=...x..... hzhzwa ........ Yemuhm (Mr. :c.......n. a...... kmcgnnu) )uwg ......a .u........n=.. Prmnu xcbagu .....m dxkecnnlwkzn .....m. .....m...... =..........:' .«......au 56. The sq look the vve\v that an we of whcll-lcr the “trip rcxrnbuxscment" was nvuumc payment or . Iuv(*|.Lu'lg allowance was mind In dlspultd [null and was r.onLrovusm| aml could not be den-umncd an Iffldnvlls by Way 0! (ha os ()1: am ground don: she was ptcpazrd to dlsrmss lhc us. The SC] also held me vlew am slnce DZ had Anvesngalcd ms plamurrs complaint and analysed the underlying nnomk or explznauon mamas gm 1-ly D1 and conseqllendy made a det:xmlnnl7nn that mp xeln-l|7ul'scm:nr was pxwmmr In (ht form ar "m'cInrnc" and a lxn\'cl1lng alluwaau", therefore the Conn could rm: lnmlm wlrh D2‘: flnd.|ngs lhru L! was not pan or wages. The SJC accordingly djsmissnd Lhc plalmlres dzun. Befox: me K was zrgucd la, DI and D2 Lhxt {hr Court should not usurp the pawns and functions and almsas of D2. Thus, it was conrendrd smc: D2 had conducted an lnvestigztion and dnrrmzncd that mp mmbluscmznl was payment In rhc form of “o\'cx'llme" and a rnvclhng allnwlncc", alm Court should therefore Klllrti in D2’: dtclslnn, wlm.-In .s not ulnted wll.h any ulluior monve or mala fid: or had full: Fm the plaintiff It \-ms nxgwad ma: It 15 ms duty of the Court to ll-mpm the law and ma: Inurprctanon 15 not Lht domain ofDl 1: was argued that D1 has misleadingly msozted to descubnng ma payn-lcnr as “mp rumbursemenn “mp lassam-an “mp allowance", "mlvrlhng slllwwmlce" and finally as “oven1m:" Pageilulu 57. 56. 59. Ar (he ourscr, 1 ngrcc ma. :2 n an EFF‘; uammcrs In canducl llwesugntluns min any complaint ufnwn-conmbunun mud. due EFF And Lht power to candutl mvtsugauuns and exumnauon is to be cullad [mm sermons 34 and 35 EFF Au. And pnnnnnz to am: mnmxy pmvxsmvns, D2 mu appoint exarmntts to carry out lh: funcuons of D2 and (hmugh me mvesugxnons «nu were conducmd by me txnmlnus mm me coopuzunn of due D1. D2 dmded nu: “mp raimbursemcnks" axe nut Isonsxdeud as wages Cuunscl for D2 argntd am In quL-snml the dcnsmn Bf D2‘; cumnncxs (m uh: absence or any nlucgnnnn of rnuusc n: pnw: maln fidc; conspuzcy) would unntccxsznly open me flood gm [U qucsnon all dcclsnons made not cnlv bv D2 but all sntulory bodxcs. Counscl for D2 emphasised mnhex suungly um minus n( dnmnon and .ud,nnm should 1:: lcfi ma. ma prisons duly aufllrmsed under me law nml III: cnnm should not be pm In 2 pnsmun to qllcxrmn rack and every dccxslun mad: by mu nuduunscd pulsuni unlcxi that .5 .n allegation nr misuse nr powu, ma]: nu: cm. I: \\:as pointed out an. than are no such nuegauons mad: Info): rhAs Couzt by me pmnnzr 11.: sccond pomt |s ma: Anmxpxeulion of; statute is n mmzr of law No daubr. lh: duermnnnnon of {ms 15 a market which (nus wnlun me snnum aonnnn nmz Pagesamu (.1 In .1... c..., D2 1... tnvcsngmcd ....1 .1.....-.....¢..1 .1... “mp ....n1.............»' .. lmvellmg allnwzncc .....1 ........... ...a .. lhcxciaxc cxcludcd [mm .1.. .1ca......m .-.1 wngcs. The plmnufi argues .1... D2’. drrennimnion .. wzong .. .1.. undisputed rm. a...1..s.s .1... rnp relmbunsemcm .. .....1.¢. Lmvel.|.|n.g zllowzncc no. .5 .. o........... 1 1.... 1001...: .. .1.e .m.1.v..s .1... wet: filed by (he pames. 1.. p....c..1.., .1.¢ plzmuif 1...: presented 1... .1..11...g. .0 D2: a..e..........o.. of .1.. c1...s.1ic....... nf mp .c....1....s....c... .5 ..-.v.11...g ..11....~...;. ...a o.......... 13... ms ...po.... serms re 1.. .1... D! 1... gwzn .1.... explamlmn ....1 .1..-,» 1.... Lnvuugalcd .1.. .-....... ....1 ...-e .....sr..a .1... mp ..»;....1....s........ .5 (nvdlmg .11....-...... ...d ............ 1 find .1... D2’. exphnzllon 1.. way of .1... .rr.d..—..s .. . m... “pr: .1....1 1.. my mm, .1.. .rr..1.v... 1.. D2 do not ...p1.... why or on .1... 1.... .1... fozmgd .1.. .1... .1... mp .......1...m=....e... is tnve|.|.11-1g .I1ow..... ....1 ovemmc. 1.. my cw. .. would no. ...mc. r... D2 .0 merely rake .1... .....=....... .1... .1... .3... w..1. D1‘: ..,.1.......... rm Iupunxc by .rr..1...»... .....s. 5...-..1 up ... culinl scnmny 1.-. .1..; cmc,D2'11 affidavus do no. .....d up .0 sczuL1nybyLh1s Conn 1.. ms xepld. .. is slgmficanr .1... 132'. mu: new (.= p.. ... ...p1.....o.. s.....-...... .. .1. wrbsltc) .5 .o what constitutes “....~.11...g .u..........” suggest \':ry .1...1y .1... rm\.¢LL1ng alluwznce .. .0 defray ....— sxpznscs .....c'....d wul-1 n-.1v¢|l11-1g whdst nrn duty. Hz... .1.... ... no ...p...... .1... ... ..........1 1.. .1.. p1..n..rr..-1...1. ..q..... p.,....... ... .1.. 10.... of .....u...,; allowance n...s4...u 63. Further. me plmnrr was cmployxrd as a lorry am: and ms mp was 1;; dnrc ms lnrry :0 various dcsnm1ucns.A\ xpecxfic sum was pzyablc fur ml, deaunauon. The l'urLI1er 11.: dmzncz, 11.: lughtz the quantum pr “mp zemlbunznxcnt". rm» p1.mc1r€s hon-1: bus: was Menglcmbu .11 Peak Thus, 1f he mnspomd an} goods m a lomuon m Ipoh, Peak, mg ‘mp rcunbunscmtnt" was m1o,1>a. And, .6 11: travelled to Sham Alzm m 5:1/Mgox. his “lap rc1Inbun:ln:nr" was 12111.30 00. Ana .1 mg pmnurr uav:lled mgeiher w.-1. an nncndnnl. um. I-1c wuuld M11, be nnurled up 1 5% 0f :11: and sum (mp Icunhurscmcnt). 71.. nomcnclnulc omnp Icllnbuucmcnl" 1: ltsdf : mzmolncn nud mxslcamng bcczusc by definmon, a xcunbuzsemcnl only occurs when :11: plamuff .5 being pm for txpensts Lhsz Ht mcuncd whilst on 1 mp. In (1115 case, Lher: m no zxpensts um war: manned by 11.: plmnuff or Keunbulscd by D1 A150 11.: plmnllff ma not pay any roll charges out of I115 own pocket as he was glvcn : "TouchrN— Go" card. 1-1: nvvu used 1.1; own mallcy Ln nu pcuol fur the lorry as he wns given :1 pcrxol cud. Hcncc, m rc|.|.|ty, Lhcn: nu 1:1n1bursc1-ncm whatsoever. -111: 111.51 ‘mp tc1.mbu:semcm" whuch appcaxed 1.. Lb: plan-nnffs salary shp u plainly and blalzndy a mmeaasng 1217:: A. any urn, 11115 15 exactly am kind ofcz-154 winch zxunpliflzs 11.: pmposiuml am 11.: Ooum me always concerned W1. “substance and not 11.: fom-1" md am ”lab<ls". 1./1.115. sometimes helpful. are not 1n themselvcs, concluuve. Page as mu 65. In «rm case, there was a xurfrlv cflnbclx The labels llm wexc ma by DI wen, “flip rclrnhurxcmcnr", “mp incenuvc", ‘mp nlloxvallcc". “Lnvcl .ll.luwulcc' ma finally “oVerLimc"l -rm use or a mulumdc of labels 1: or usdi quiz: uoubhrlg and this in “salt should have haul a “zed slag" fox D2 Eu: D2 seems quite obllvlous m ml nonchzlzm about 1312 indlscnmlmrt use of lzbcls In dcscubc me payment ma: W25 made IO me plml-luff, cm and abov: me basic salluy. The mums: question 15 how or on what bnsls did 172 concludr ma: (ht so-callrd “mp mllnbunclnrnl" is Lraxtlllng illuwnucc. DI‘: cxphnzlunn |§ is pet that letter «ma 5 Ocuabcr zlm (p.l32—l(aB AR 2(2)) ma .1 is rclcvam (O zefu m Lhc luauficznion fur Lhe payment of the “Lup lmlmsemem" winch Ly at p.135 AR \’ol2(2) wlm the payment comes Ilndez mg heading %..Mnm...a'. I: mads reads as (sea: p 135 V012 AR):— ‘*3 z .3. l>.r.l.,,,. V rm Pan-ndu Lrm ad-lah .ml.l..u.n .ml..mu.al mm pclanggavl kc lkmpll pdulggun mgm .;m...m.... ..¢l...W mm. 7 se-.3.“ g&n mg dihevikarl mm. lml.s.,lg.. ,..:...l lnkasl ungd ..,,m . Penghanunn mm kc :=....,.« .,l...,.... mm. ...¢l.;,m um... Irmplan 4... km away Izemanluns lam .mm... mm pelugym . Sellzp mgm .l.... mcnymbnl km mas: puuunggshm dm .,c.......m... .m.:.. pcrlghnnlnnn B:-lmg . se my: km rm. pemmugahzn mzngambll mas: mg l...... malu lempuh mm. M. W...“ wulm am... l>m...a.. [mi . ml. seklflnyn mus: pcnlanduan ,..g. panjang Mel: lvzmla penglunulln kc l.l..nm.. ml mp» (em-hmluu -dnl-h tmnuuk xnklu um. Pcnundu Lon Pagulnlu 66. 1.7. over. yang de um. ksbxnyukm :u....... .x... munnkm mu yang pa-pug Mug am mzhlazlkzn kn}: mm. mm bznm um:--n unluk ...c-acuu.-m Ielwlp |uy.wn ...m.r. ...=1em».. mm brkzqa normal Sudan Khan penghlmulnn, mm mzlnpmkm am am»; berganmng mad. kebolehan Vtmwdu Lori «mm um mm: mm mm; mevwku. my sesclmgph |":mandu Lnn msukn nknn mtnpmhnl mu unmk udur 4. pawngimn perplanm pullng u pquhul senelum mclnp-‘lam dm mm. Klan‘ pun;-Juninnn I... lkan mcng;k|b:l.kua lzmwh ma... pawghmlann yang mm. m;..,m. I:-hm pxnjnng/lnmn Sehm n... gm... pcnghanumn ylngjmm akan di\akukIvu7¥:h 2 urnng Famndu Inn. lm mcmmbulkan kcsuhnn unmk mrmrnuuhn mun yemuwdmn 4... ycnxuun lrmpuh um. lrbnh mas: ynnga.mm.. nleh mp Pgmandu Lan. Mcmuwdnngknn lcnlupumyn ha-tiny: ktsulum flux pcmkmul mum mengarlzl pa“! mrm=npmm.;,u...:.n pcmhnyann ylllg xewnjarwn umuk kcuavkcqa mun mnsa yuug dxlapmkzn ale}: r¢.......m ,»m.k mm: flan |>:....na.. Lan um. Inruluju supm buynrln keua mm ms. Pcmlndu Lm a.g.u.m.. mum ellun ptnlhmn. Cur: m dtpusruuuv aw. tflxycn bug mhak 3,...“ 4... x—:n.mu—penumu A.» Kmar em... p¢!_yIln\\nlI ylnu mun .4am...n.. mm: mm. kapndn pink mm. flan nngglr1:|\lrI.!up:1\yIan1amr\ a.|.k..n... um. kuanl mm“ mu Am uumn clam: penlhnzll an mum s<b1p' bxyamu mg. Ishh muss. nuh ax xim ummln Kwsr ndzk dmnbllkunscpelumana mu... k:|jI Izbm mnsa yangllm‘ In I33 ,uu(z)I 1: .5 (In: am D1 has confined “um: a|.|o\vnnoe" w1Lh “o\':1ume" and D2 teadlly nnd uncnucdly Itczpmd Dr; cxplanation Oonszqumdy, DZ rook we posmon am “kip munbursclnnnt" .5 travel nllownnce and ovemmr and Lhercfoxc thty are nnrwzges As \v:s nghdy pmmd out 1,, cunnscl rm the plmnuff, me so called “Lup zcxmbutscmcnl" cannot br: Luvcl Lllowancr: and at the snxne um. be ovezumc as well. Acwldmg to coumcl (ox the plamufl, it ,5 mum Page n ma 68 .59. 70. Of course. D2’: acceptance nfDl's txplmuunn and then: so-called de.m...n.m that .1 .3 u‘x\':l.lIng zllml/an¢¢ ma uvunmc. lakes .1 cut o[(|1c definlunn ufwzgts AS the dcflmuon ofwagvcs m xecuon 2 of :11: EFF Ac: xpcclflcnlly zxcludes uavcfljng a.Uo\I/ant: and ovemm: As 1 sad, Lb: so—cn.llcd "Ldp Jexmbulscment" 15 at odds we ms awn deflmuon of ummng allowance. wh|d1 mvoivts me dtfraymg uf expenses assocmcd wxdx Lmvellmg whxlst on duty for Ih: employer Then is no cvplanauon by D2 m that affldavils as to why the} dxsregakkd um; awn publicly discloscd dcfimriou of"Lr;wcI1ing allomncah 1 mm now m ovemme ps_rm:nL Section 2 or me EPF Ac: dzfincs “ovemme payment" as: ‘avmime pg/mtnl” mm. any p.!3vn:-tn du: [mm an mlpluyzr m In :myIhI_\:< lvr work umcd um m cxuux -1! me mm: uurkmg um; «I 51:11 unplvvce ...a inchmcs my puyvnznl mm m u. empltvyee lm wvrk mm: am on man: hnhdlvx and res: dny;,’ Adrhuonnlly, Secuon (.0.-\[3)(b) of me Empluymcnl Act 1955 smlcs: 'VbHnlh133:uvou —vvcmm< mm me nnmkr nfhmns «II-Wk umud an m (Keg: nflbe nnlmnl hours mom pa day. m Pot III: purpuns oflhls seem... semen an. plflinvh mama» and necxian aux. —mmm noun ulwmk mam Ihe number ofhmus ulwclk .5 agreed btlwnvw an anplnyzr ma ... employ: in me wn|rl:lof><rvw: 1.. h: we umal hams nf mm per day nu ma haul: of wk man not sxccnd KM Ixmilsnfhmn pleicnbcd m subuclwn m“ Vqnslnfu 71. 73. In this cast. n is Important ma uwuperative .0 note max the plnlnuff ma no fixed working hams. In lhu M-gxrd, Ins employmcm cnnrvact dncd 10 Snylcmbct 2010 start: >1 Wmkmg um ‘lnnr vmrklng mm: Wm n: dzlcnnuved by yum Supnmr ma \\\ll 12 hncfrd In ,1». upon my Icpnmng In (Ive «Nice Walking haul: may ht Irvisesl as and when medal m mu m ('01I\puny's upelznnnal m4unrm¢-nls." (:5: pages 75 I 76nfA|{ . zm. Bahupuzn cx DI themselves have cunflnned um lorry dnvcrs were allowed :9 be on smndby at Lhcxr homes and were not required to be 3.. offic: whcn Lhey Wu: nm sdmduled (0 do so or .r (hue .5 no delivery to be made by mm To mcord mes. nntndance. they Wu: mqulxed m punch “I when they cam: in :0 work and punch out when they complctgd may .05 Q1. :12 . ms nf AR Vol. 2(2)) nmd on the nbavc, ma walking houxs of pl.-unnfi depended on whm D1 rcqulmd him to \|/Olk. Thus :5 cvndent Emm me rm am D1 an no! pa} an plamdff 2 lughcr rate when II: was working as required nndu Secuen 60A (3)13) or the Employmrnt an I953 which mm: mm For my «rvulune um canned mil VI was olm: ...m..x hnurx .4 um, um. empIo\v< gun he paid .1: ml: ml ls man nu: ma mlflimes hm nu-.u, 11l£nI'pay|rr:J|><(|n: nhh: mm on Much his rule ofpny 5 ma ' paumm 15 Ifxhc plmnuff\vas In rne. walking o\'r:mm:. than he would have renewed a pay “on: nna nnu umu Ins hourly pm)". But, Ihu did not lmppcn 1:) ans us: 131 nsm mm: Lhe mp xcxrnburscmcm as “o\'uLi:ne. pnymen." and mus was endennen by rnnn the pl2mn.ff's nnonduy pay sun as n was new claxsxfind as such In new of me fact um me plmnnff had no work houxs as such and wt: to be on standby at all nrncs and be at me nmss wnxnn on:(1) hour nfbung iummnncd fur wnrk, mm ut nu hours nr work pm The plzunuffhnd to dnvc In any locauon as durclnd 1,,- DI’: supervisor on duty on any gwm day. rm nmuum of mp relmbuxsemcm gpee me monthly salary snps), which .s also descnbed as "mp Incznuve” nna “mp Illoxranbe" 15 Eur] and would dgpcnd on the lomuon. The funhct the location (ht hlghex the amount pnysble It docs nol amount Lo cmnpcnsmon for ovcmm: 1:: any shnpc at farm Indrnd me qnssnnn of ovennne data not =\'cn nnse mm men n me “nip rvunburszlncnr"? In my v1:\v,1\‘|x not n reimbursement In any slmpc or farm Hence. :2 as no: 9 (mp Ac|ml>u1semenL 1: xs not : Lap or Luvcl nunwnnce because n 1: not payment to defray any expenses mrnutd with uavrfling whilst on duty for me employee And ans 1: all the mute when the employer's )ab 15 to Law] on bchllf of (H: emplogrr and using the emplqxcfs mnnnnvehiele and mm all expenses snen ax puxol Ind roIl—clm:gcx bcmg absorbed by :11: employcx Pageululu Thc pray.-xx sought ... the 05 m ..s fnllnws: um»... r..h.w. Dtfcrudm m....... Iikmpunym u..g.......g.w.n .......k mzmhayar cnmnun kepnda 91...... d. tuuxh ma. m...,...:... \-....g s........... rm... :99. bngl -tn... Relmbulsnncnl s¢..¢.......... yang .:...,...k... am... . .. g... Pllmllfdzn|;n|:nJum20|0hmgglOgm2DIJ. Deklansx Inhawz -1.... Rcimblnsnnenl" xeptmnum yang a...»....x... an... .:.p W. m......r...... M... 1.... mm .....w Ogus mu ...;.......1.... "um." yangdlmakxuflhn ma... saeksgvn 2 All; x.........|:.. w...., s............ Pckujn .99. dflnkksgrn 2 Aka Kcnn wss I7(mIIah b..v.m.. n.:.m... v.n....... .......x...y... ,.....x.... m man xcbzgu umman 1<.........1.... w...g s.....m.. nu... .. .. tfleps-in Dclzudan K:-2 .u...,... yen:-m:n.1 ,.p.,.... mm u... ......L. :«|......ry...g.u......g..... mm. ........:....m. M...1.......n. v...g mu.» The Sc] dzsmlsscd the Os, holdmg um D2 had made a am.-.....a...=.. dm “mp xexrnbuxsemem" M. ... rm Kravclling alknmnoc and orcmme. and rhcxcfmc cxcludgd [mm lhc dcfinxrinn ofwzgts. Th: rclrvam P... of 21.: scy. gxoundi read .. r..u..w.-. “[22] Rx-xwnrlen :<.=a.... ugh... .......xm.. .......... .... ml .,:.....r..... .1... .4... mzngamhil ....a.s.... yang wajar ...;.........xm ......¢....... lkspandrn 1-=..a.... ...=..ge.... --.......=" human 1.... ' n...s¢...¢..r mm ...=........ .... am... .a..... venmlum Dun n...n-y. .v...»..u.. um... hmnndn . hdulw: hnynnn mm... aau....-.n...u... .n...,.. .1»... ......|...... .1... ...,....... hr]: 1...... ....n J.m=... ... .=..r yang .a..»r..... ...i .1...,..... jrlus bcflcnungm .a=..g... pmmlulun a. raw... AH: xwsr a... ...m.........:. m... lulu: menpmrmun ..... r..n...=.. am... ............1... puncn kuam »eme.72;.1..u..........=...\.:..:.... mm .....ks..a a. ...w....=k.y=.. 2 Aku -V I.-...,........ mam] .>..;;..u 77. I. .5 .150 not overtime humus: DI docs um have and hours of work and never mma .. as --<wc......." .. P2. the ...mm .....1 mp 71|.In\\.1ncc am... (can Fuulncr, snnc: rho pu......rr 1.... no specific wolk hours, .n.c .5... of owmm: does no. me». And L.’ .. ma mg. mm then: 1. no suggrsnon not cndrnce um Lhe pm....;; was pm. ovemme ... accoxdznce .....h 0.: fonnnlz as spec-xflad m the men... pxovnsmns of the Employ-menrAcI 1955. 1.. my view, khc appronch .0 be 2.1.... ... unmvellmg khr cuntcpl nf the swcallzd “mp rcnnburscmenr" .. (he 0... mm was ndvncatsd by 1.0.4 Dcnmng ... Hndgr .. Campbt//Dumunt CA La! [1902] AC can at 527 [1952] 1 All an 335 2. 393 whet: h: said. ..m.;. 4; r». kgal hqpptng: m ma. {tbeprrmzl Immuzmrx) an bent dmud and m .2 in 2:. rmrur ..»¢2.agy..." And so here too .. I5 necessary .0 smp off Lh: 1.5.1 of “mp .e..-..|=.m;¢...¢..." (ma Lhe host of 0.1.... labels) and v1:w mg payment ma. was rnxd: ... us native .....pL.c..y. .v\nd whcn ma. .5 done, i. ...n b: clear as night follow day, [hat the payment .....\.:. the ,,-....c of “mp .c....b....m.c..." and scrcml alllcl dubious labels, .s rmlhmg mm 2|-nu n "camrmsslnn" .d the .,......-...s...... 1. paged .9 the dasmncc lmvcllcd. 1. .5 as simple as .1... 11.: longer the d.\s|znce unveiled by (h: duvet, me me. an conumssxon. v...u...u Thux, me qucsnnn .3 wlmm cummlssxon is \-mlnn me dcfinmnn nrwagcs. Undu me E F Am. “wngcs" rncmu all vuvmntnuun in money. duc [0 4.. crnployte under ms comma oncmce whtzhcr agmd m be pmd momhh, weekly, daily or gum.-.5: and includns my comxnissiun payable by me employer Io «he :mploye: whether commission is payable by me terms arm: cnnuacl ofempltvymknl. Th: ..m.11ea ‘mp vcxlnlzurscnnenfl’ is quit: clearly a commxssmn which n mccnuvizcd by an distance of am mummy lxavcflcd by [hr lorry dnvcr. Hem. um longu «In )oumey, Lhu higher the commusmn. nm most certainly 1: not zxcluded (mm the delirunnn of wages under me EPF An, In can It .5 an mttgral pan ufm dcfiniuon of wzges under me EFF Au 1: .5 xmpormm [0 but in mm mm Lhe EPF Act 1x a piece of social Icpslznun and D2 RS mg tnslodnn and gualdlan om: EPF me me authonly an chnrgt of enforcing ma EFF Au. ought to be \'lgIlanI m mnlcudxng label! and cunvcmcm sen-mvmg cxplannnnns by employers who mk m come up with «mm and Annuvauvc lnbcls In “dnss up" the payrnznrs nm are made [0 mm employees mm the xntenuun um digs: payments would not mm EFF wnmbnuons. Here ma us: of 2 mulurude of labels ilssli should have put D2 on guard [0 mg possibility um Dl had dxesstd up 2 “c,omm|ssmn" u :1 so-callzd “Lnp—r¢u-nbulscmcnt’ when in rm .. ms n=uhc1 :1 xcxmbunement nnr travelling allnwmuze or ovemrnc. Put 5: MM 31 For me masons as dxscusicd nbmc. I rma mm Ihv: facts hem are nm 111 (hxpulc and m: mu: .5 mm nfpure mxcrpvcuuon qr thc um- zgnnxl me backdrop olumhspnrml rm. 1.. this wgrud. 1 and am that: um R rn.\sd.n'c.:Lio|| an law by mg ac; wlnrh wnum: ztppellnte mrexfetcnce As such, me pla.\nnl'Fs nppaal is alloxvcd. The order of me sq amd 9 Decm-Abe: 2015 is set asldc 3.. us enurely Order m mm; or me 05 x5 hercby gnnled. 01 and D2 :1: to pay cosls cv[IU\|1,SA'70.00 each (mam m 4% nllocnmr) as costs hem ma bclow. The d:pour xs xx-fi\nd:d In rhe plan-mff, mac; accordingly Data: 14 August 1017, MM 5. Namlu Balm: . . judg: Hugh com Kuzlz Lumpur v...unm Cmmscl: New Sm Ynv Iogelhzr with Qumrulam Auqnh und vu-u. Kamalanuhan (Mmrr/Lrrmfrwt) for the uppeunnu/plunnie Nik Ennan Em N111 Rosch (Mgmv /Irmr K/wgwrt 44”/Lrwria/0.1) for Lhc rm mspnndznr/firs: defcndaul Syafiq Fuznl Hm Azml Iogezhu ma. wan Mohd Fusal (/4/Satan Uttniarzg ['m!1I»g V xmpnu. Wu.) mpnnun new rd. due mend respondent/secand defendant. Slsnne: Secnnn 2 Ernployeu Provident Fund Act 1991 Sccunn 14 Emplnyzcs Pmwdunl Fund Au 1991 Sccuon 35 Employees Pruvximl Fund 11:1 1991 xenon 43(1 )Emplo)‘t:s Pmndcnt Fund An 1991 Sccuon 65(1) Employees Pzo\'1d:11lFund Act 1991 Sccunn 55(2) Employees Prondcnt Fund r\cr1')91 Secnnn 57 Empluyets Pmwdent Fund An 1991 Secuon 720,) Employees Fmvidmr Fund an 1991 Sccuon 2 T.1nplu\'mcm Act 1955 S:cuun mm (3)(n) Elnpluymcnt Act 1955 sccunn mm (3)11) Emplayme1'1:;\cl 1955 C252: ltfexrcd to: 1.1m 101114111 1/ Dntn’.\'m Dr}\1a}mflIir.\'1abammI[1‘137] 1 ML} 133 sc RHB Fm wmdu Lawn Trkmlqqz 1.1» M12011] M1._1L' 571 1-1c Rmlgr u Cm/1m nlmumr Cm I./rI'[l9(12] Ac 600 at 627: [I962] 1 All ER 385 Puzuulu Statutory deliniton ofwagnl 8 1 mm now .0 .1.. pmvxsmns oflhe EPF Ac. The ...m..g pom! .. of count nu definiuan of “wagts" .. pm me EFF An. 11.. dzfimunn rzf"\v:ges" um. the r.r-r is ......1.. under sccunn 2 of the Employmcm Am .935. .. definzd under sncuon 2 of am an»; Act 4. ‘\~:g::s" mean: all m......=........ .. mnnzy, due no ... emplhyct ....a=. hi: ......m. .1... at ur lpprcnnccxlun um)... .g.:m ... 5. pm! ..........:,. weekly, dmly ax ...n...w..e and ...;m.s any Ivovnus. wrnlmmm o. ..m.w...« 99...... by IN: tmyluyer \o me cvnpluye: am... such 5...... commnssmu .. zllowmu .. pzyabk um. his mnnau of xv/u::, .pp.».....x.m.. nyulhcrwlst, butdnam Am. (3) S¢l’VlD<|;I1lIEE. in u........: ru:«.......: Iv» yam--y: my .¢.......=... .mn., u. m .¢.....=r....a....1.m:rm.....' mnbentfils. m ...y Imvellmg .n..»...... .. .... valu: uf any havelhllls a«nI:e(\|un." Plzinwifirs complains 9 11.. plmurrs co...p1..... mm nan—cunn1buuon of EPF payrnznts by m m 1.. culled no... mg fullowmg pang-nphs of 1... zraam. .ra....=d on 23]uly zmc whcrc m xtare.<:— --4 s.,. max. .m.....x nlch Dcfendxm mm... “haul .........a.. u... an bulm 1.1.. Zflmhingga A.......2ms 5. mm .........a.. ma. myu a... unggungyavuh say: Izrmuuk ...a.....4.. mum. Von yum m... * am. uernm... Fcluma 4... W»... Defendan v....... a. Gayrng k: slur-xlur ‘nascn a. khllull Szuwnmjung Mumm .......x. ...a..:....... ....x....... xxx. ma... hm. ,...a. >.|..b.|. mmu. .m.,ui.-.><.-ma. um -hm mzughubung sag-2 melalm .=|=r.».. bimbiuayn .......k munberilahu ..,.. dunnux unmk .......b..... ,x....r........... v...s..u Say: dikchzndzki mmk am: a. pqnhu Ddzndm mm. a. (iopmg, mm mm: mu jam xkp! say: dlhulmngl am xlcnnnyl mamndu hm kc desnnrul y-ng dfltllphn. 5.). a.bmu.. suuknri can :map mmggu. sm «nap: pp Wm 4~-um smry-1 sep<r\i yum dnenlukan om» Dckndnn mum nmmm. kepad: M. pdwk my. sly- .m,.. mu. r‘«vn¢u") bcliluykm m...,, pcnghlnulln yin; Ilxbuu nldi say: plda selup um um my: am baduxtkan krpud: mm. pcnghnnulnn smgnx annual. JI Jlyfl pellu mcmbum um penghanunn kc Kuala Lumpur. uplh s-_u mm. mm M....u.u. unmk sum penglunmrnn kc Selvmhun. upnh say: mm. mm a... -mum Mrluh. upxh In): mm. mm Say: Ielnh dmcnkln kad man Pclmnu mm mm: din km Iouch .. Cm unmk ml akh D:f=ndm pm»... mg. ruxp ptrylhnnlv dun sly: .m=m.m.u. mcupemhnluknn mu . pcnahmn mum dmlrxauhn. Svzlzpzs saga nbu dz dcninan say: um memhual pcnghanurun‘ sayn d\k:)InId.:h unluk xmmn. kz Gnrpeng mm suwmm. Say: um dlhumlun unluk Vk-mulnm unluk mum-mum pednlanansuyu. Kudnnzkaln xtbmk may lay: mm. u aupmg sdrms memhunl ,mn..u..m. snyn aak=:.=..a.m mink ...=...m.. yrngmnlu-In ,.... bin awn yzmvrwnz k: m....;. dun «kw m. knnhlhkz Linpeng magpngmmn am: Gap sq. aim» wms kcdllam Lkzun hank sly: pm .uurseu.av lmlnn lhlunyl. um um dun ....m.. Iclrpm nu. Defenuhm Penuna nhn membcnlrzn shy pp mi umuk bulan yang hukrnun .... bmam-d:nyn um ptnyu-an ymg .m.a..n.. olth w...a... Penznu mg mtniandlmgl nmmmux sepem -(Imp unkh pm.p..m..m yam; ulan aim km hasum drngan am...“ ptmfuylxm uvuuk ..x..,. driunn . mum!-mr um um mm.;x..... mm. mm ylng dxmjuk mm vtlvylmn Iuselflll xbrnamylldlllh mph mg lcllh gm pemlahl umuk mm. nu Amnn bulau Julm mu hmggu Me. zuu. say: dxbaymr W poknk xmsa sclup km basamvsmu ckngan Llylh mg ma.» say: pzmlrm mp hulm Pad: Jenna mm mm, D<f:1whn mm... mm m¢mhAA| baynrln-haul-n kc hvuwloymcnl mmm ma |"I£Pf‘) unluk FM mm say: wm huuinunrmlmn. Dcfmdvu mum. mluk nwmbunl pembxynran Kwsr muuk upm say: arms .1“. bahawa mm. sy. M.» uuml-hkm ncbuuxv "pclnlfilyumn mm m,.:.......-- alch D¢[¢nd.InPcmm1 vagemu 2a 24 :2 sq; sesunggullnyi pmy. bnhlwn Ikfendan Frruma mun wan, enggnn mm zbm mcmhnyxr ururnan xwsr bag) upnh uyn -Jan okmm zmu hula: Jun 2013 mm o.ka.mm. .4. buvuh Aku Kumyuhn Wang s.m,man mm. 199: wan... Mgnlmanlpun. pads zsuzmu, u=r=..a... Krl ;. r. lrlemuluxkln baluwn pemb-Iyunn “vzmhnyann um p¢nu¥In.In" gnmmbnyu mm say: mzmpukznelnm puyalkm-n dun bayuan umuk ken: new. mu dun idzk um umuk umrnan Kwsr dun buluwn mam“ rmm ndak melnpunyax kmnp... unluk Inrmhmn:-mmnn scum. nu. pm: 2705 1l.‘I|5,94ya mznulu Lam ug. mu krpadn Dem.“ k=.2 mclmlplvkm sun! daripaia Krmtnhcn-n Sumbel Mammn npa. benunkh mas zmo unwk mzmvcmlclu keunngm sc\llVJ\I«In;/A a. 21 moms, mu dxnluklumlan om. Ahh r..1.m... Sungax sum ya Dr Mtchul lrynkumnr Dvvnni bnhnwn Mullen Kzwxngnn um. membenlnnjnwzpln banal}; lvzyadn smhn gang dwuhn kzpldmyl mum; unudn mnjlknn lacriuk unmk lmngeclnhkun zlwm perjalanan yang mcmpukzn map M. w...., pmmndu Ion dun uzmmxm xwsr Say: ulnh dmnxhma nkh peguamun nu dzn Vexlmuuhnyi mm bzluwa .5-um "pcmbayxmn mm pct-plum" scbenlmya mzmynkan uplh krlunn u ldnlnh I1:-nI.uuhm um. um.‘ pcnghanluin sun. I: bulmn am. pcnjnlalun dun bayznn kn}: lgblh mun Pzmiuyimn upah bug m...» ,,¢..g..m...... y...,; amm uya mm. nmk unlnk cnmmnn KWSP flan Mm; Jllanggung Lvleh umm... Puuml Wxhu baynmzmplm, um dlllkukan oleh mrmm mm: syn xxunuuhnyl wluyn hnluwn Dclswdln Penumn mun dmgun supgajfl mcnggumkan gum. yzng mcngclnuulun szyem ‘pclubaynv-in mu pcunlumn“ uuluk ...=..g.:..u nahmn mink memkrnxr bnyann mmhuugan penuh canumn KWSP ynng vzvhuung upmm. um. d:nukI.:n sly: dulnuung uruman KWSP xbmyuk uM\2.791.m nlch nerm... Puhml ktpndn nyn _.m; ncpamlnyl an»-ya kupadl Dcftlmnn K¢~2 kc mum. M... KWSP [p \s 45. zu~2\.2a AR van zrnl pm-uu 10. D1‘; msponsc on xh: rmnnale for ‘mp rurnburscmcnr" my be 11. gicaned rm... paragraphs 1: (g) and (1) of rhc amdm. nf Enuk sand" "m -m . nr... Bin Bumnudccn, nffirmcd an 2 September 2016 what: he Seprmmnnn ynng mm. a......u.....u:.. 4 am... RANK new... Panama btrunkh naznu. sebum valrrlasan k¢.,.a. "mp tc|n\bwseuh:n\‘ mm. n.r.._... ...,..a.. rash! .1... ......... "Hip nimhunkntnl‘ lrnebnl . n. xrhapu nmr... my. kbih -In. a... ul¢h|m,M:kp:|1- u........ ma 5:" 1,. 1: AR Vnl 2n )1 [en-vn.s....a.:=-1] se|...,.m sky: .......:.a.... mu "mp vuimbursenwm“ Iuubu amt. ,...;. elnm pflilhsuln .......k ...¢......p....g km dnn pclbchnjun mm. n.:\.n...1.... mgas n....«.r" |pz9AKVnl 2m] 1.. Kspnnse. me plaintiff “med ... paragraphs [71 and (31 of 1... affida\1taffix-med on 19 Seplcmbex 201fi(|1al'.- ‘I71 ml Scbagm mm nub kzpada pncngganmtvtnggln n.|> lungga I n e. haywnn uplh .... m....... ,:w.. :..y..-... mm p¢.,.:...;.. unmk ...m...p..... km pelilhlun auupun srh-sav mam. kmn um. mm say: .zn.y....m ynng .a....-mu... sm:.k..,. buynnn Llpuh .... ndxlah uyuh ma. ...;..,... yum My: mu... whim umbzhm mm M. Wm. mg dihayzl oleh Dcfendnn Penzmn k.;...a. ..y. 1.....n..»... 2.... v..y.... updw .... .=..u...x.:. >..,...... kg... 1; m ...m kcmu .. ..a.1. munpan kehmdnk mam... km. kn... mun slpeninuna mg mlmlluk dllum Aku Kama I955 Pcmzluan mum... rm... mm. 9...... afienhouxhl hugi ........ m¢...m... run. an ....m dlhaynrummul xwsp Pcrtnggan m Afixlnvfl Juwapan mrc..az.. mm .4...» a.....r.L... Enyunn ..n..>. . \...k...m. mum... =:..... pujnlnnun ........k mcmhnylz scmula km .-.:.7a|...... mu. xayn um. dubckalknn nu ma" Pelmnu .......u cfluel din kad um. .. on .......k ml in Mal ...:......a.. In ' yang .s.m.:x.... urlch Defmdan 92...... 5......» us. my: . .k ...:.=.......... mxuk mm... m....|.... m... am. .-m.I..v..... ma. may mu. ...m...v, rayn mm muunzsung lpa-up: ,x.ma....... sums: pzdalanm nyn [y\3I.AR Vol ml ».;.a..uu 12 Th: respnns: from n2 .5 to be gathered from the affidavit of Syafiq Falznl Em 4\zmI afflnntd on I2 October 2016 and lb: tclcxnm parngrxphl are [5] la [u] ...a they mad ax {ouow ‘ "H .71 Mcmguk luqzlda pcmngyn o mam Sokungqu Pllmuf din Imnkluk kzpad: percnguan 5 an 7 Armvu hvxnpnn Dcfrndln Permm. hrnhsllkln Ittpidz a.p.u.. mm... yang vzlah a.jnn..m «M: |'):7'<v\d-n Krdun. mu mewk... rpm. bcnkm» 5| Elfiun ynng dnznmu nleh Plnmlvfszllm dun pji pawn malm b<rbznInk‘1lIpmmbIn::mcm" 5.2 Teysan m...m dcngan mcngguu-pakn paknum -wur [“wIgcs"]nIu1amEnhnI epdngwuy-zknkynngdn: mm mm. mu um. um am -max bmmm... km. .A......, numzn yangdxlnknkm ulch mrem. Kudua. as n....m. man... man. mu....... -mp renmhunemnul" pm. aami.-.. ukh rt-uni! -dun: merupllun nm a.-... ptrjllmvn .1... |..y..... mi. Iahm n...» (‘nvvrIime‘l y-n; anmm. ulcn 1-mm Dnpaun mi Jug: dmuklumhn kepm mm; mammxl mml-mm bcmrulxh 29/12/zum, mrzols. zzwzuu. 15/2/zmmnxsruoxs smnm. sunksmtl Drlendan Kedul nmm 2-wmmo. Hams. muons. muons mu m./ms mm m... a. um um. au...a.m mu kA1|n:knfx:h>wII "F.LubI| sr. . 54 Hm! a..,..... 4. pemllgun 6,3 .1. . makn Dekmun Kudlm bcrpwdanpzn bahlv-«I “nip bmsmml‘ yum am-yu om. D:[:ndan Pzlumn mu. Pllmlif mm min nmm....¢ unluk dnumm mm KWSP an mm mukluk kzplda um... w.,..2." as mu. x«s,=.. 2 am. Kwnpulm ww mnlnnnP-:krnIlWl, Mn-nyuk kacpldn pevenggln-pcmnggnn 7 xghlnggla u mm: Sokovmnn mmur. an mym... mm mm . 7: n=,¢x..n.r..,. Ieguian-kuaxun ,...u dm;/I u... ..a.:.«n mukhnk kzvlia penguahnn mrma... rm... dnmnni rmmu... Kcdun mink Bench: .1. am... pt-xm hxgu m:rn<nluSaivkaIIl2gmI|rl:gasnn:rseb\IL Fag: m HIM

Pytesseract-0.3.10

WA-22NCC-79-03/2017

PLAINTIF ETIKA DISTRIBUTIONS SDN BHD (No. Syarikat: 770956-P) (Dahulunya dikenali sebagai Permanis Distribution Sdn Bhd) ...PLAINTIF DEFENDAN T.G.DISTRIBUTIONS SDN BHD (No. Syarikat: 683272-T) ... DEFENDAN

14/08/2017

YA TUAN MOHD NAZLAN BIN MOHD GHAZALI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=18a825ec-f103-43d6-9caa-f9976c454979&Inline=true

DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR DALAM WILAYAH PERSEKUTUAN GUAMAN SIVIL NO.: WA-22NCC-79-03/2017 ANTARA ETIKA DISTRIBUTIONS SDN BHD (No. Syarikat: 770956-P) (Dahulunya dikenali sebagai Permanis Distribution Sdn Bhd) ...PLAINTIF DAN T.G.DISTRIBUTIONS SDN BHD (No. Syarikat: 683272-T) ...DEFENDAN DI HADAPAN YANG ARIF TUAN MOHD NAZLAN MOHD GHAZALI HAKIM JUDGMENT Introduction [1] This is an application by way of an originating summons to transfer this action in Suit No. WA-22NCC-79-03/2017 from the High Court in Kuala Lumpur to the High Court in Kuala Terengganu. [2] At the conclusion of the hearing, I dismissed the application. This judgment contains the full reasons for my decision. Key Background Facts [3] The Plaintiff and the Defendant are both locally incorporated private companies. The business of the latter, relevant for present purposes includes the distribution of the products of the former pursuant to a Distributor Partner Agreement dated 16 February 2015 (“the Agreement”). [4] The Plaintiff has its registered address at Bangsar South in Kuala Lumpur and one of its business addresses at Bandar Baru Bangi in Selangor. The Defendant’s registered and business addresses are both in Kuala Terengganu. [5] The underlying writ action filed by the Plaintiff at the High Court in Kuala Lumpur is a claim for payment for goods sold and delivered against the Defendant. The Defendant, in response filed a counter claim against the Plaintiff for an alleged wrongful enforcement of a bank guarantee by the Plaintiff against the Defendant. The Transfer Application [6] By a notice of application filed on 10 April 2017 documented as enclosure 7, the Defendant sought to have the entire proceedings concerning the main claim by the Plaintiff against the Defendant in Suit No. WA-22NCC-79-03/2017 (“the Suit”) be transferred from the High Court in Kuala Lumpur to the High Court in Kuala Terengganu. [7] This application is stated to be made in pursuance of Order 57 r 1 of the Rules of the Court 2012 (“the RC 2012”) and premised on the following grounds as affirmed in the affidavit for the Defendant:- (1) The place of business of the Defendant is in Terengganu; (2) The witnesses, including other potential witnesses for the Defendant are based in Terengganu; (3) The cause of action and the facts on which the proceedings are based arose in Terengganu; and (4) The High Court in Kuala Terengganu is thus the most appropriate and convenient forum to determine the dispute between the parties. [8] The Plaintiff resisted this application, arguing instead that the correct forum is indeed the High Court in Kuala Lumpur. [9] I shall next examine the arguments of the Defendant in support of the instant application, and the assertions made by the Plaintiff to counter the same before I state my findings. But before all that, I think it is apposite and in the interest of clarity for the law governing the subject of transfer of proceedings from one High Court to another be stated. The Law on Transfer of Proceedings [10] The underlying jurisprudence on the transfer of proceedings is found in the provisions of Section 23(1) of the Courts of Judicature Act 1964 (“CJA”), which provides for the civil jurisdiction of the High Court as follows:- “Civil jurisdiction – general  23. (1) Subject to the limitations contained in Article 128 of the Constitution the High Court shall have jurisdiction to try all civil proceedings where –  (a) the cause of action arose;   (b) the defendant or one of several defendants resides or has his place of business: (c) the facts on which the proceedings are based exist or are alleged to have occurred; or (d) any land the ownership of which is disputed is situated,  within the local jurisdiction of the Court and notwithstanding anything contained in this section in any case where all parties consent in writing within the local jurisdiction of the other High Court.”  [11] For clarity, Section 3 of the CJA further defines “local jurisdiction” to mean:- (a) in the case of the High Court in Malaya, the territory comprised in the States of Malaya, namely, Johore, Kedah, Kelantan, Malacca, Negeri Sembilan, Pahang, Penang, Perak, Perlis, Selangor, Terengganu and the Federal Territory of Kuala Lumpur; and (b) in the case of the High Court in Sabah and Sarawak, the territory comprised in the States of Sabah, Sarawak and the Federal Territory of Labuan". [12] Thus the High Court of Malaya, for instance, constitutes one local jurisdiction. In Sova Sdn Bhd v Kasih Sayang Realty Sdn Bhd [1988] 2 MLJ 268, Lim Beng Choon J held as follows: “…a High Court located at Penang or at Alor Setar is but a branch of the High Court in Malaya and each branch of the High Court in Malaya located in any state has concurrent jurisdiction to entertain any civil proceedings regardless of whether the cause of action arose in another state”. [13] In addition, paragraph 12 of the Schedule to the CJA further provides for the additional power of the High Court to transfer proceedings in the following terms:- “Transfer of proceedings  12. Power to transfer any proceedings to any other Court or to or from any subordinate court, and in the case of transfer to or from a subordinate court to give any directions as to the further conduct thereof:  Provided that this power shall be exercised in such manner as may be prescribed by any rules of court”.  [14] Order 57 r 1(1) and 1(4) of the RC 2012 similarly provides for the Court’s power to transfer proceedings to another Court as follows:  “Transfer of proceedings to another Court (O.57 r 1)  1. (1) Where the Judge of the High Court or a Judge of the Sessions Court or a Magistrate is satisfied that any proceedings in that Court can be more conveniently or fairly tried in some other Court of co-ordinate jurisdiction, he may on application by any party, order the proceedings to be transferred to the other Court……….  (4) Before making any order to transfer any proceedings from -  (a) the High Court to another High Court of co-ordinate jurisdiction;  (b) a Subordinate Court to the High Court;  (c) the High Court to a Subordinate Court; or (‎d) a Subordinate Court to another Subordinate Court,  the High Court Judge or the Judge of the Sessions Court or Magistrate, as the case may be, shall take into consideration whether the High Court or Subordinate Court which shall hear the case is located at or nearest to the place where –  (A) the cause of action arose;  (B) the defendant, or one of the several defendants, resides or has his place of business;   (C) the facts on which the proceedings are based exist or are alleged to have occurred;  (D) the land the ownership of which is disputed is situated; or  (E) for other reasons it is desirable in the interests of justice that the proceedings should be transferred.” [15] For completeness, it should also be stated that in the context of the Federation of Malaysia having two High Courts of coordinate jurisdiction, one being the High Court of Malaya covering the territorial jurisdiction of West or Peninsular Malaysia, and the other, the High Court of Sabah and Sarawak concerning the territories in the states of Sabah and Sarawak, it is settled law that there is no legal basis for the transfer of proceedings from one High Court to another. [16] Thus the Federal Court in the case of Fung Beng Tiat v Marid Construction Co [1996] 2 MLJ 413, held, in the judgment delivered by Gopal Sri Ram JCA (as he then was):- "First, it is crystal clear from art 121 of the Federal Constitution that there are two separate High Courts in Malaysia exercising distinct territorial jurisdiction over different geographical areas of the country. There is the High Court in Malaya and there is the High Court in Sabah and Sarawak. Each has jurisdiction over dispute that arise within its territory. As presently advised, there is absent in any Federal legislation that confers power upon the one High Court to transfer proceedings to the other. This bifurcation of territorial jurisdiction was dealt with by Hashim Yeop A. Sani J (later Chief Justice, Malaya) in Sykt Nip Kui Cheong Timber Contractor v Safety Life & General Insurance Co Sdn Bhd [1975] 2 MLJ 115. His Lordship observed that: ''[I]t is all too clear that both the High Court in Malaya and the High Court in Borneo have separate and distinctive territorial jurisdiction. Article 121(1) of the Constitution speaks of the two High Courts having 'co-ordinate jurisdiction' and the definition of 'local jurisdiction' in the Courts of Judicature Act 1964 speaks of the territorial jurisdiction of each of the two High Courts". ……………………………………….. [17] More recently, the Federal Court in Hap Seng Plantations (River Estates) Sdn Bhd v Excess Interpoint Sdn Bhd & Anor [2016] 3 MLJ 553 reaffirmed its earlier decision in Fung Beng Tiat v Marid Construction Co and rejected the argument that the new Order 57 r 1 of the RC 2012 permitted the transfer between the two High Courts. Delivering the judgment of the Federal Court, Zulkefli Ahmad Makinuddin, CJ (Malaya) (now PCA) held that the reference to “local jurisdiction” in Section 3 of the CJA meant that the power to transfer any proceedings must be confined to transfers within a particular local jurisdiction and not between the two local jurisdictions. [18] In exercising the discretionary power to consider whether or not to invoke the transfer under Order 57, the factors set out thereunder, as similarly stated in Section 23 of the CJA as noted above, must be taken into account. It is also of significance to observe that no one single factor will prevail over the other. For the Court must weigh all the factors relied on in making a decision as to whether the application ought to be favourably considered (see the High Court decision in POSC TI Sdn Bhd v Kerajaan Negeri Terengganu & Anor [2016] 10 MLJ 663). Evaluation & Findings of this Court A) Where the cause of action arose [19] The cause of action in the writ action filed by the Plaintiff is concerning a claim for payment allegedly due to the Plaintiff from the Defendant for goods sold and delivered by the Plaintiff to the Defendant pursuant to the Agreement and as evidenced by the various delivery orders and invoices. The failure on the part of the Defendant to make the payment as claimed by the Plaintiff thus constitutes a breach of contract, giving rise to a cause of action for the Plaintiff to pursue against the Defendant. [20] In situations of cause of action involving non-payments like in the instant claim, it has been held that the breach occurs at the place where payment was supposed to be made such that the cause of action will thus accrue in that place. If place of payment is unspecified, payment must be made at the place of business or residence of the party who is entitled to the payment. [21] I can do no better that reproduce that part of the judgment of the High Court in the case of Malacca Securities Sdn Bhd v Loke Yu [1999] 6 MLJ 112, which facts bear much similarity with those in the instant case, as follows:- “In this case, sub-para (b) and (d) clearly cannot apply in favour of the plaintiff as the defendant resides in Kuala Lumpur and the subject matter of this action is not land. That leaves for consideration sub-para (a) and (c) of the section. I shall first consider sub-para (a). With regard to accrual of a cause of action in contract cases it is deemed to have occurred at the place where the breach took place. In support of this principle I refer to the case of Cuban Atlantic Sugar Sales Corp v Compania De Vapores San Elefterio Limitada [1960] 1 All ER 141 where Lord Hodson LJ said at p 143: … The question is not whether a breach must be deemed to have been committed, or whether a breach must necessarily be taken to have been committed when the defendants have put themselves in the wrong, but whether a breach has been committed in the United Kingdom. And Ormerod LJ said in the same case at p 145: … Counsel for the defendants at the beginning of his argument said (and I think rightly) that the jurisdiction of the courts under RSC Ordinance 11 rule 1 should be administered with the greatest care, as it is a rule which tends to encroach on the sovereignty of other nations. Bearing that in mind, one has to consider the one and only important question in this appeal, and that is whether the defendants have committed a breach of contract within the jurisdiction. In a contract for the payment of money the breach occurs when there is a failure to pay the sum promised. This is logical as the meaning of 'cause of action' is the act on the part of the defendant which gives the plaintiff his cause of complaint (see Jackson v Spittall (1870) LR 5 CP 542). The failure to pay will be the cause of complaint. That breach will have to be at the place where the payment is to be made and the cause of action will therefore accrue in that place (see Bank Bumiputra Malaysia Bhd v Melewar Holdings Sdn Bhd & Ors [1990] 1 CLJ 1246). Where there is no agreement as to the place where the payment should be made then the payment should be made at the place where the plaintiff lives. In this regard I refer to Northey Stone Co v Gidney [1894] 1 QB 99 where Charles J said at p 100: The action is brought to recover the balance of the price of goods sold and delivered. According to the law applicable to contracts, there being no special stipulation as to the place of payment, the defendant must pay at Bath, where his creditors, the plaintiffs, live”. [emphasis added] [22] In the instant case, the party who claimed to be entitled to the payment is the Plaintiff, who has its registered address in Kuala Lumpur. Clause 21.1.3 of the Agreement on notices also specifies the notification address of the Plaintiff to be in Kuala Lumpur. Since the applicable Agreement is silent on venue of payment, this is the place where payment ought to have been made by the Defendant. Failure on the part of the Defendant to have made the payment claimed by the Plaintiff thus meant that a breach occurs in Kuala Lumpur. The fact that the place of business and the registered address of the Defendant are in Terengganu is in so far as the question on where the cause of action arose, is of secondary importance, if not entirely irrelevant. Thus, on this ground, the Plaintiff was correct in having filed its writ action in the High Court in Kuala Lumpur. [23] Even if it was the case that payment could be made by electronic medium of online transfers, the principle would then be that the breach occurs where the recipient’s bank account intended for receiving payment from the payer is opened and maintained. However, neither of the parties touched on this point, and no evidence was given of any bank accounts. B) Where the Defendant has its place of business [24] It cannot be denied however, that the business of the Defendant is located and based in Kuala Terengganu and in Dungun. And Order 57 r 1 (4) (b) as well as Section 23 (1) (b) of the CJA clearly concern the place of business of the Defendant, not the Plaintiff. Thus, on this basis, the application of the Defendant seeking the transfer to the High Court in Kuala Terengganu is not unmeritorious. [25] In this regard, I must nevertheless, emphasise two important considerations. First, the subparagraphs in (a), (b), (c) and (d) of Section 23 (1) of the CJA, as set out above, are to be read disjunctively. Thus, a party intending to institute an action in a High Court may do so if his case falls within any one of the said paragraphs (See the Court of Appeal decision in Enersafe Sdn Bhd v Megarina Sdn Bhd [2006] 4 MLJ 271, and the High Court case of Malacca Securities referred to earlier). [26] Secondly, and consistent with POSC TI Sdn Bhd v Kerajaan Negeri Terengganu & Anor referred to earlier, fulfilment of any one of the four requirements is not necessarily definitive. All the factors set out in paragraphs (a) to (d) of Section 23 (1) of the CJA, or the corresponding provisions in Order 57 r 1 must be considered. And the overarching issue for determination is whether the Court is the most appropriate and convenient forum to hear the dispute. The following observations of the High Court in Malacca Securities are most instructive:- “In referring to this case Edgar Joseph Jr J (as he then was) said in Wee Chow Yong t/a Vienna Music Centre v Public Finance Bhd [1989] 3 MLJ 508 at p 512: The case of Sova Sdn Bhd v Kasih Sayang Realty Sdn Bhd [1988] 2 MLJ 268 reminds us of the familiar proposition that the High Court of each state in our country are but branches of the High Court of Malaya and that each branch has concurrent jurisdiction to entertain any civil proceeding regardless of whether the cause of action arose in another state. The result is that a plaintiff is entitled to file an action in any branch of the High Court in Malaya regardless of whether the cause of action arose in another state (see Re Application of Asia Insurance Co Ltd [1968] 2 MLJ 228). I therefore hold that this court has jurisdiction to entertain this action even if the defendant is correct in his submission that the cause of action arose in Kuala Lumpur coupled with the fact that he resides there also. But, as Lim Beng Choon J observed in Sova Sdn Bhd, that is not the end of the matter as the critical issue for determination is whether this court is the forum conveniens to hear the dispute between the parties notwithstanding the fact that it has jurisdiction to do so. His Lordship added at p 271: However, that is not the end of the matter since the defendants have also contended that this court is not the proper or convenient forum to determine the dispute between the parties. To this contention, I agree. It is quite obvious that in creating a branch of the High Court in Malaya in each state, the legislature had two things in mind: (i) to enable the parties of a civil suit to have easy access to a branch of the High Court in Malaya located in a state where either the plaintiff or the defendant resides. When a person is sued for breach of contract or for that matter a tortious act when the breach or the tort was committed in the state where he resides, it is certainly unreasonable to require him to travel all the way, say, to Kuala Lumpur to defend himself. Apart from the expense incurred, the defendant may have to remain in Kuala Lumpur perhaps one week to participate in the civil proceedings. No doubt he would be compensated in terms of costs should he succeed in defending himself but the inconvenience caused may outweigh the amount of costs awarded to him; (ii) the obvious reason for the setting up of a branch of the High Court in every one of the 11 states is to facilitate the disposal of cases in Malaya and to cut down, even if it is not yet possible to obliterate, the backlog of cases pending in any one or more of the branches of such High Court. For the reasons as stated above, I do not think that the present civil proceedings should be dealt with by this court. I am also of the view that it is for the defendants to apply to this court for a transfer of the civil suit and the application made by the plaintiff under O 81(1) to the High Court in Malaya at Penang or Kuala Lumpur since the cause of action arose in Penang but the parties have their places of business in Kuala Lumpur. His Lordship therefore declined to exercise his jurisdiction to hear the case on the ground that it should be heard in another branch High Court in accordance with the doctrine of forum conveniens. That brings into focus the circumstances in which a court which has jurisdiction to hear a case can lawfully decline to exercise its jurisdiction on the ground that the case must be heard by a more accessible court. In declining to exercise jurisdiction a court does so not on grounds ofconvenience but of the suitability or appropriateness of another tribunal in the interests of all the parties and for the ends of justice (see Sim v Robinow (1892) 19 R 665, Spiliada Maritime Corp v Consulex Ltd [1987] AC 460). In this regard reference may be made to The Atlantic Star [1973] 2 All ER 175 where Lord Morris of Borth-y-Gest said at pp 183–184: The cases show that if there is jurisdiction in the court and if a plaintiff becomes enabled to invoke it and chooses to do so he may nevertheless in some circumstances not be allowed to do so. In the decisions which indicate what those circumstances are certain words constantly emerge. They are such words as 'vexation' or'oppression'. Thus in McHenry v Lewis (1882) 22 Ch D 397, Sir George Jessel MR said that it was part of the general jurisdiction of the court to prevent a defendant being 'improperly vexed' by legal procedure ….” [emphasis added] [27] As such, the totality of the respective positions of the parties vis-à-vis the requirements to be considered in Section 23 (1) or Order 57 r 1 (4) must be evaluated before arriving at the determination of the forum conveniens. The mere fact that the Defendant and their witnesses are located in Terengganu is not determinative of the issue. C) Where the facts on which the Suit is based exist or occurred [28] The Suit involves a claim for the payment said to be due to the Plaintiff from the Defendant on the basis on goods sold and delivered to the latter. The goods were presumably said to have been received by the Defendant in Terengganu. This thus potentially warrants the need to call witnesses who are based in the Defendant’s place of business to confirm delivery. This also however potentially involves the Plaintiff and a third party distributor involved in this Suit, both of which are based in Kuala Lumpur and Selangor, perhaps to confirm on the fact of the supply and delivery of the goods. [29] Further, in its defence, the Defendant questioned the person who signed the Agreement on behalf of the Plaintiff, and whether the said third party distributor appointed by the Plaintiff to deliver the said goods to the Defendant was validly authorised. This thus means that witnesses for the Plaintiff concerned with the execution of the Agreement, and from the third party distributor appointed by the Plaintiff may potentially have to be called. They are on the other hand based in Kuala Lumpur and Petaling Jaya, Selangor, respectively. The Agreement itself had been executed in Kuala Lumpur by the Plaintiff and stamped in Hulu Langat, Selangor. And it has earlier been stated that payment should also be made to the Plaintiff in Kuala Lumpur. On the whole it appears that this issue of where the greater substance of facts of the Suit existed or occurred is somewhat inconclusive. D) Whether there are other reasons making it desirable in the interest of justice for the transfer [30] In any transfer application, and as set out in Section 23 of the CJA and Order 57 r 1 of the RC 2012, the duty of a Court hearing the application is to determine the appropriate forum where the dispute of the case may be conveniently and fairly tried. The factors to be considered in the exercise of judicial discretion to decide on the application are those set out in the said provisions of the CJA and the RC 2012, such as where the cause of action arose, the residence or place of business of the defendant and the hardship of the parties and their respective witnesses. [31] In this case, the contention of the Defendant is effectively of some validity only by reason of the claim that its witnesses are residing in Terengganu, and the goods were received by them in Terengganu. But on the other hand, it has been found that the cause of action of the Plaintiff against the Defendant arose in Kuala Lumpur. [32] I must emphasise that whilst the determining consideration as to which Court is more suitable and appropriate is dependent on the forum conveniens of the case, as had been held by the Supreme Court in American Express Bank Ltd v Mohamed Toufic Al-Ozier & Anor [1995] 1 MLJ 160, the burden is unmistakably on the party making the transfer application, in the instant case, the Defendant, to satisfy the Court that another Court (in this case, in Kuala Terengganu) is the more appropriate forum to hear the case. [33] However, other than the fact of its place of business being in Terengganu and of the witnesses for the Defendant also are said to be residing in that state, not much had been proffered by the Defendant to further strengthen its application or to credibly challenge the resistance put up by the Plaintiff in response to this application. [34] An important consideration that however significantly weakens the case of the Defendant is that this application by the Defendant is designed to deal only with the main claim of the Plaintiff in the Suit. It does not extend to the counter claim filed by the Defendant as well. Thus, even if the claim of the Plaintiff were to be transferred to the High Court in Kuala Terengganu, the counter claim of the Defendant will continue to be heard at the High Court in Kuala Lumpur. [35] Surely this runs counter to the essence of why a proceeding should be transferred. Having the parties, and their respective witnesses to attend the High Court in two different locations, one in Kuala Terengganu for the main claim (as applied for by the Defendant) and the other in Kuala Lumpur for the counter claim is neither fair nor appropriate and is certainly not convenient to all parties. It is the antithesis of a fair, just and economical disposal of the proceedings envisaged in the RC 2012. [36] No explanation was given by the Defendant as to why it did not seek to also transfer its counter claim. Its notice of application and the affidavit in support dealt only with the arguments to support its application to transfer the main claim of the Plaintiff in the Suit. [37] In such a situation, in the counter claim, the witnesses for the Plaintiff will now be the witnesses for the defendant. This strengthens the case of the Plaintiff since it now also is the defendant who is based in Kuala Lumpur, making the transfer to Terengganu less deserving, given Section 23 (1) (b) of the CJA and Order 57 r 1 (4) (B). The cause of action remains in Kuala Lumpur since the alleged unlawful realisation of the bank guarantee was in respect of the funds deposited by the Defendant at Maybank in Kuantan, in favour of the Plaintiff pursuant to the Agreement, which was then enforced by the Plaintiff under Clause 8.2 (b) of the Agreement, whereby the sum of the security of the bank guarantee was then credited by Maybank to the account of the Plaintiff. [38] In the case referred to by the Plaintiff of Amalan Lengkap Sdn Bhd v SKS Coachbuilders Sdn Bhd [2016] 1 LNS 883, the suit filed in the High Court in Melaka involved both a claim and a counter claim. The defendant in that case applied to have the proceedings transferred to the High Court in Shah Alam. Unlike the application in the instant case before me, the defendant in that case, quite sensibly, applied for both the main claim and the counter claim to be transferred. The application was however refused by the High Court which found that like in the instant case, the pleaded cause of action arose in Melaka, since the claim was for contractual payment due from the defendant to the plaintiff who had its place of business in Melaka. [39] In the instant case before me, other than the cause of action having arisen in Kuala Lumpur, the Defendant also did not seek the transfer of its counter claim to Kuala Terengganu. That I think is fatal to its application and puts paid to whatever little semblance of merit that the Defendant ever had to warrant the transfer. If a suit involves a counter claim, the failure of the applicant to seek the transfer of both the main claim and the counter claim should generally not be countenanced as it would clearly defeat the entire objective of securing the most convenient forum for the resolution of the dispute. The application of the Defendant, for such reasons, considering the factors specified in Order 57 r 1 and Section 23(1) of the CJA is not sustainable and must fail. Conclusion [40] In view of the foregoing reasons, it is my judgment that the Defendant has not succeeded in establishing its case for the transfer of the Suit concerning the main claim of the Plaintiff from the High Court of Kuala Lumpur to the High Court in Kuala Terengganu. I therefore dismiss enclosure 7, with costs to the Plaintiff. Dated: 14 August 2017 (MOHD NAZLAN BIN MOHD GHAZALI) Judge High Court NCC1 Kuala Lumpur Counsel: For the Plaintiff Mohd Khairul Azri Messrs S.Ravichandran & Anuar Kuala Lumpur For Defendant Zahidah Zakaria Messrs G.K. Soh & Partners Kemaman, Terengganu Page 2 of 15

Tika 2.6.0

WA-22NCC-79-03/2017

PLAINTIF ETIKA DISTRIBUTIONS SDN BHD (No. Syarikat: 770956-P) (Dahulunya dikenali sebagai Permanis Distribution Sdn Bhd) ...PLAINTIF DEFENDAN T.G.DISTRIBUTIONS SDN BHD (No. Syarikat: 683272-T) ... DEFENDAN

14/08/2017

YA TUAN MOHD NAZLAN BIN MOHD GHAZALI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=18a825ec-f103-43d6-9caa-f9976c454979&Inline=true

DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR DALAM WILAYAH PERSEKUTUAN GUAMAN SIVIL NO.: WA-22NCC-79-03/2017 ANTARA ETIKA DISTRIBUTIONS SDN BHD (No. Syarikat: 770956-P) (Dahulunya dikenali sebagai Permanis Distribution Sdn Bhd) ...PLAINTIF DAN T.G.DISTRIBUTIONS SDN BHD (No. Syarikat: 683272-T) ...DEFENDAN DI HADAPAN YANG ARIF TUAN MOHD NAZLAN MOHD GHAZALI HAKIM JUDGMENT Introduction [1] This is an application by way of an originating summons to transfer this action in Suit No. WA-22NCC-79-03/2017 from the High Court in Kuala Lumpur to the High Court in Kuala Terengganu. [2] At the conclusion of the hearing, I dismissed the application. This judgment contains the full reasons for my decision. Key Background Facts [3] The Plaintiff and the Defendant are both locally incorporated private companies. The business of the latter, relevant for present purposes includes the distribution of the products of the former pursuant to a Distributor Partner Agreement dated 16 February 2015 (“the Agreement”). [4] The Plaintiff has its registered address at Bangsar South in Kuala Lumpur and one of its business addresses at Bandar Baru Bangi in Selangor. The Defendant’s registered and business addresses are both in Kuala Terengganu. [5] The underlying writ action filed by the Plaintiff at the High Court in Kuala Lumpur is a claim for payment for goods sold and delivered against the Defendant. The Defendant, in response filed a counter claim against the Plaintiff for an alleged wrongful enforcement of a bank guarantee by the Plaintiff against the Defendant. The Transfer Application [6] By a notice of application filed on 10 April 2017 documented as enclosure 7, the Defendant sought to have the entire proceedings concerning the main claim by the Plaintiff against the Defendant in Suit No. WA-22NCC-79-03/2017 (“the Suit”) be transferred from the High Court in Kuala Lumpur to the High Court in Kuala Terengganu. [7] This application is stated to be made in pursuance of Order 57 r 1 of the Rules of the Court 2012 (“the RC 2012”) and premised on the following grounds as affirmed in the affidavit for the Defendant:- (1) The place of business of the Defendant is in Terengganu; (2) The witnesses, including other potential witnesses for the Defendant are based in Terengganu; (3) The cause of action and the facts on which the proceedings are based arose in Terengganu; and (4) The High Court in Kuala Terengganu is thus the most appropriate and convenient forum to determine the dispute between the parties. [8] The Plaintiff resisted this application, arguing instead that the correct forum is indeed the High Court in Kuala Lumpur. [9] I shall next examine the arguments of the Defendant in support of the instant application, and the assertions made by the Plaintiff to counter the same before I state my findings. But before all that, I think it is apposite and in the interest of clarity for the law governing the subject of transfer of proceedings from one High Court to another be stated. The Law on Transfer of Proceedings [10] The underlying jurisprudence on the transfer of proceedings is found in the provisions of Section 23(1) of the Courts of Judicature Act 1964 (“CJA”), which provides for the civil jurisdiction of the High Court as follows:- “Civil jurisdiction – general  23. (1) Subject to the limitations contained in Article 128 of the Constitution the High Court shall have jurisdiction to try all civil proceedings where –  (a) the cause of action arose;   (b) the defendant or one of several defendants resides or has his place of business: (c) the facts on which the proceedings are based exist or are alleged to have occurred; or (d) any land the ownership of which is disputed is situated,  within the local jurisdiction of the Court and notwithstanding anything contained in this section in any case where all parties consent in writing within the local jurisdiction of the other High Court.”  [11] For clarity, Section 3 of the CJA further defines “local jurisdiction” to mean:- (a) in the case of the High Court in Malaya, the territory comprised in the States of Malaya, namely, Johore, Kedah, Kelantan, Malacca, Negeri Sembilan, Pahang, Penang, Perak, Perlis, Selangor, Terengganu and the Federal Territory of Kuala Lumpur; and (b) in the case of the High Court in Sabah and Sarawak, the territory comprised in the States of Sabah, Sarawak and the Federal Territory of Labuan". [12] Thus the High Court of Malaya, for instance, constitutes one local jurisdiction. In Sova Sdn Bhd v Kasih Sayang Realty Sdn Bhd [1988] 2 MLJ 268, Lim Beng Choon J held as follows: “…a High Court located at Penang or at Alor Setar is but a branch of the High Court in Malaya and each branch of the High Court in Malaya located in any state has concurrent jurisdiction to entertain any civil proceedings regardless of whether the cause of action arose in another state”. [13] In addition, paragraph 12 of the Schedule to the CJA further provides for the additional power of the High Court to transfer proceedings in the following terms:- “Transfer of proceedings  12. Power to transfer any proceedings to any other Court or to or from any subordinate court, and in the case of transfer to or from a subordinate court to give any directions as to the further conduct thereof:  Provided that this power shall be exercised in such manner as may be prescribed by any rules of court”.  [14] Order 57 r 1(1) and 1(4) of the RC 2012 similarly provides for the Court’s power to transfer proceedings to another Court as follows:  “Transfer of proceedings to another Court (O.57 r 1)  1. (1) Where the Judge of the High Court or a Judge of the Sessions Court or a Magistrate is satisfied that any proceedings in that Court can be more conveniently or fairly tried in some other Court of co-ordinate jurisdiction, he may on application by any party, order the proceedings to be transferred to the other Court……….  (4) Before making any order to transfer any proceedings from -  (a) the High Court to another High Court of co-ordinate jurisdiction;  (b) a Subordinate Court to the High Court;  (c) the High Court to a Subordinate Court; or (‎d) a Subordinate Court to another Subordinate Court,  the High Court Judge or the Judge of the Sessions Court or Magistrate, as the case may be, shall take into consideration whether the High Court or Subordinate Court which shall hear the case is located at or nearest to the place where –  (A) the cause of action arose;  (B) the defendant, or one of the several defendants, resides or has his place of business;   (C) the facts on which the proceedings are based exist or are alleged to have occurred;  (D) the land the ownership of which is disputed is situated; or  (E) for other reasons it is desirable in the interests of justice that the proceedings should be transferred.” [15] For completeness, it should also be stated that in the context of the Federation of Malaysia having two High Courts of coordinate jurisdiction, one being the High Court of Malaya covering the territorial jurisdiction of West or Peninsular Malaysia, and the other, the High Court of Sabah and Sarawak concerning the territories in the states of Sabah and Sarawak, it is settled law that there is no legal basis for the transfer of proceedings from one High Court to another. [16] Thus the Federal Court in the case of Fung Beng Tiat v Marid Construction Co [1996] 2 MLJ 413, held, in the judgment delivered by Gopal Sri Ram JCA (as he then was):- "First, it is crystal clear from art 121 of the Federal Constitution that there are two separate High Courts in Malaysia exercising distinct territorial jurisdiction over different geographical areas of the country. There is the High Court in Malaya and there is the High Court in Sabah and Sarawak. Each has jurisdiction over dispute that arise within its territory. As presently advised, there is absent in any Federal legislation that confers power upon the one High Court to transfer proceedings to the other. This bifurcation of territorial jurisdiction was dealt with by Hashim Yeop A. Sani J (later Chief Justice, Malaya) in Sykt Nip Kui Cheong Timber Contractor v Safety Life & General Insurance Co Sdn Bhd [1975] 2 MLJ 115. His Lordship observed that: ''[I]t is all too clear that both the High Court in Malaya and the High Court in Borneo have separate and distinctive territorial jurisdiction. Article 121(1) of the Constitution speaks of the two High Courts having 'co-ordinate jurisdiction' and the definition of 'local jurisdiction' in the Courts of Judicature Act 1964 speaks of the territorial jurisdiction of each of the two High Courts". ……………………………………….. [17] More recently, the Federal Court in Hap Seng Plantations (River Estates) Sdn Bhd v Excess Interpoint Sdn Bhd & Anor [2016] 3 MLJ 553 reaffirmed its earlier decision in Fung Beng Tiat v Marid Construction Co and rejected the argument that the new Order 57 r 1 of the RC 2012 permitted the transfer between the two High Courts. Delivering the judgment of the Federal Court, Zulkefli Ahmad Makinuddin, CJ (Malaya) (now PCA) held that the reference to “local jurisdiction” in Section 3 of the CJA meant that the power to transfer any proceedings must be confined to transfers within a particular local jurisdiction and not between the two local jurisdictions. [18] In exercising the discretionary power to consider whether or not to invoke the transfer under Order 57, the factors set out thereunder, as similarly stated in Section 23 of the CJA as noted above, must be taken into account. It is also of significance to observe that no one single factor will prevail over the other. For the Court must weigh all the factors relied on in making a decision as to whether the application ought to be favourably considered (see the High Court decision in POSC TI Sdn Bhd v Kerajaan Negeri Terengganu & Anor [2016] 10 MLJ 663). Evaluation & Findings of this Court A) Where the cause of action arose [19] The cause of action in the writ action filed by the Plaintiff is concerning a claim for payment allegedly due to the Plaintiff from the Defendant for goods sold and delivered by the Plaintiff to the Defendant pursuant to the Agreement and as evidenced by the various delivery orders and invoices. The failure on the part of the Defendant to make the payment as claimed by the Plaintiff thus constitutes a breach of contract, giving rise to a cause of action for the Plaintiff to pursue against the Defendant. [20] In situations of cause of action involving non-payments like in the instant claim, it has been held that the breach occurs at the place where payment was supposed to be made such that the cause of action will thus accrue in that place. If place of payment is unspecified, payment must be made at the place of business or residence of the party who is entitled to the payment. [21] I can do no better that reproduce that part of the judgment of the High Court in the case of Malacca Securities Sdn Bhd v Loke Yu [1999] 6 MLJ 112, which facts bear much similarity with those in the instant case, as follows:- “In this case, sub-para (b) and (d) clearly cannot apply in favour of the plaintiff as the defendant resides in Kuala Lumpur and the subject matter of this action is not land. That leaves for consideration sub-para (a) and (c) of the section. I shall first consider sub-para (a). With regard to accrual of a cause of action in contract cases it is deemed to have occurred at the place where the breach took place. In support of this principle I refer to the case of Cuban Atlantic Sugar Sales Corp v Compania De Vapores San Elefterio Limitada [1960] 1 All ER 141 where Lord Hodson LJ said at p 143: … The question is not whether a breach must be deemed to have been committed, or whether a breach must necessarily be taken to have been committed when the defendants have put themselves in the wrong, but whether a breach has been committed in the United Kingdom. And Ormerod LJ said in the same case at p 145: … Counsel for the defendants at the beginning of his argument said (and I think rightly) that the jurisdiction of the courts under RSC Ordinance 11 rule 1 should be administered with the greatest care, as it is a rule which tends to encroach on the sovereignty of other nations. Bearing that in mind, one has to consider the one and only important question in this appeal, and that is whether the defendants have committed a breach of contract within the jurisdiction. In a contract for the payment of money the breach occurs when there is a failure to pay the sum promised. This is logical as the meaning of 'cause of action' is the act on the part of the defendant which gives the plaintiff his cause of complaint (see Jackson v Spittall (1870) LR 5 CP 542). The failure to pay will be the cause of complaint. That breach will have to be at the place where the payment is to be made and the cause of action will therefore accrue in that place (see Bank Bumiputra Malaysia Bhd v Melewar Holdings Sdn Bhd & Ors [1990] 1 CLJ 1246). Where there is no agreement as to the place where the payment should be made then the payment should be made at the place where the plaintiff lives. In this regard I refer to Northey Stone Co v Gidney [1894] 1 QB 99 where Charles J said at p 100: The action is brought to recover the balance of the price of goods sold and delivered. According to the law applicable to contracts, there being no special stipulation as to the place of payment, the defendant must pay at Bath, where his creditors, the plaintiffs, live”. [emphasis added] [22] In the instant case, the party who claimed to be entitled to the payment is the Plaintiff, who has its registered address in Kuala Lumpur. Clause 21.1.3 of the Agreement on notices also specifies the notification address of the Plaintiff to be in Kuala Lumpur. Since the applicable Agreement is silent on venue of payment, this is the place where payment ought to have been made by the Defendant. Failure on the part of the Defendant to have made the payment claimed by the Plaintiff thus meant that a breach occurs in Kuala Lumpur. The fact that the place of business and the registered address of the Defendant are in Terengganu is in so far as the question on where the cause of action arose, is of secondary importance, if not entirely irrelevant. Thus, on this ground, the Plaintiff was correct in having filed its writ action in the High Court in Kuala Lumpur. [23] Even if it was the case that payment could be made by electronic medium of online transfers, the principle would then be that the breach occurs where the recipient’s bank account intended for receiving payment from the payer is opened and maintained. However, neither of the parties touched on this point, and no evidence was given of any bank accounts. B) Where the Defendant has its place of business [24] It cannot be denied however, that the business of the Defendant is located and based in Kuala Terengganu and in Dungun. And Order 57 r 1 (4) (b) as well as Section 23 (1) (b) of the CJA clearly concern the place of business of the Defendant, not the Plaintiff. Thus, on this basis, the application of the Defendant seeking the transfer to the High Court in Kuala Terengganu is not unmeritorious. [25] In this regard, I must nevertheless, emphasise two important considerations. First, the subparagraphs in (a), (b), (c) and (d) of Section 23 (1) of the CJA, as set out above, are to be read disjunctively. Thus, a party intending to institute an action in a High Court may do so if his case falls within any one of the said paragraphs (See the Court of Appeal decision in Enersafe Sdn Bhd v Megarina Sdn Bhd [2006] 4 MLJ 271, and the High Court case of Malacca Securities referred to earlier). [26] Secondly, and consistent with POSC TI Sdn Bhd v Kerajaan Negeri Terengganu & Anor referred to earlier, fulfilment of any one of the four requirements is not necessarily definitive. All the factors set out in paragraphs (a) to (d) of Section 23 (1) of the CJA, or the corresponding provisions in Order 57 r 1 must be considered. And the overarching issue for determination is whether the Court is the most appropriate and convenient forum to hear the dispute. The following observations of the High Court in Malacca Securities are most instructive:- “In referring to this case Edgar Joseph Jr J (as he then was) said in Wee Chow Yong t/a Vienna Music Centre v Public Finance Bhd [1989] 3 MLJ 508 at p 512: The case of Sova Sdn Bhd v Kasih Sayang Realty Sdn Bhd [1988] 2 MLJ 268 reminds us of the familiar proposition that the High Court of each state in our country are but branches of the High Court of Malaya and that each branch has concurrent jurisdiction to entertain any civil proceeding regardless of whether the cause of action arose in another state. The result is that a plaintiff is entitled to file an action in any branch of the High Court in Malaya regardless of whether the cause of action arose in another state (see Re Application of Asia Insurance Co Ltd [1968] 2 MLJ 228). I therefore hold that this court has jurisdiction to entertain this action even if the defendant is correct in his submission that the cause of action arose in Kuala Lumpur coupled with the fact that he resides there also. But, as Lim Beng Choon J observed in Sova Sdn Bhd, that is not the end of the matter as the critical issue for determination is whether this court is the forum conveniens to hear the dispute between the parties notwithstanding the fact that it has jurisdiction to do so. His Lordship added at p 271: However, that is not the end of the matter since the defendants have also contended that this court is not the proper or convenient forum to determine the dispute between the parties. To this contention, I agree. It is quite obvious that in creating a branch of the High Court in Malaya in each state, the legislature had two things in mind: (i) to enable the parties of a civil suit to have easy access to a branch of the High Court in Malaya located in a state where either the plaintiff or the defendant resides. When a person is sued for breach of contract or for that matter a tortious act when the breach or the tort was committed in the state where he resides, it is certainly unreasonable to require him to travel all the way, say, to Kuala Lumpur to defend himself. Apart from the expense incurred, the defendant may have to remain in Kuala Lumpur perhaps one week to participate in the civil proceedings. No doubt he would be compensated in terms of costs should he succeed in defending himself but the inconvenience caused may outweigh the amount of costs awarded to him; (ii) the obvious reason for the setting up of a branch of the High Court in every one of the 11 states is to facilitate the disposal of cases in Malaya and to cut down, even if it is not yet possible to obliterate, the backlog of cases pending in any one or more of the branches of such High Court. For the reasons as stated above, I do not think that the present civil proceedings should be dealt with by this court. I am also of the view that it is for the defendants to apply to this court for a transfer of the civil suit and the application made by the plaintiff under O 81(1) to the High Court in Malaya at Penang or Kuala Lumpur since the cause of action arose in Penang but the parties have their places of business in Kuala Lumpur. His Lordship therefore declined to exercise his jurisdiction to hear the case on the ground that it should be heard in another branch High Court in accordance with the doctrine of forum conveniens. That brings into focus the circumstances in which a court which has jurisdiction to hear a case can lawfully decline to exercise its jurisdiction on the ground that the case must be heard by a more accessible court. In declining to exercise jurisdiction a court does so not on grounds ofconvenience but of the suitability or appropriateness of another tribunal in the interests of all the parties and for the ends of justice (see Sim v Robinow (1892) 19 R 665, Spiliada Maritime Corp v Consulex Ltd [1987] AC 460). In this regard reference may be made to The Atlantic Star [1973] 2 All ER 175 where Lord Morris of Borth-y-Gest said at pp 183–184: The cases show that if there is jurisdiction in the court and if a plaintiff becomes enabled to invoke it and chooses to do so he may nevertheless in some circumstances not be allowed to do so. In the decisions which indicate what those circumstances are certain words constantly emerge. They are such words as 'vexation' or'oppression'. Thus in McHenry v Lewis (1882) 22 Ch D 397, Sir George Jessel MR said that it was part of the general jurisdiction of the court to prevent a defendant being 'improperly vexed' by legal procedure ….” [emphasis added] [27] As such, the totality of the respective positions of the parties vis-à-vis the requirements to be considered in Section 23 (1) or Order 57 r 1 (4) must be evaluated before arriving at the determination of the forum conveniens. The mere fact that the Defendant and their witnesses are located in Terengganu is not determinative of the issue. C) Where the facts on which the Suit is based exist or occurred [28] The Suit involves a claim for the payment said to be due to the Plaintiff from the Defendant on the basis on goods sold and delivered to the latter. The goods were presumably said to have been received by the Defendant in Terengganu. This thus potentially warrants the need to call witnesses who are based in the Defendant’s place of business to confirm delivery. This also however potentially involves the Plaintiff and a third party distributor involved in this Suit, both of which are based in Kuala Lumpur and Selangor, perhaps to confirm on the fact of the supply and delivery of the goods. [29] Further, in its defence, the Defendant questioned the person who signed the Agreement on behalf of the Plaintiff, and whether the said third party distributor appointed by the Plaintiff to deliver the said goods to the Defendant was validly authorised. This thus means that witnesses for the Plaintiff concerned with the execution of the Agreement, and from the third party distributor appointed by the Plaintiff may potentially have to be called. They are on the other hand based in Kuala Lumpur and Petaling Jaya, Selangor, respectively. The Agreement itself had been executed in Kuala Lumpur by the Plaintiff and stamped in Hulu Langat, Selangor. And it has earlier been stated that payment should also be made to the Plaintiff in Kuala Lumpur. On the whole it appears that this issue of where the greater substance of facts of the Suit existed or occurred is somewhat inconclusive. D) Whether there are other reasons making it desirable in the interest of justice for the transfer [30] In any transfer application, and as set out in Section 23 of the CJA and Order 57 r 1 of the RC 2012, the duty of a Court hearing the application is to determine the appropriate forum where the dispute of the case may be conveniently and fairly tried. The factors to be considered in the exercise of judicial discretion to decide on the application are those set out in the said provisions of the CJA and the RC 2012, such as where the cause of action arose, the residence or place of business of the defendant and the hardship of the parties and their respective witnesses. [31] In this case, the contention of the Defendant is effectively of some validity only by reason of the claim that its witnesses are residing in Terengganu, and the goods were received by them in Terengganu. But on the other hand, it has been found that the cause of action of the Plaintiff against the Defendant arose in Kuala Lumpur. [32] I must emphasise that whilst the determining consideration as to which Court is more suitable and appropriate is dependent on the forum conveniens of the case, as had been held by the Supreme Court in American Express Bank Ltd v Mohamed Toufic Al-Ozier & Anor [1995] 1 MLJ 160, the burden is unmistakably on the party making the transfer application, in the instant case, the Defendant, to satisfy the Court that another Court (in this case, in Kuala Terengganu) is the more appropriate forum to hear the case. [33] However, other than the fact of its place of business being in Terengganu and of the witnesses for the Defendant also are said to be residing in that state, not much had been proffered by the Defendant to further strengthen its application or to credibly challenge the resistance put up by the Plaintiff in response to this application. [34] An important consideration that however significantly weakens the case of the Defendant is that this application by the Defendant is designed to deal only with the main claim of the Plaintiff in the Suit. It does not extend to the counter claim filed by the Defendant as well. Thus, even if the claim of the Plaintiff were to be transferred to the High Court in Kuala Terengganu, the counter claim of the Defendant will continue to be heard at the High Court in Kuala Lumpur. [35] Surely this runs counter to the essence of why a proceeding should be transferred. Having the parties, and their respective witnesses to attend the High Court in two different locations, one in Kuala Terengganu for the main claim (as applied for by the Defendant) and the other in Kuala Lumpur for the counter claim is neither fair nor appropriate and is certainly not convenient to all parties. It is the antithesis of a fair, just and economical disposal of the proceedings envisaged in the RC 2012. [36] No explanation was given by the Defendant as to why it did not seek to also transfer its counter claim. Its notice of application and the affidavit in support dealt only with the arguments to support its application to transfer the main claim of the Plaintiff in the Suit. [37] In such a situation, in the counter claim, the witnesses for the Plaintiff will now be the witnesses for the defendant. This strengthens the case of the Plaintiff since it now also is the defendant who is based in Kuala Lumpur, making the transfer to Terengganu less deserving, given Section 23 (1) (b) of the CJA and Order 57 r 1 (4) (B). The cause of action remains in Kuala Lumpur since the alleged unlawful realisation of the bank guarantee was in respect of the funds deposited by the Defendant at Maybank in Kuantan, in favour of the Plaintiff pursuant to the Agreement, which was then enforced by the Plaintiff under Clause 8.2 (b) of the Agreement, whereby the sum of the security of the bank guarantee was then credited by Maybank to the account of the Plaintiff. [38] In the case referred to by the Plaintiff of Amalan Lengkap Sdn Bhd v SKS Coachbuilders Sdn Bhd [2016] 1 LNS 883, the suit filed in the High Court in Melaka involved both a claim and a counter claim. The defendant in that case applied to have the proceedings transferred to the High Court in Shah Alam. Unlike the application in the instant case before me, the defendant in that case, quite sensibly, applied for both the main claim and the counter claim to be transferred. The application was however refused by the High Court which found that like in the instant case, the pleaded cause of action arose in Melaka, since the claim was for contractual payment due from the defendant to the plaintiff who had its place of business in Melaka. [39] In the instant case before me, other than the cause of action having arisen in Kuala Lumpur, the Defendant also did not seek the transfer of its counter claim to Kuala Terengganu. That I think is fatal to its application and puts paid to whatever little semblance of merit that the Defendant ever had to warrant the transfer. If a suit involves a counter claim, the failure of the applicant to seek the transfer of both the main claim and the counter claim should generally not be countenanced as it would clearly defeat the entire objective of securing the most convenient forum for the resolution of the dispute. The application of the Defendant, for such reasons, considering the factors specified in Order 57 r 1 and Section 23(1) of the CJA is not sustainable and must fail. Conclusion [40] In view of the foregoing reasons, it is my judgment that the Defendant has not succeeded in establishing its case for the transfer of the Suit concerning the main claim of the Plaintiff from the High Court of Kuala Lumpur to the High Court in Kuala Terengganu. I therefore dismiss enclosure 7, with costs to the Plaintiff. Dated: 14 August 2017 (MOHD NAZLAN BIN MOHD GHAZALI) Judge High Court NCC1 Kuala Lumpur Counsel: For the Plaintiff Mohd Khairul Azri Messrs S.Ravichandran & Anuar Kuala Lumpur For Defendant Zahidah Zakaria Messrs G.K. Soh & Partners Kemaman, Terengganu Page 2 of 15

Tika 2.6.0

P-02(NCVC)(W)-1349-07/2016

PERAYU TEOW TEK SOON RESPONDEN KOAY CHIN TEONG

10/08/2017

YA DATUK NALLINI PATHMANATHANKorumYA DATO' ALIZATUL KHAIR BINTI OSMAN KHAIRUDDINYA DATUK NALLINI PATHMANATHANYA DATO' ZABARIAH BINTI MOHD YUSOF

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=883fa2ff-a7d1-4c87-90fe-87b2834c862a&Inline=true

1 IN THE COURT OF APPEAL MALAYSIA (APPELLATE JURISDICTION) CIVIL APPEAL NO. P-02(NCVC)(W)-1349-07/2016 BETWEEN TEOW TEK SOON … APPELLANT AND KOAY CHIN TEONG … RESPONDENT (Dalam Mahkamah Tinggi Malaya Di Pulau Pinang Guaman No: 22NCVC-1-01/2015) Between Koay Chin Teong … Plaintiff And 1. Teow Tek Soon 2. Ang Soon Lee … Defendants CORUM ALIZATUL KHAIR OSMAN KHAIRUDDIN, JCA NALLINI PATHMANATHAN, JCA ZABARIAH MOHD YUSOF, JCA 2 GROUNDS OF JUDGMENT Introduction [1] The appeal before us raised two main issues for determination. Firstly, whether there was a valid oral agreement to vary the purchase price of shares sold by the respondent/plaintiff (‘the plaintiff’) to the appellant/1st defendant (‘1st defendant’) and to the 2nd defendant, who is not a party to this appeal. [2] It is not in dispute that there was no written sale of shares agreement executed between the parties. Therefore, the only documents adduced to support the sale of shares from the plaintiff to the 1st defendant and the 2nd defendant were the share transfer forms, Form 32A. The plaintiff argued that by virtue of an oral agreement, parties had agreed upon a purchase price for the shares far higher than that recorded in the share transfer forms, i.e. RM1-00 per unit. The High Court did not agree with the submission of the plaintiff that the parties had agreed upon the purchase price of RM10-71 per unit. However, the High Court found that parties had agreed upon the purchase price of RM3-67 per unit. [3] The second issue raised was whether the 1st defendant and the 2nd defendant had paid the purchase price of the shares to the plaintiff. [4] Learned counsel for the 1st defendant submitted that the price had been set off by a contra arrangement involving another debt owed by the plaintiff to the 1st defendant and the 2nd defendant. The High Court rejected this submission and held that the 1st defendant and the 2nd 3 defendant were liable to pay the plaintiff the purchase price of the shares, recalculated at RM3-67 per unit. [5] We allowed the appeal and append the reasons for our decision below. The salient facts are also set out below. The parties will be referred to as they were in the High Court for ease of reference. Salient Facts [6] The parties are directors and shareholders of a company known as Champ Steel Sdn Bhd (‘Champ Steel’). [7] Champ Steel was established on 30 April 1997 and has a total of 750,000 units of shares selling for RM1-00 each. It carries out the business of fabrication of steel structures. [8] The plaintiff resigned as a director of Champ Steel on 30 April 2007. [9] On 13 November 2007, the plaintiff transferred 147,500 Champ Steel shares to the 1st defendant and 132,501 Champ Steel shares to the 2nd defendant. This is evidenced in two Form 32A dated 13 November 2007, one for the transfer of shares to the 1st defendant for a consideration of RM147,500-00 and another for the transfer of shares to the 2nd defendant for a consideration of RM132,501-00. [10] However, the plaintiff claimed that the reason he sold his shares was to settle his debts to his creditors because he had been served with a Bankruptcy Notice No. 29-31-2007. He needed the sum of RM3 million to avoid being made a bankrupt. For this purpose, he claimed he entered 4 an oral agreement with the defendants for the sale of all his shares in Champ Steel to them for the total consideration of RM3 million. This would mean that each share of Champ Steel cost RM10-71. [11] The plaintiff did not explain, either in his statement of claim or his witness statement, the reason why the transfer forms for the shares did not reflect the actual purchase price of the shares. He merely stated in the statement of claim that the alleged deliberate misstatement of the purchase price of the shares in the transfer forms was done by him upon the request of the defendants. During cross-examination, the plaintiff had no reasonable explanation for misstating the purchase price of the shares at RM1-00 per unit other than that alleging that the 1st defendant had instructed him to do so. [12] The 1st defendant disputed this account by the plaintiff and submitted that the purchase price stated in the transfer forms was correct. Further, the 1st defendant denied not giving the plaintiff consideration for the shares. The 1st defendant submitted that the money owed to the plaintiff for the Champ Steel shares had been set off by a contra arrangement for the debts owed by the plaintiff to the defendants. [13] The plaintiff was adjudged a bankrupt on 7 April 2010. On 10 October 2014, the Insolvency Department granted the plaintiff sanction to commence this action. Subsequently, the plaintiff appointed Messrs Aswar Simon & Azhar as his solicitors and upon his instructions, the said law firm issued a notice of demand dated 3 November 2014 to the defendants. Thereafter, the plaintiff filed the writ on 5 January 2015. 5 [14] The plaintiff admitted that before the writ was filed, he had not issued a notice of demand for the payment of the money he claimed the defendants owed to him. During cross-examination, the plaintiff alleged that he followed up on the debt by telephone because he was advised by a solicitor that as a bankrupt, he could not legally send the defendants a notice of demand for the debt allegedly owed by them. When pressed by the 1st defendant’s counsel to reveal the name of the solicitor who allegedly dispensed such advice, the plaintiff avoided answering the question put to him. [15] When asked why he waited for so long before pursuing his claim against the defendants, the plaintiff alleged that in the telephone calls between him and the defendants, the defendants repeatedly put off the date of payment of the purchase price for the shares with the excuse that they were waiting for the preparation of a share valuation report. [16] The ‘report’ was prepared by Messrs Ooi & Associates, Chartered Accountants in a letter dated 31 January 2010. This report valued the shares based on the audited accounts as at 31 May 2010 at RM3-67 per unit. The plaintiff alleged that the delay in obtaining a valuation report was due to the fact that he had repeatedly asked the defendants to expedite payment. However, the 1st defendant submitted that the valuation report was prepared for the 2nd defendant who intended to sell his shares to the 1st defendant. However, since the 2nd defendant refused to attend court, the High Court judge drew an adverse inference against the 1st defendant on this issue. 6 Findings of the High Court [17] The High Court stated that the 2nd defendant was unco-operative and refused to attend court to testify despite being subpoenaed. On the first hearing date, the 2nd defendant’s solicitors informed the court that on the Friday of the preceding week, they had filed an application to be discharged from acting for him on the basis that he did not give them instructions for the conduct of the matter. The High Court allowed the discharge application and proceeded with the hearing in the absence of the 2nd defendant. Therefore, the High Court held that the 2nd defendant had no defence to the plaintiff’s claim and based on the 2nd defendant’s absence in court, drew an adverse inference against the 1st defendant. [18] Significantly, the learned High Court judge stated in the grounds of judgment that he found that the plaintiff had failed to prove the existence of an oral agreement between the parties for the sale of shares at the purchase price of RM3 million. However, the learned High Court judge went on to hold that the finding on the existence of the oral agreement did not preclude the court from deciding on the plaintiff’s claim because the court had the duty to determine the actual agreed price of the shares. [19] After undertaking a consideration of the evidence, the High Court held the price of RM10-71 per share as per the plaintiff’s claim was too exorbitant. However, the learned High Court judge accepted the submission of the plaintiff’s counsel that the plaintiff had, in order to avoid suffering further losses, acquiesced to the price of RM3-67 per share as per the share valuation report dated 31 January 2010, which valued each share at RM3-67 in the year 2010. Therefore, the High Court recalculated the price of the shares and held that the 1st defendant owed the plaintiff 7 the sum of RM541,325-00 while the 2nd defendant owed the plaintiff the sum of RM486,278-67. [20] The High Court found that the 1st defendant was not honest in claiming that the full purchase price for the shares had been set off by a contra arrangement. The defendants claimed that the plaintiff owed the 1st defendant the sum of RM147,500-00 and owed the 2nd defendant the sum of RM132,501-00. [21] In relation to the 2nd defendant’s claim, the High Court held that since the 2nd defendant did not testify, and that the 1st defendant was not qualified to testify on behalf of the 2nd defendant, the claim by the 2nd defendant had not been proven. [22] In relation to the 1st defendant, the High Court held that it was improbable that the plaintiff was indebted to the defendants for exactly the same sum as the purchase price of the shares, and there was no admissible evidence to prove that the plaintiff did in fact owe the defendants that sum. [23] On the issue of limitation, the High Court was of the view that the cause of action only accrued on 31 January 2010, i.e. the date of the share valuation report. From this report, which valued the shares at RM3-67 per unit, the plaintiff realised that the defendants were not going to pay him the sum of RM3 million. The writ was filed on 5 January 2015, i.e. slightly less than 5 years from the date the cause of action accrued. Therefore, the plaintiff was not time-barred from filing this claim. 8 [24] The High Court allowed the plaintiff’s claim and entered judgment in terms of paragraphs 14(a) and (b) of the plaintiff’s statement of claim, ordering the 1st defendant to pay the plaintiff the recalculated sum of RM541,325-00 (instead of the plaintiff’s claim for RM1,580,351-50) and the 2nd defendant to pay the plaintiff the sum of RM486,278-67 (instead of the plaintiff’s claim for RM1,419,648-50). Both sums were stipulated to be subject to interest at 5% per annum calculated from the date of filing of the writ until full realisation. [25] The High Court dismissed the plaintiff’s claim for general damages, holding that the plaintiff failed to prove this claim. The High Court also ordered the defendants to pay costs of RM30,000 to the plaintiff. [26] Dissatisfied, the 1st defendant appealed. The 2nd defendant did not appeal. Decision of the Court of Appeal [27] Having perused the appeal records and after hearing the submissions of learned counsel, we find that there are merits in the appeal. Our reasons are appended below. The Court Cannot Consider Issues Which Were Not Pleaded [28] It is trite that the court cannot consider issues which were not pleaded. The oft-cited case on this issue is that of Janagi v Ong Boon Kiat [1971] 1 LNS 42; [1971] 2 MLJ 196 where Sharma J, relying on the judgment of Scrutton LJ in the case of Blay v. Pollard & Morris [1930] 1 KB 628, had this to say: 9 “A statement of claim and the defence (together with the reply, if any) constitute the pleadings in a civil action. It is on the examination of the pleadings that the Court notices the differences which exist between the contentions of the parties to the action. In the words the matters on which the parties are at issue are determinable by an examination of the pleadings. An issue arises when a material proposition of law or fact is affirmed by one party and denied by the other. The Court is not entitled to decide a 'suit on a matter on which no issue has been raised by the parties. It is not the duty of the Court to make out a case for one of the parties when the party concerned does not raise or wish to raise the point. In disposing of a suit or matter involving a disputed question of fact it is not proper for the Court to displace the case made by a party in its pleadings and give effect to an entirely new case which the party had not made out in its own pleadings. The trial of a suit should be confined to the pleads on which the parties are at variance. If the parties agree to a factual position then it is hardly open to the Court to come to a find into, different from such agreed facts. The only purpose in requiring pleadings and issues is to ascertain the real difference between the parties and to narrow the area of conflict and to see just where the two sides differ ………………………………………………………….………. A judgment should be based upon the issues which arise in the suit and if such a judgment does not dispose of the questions as presented by the parties it renders itself liable not only to grave criticism but also to a miscarriage of justice. It becomes worse and is unsustainable if it goes outside the issues. Such a judgment cannot be said to be in accordance with the law and the rules of procedure. It is the duty of the Courts to follow the rules of procedure and practice to ensure that justice is done. These rules are meant to be observed and respected. The faith and the confidence of the public in the law, the Constitution and the Government depends to a fairly large extent on the way the machinery of justice functions and it is the duty of those who man that machinery to realise that what they do does not in any way tend to diminish that faith.” (emphasis ours) 10 [29] The decision of Sharma J has been approved by and relied upon by the highest court in the land, most recently the Federal Court in the cases of Saiman Umar v Lembaga Pertubuhan Peladang [2015] 6 MLJ 492, [2015] 9 CLJ 153 and SPM Membrane Switch Sdn Bhd v Kerajaan Negeri Selangor [2016] 1 MLJ 464, [2016] 1 CLJ 177. [30] Therefore, it appeared to us that in granting judgment for the plaintiff based on the unpleaded share purchase price of RM3-67, the High Court had erred. Principles of Appellate Intervention [31] The principles of appellate intervention are trite. The Court of Appeal will very rarely reverse a trial judge’s findings of primary fact and then only if it is satisfied that the trial judge was plainly wrong (see for example Tindok Besar Estate Sdn Bhd v Tinjar Co [1979] 2 MLJ 229, Gan Yook Chin v Lee Ing Chin [2004] 4 CLJ 309, UEM Group Bhd v. Genisys Integrated Engineers Pte Ltd & Anor [2010] 2 MLRA 668, the old English cases of Yuill v Yuill [1945] P 15, 19 per Lord Greene MR and Thomas v Thomas [1947] AC 484 per Lord Thankerton, and more recently in the United Kingdom, In re B (A Child) (Care Proceedings: Threshold Criteria) [2013] 1 WLR 1911, Fage UK Ltd v Chobani UK Ltd [2014] EWCA Civ 5 [2014] ETMR 26, Henderson v Foxworth Investments Limited [2014] UKSC 41, Carlyle v Royal Bank of Scotland plc [2015] UKSC 13, Watson Farley and Wiliams v Ostrovizky [2015] EWCA Civ 457, and Elliston v Glencore Services (UK) Ltd [2016] EWC CIV 407). 11 [32] However, this is one of the rare cases where we are constrained to interfere with the decision of the learned judge. We find that the learned High Court judge erred in law and in fact when, having found that the plaintiff had failed to prove his claim for the purchase price of the shares at RM10-71 per unit, she went on to hold that the court was entitled and indeed, duty bound to make a decision on the actual purchase price of the shares. The High Court erred in finding that the actual purchase price of the shares was RM3-67 per unit, despite the fact that this price was not pleaded by the plaintiff and was only raised by his counsel during submissions. [33] Further, if the High Court had conducted a thorough evaluation of the evidence, a red flag would have surely been raised from the fact that the plaintiff could not logically explain the reason for recording in Form 32A that the shares cost RM1-00 each, but alleged that there was an oral agreement between the parties that the shares would cost RM10-71 each. [34] The learned High Court judge found that the price of RM10-71 per unit was unreasonably high to pay for the shares, considering the fact that from a valuation of the shares between the years 2006 – 2010, the value per unit only fluctuated slightly, increasing slightly each passing year. At its lowest, the shares sold at RM2-40 per unit in 2006, while at its highest, the shares sold at RM3-67 in 2010. [35] Even if there had been an agreement between the parties to falsify the consideration sum in Form 32A (which would have been an illegality), the learned High Court judge should not have awarded the plaintiff the price of the shares as computed in 2010 by the accountants. The transfer of the shares took place on 13 November 2007. Therefore, if at all the 12 plaintiff is entitled to judgment, the High Court should have given judgment on the basis of the share price as at 2007, which the accountant found to be RM2-67 per unit. [36] In any case, the learned High Court judge herself acknowledged in her grounds that the purchaser and the seller are free to agree to fix the contract price at any price (“Sebenarnya, harga saham boleh ditetapkan atas persetujuan pembeli dan penjual.”). Barring any convincing evidence to the contrary, the purchase price of the shares must be taken to be RM1- 00 as per the Form 32A. Limitation [37] Having decided that the High Court had erred in giving judgment for the plaintiff on a claim which was not pleaded, it is not necessary for us to consider the issue of limitation as it is a moot point, as well as the issue of whether there was a contra arrangement. However, suffice for us to remark upon the lax attitude of the plaintiff in neglecting to issue a notice of demand to the defendants until after nearly 7 years had passed from the date of transfer of the shares. [38] Even if it was true that a solicitor had advised the plaintiff that he had no legal capacity to issue a notice of demand to the defendants, a consideration of the relevant dates would show that this argument is a mere afterthought. The plaintiff was only adjudged a bankrupt on 7 April 2010. Between the date of the transfer of the shares into the names of the defendants on 13 November 2007 and the date the plaintiff was adjudged bankrupt, nearly 2 years and 5 months elapsed. It is unreasonable for the plaintiff not to have engaged solicitors to issue a notice of demand to the 13 defendants during this time period. This is especially the case since the plaintiff claimed that he needed the alleged purchase price of the shares in the sum of RM3 million to be paid by the defendants in order to avoid bankruptcy. [39] The court should not countenance the laxity on the part of litigants in pursuing their claims. It is for this reason the doctrine of limitation exists. In Malaysia, the legislation providing for the limitation of actions was enacted as the Limitation Act 1953 (revised 1981) [Act 254]. Section 6 of the Limitation Act provides that for actions such as the present which is premised on a breach of contract, that there is a time-bar after the expiry of 6 years from the date of accrual of the cause of action. [40] In the renowned Supreme Court case of Credit Corp (M) Bhd v. Fong Tak Sin [1991] 2 CLJ 871; [1991] 1 CLJ (Rep) 69, Hashim Yeop Sani CJ (M) stated the rationale for the doctrine of limitation as follows: “The doctrine of limitation is said to be based on two broad considerations. Firstly there is a presumption that a right not exercised for a long time is non-existent. The other consideration is that it is necessary that matters of right in general should not be left too long in a state of uncertainty or doubt or suspense. The limitation law is promulgated for the primary object of discouraging plaintiffs from sleeping on their actions and more importantly, to have a definite end to litigation. This is in accord with the maxim interest reipublicae ut sit finis litium that in the interest of the State there must be an end to litigation. The rationale of the limitation law should be appreciated and enforced by the Courts.” 14 [41] Recently, this court in Husli Mok v. Superintendent of Lands & Survey & Anor [2013] 3 MLJ 666, [2012] 1 LNS 969 referred to and applied the case above. [42] Therefore, even if the plaintiff applied to amend his pleadings or if for some other reason such as estoppel or admission, the defendants are barred from objecting to the share valuation at RM3-67, we find that the plaintiff has been “sleeping on his rights” for nearly 7 years and is not entitled to pursue this action, as it is barred by limitation. Conclusion [43] For the reasons stated above, we find that the learned High Court judge had erred in law and fact in allowing the plaintiff’s claim on a basis that was never pleaded. The decision of the High Court is also inconsistent with the rejection of the plaintiff’s claim for the sale of shares at RM10-71 per share. The court should have either accepted the case put forward by the plaintiff or rejected the same. Having decided to reject the plaintiff’s claim for the share price at RM10-71, it was not open to the court, with the utmost respect, to formulate and make out a case for the plaintiff by finding that the plaintiff was entitled to the sale price of the subject shares at RM3-67 per unit. This latter claim was never pleaded and only sought as a compromise recourse by the plaintiff’s counsel in the course of submissions well after trial. This comprises the primary reason for our allowing the appeal. Therefore, we set aside the decision of the High Court. 15 [44] We ordered costs of RM7,000-00 be paid by the plaintiff to the 1st defendant. The deposit is refunded to the 1st defendant. Nallini Pathmanathan Judge Court of Appeal Malaysia Dated: 10 August 2017 For the Appellants : Kanesh Sundrum Messrs Kanesh Sundrum & Co. Advocates & Solicitors No. 1-1-A, 1st Floor NB Plaza, 3000 Jalan Baru 13700 Prai For the Respondent : Simon Tan Hong Jin (Ooi Chin Zin with him) Messrs Aswar Simon & Azhar Advocates & Solicitors 41-5-4, 5th Floor Wisma Prudential Cantonment Road 10250 Georgetown Signed

Tika 2.6.0

02(f)-12-03-2016(W)

PERAYU 1. U TELEVISION SDN BHD 2. TAN SRI DATO’ SERI VINCENT TAN CHEE YIOUN … APPELLANTS RESPONDEN COMINTEL SDN BHD … RESPONDEN T

Evidence : Burden of proof - Whether approach adopted by High Court and Court of Appeal was correct regarding the discharge of burden of proof by plaintiff seeking judgment in respect of matters of a technical nature - Whether plaintiff had proven its case on balance of probabilities against defendants Evidence : Expert evidence - Onus upon plaintiff to establish facts which by their nature demand expert evidence under s 45 Evidence Act 1950 - Whether open to court to hold said onus to have been discharged without plaintiff calling any expert evidence - Required standard of an expert witness - Whether fulfilled.

08/08/2017

YAA TAN SRI DATO' SERI ZULKEFLI BIN AHMAD MAKINUDINKorumYAA TUN MD RAUS BIN SHARIFYAA TAN SRI DATO' SERI ZULKEFLI BIN AHMAD MAKINUDINYA TAN SRI HASAN BIN LAHYA TAN SRI DATO' WIRA AZIAH BINTI ALIYA TAN SRI JEFFREY TAN KOK WHA

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=1e490af7-8501-46e0-97ec-032161c15296&Inline=true

1 IN THE FEDERAL COURT OF MALAYSIA (APPELLATE JURISDICTION) CIVIL APPEAL NO: 02(f)-12-03/2016(W) BETWEEN 1. U TELEVISION SDN BHD 2. TAN SRI DATO’ SERI VINCENT TAN CHEE YIOUN … APPELLANTS AND COMINTEL SDN BHD … RESPONDENT Coram: Raus Sharif, CJ Zulkefli bin Ahmad Makinudin, PCA Hasan bin Lah, FCJ Aziah Bte. Ali, FCJ Jeffrey Tan Kok Wha, FCJ JUDGMENT OF THE COURT Introduction 1. This is an appeal by the appellants against the decision of the Court of Appeal affirming the decision of the High Court allowing the 2 claim of the respondent against the appellants for breach of contract and dismissing the counterclaim of the appellants against the respondent. The appellants were the first and second defendants and the respondent was the plaintiff before the High Court. We shall refer to the parties as they were before the High Court. 2. The defendants were granted leave to appeal against the decision of the Court of Appeal on the following question of law: “Where the onus is upon the plaintiff to establish facts which by their nature call for or demand expert evidence under section 45 of the Evidence Act 1950, is it open to the Court to hold the said onus to have been discharged without the plaintiff calling any expert evidence having regard to the decision of the Federal Court in Syed Abu Bakar bin Ahmad v. Public Prosecutor [1984] 2 MLJ 19?” Background Facts 3. The relevant background facts of the case are as follows: The plaintiff was a Company involved in the business of amongst others providing software and hardware solutions in the broadcast and telecommunication industries. The first defendant was granted a broadcasting licence under the Communications and Multimedia Act 1998 to provide digital broadcasting services as a subscription TV operator which broadcast local and overseas TV channels. 3 4. The system set up by the first defendant experienced various problems in transmission to viewers. This included poor picture quality, picture jerking, freezing of frames and intermittent video and audio streams. The first defendant engaged the plaintiff to provide technical consultancy services to resolve technical problems that the first defendant encountered in digital broadcasting. 5. After discussions between the parties, a Letter of Award [“LOA”] dated 5.12.2006 was issued by which the plaintiff undertook works in the re-design and transmission enhancement [“the Project”] for the first defendant on a full turnkey basis. The second defendant executed a Guarantee and Indemnity to pay on demand all monies due to the plaintiff under the LOA. 6. The Project consisted of three (3) phases. The contract price for each phase were as follows: Phase 1 RM33,394,265.59 Phase 2 RM36,288,215.22 Phase 3 RM45,360,269.02 Total Contract Price RM115,042,749.83 7. Both parties later agreed to remove a certain portion from the scope of work in the LOA. This resulted in a reduction of the contract price for phase 1 to RM32,050,850.95. No formal agreement was executed between the plaintiff and the first defendant. The parties at 4 all material times accepted the LOA to be the governing contract between them. 8. Under the terms of the LOA the plaintiff was to pass a “Proof of Concept Site Acceptance Test” [“POC SAT”]. The POC SAT was a test aimed at determining whether the plaintiff’s proposal solutions resolved the first defendant technical issues. Various drafts of the test protocol were negotiated between the parties. There were twelve (12) draft versions of the POC SAT. This culminated in the POC SAT version 3.8(a). 9. The POC SAT testing was initially scheduled to be tested on 3 days from 16 – 18.4. 2008. However, midway during the test on 16- 04-2008 the first defendant contended that the plaintiff had not adequately planned and prepared the test. It failed to bring appropriate equipment to carry out the test. Further the first defendant observed that the test format of version 3.8(a) was not suited for the intended purpose of the POC SAT as it would not allow proper recording of the test presentation and results. 10. The first defendant then deferred the test to the next day when the first defendant alleged that the plaintiff’s representatives were told that although version 3.8(a) would be used, that format changes would have to be made in order to improve the presentation and procedure of the test format to enable proper tracking of the test and its results. 5 11. The defendants contended that the plaintiff was aware of the changes and agreed to apply the changes to the the POC SAT. Consequently the POC SAT was carried on 17.4.2008, 18.4.2008 and 21.04.2008 using reformatted version 3.8(a) which came to be described as version 3.8(b). It was the defendants’ position that versions 3.8(a) and 3.8(b) of the POC SAT were similar in substance. The plaintiff however contended otherwise. 12. The first defendant had made payment to the plaintiff amounting to RM20,833,053 for the period between 12.12.2006 and 19.3.2008 under the said Project. 13. The plaintiff claimed that by reason of the first defendant’s failure to make payment when due and by its acts and/or omissions in preventing and/or interference with the plaintiff’s performance and its obligation under the LOA, the first defendant had breached and repudiated the LOA. The plaintiff had no alternative but to terminate the LOA. 14. Pursuant to the guarantee and indemnity executed by the second defendant, the plaintiff demanded the amount due to the plaintiff from the first defendant. 15. The plaintiff in its statement of claim sought the following reliefs: (i) General damages for breach of contract in the sum of RM21,278,498.10 comprising: 6 (a) amount due and owing for work done by the plaintiff in the sum of RM11,217,797.84. (b) amount due and owing to the plaintiff pursuant to clause 15C(1) and 15C(II) of the LOA in the sum of RM10,160,700.26; alternatively, damages for breach of contract in a sum to be assessed, by the first and second defendants and/or each of them in such proportion (if any) as may be determined by the court; (ii) Special damages for storage and insurance costs of the Transmitters in the sum of RM162,517.10 as of 23.6.2010 and still continuing; (iii) Costs; (iv) Interest on such amounts of special and/or general damages as may be awarded by this Court; and (v) Such further and other relief as deems fit. 16. The first defendant’s counterclaim against the plaintiff sought the following reliefs: (i) the sum of RM20,833,053 to be paid by the plaintiff to the first defendant within fourteen (14) days of the date of the Court’s Order; (ii) general damages for breach of contract to be assessed by the Court; (iii) interest at the rate of 8% per annum on all sums adjudged to be paid by the plaintiff to the first defendant; 7 (iv) costs on a solicitor and client basis; and (v) further and other relief as the Court deems proper. Findings of the High Court 17. The main issues for determination before the High Court as found by the learned High Court Judge are as follows: (1) Whether the POC SAT version 3.8(a) and 3.8(b) were the same or were they different; and (2) Whether the plaintiff had passed the POC SAT either based on version 3.8(a) or 3.8(b). 18. The learned High Court Judge came to a finding that the plaintiff had passed the POC SAT and hence allowed the plaintiff’s claim and dismissed the defendants’ counterclaim for the following reasons, amongst others: (1) The defendants’ witnesses lacked expertise and technical knowhow despite holding senior management positions in the first defendant and being involved in the project. [See paragraph 57 of the Judgment of the High Court]. (2) The plaintiffs’ witnesses PW2 and PW3 demonstrated that they had the technical expertise and knowhow of the working of the Project. [See paragraph 58 of the Judgment of the High Court]. 8 (3) The plaintiff’s evidence that the POC was a standalone system was to be preferred over the defendants’ contention that the POC was an end-to-end broadcast solution. [See paragraph 59 of the Judgment of the High Court]. (4) Versions 3.8(a) and 3.8(b) are different. [See paragraph 61 of the Judgment of the High Court]. Findings of the Court of Appeal 19. The Court of Appeal affirmed the decision of the High Court and dismissed the defendants’ appeal. The learned Judges of the Court of Appeal in their Judgment stated that the crucial issue raised in the case was, what was the correct test protocol to be used: version 3.8(a) or version 3.8(b). [See paragraph 53 of the Judgment of the Court of Appeal]. 20. The Court of Appeal took note of the learned High Court Judge’s finding that the plaintiff’s witnesses, PW2 and PW3, demonstrated that they had the technical expertise and knowhow of the workings of the Project. This led the Court of Appeal to affirm the decision of the High Court and to hold that the test protocol version 3.8(b) utilized was not mutually agreed to by the parties and that it was substantially different from version 3.8(a) and that thus the plaintiff was entitled to reject the test results of the test protocol of version 3.8(b). 9 Submissions of the Defendants 21. Learned Counsel for the defendants submitted that the plaintiff was supposedly the expert who would solve the problems faced by the first defendant in its digital broadcasting. The main point in the case before the High Court was whether the plaintiff had solved the problem that it was engaged to remedy. What this meant was whether the POC SAT had been achieved. 22. It was the contention of the defendants that the issues raised before the Court were admittedly of a technical nature. Learned Counsel for the defendants submitted that the learned High Court Judge did not direct parties to lead expert evidence on the technical issues. Parties were left to determine the nature of their evidence thought sufficient to establish their respective cases. Consequently, no expert witness was called by either party at the trial. 23. The defendants contended that the plaintiff’s fact witnesses, PW2, PW3 and PW4, who claimed to have a technical background, amongst others, at the trial had made the following critical admissions in their evidence on essential points which wholly undermined the plaintiff’s case as follows: (i) the test criteria and components of POC SAT version 3.8(a) and 3.8(b) were the same. The diagrams drawn to illustrate versions 3.8(a) and 3.8(b) were also the same; 10 (ii) the plaintiff was aware and accepted that whether the system had “frozen” during the POC SAT was not the only criteria for the plaintiff to pass; (iii) the plaintiff recognized the first defendant’s desire to test the system functionality and performance from end-to- end; (iv) the POC SAT conducted in April 2008 was not a trial run; and (v) there were no documents to show that the plaintiff had in fact passed version 3.8(a). 24. The first defendant also contended that the test results recorded failure of the plaintiff’s solutions at various stages, resulting in the failed POC SAT. The plaintiff refused to accept the test results and attempted to declare the test result as void, alleging the tests to be merely a ‘trial run’. 25. Upon the plaintiff’s request, parties considered a re-test but no re-test was conducted as parties could not agree on the scope of the revised POC SAT. 26. It was the defendants’ case that the plaintiff’s failure to rectify the failed POC SAT was a breach of the plaintiff’s obligations as a full turnkey contractor under the terms of the LOA and of the representations made by the plaintiff of its skills and expertise. 11 27. It was the contention of the defendants that the plaintiff’s breach resulted in the Project being suspended and stalled, including the re-test of the POC SAT, Network Operation Centre Acceptance Tests (NOC SAT) and installation of the Transmitters. Submissions of the Plaintiff 28. It was the submission of the plaintiff that the dispute between the parties was essentially a contractual dispute over the agreed test protocol version to be used for the tests conducted jointly between representatives from both sides. In this regard the learned High Court Judge was not called upon to decide on technical questions or any mater involving scientific knowledge or knowhow. 29. It was the contention of the plaintiff, that there was concurrent finding of fact by the Courts below that the first defendant deliberately failed to use the test version designed by the plaintiff and effectively prevented or hindered the plaintiff from completing the Project. 30. On the part of the plaintiff, its onus was to prove what was the test protocol agreed by the parties under clause 15B of the LOA and not the technical components of the same or how it worked. It was submitted that expert evidence was neither relevant nor necessary given what was agreed by the parties. If the first defendant thought otherwise it could have called an independent technical witness to prove the compatibility between versions 3.8(a) and 3.8(b). 12 31. It was the contention of the plaintiff that in the circumstances of the case it did not see any necessity to call an expert witness on the issues in dispute. Decision 32. It is to be noted at the outset that the learned Judges of the High Court and the Court of Appeal took the view that the technical nature of the evidence presented by the parties required technical expertise. 33. The main issue for determination in the case before the High Court was whether the POC SAT had been performed and the results achieved. The plaintiff contended it met the test. The defendants contended otherwise. Neither side called an expert to determine whether the test had been met. Nevertheless, the learned High Court Judge treated the two important witnesses of the plaintiff [PW2 and PW3] as if they were experts. 34. It is our considered view that the fact that since both the Courts below determined that there was a need for technical evidence for parties to prove their respective case, the pertinent question to be resolved in this case is whether the approach adopted by both the High Court and the Court of Appeal was correct as regards the discharge of the burden of proof by the plaintiff seeking judgment in respect of matters of a technical nature. 13 35. On the meaning and application of the term “burden of proof” section 101 of the Evidence Act 1950 [“the Act”] states that it is the burden to establish a case which rests throughout on the party who assert the affirmative of the issue. The “burden of proof” in section 102 of the Act is the burden to adduce evidence, to make out or rebut the claim. The “burden of proof” in section 102 of the Act shifts from one side to the other according to the weight of the evidence. 36. In the Federal Court’s case of Letchumanan Chettiar Alagappan @ L. Allagappan & Another v Secure Plantation Sdn. Bhd. [2017] 5 CLJ 418 his lordship Jeffrey Tan, FCJ cited with approval the principle laid down in the case of Ranchhodbhai v. Babuhai AIR 1982 Guj 308 as regards the “burden of proof” to establish a case which never shift and the shifting burden to adduce evidence in the context of sections 101 and 102 of the Indian Evidence Act which are identical to sections 101 and 102 of our Act as follows: “It is also well to bear in mind that there is an essential distinction between ‘burden of proof’ and ‘onus of proof’; burden of proof lies upon the person who has to prove a fact and it never shifts, but the onus of proof shifts. Such a shifting of onus is a continuous process in the evaluation of evidence. [See Raghavamma v. Chenchamma, AIR 1964 SC 136]. Burden of proof has two distinct meanings, namely, (i) the burden of proof as a matter of law and pleadings, and (ii) the burden of proof as a matter of adducing evidence. Section 101 of the Evidence Act deals with the former and Section 102 of the Evidence Act with the latter. The first remains constant but the 14 second shifts. In a claim application, therefore, the burden of proof, in the first sense, certainly lies on the claimant. If he examines himself and his witness, if any, and if the evidence, tested in the light of the principle as set out above, is found to be acceptable, the onus shifts on the tortfeasor to prove those circumstances, if any, which dislodge the assertions of the claimants. If the tortfeasor fails to prove before the Court any fact or circumstance which tends to affect the evidence led by the claimant, the claimant would be entitled to ask the Court to hold that he has established the case and, on that basis, to make a just award it would thus appear, that though the legal burden, - the burden as a matter of law and pleadings – remains constant on the claimant, the burden as a matter of adducing evidence changes often times as the trial of the claim petition progresses.” 37. In the present case the learned High Court Judge recognized that the parties differed in their interpretation of the POC SAT. The defendants understood it to be a model of the end-to-end broadcast solution whereas the plaintiff viewed the POC SAT as a standalone system. The learned High Court Judge further recognized that the parties differed on the issue of whether POC SAT versions 3.8(a) and 3.8(b) were the same. 38. We are of the view the issues surrounding the POC SAT were technical in nature and were pivotal in determining whether the first defendant wrongfully prevented the plaintiff from performing the LOA as contended by the plaintiff. 39. It is noted that the learned High Court Judge decided on the burden of proof for the plaintiff to prove its case on this technical 15 issue based on the evidence provided by its fact witnesses namely PW2 and PW3. The plaintiff’s fact witnesses were preferred by the learned High Court Judge on the basis that PW2 and PW3 demonstrated that they had the technical expertise and knowledge of the working of the Project. 40. The learned High Court Judge accepted PW2 and PW3 as experts when in our view they did not satisfy the test under section 45 of the Act. Section 45 of the Act provides: “45. (1) When the Court has to form an opinion upon a point of foreign law or of science or art or as to identify or genuineness of handwriting or finger impressions, the opinions upon that point of persons specially skilled in that foreign law, science or art or in questions as to identity or genuineness of handwriting or finger impressions, are relevant facts. (2) Such persons are called experts.” 41. For a witness to be an expert, he must be truly independent and skilled in the area in which he is giving evidence. [See the case of Batu Kemas Industri v. Kerajaan Malaysia Tenaga Nasional Berhad (2015) 5 MLJ 52]. In accepting the plaintiff’s case the learned High Court Judge relied in particular on the testimony of PW2, the plaintiff’s Senior Manager who was personally involved in the technical aspects of the Project and who coordinated and oversaw the implementation of the Project and participated in the discussions to finalise the test protocol for the POC SAT with the first defendant. Reliance was also placed on the evidence of PW3, the CEO of the plaintiff’s company. 16 42. In contrast, the learned High Court Judge rejected and disbelieved the testimony of the defendants’ witnesses, DW1 and DW2, that the definitive version was version 3.8(b), particularly because DW1 and DW2 were not technical experts for the POC SAT, but were accountants by profession. 43. It is our finding that both the plaintiff’s witnesses, PW2 and PW3, fell far short of the required standard of an expert witness under section 45 of the Act. PW2 was the Senior Manager and PW3 the plaintiff’s CEO and director. Both witnesses can hardly be described as independent. As members of the plaintiff’s Senior Management team they should have been treated as having an interest in the case. This fact by itself should have disqualified them as truly independent witnesses. 44. It is our considered view that the learned High Court Judge, who formed the view that the issues required technical evidence, was in no position to make a determination of those technical issues without such expert evidence as the provision of section 45 of the Act applied. 45. In the context of the present case we are of the view that expert evidence was required. The plaintiff’s witnesses, namely PW2 and PW3 were witnesses of facts and could not be characterized as experts. It was not, but was found by the learned High Court Judge, a question of accepting the testimony of plaintiff’s witnesses PW2 and PW3 and disbelieving the testimony of the defendants’ witnesses, 17 DW1 and DW2, on the issues raised. There being no expert evidence, the learned High Court Judge was in no position to make a determination of these technical issues. On this point, we would like to refer to the observation made by Abdul Hamid, FCJ (as he then was) in the case of Syed Abu Bakar bin Ahmad v. Public Prosecutor [1984] 2 MLJ 19 at page 23 as follows: “Our law is clear in that under section 45 of our Evidence Act 1950 it is provided that…The scope of this section can be found in the commentary in Sarkar on Evidence 12th ed. at page 488 where, while recognizing that opinion in so far as it may be founded on legal evidence shall be the function of the tribunal whose province alone it is to draw conclusions of law or fact – ‘There are however cases in which the Court is not in a position to form a correct judgment without help of persons who have acquired special skill or experience on a particular subject, e.g. when the question involved is beyond the range of common experience or common knowledge or when special study of a subject or special training or special experience therein is necessary. In such cases the help of experts is required. In these cases, the rule is relaxed and expert evidence is admitted to enable the court to come to a proper decision.’ … Since the document was not examined by any person who has acquired a special skill or expert in the particular subject, i.e. handwriting, the question therefore is was the learned High Court Judge right in making the finding of fact that he did in the absence and without the aid of expert evidence? … 18 It is settled principle that while it is true that a Judge who sits alone is entitled to weigh all the evidence, to put his own magnifying glass to determine the probabilities so to speak and form his own opinion or judgment, it would be erroneous for him to form a conclusion on a matter which could only be properly concluded with the aid for expert evidence.” [Emphasis added] 46. It is to be noted that the plaintiff did not lead their evidence on the basis upon which its witnesses were experts and as such their evidence were not scrutinized on that basis. On this point in PB Malaysia Sdn Bhd v. Samudra (M) Sdn Bhd [2009] 7 MLJ 681 at 702, Ramli Ali J. (as he then was) held that: “Opinions of experts are admissible to furnish the court with scientific information which is unlikely to be within the experience and knowledge of a judge, (s 451(1) of the Evidence Act 1950). Where expert testimony is required on certain matters including technical matters relevant in allegations of professional negligence (in this case, against a consulting engineer), it is not open to the court to decide on such matters in the absence of such evidence.” [Emphasis Added]. 47. The decision of Mohamed Azmi SCJ in Junaidi bin Abdullah v. Public Prosecutor [1993] 3 MLJ 217 is also relevant and instructive on the need to call expert evidence wherein his lordship had this to say: “In our view, the test to be applied for the purpose of section 45 of the Evidence Act 1950 is this. First, does the nature of the evidence require special skill? Second, if so, has the witness acquired the 19 necessary skill either by academic qualification or experience so that he has adequate knowledge to express an opinion on the matter under enquiry? The answer to both questions must necessarily depend on the facts of each particular case. The specialty of the skill required of an expert witness under section 45 would depend on the scientific nature and complexity of the evidence sought to be proved. The more scientific and complex the subject matter, the more extensive and deeper will the court be required to enquire into the ascertainment of his qualification or experience in the particular field of art trade or profession.” [Emphasis Added]. 48. It was submitted for the plaintiff that if the first defendant held the view that expert evidence was relevant and necessary to prove the compatibility between versions 3.8(a) and 3.8(b) it was for the first defendant to call such independent technical witness. With respect we could not agree with such a contention. 49. It must be borne in mind that the burden was on the plaintiff to put sufficient material before the High Court to discharge its burden of proof. It should also be noted that the defendants approached the matter on the basis that the admissions of the plaintiff’s so-called technical witnesses on essential points had wholly undermined the plaintiff’s own case, which can be seen as follows: (1) The plaintiff’s witness PW2, the Senior Manager of the plaintiff’s system and Network Department in re- examination when asked whether the test criteria and 20 components of POC SAT versions 3.8(a) and 3.8(b) were the same had this to say: “PC: Why did you all come out with version 3.8(b)? A: We did not come out with 3.8(b). When we received the result it’s actually the 3.8b result, yes. The test was carried out on 3.8(a). But, the result when come back is on 3.8(b). PC: Was the criteria used in 38(a), the same as been used in 3.8(b)? A: Yes. The content layer measurement, transcoding test is the same criteria stated. PC: The same criteria? A: Yes.” [See lines 11-24 at page 198 of the Records of Proceedings]. (2) The plaintiff was also aware and accepted that whether the system had “frozen” during the POC SAT was not the only criteria for the plaintiff to pass. The plaintiff’s witness PW4, one of the directors of the plaintiff in cross- examination on this point had this to say: “DC: Another words,….if you look at page 629 that is on the Content Acquisition test stage and you look at page 639, that is on the offline editing stage and finally you look at page 650 that is on the Compression and Delivery test stage. It does include a human perception element where the testing the parameters is to check whether there is video pixelization whether there is any video audio jerking and freezing, video noise, video crackle, audio rumble so on and so forth. So, therefore I said looking at all this, POC SAT is 21 not just about whether STB freezes or otherwise, it is a little bit more than that? A: Yes, if you look at the main complaint by the operator is set topbox freeze. So the first thing is to solve this set topbox freeze and there is a recommendation to change WMV9 out and replace it with MPEG-4. Okay. The rest are basically a perception which is visual…for example pixelization and all that. We can carry out all kinds of test, and that would not be a problem.” [See lines 25-41 at page 276 of the Record of Proceedings] (3) The plaintiff’s witness PW2 admitted during cross- examination that the POC SAT test concluded in April 2008 was not a trial run: “DC: Now, I understand from Goh that these 4 days…right, 16th , 17th , 18th and 21st was actually a POC SAT and they are not the trial run. A: Yes, My Lady.” [See lines 4-8 at page 111 of the Record of Proceedings] (4) PW3, the plaintiff’s CEO and director in cross-examination could not show that the plaintiff had in fact passed version 3.8(a): “DC: As far as you understand, you have already passed your portion. That’s where I wanted to take it further and say, is there any documents to show that you have passed your 22 portion. You, in the sense of Comintel have passed the Comintel’s portion. A: By looking at the result form the test result given by the UTV, just on the original scope for the POC. DC: But, you don’t have your own document to show that you have passed? A: I can’t recall whether we have that.” [See lines 10-20 at page 241 of the Record of Proceedings] (5) The plaintiff’s witness PW3 agreed that the onus was on the plaintiff as the vendor to document and prepare the test result. “DC: Now, as a vendor, is it not in your interest to see that, you passed the POC SAT, is it also not in your interest to make recording of what was the results. A: Yes, it is our interest.” [See lines 24-28 at page 237 of the Record of Proceedings] 50. The High Court found that there was a need for technical evidence but, however, it preferred the evidence of the plaintiff on the basis of its so-called technical witnesses. It is our judgment, when it was determined that there was a need for technical evidence, it was incumbent on the plaintiff to lead evidence through experts. It did not do so and by reason of that failure had failed to discharge its “burden of proof” under sections 101 and 102 of the Act. Consequently the 23 “onus of proof” did not shift to the defendants to dislodge the assertions made by the plaintiff as the claimant. 51. Learned Counsel for the defendants also raised an additional point in his submission. This was the question of whether the first defendant breached the terms under the LOA in not performing its obligations. It was the contention of the defendants that for a party to be held liable for breach of contract, he must be shown to have committed a breach going to the root of the contract. [See Rasiah Munusamy v. Lim Tan & Sons Sdn Bhd (1985) 2 MLJ 291 at p. 294]. In the present case, the first defendant had shown its willingness to perform the contract. In the first place, it had paid 65% of the contract sum for phase 1. It wanted the glitches in the system to be removed. The plaintiff did not do that. Instead the plaintiff terminated the contract. 52. It is to be noted in this case that the issue as to whether POC SAT had been achieved or not had not been determined in view of the conflicting contention of the parties. The plaintiff contended it met the test. The defendants refuted that. However, from the evidence adduced before the learned High Court Judge, the test results recorded failure of the plaintiff’s solutions at various stages, resulting in the failed POC SAT. The plaintiff refused to accept the test results on the ground that the first defendant adopted the POC SAT based on version 3.8(b) which the plaintiff claimed was not agreed upon by the parties. Upon the plaintiff’s request, parties considered a re-test but no re-test was conducted as parties could not agree on the scope 24 of the revised POC SAT. Therefore, on the evidence before the Court, the POC SAT based on version 3.8(a) was at no time performed and achieved, but yet the learned High Court Judge came to a finding that the plaintiff had passed the POC SAT. This to us was an erroneous finding. 53. Based on the facts and the circumstances of the case it is our considered view that the plaintiff’s failure to rectify the failed POC SAT was a breach of the plaintiff’s obligations as a full turnkey contractor under the terms of the LOA and of the representations made by the plaintiff of its skills and expertise. The failure of the POC SAT effectively prevented the Project from moving forward as the delivery of transmission sites and the testing and acceptance of the redesigned Network Operation Centre were contingent on the plaintiff having passed the POC SAT. In this regard, the plaintiff could not contend that the first defendant wrongly prevented it from performing the LOA. 54. It can be said in this case that the first defendant did not receive what it contracted for. The turnkey contract required the plaintiff to remove the technical faults faced by the defendant in the system. Accordingly, we are of the view that there was a total failure of consideration on the part of the plaintiff to perform its obligations under the contract. [See the cases of Stocznia Gdanska SA v. Latvian Shipping Co & Others [1998] 1 All ER 883 at 896 and Damansara Realty v. Bangsar Hill Holdings Sdn Bhd & Others [2011] 6 MLJ 464]. The act of termination of the contract by the 25 plaintiff itself amounted to a repudiation under section 40 of the Contracts Act 1950 which provides as follows: “When a party to a contract has refused to perform, or disabled himself from performing, his promise in its entirety, the promisee may put to an end to the contract, unless he has signified, by words or conduct, his acquiescence in its continuance.” 55. There was no judicial appreciation of the evidence by the learned High Court Judge of the High Court in coming to the conclusion that the plaintiff had discharged its burden of proof of proving its case. The Court of Appeal also failed to exercise its powers of appellate intervention in not reversing the findings of the learned High Court Judge. It is therefore appropriate for this Court to exercise its powers of appellate intervention and reverse the findings and the decision of the High Court. In the circumstances of this case, it is our considered view that the plaintiff had not proved its case on balance of probabilities against the defendants. 56. For the reasons above stated we would allow this appeal with costs. The question of law posed is answered in the negative. The orders of the High Court as affirmed by the Court of Appeal are hereby set aside. As regards the counterclaim of the defendants against the plaintiff, we would allow the counterclaim with costs to the extent of only the recovery of the sum of RM20,833,053 already paid to the plaintiff by the defendants under the contract sum for phase 1 of the Project with interest at the rate of 8% per annum, so as to put 26 the parties back to their original positions. The deposit is to be refunded to the defendants. (ZULKEFLI BIN AHMAD MAKINUDIN) President Court of Appeal Dated: 18th August 2017 Counsel for the Appellants Datuk Seri Gopal Seri Ram, Clinton Tan Kian Seng and David Yii. Solicitors for the Appellants Messrs. Thomas Philip Counsel for the Respondent Dato’ Cyrus Das, Nahendran Navaratnam, Wong Wye Wah and Tan Min Lee. Solicitors for the Respondent Messrs. Gan Partnership

Tika 2.6.0

02-72-10/2015(W)

PERAYU DATO' DR LOW BIN TICK RESPONDEN DATUK CHONG THO CHIN

Tort : Defamation - Absolute privilege - Letters alleged to be defamatory sent to various investigative agencies without authority or mandate - Whether absence of such authority or mandate would negate or make unavailable defence of absolute privilege - Whether requisite authority or mandate is necessary for absolute privilege to apply Tort : Defamation - Absolute privilege - Nature and scope of - Whether police report protected by absolute privilege - Public policy considerations Tort : Defamation - Absolute privilege - Reports to other public investigative agencies and authorities - Whether ratio in Lee Yoke Ham v. Chin Keat Seng ought to be applied to reports to other public investigative agencies and authorities - Whether report to other public investigative agencies and authorities protected by absolute privilege Tort : Defamation - Libel - Malice - Whether defence of qualified privilege not available if shown tortfeasor actuated by actual or express malice or if tortfeasor motivated by some indirect or wrong motive - Whether mere act of filing complaints with various relevant authorities, without more, insufficient to prove malice Tort : Defamation - Qualified privilege - Letter of complaint sent by Complainant as President of Association to Bar Council because Complainee an advocate and solicitor - Whether Complainant had an interest to make such complaint - Whether Bar Council had corresponding interest to receive such letter of complaint - Whether such letter of complaint protected by qualified privilege Tort : Defamation - Qualified privilege - Nature and scope of - Whether qualified privilege depended on the nature of the occasion in which the impugned communication was made - Whether a matter of law for the judge to decide whether occasion was privilege

07/08/2017

YA TAN SRI DATO' WIRA AZIAH BINTI ALIKorumYAA TAN SRI DATO' SRI AHMAD BIN HAJI MAAROPYAA TAN SRI DATUK SERI PANGLIMA RICHARD MALANJUMYA TAN SRI HASAN BIN LAHYA TAN SRI DATUK RAMLY BIN HAJI ALIYA TAN SRI DATO' WIRA AZIAH BINTI ALI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=beb966e8-36cc-4c39-a861-d1d942447df0&Inline=true

1 MAHKAMAH PERSEKUTUAN MALAYSIA DI PUTRAJAYA (BIDANGKUASA RAYUAN) RAYUAN SIVIL NO. 02-73-10/2015(W) ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN … RESPONDEN [DALAM MAHKAMAH RAYUAN MALAYSIA DI PUTRAJAYA RAYUAN SIVIL NO. W-02-1700-07/2012 ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN … RESPONDEN DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR GUAMAN SIVIL NO. S3-23-78-2007 ANTARA DATUK CHONG THO CHIN … PLAINTIF DAN DATO’ DR. LOW BIN TICK … DEFENDAN] 2 DIDENGAR BERSAMA DENGAN MAHKAMAH PERSEKUTUAN MALAYSIA DI PUTRAJAYA (BIDANGKUASA RAYUAN) RAYUAN SIVIL NO. 02-74-10/2015(W) ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN … RESPONDEN [DALAM MAHKAMAH RAYUAN MALAYSIA DI PUTRAJAYA RAYUAN SIVIL NO. W-02-1662-07/2012 ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN … RESPONDEN DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR GUAMAN SIVIL NO. S-23-709-2007 ANTARA DATUK CHONG THO CHIN … PLAINTIF DAN DATO’ DR. LOW BIN TICK … DEFENDAN] 3 DIDENGAR BERSAMA DENGAN MAHKAMAH PERSEKUTUAN MALAYSIA DI PUTRAJAYA (BIDANGKUASA RAYUAN) RAYUAN SIVIL NO. 02-75-10/2015(W) ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN … RESPONDEN [DALAM MAHKAMAH RAYUAN MALAYSIA DI PUTRAJAYA RAYUAN SIVIL NO.W-02-18-01/2013 ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN … RESPONDEN DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR GUAMAN SIVIL NO. S4-23-79-2007 ANTARA DATUK CHONG THO CHIN … PLAINTIF DAN DATO’ DR. LOW BIN TICK … DEFENDAN] 4 DIDENGAR BERSAMA DENGAN MAHKAMAH PERSEKUTUAN MALAYSIA DI PUTRAJAYA (BIDANGKUASA RAYUAN) RAYUAN SIVIL NO. 02-76-10/2015(W) ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN RESPONDEN- YAP HON KONG … RESPONDEN [DALAM MAHKAMAH RAYUAN MALAYSIA DI PUTRAJAYA RAYUAN SIVIL NO.W-02-1701-07/2012 ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN RESPONDEN- YAP HON KONG … RESPONDEN DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR GUAMAN SIVIL NO. S4-23-83-2007 ANTARA DATUK CHONG THO CHIN PLAINTIF- YAP HON KONG … PLAINTIF DAN DATO’ DR. LOW BIN TICK … DEFENDAN] 5 CORAM: AHMAD MAAROP, CJM RICHARD MALANJUM, CJSS HASAN LAH, FCJ RAMLY ALI, FCJ AZIAH ALI, FCJ JUDGMENT OF THE COURT Introduction [1] There are four appeals heard before us. These appeals are against the decision of the Court of Appeal dated 3.12.2014 in Civil Appeal No.W-02-1701-07/2012 which was heard together with Civil Appeal Nos.W-02-18-01/2013, W-02-1662- 07/2012 and W-02-1700-07/2012. [2] The Court of Appeal dismissed the appellant’s appeals (save for interest and costs) and affirmed the decision of the High Court dated 8.8.2012 allowing the respondent’s claims against the appellant for defamation. The High Court awarded general damages, exemplary damages and aggravated damages against the appellant. [3] The respondent’s claims against the appellant were in respect of a police report and letters of complaint lodged by the appellant with the Commercial Crime Division, Kuala Lumpur (‘CCD’), the Disciplinary Board (‘DB’), the Bar Council Malaysia (‘BC’), the Anti Corruption Agency (‘ACA’) and the Registrar of Societies (‘ROS’). 6 Questions of law [4] On 6.10.2015 this court granted leave to appeal on five questions of law which were consolidated by the learned counsel for the appellant as follows: (i) whether the lodging or writing of letter/s of complaint/s to the ROS/ACA/CCD were occasions of absolute privilege, consonant and/or consistent with the principle set out by the Federal Court in Lee Yoke Yam v Chin Keat Seng [2013] 1 MLJ 145 (“Lee Yoke Yam”)?; (ii) whether the issue of authority was a relevant or necessary consideration for absolute privilege to apply?; (iii) whether the lodging or writing of letter/s of complaint/s to the ROS/ACA/CCD/BC were, prima facie, occasions of qualified privilege?; (iv) whether malice as contemplated in the authority of Horrocks v Lowe [1974] 1 All ER 662 (“Horrocks”) may be inferred from the failure on the part of the defendant to take steps that he is not obliged to in law for the purpose of defeating the defence of qualified privilege, and (v) whether a High Court is empowered to award aggravated and/or exemplary damages in respect of a series of defamatory remarks premised upon the same factor raised or contended by a plaintiff? 7 Background facts [5] At the material time the appellant was the President of Chinwoo Athletic Association Selangor and Kuala Lumpur (‘Chinwoo’). The appellant became the President of Chinwoo in 2001. He succeeded the respondent who was the immediate past president of Chinwoo. [6] The respondent is an advocate and solicitor and the founder of the legal firm Messrs T.C. Chong & Rakan-Rakan. The respondent was the President of Chinwoo from 30.6.1991 till 24.6.2001. Prior to that, the respondent was the Vice- President of Chinwoo from 1983 to 1988. He was a member of the Chinwoo Property Committee (CPC) from 1984 and became Chairman of the CPC from 1989 till 1990. He was the Deputy President of Chinwoo from 1989 till 1991. [7] Chinwoo was the registered owner of a parcel of land known as GRT 2643 Lot 27, Section 69, Bandar Kuala Lumpur (‘the Land’). By a resolution made at Chinwoo’s extraordinary general meeting (‘EGM’) on 22.4.1984, the members resolved to enter into a joint venture with one Jiwa Realty Sdn Bhd (‘the Developer’) to develop the Land (the Project). [8] In 1985 and 1986 Chinwoo entered into two sale and purchase agreements with the Developer. Pursuant to the 1985 sale and purchase agreement (the 1985 SPA) Chinwoo agreed to sell the Land to the Developer and in return, according to the 1986 sale and purchase agreement (the 1986 SPA), the 8 Developer agreed to sell 23% of the units developed in the Project to Chinwoo. This reflected the agreed sharing ratio of 23:77. However no development took place. [9] On 30.6.1991 by an Extraordinary General Meeting (EGM), it was decided that the 1985 and 1986 SPAs be revoked and a new agreement be entered with the Developer. The respondent was then the President of Chinwoo. At this EGM it was decided that the total number of units was 669. Chinwoo would purchase 154 units and 159 car park bays. The 154 units represented 23% of the 669 pre-determined total and reflected the sharing ratio 23:77 that had been agreed previously. [10] On 26.3.1992, the 1985 and 1986 SPAs were revoked. On the same date Chinwoo and the Developer entered into two new sale and purchase agreements (the 1992 SPAs). One agreement was for the sale of the Land by Chinwoo to the Developer and the other was for the purchase of one block of 154 units and 159 car park bays by Chinwoo from the Developer. The parties also entered into an additional supplemental agreement on the same date (the Additional Agreement) which contained a new clause allowing the Developer to develop the Land “in whatever manner it may deem fit” (the Free Hand Clause). The Additional Agreement reveals that the Trustees of Chinwoo had agreed to the Free Hand Clause. The respondent was a trustee of Chinwoo then. He was also a member of the Chinwoo Property Committee 9 (CPC). The 1992 SPAs and the Additional Agreement were drawn up by the respondent’s legal firm. [11] On 14.6.1998 the apartment block containing 154 units and 159 car park bays were handed over to Chinwoo. Some members then realized that the 154 units was less than 23% of the agreed sharing ratio because, during the development of the Project, and by virtue of the Free Hand Clause, the Developer had obtained approval from the authorities to build an additional 201 units. Thus the total number of units built was 870 and not 669 units. The members were unhappy that the Developer was given a free hand to develop its portion of the Project as they saw fit which ultimately deprived Chinwoo of 46 units. [12] At the Annual General Meeting (AGM) on 29.6.2003 (the 2003 AGM), a unanimous resolution was passed (the 2003 resolution) directing Chinwoo’s General Committee (GC) to investigate the Project to determine whether there were any irregularities. The GC is the highest decision-making body in between General Meetings of Members. The GC comprises the President, Deputy President, two Vice Presidents and 22 Committee Members. During the debate leading to the resolution, the respondent had suggested that an independent committee be set up to investigate the Project. 10 [13] The 2003 resolution as contained in the minutes of the AGM reads, amongst others, as follows: “….. unanimously directed the new general committee to investigate the real facts of the development of Chinwoo Court, whether what our Association got is fair and conform to the principle win-win, if it is found that something is questionable, get advice from our Association’s legal adviser, contact the relevant department and authorities and take appropriate action.” [14] Subsequent to the 2003 AGM, the GC established an Independent General Committee (ICE) comprising of individuals who were not members of Chinwoo. ICE conducted its investigations based on documents provided by the secretariat of Chinwoo. No member was called for an interview or inquiry. In its qualified report (the ICE report), ICE found, amongst others, that: (a) the GC which was led by the respondent at the material time was in breach of its duty to Chinwoo and was negligent in failing to protect Chinwoo’s entitlement to 23% of the constructed units and these acts of breach of duty and negligence might be actionable by Chinwoo; (b) on the documents there was no evidence that any member of the GC or any other individual had committed any criminal act, and (c) a civil claim be commenced against the Developer for liquidated damages for late delivery of the Chinwoo’s units. 11 [15] On 2.11.2004 the meeting of the GC scrutinized the report by ICE and decided, amongst others, that the ICE report be submitted to the BC, the ACA and the ROS. On 29.3.2005 the GC agreed to table the ICE report during the upcoming AGM. The appellant also informed the GC that, in accordance with the 2003 resolution, he would forward the ICE report to the ROS, BC, ACA and CCD. No objection was raised by the members of the GC. [16] The appellant sent the ICE report to the CCD and the DB under two separate cover letters dated 18.5.2005 and 25.5.2005 respectively. On 31.5.2005 he reported this to the GC. He also informed the GC that he would seek legal advice before submitting the said report to the ACA. The appellant sent the report and the letters of complaint to the BC, ACA, police and ROS on 8.6.2005, 9.6.2005, 13.6.2005 and 16.6.2005 respectively. During the AGM on 26.6.2005 the appellant informed the members that following the 2003 resolution, he had sent the ICE report to these authorities for further action and investigation. [17] In the letters sent to the various authorities (the impugned letters), the appellant had, amongst others, alleged fraud, misuse of power and breach of trust and had named the respondent as the president of Chinwoo and who had held material positions in Chinwoo during the development of the Project. The appellant’s acts led to the filing of the numerous defamation actions against him by the respondent. The 12 appellant’s defence is primarily absolute and/or qualified privilege, and/or justification. The High Court [18] The trial judge found that the impugned letters were defamatory of the respondent and that all the defences raised were not available to the appellant. [19] On the defence of absolute privilege, the trial judge states as follows: Dengan beliau menulis kelima-lima aduan dan laporan polis berkenaan tanpa mendapat mandat dari Persatuan Chinwoo, saya berpandangan apa yang beliau lakukan adalah salah dan melanggar peraturan Persatuan Chinwoo, maka dengan itu aduan-aduan dan laporan polis berkenaan tidak boleh dipertimbangkan untuk mendapat perlindungan secara mutlak. Untuk sesuatu aduan dan laporan polis untuk mendapat perlindungan secara mutlak, aduan-aduan dan laporan polis itu sendiri hendaklah keluar dari sumber yang sah dan di dalam tindakan ini perlu mendapat mandat dari ahli- ahli Persatuan Chinwoo dahulu atau resolusi dari AGM 2003 dan juga Mesyuarat GC pada 2.11.2004. [20] In respect of the defence of qualified privilege, the trial judge states as follows: Setelah meneliti keseluruhan keterangan di dalam kes ini, Mahkamah berpendapat bahawa Defendan gagal untuk buktikan wujudnya keadaan yang dilindungi. Alasan utama mengapa Mahkamah berpendapat demikian adalah bahawa kerana kelima-lima aduan dan laporan polis berkenaan merupakan aduan-aduan dan laporan polis yang dibuat tanpa mendapat kelulusan atau tanpa resolusi dari Ahli-Ahli Persatuan Chinwoo melalui AGM 2003 mereka dan Mesyuarat GC pada 2.11.2004. 13 Pengataan di dalam kelima-lima aduan dan laporan polis yang diterbitkan atau disiarkan oleh Defendan kepada pihak ketiga, dengan tidak mendapat mandat melalui resolusi dari AGM 2003 Persatuan Chinwoo dan Mesyuarat GC berkenaan, saya berpendapat pembelaan perlindungan bersyarat tidak terpakai dalam keadaan begini. Dengan Defendan tidak mendapat mandat dari Ahli-Ahli Persatuan Chinwoo juga resolusi dari AGM 2003 dan Mesyuarat GC pada 2.11.2004 untuk membuat kelima-lima aduan dan laporan polis maka secara per se telah membuktikan niat jahat di pihak Defendan. [21] On the defence of justification, the trial judge states as follows: Pihak Defendan semasa disoalbalas mengaku bahawa alegasi beliau terhadap Plaintif terutamanya untuk pecah amanah jenayah, frod dalam kesemua aduan Defendan adalah berdasarkan pada syak wasangka. Defendan juga akui bahawa tidak terdapat dalam minit EGM 1991 atau Resolusi 1991 dinyatakan yang Chinwoo berhak kepada 23% jumlah keseluruhan unit yang akan dibina dalam projek berkenaan. Her Ladyship then concludes as follows: Isu mengenai dengan kebebasan Pemaju untuk memajukan hartanah pada bahagian hartanah yang diperuntukkan untuk mereka adalah tidak relevan dalam tindakan fitnah ini. Defendan gagal tunjukkan yang mereka mempunyai pembelaan justifikasi yang bermerit di dalam tindakan ini. The Court of Appeal [22] The appellant appealed to the Court of Appeal. By a unanimous decision, the Court of Appeal dismissed the appellant’s appeals and agreed with the trial judge that the defence of absolute privilege and qualified privilege were not 14 available to the appellant because the appellant had sent the impugned letters without the authority or mandate or resolution of the AGM 2003 and the GC Meeting on 2.11.2004. On the defence of justification, the Court of Appeal agreed with the trial judge that the appellant had failed to prove that the allegations made in the impugned letters were true and that the lack of mandate showed that the appellant had mala fide intent in writing the impugned letters and lodging the police report. Before this Court Appeals No.02(f)-73-10/2015(W); 02(f)-74-10/2015(W) and 02(f)-76-10/2015(W) Whether the lodging or writing of letter/s of complaint/s to the ROS/ACA/CCD were occasions of absolute privilege, consonant and/or consistent with the principle set out by the Federal Court in Lee Yoke Yam v Chin Keat Seng [2013] 1 MLJ 145 (“Lee Yoke Yam”) (Question 1) [23] In Lee Yoke Yam v Chin Keat Seng [2013] 1 MLJ 145 the Federal Court held that “....absolute privilege should be extended to a statement contained in a police report lodged under s.107 of the CPC as in the case of statement made under s.112 of the CPC.”. The ratio in Lee Yoke Yam as expressed in the judgment of the Federal Court through Arifin Zakaria, CJ (as he then was) is as follows: …..The underlying reason behind this, is the overriding public interest that a member of the public should be encouraged to make police report with regard to any crime that comes to his or her notice. Such report is important to set the criminal investigation in motion. With such report, the alleged crime may be investigated and the perpetrator be brought to justice. 15 It is without doubt that public interest should override the countervailing consideration that this may sometime lead to an abuse by a malicious informant. In any event, if a false report is lodged by a complainant, he is liable to be prosecuted for making false report under s.117, s.182 or s.203 of the Penal Code. That we believe provides a sufficient safeguard against any person from making a false report.”. [24] The thrust of the submissions made by learned counsel for the appellant before us is that the ratio in Lee Yoke Yam should apply to the complaints lodged by the appellant with the CCD, the ACA and the ROS. It is submitted that considerations that govern the lodging of general police reports similarly apply to the lodging of reports or complaints with the ACA, the CCD and the ROS. The ACA, the CCD and the ROS are conferred with the power to investigate wrong doings under their respective laws and the power to take enforcement action. The purpose of lodging reports or complaints with these authorities is to bring to their attention possible unlawful conduct and to urge these authorities to investigate and to take action, if appropriate. Therefore the ratio in Lee Yoke Yam ought to be extended to letters of complaints lodged with the ACA, the CCD and the ROS. [25] For the respondent the learned counsel submitted that the decision in Lee Yoke Yam did not apply to the present appeals because the present appeals do not concern any police report. According to learned counsel, read as a whole, Lee Yoke Yam shows that police reports per se are merely accorded with the status of qualified privilege and demonstrates that a police report 16 and a statement contained in a police report which is not with regard to any crime or which cannot set a criminal investigation in motion does not fall within the ambit of the decision in Lee Yoke Yam [26] Learned counsel urged this court to reconsider the case of Lee Yoke Yam and not to extend the ratio in Lee Yoke Yam to letters of complaints sent to the CCD, the ACA and the ROS. To this end and after the hearing of these appeals had been completed, learned counsel for the respondent had forwarded for our consideration the recent decisions by the Singapore High Court and Court of Appeal in Goh Lay Khim and Others v Isabel Redrup Agency Pte Ltd and another appeal [2017] SGCA 11 and Isabel Redrup Agency Pte Ltd v A L Dakshnamoorthy and others and another suit [2016] SGHC 30. Goh Lay Khim is the decision of the Singapore Court of Appeal on an appeal from the decision of the High Court in Isabel Redrup Agency Pte Ltd. [27] We have given careful and anxious consideration to the submissions made by learned counsel for the parties. However before we proceed further, we feel that it is necessary to address some issues raised by learned counsel for the respondent before us including his submissions that the case of Lee Yoke Yam shows that police reports per se are merely accorded with the status of qualified privilege. 17 Police report [28] In the case of Goh Lay Khim, one of the issues before the Singapore Court of Appeal was whether absolute privilege covers gratuitous complaints to the authorities. The Singapore Court of Appeal was of the considered view that the balance between freedom of expression and protection of reputation depends on local political and social conditions and held that, in the context of Singapore, gratuitous complaints to prosecuting authorities should be protected by qualified privilege only. In the judgment delivered by Judith Prakash JA, Her Ladyship said: A balance must be struck between the freedom of speech and the protection of reputation. In this regard, the foreign authorities that have been cited in respect of absolute privilege must be viewed with some circumspection since the balance between freedom of expression and protection of reputation depends on local political and social conditions…. It must not be readily assumed that the foreign judicial pronouncements on defamation should apply in our local context without modification. The determination of “necessity” is an exercise that must be carried out in the context of a particular society and its mores, values and expectations of the proper behavior of its members. Her Ladyship said further: In our judgment, in Singapore, the suggested extension to the scope of absolute privilege would be wholly disproportionate to and unnecessary for the aim of encouraging members of the public to report suspected wrongdoings. [29] In Lee Yoke Yam, appellant’s counsel in that case had made submissions similar to the submissions made by respondent’s counsel in the present appeals that police reports 18 are only protected by qualified privilege. In paragraph 21 of the judgment it is stated as follows: [21] Counsel for the appellant submitted that Abdul Manaf bin Ahmad’s case was wrongly decided and urged this court to restore the long standing position that such statement is only protected by qualified privilege. The submissions did not find favour with the Federal Court. The Federal Court agreed with the decision of the Court of Appeal in Abdul Manaf Ahmad v Mohd Kamil Datuk Hj Mohd Kassim [2011] 4 MLJ 346. In that case, Gopal Sri Ram, JCA (as he then was) had said as follows: [4] …..There is no doubt that defamatory statements in police reports must attract the defence of absolute privilege for reasons of public policy. If actions can be brought against complainants who lodge police reports, then it would discourage the reporting of crimes to the police thereby placing the detection and punishment of crime at serious risk….. [30] A police report lodged under s.107 of the Criminal Procedure Code (CPC) and commonly known as a ‘first information report’ (FIR) is a report that is drawn up by a police officer upon receiving information about the commission of an offence. Section 107 of the CPC states as follows: (1) Every information relating to the commission of an offence, if given orally to an officer in charge of a police station, shall be reduced to writing by him or under his direction and be read over to the informant. 19 [31] The FIR is made to provide the police early information of criminal activity. In Emperor v Khwaja Nazir Ahmad A.I.R. 1945 P.C. 18, Lord Porter in delivering the judgment of the Privy Council said: 10. In truth the provisions as to an information report (commonly called a first information report) are enacted for other reasons. Its object is to obtain early information of alleged criminal activity, to record the circumstances before there is time for them to be forgotten or embellished, and it has to be remembered that the report can be put in evidence when the informant is examined if it is desired to do so. [32] In the case of In Re: Muthusami Naidu vs Unknown ILR 37 Mad 110; A.I.R. 1914 Madras 472, the question for decision was whether a defamatory statement made by one person regarding another in a complaint presented by the former against the latter is absolutely privileged. The court said as follows: We do not think that a statement in a complaint which initiates a proceeding should be held to be entitled to less privilege than other statements made by parties in the subsequent stages of the proceedings. If the complaint is false, then the defendant would be entitled to prosecute the complainant for preferring a false charge. We think the proper rule to lay down is that a statement contained in a complaint should be held to be absolutely privileged. [33] The Federal Court in Lee Yoke Yam had cited with approval the case of Taylor and Others v Director of the Serious Fraud Office And Others [1999] 2 AC 177; [1998] 4 All ER 801; [1998] 3 WLR 1040 wherein the House of Lords held that persons who take part in the administration of justice require 20 nothing less than absolute immunity from suit. In that case, the defendant had requested the Isle of Man authorities to investigate the part, if any, taken by the plaintiff in a major fraud. No charges were brought against the plaintiff. The plaintiff sought damages in defamation. Lord Hoffmann said: I find it impossible to identify any rational principle which would confine the immunity for out of court statements to persons who are subsequently called as witnesses. The policy of the immunity is to enable people to speak freely without fear of being sued, whether successfully or not. If this object is to be achieved, the person in question must know at the time he speaks whether or not the immunity will attach. If it depends upon the contingencies of whether he will be called as a witness, the value of the immunity is destroyed. At the time of the investigation it is often unclear whether any crime has been committed at all. Persons assisting the police with their inquiries may not be able to give any admissible evidence; for example, their information may be hearsay, but none the less valuable for the purposes of the investigation. But the proper administration of justice requires that such people should have the same inducement to speak freely as those whose information subsequently forms the basis of evidence at a trial. We respectfully agree with the views expressed by Lord Sands in Dunnet vs. Nelson (1926) S.C 769 as follows: It may be unfortunate that a person against whom a charge that is not true is made should have no redress, but it would be contrary to public policy and the general interest of business and society that persons should be hampered in the discharge of their duty or the exercise of their rights by constant fear of actions for slander. 21 [34] For the reasons stated above, we find no ground to depart from the decision in Lee Yoke Yam. It behoves this court to reiterate that, in Malaysia, on public policy consideration, a police report is protected by absolute privilege. Malicious complainant [35] Another issue raised by learned counsel for the respondent is the issue of a malicious complainant. We find that this issue was addressed by Ward LJ in Wescott v Wescott [2008] EWCA Civ 818 (which was cited with approval in Lee Yoke Yam) when His Lordship referred to the judgment of Lord Simon of Glaisdale in the case of D v National Society for the Prevention of Cruelty to Children [1977] 1 All ER 589; [1978] AC 222. We take the liberty of reproducing the relevant passage of the judgment of Ward LJ in Wescott v Wescott as follows: …. The answer to the argument that immunity should not give protection to a malicious informer was tellingly given by Lord Simon of Glaisdale in D v National Society for the Prevention of Cruelty to Children [1977] 1 All ER 589 at 607; [1978] AC 222 at 233: I cannot leave this particular class of relevant evidence withheld from the court (the identity of the informer who gave information of ill treatment of children to the NSPCC) without noting, in view of an argument for the respondent, that the rule can operate to the advantage of the untruthful or malicious or revengeful or self-interested or even demented police informant as much as one who brings information from a high-minded sense of civic duty. Experience seems to have shown that though the resulting immunity from disclosure can be abused, the balance of public advantage lies in generally respecting it. 22 We respectfully adopt the view expressed by Devlin LJ in the case of Lincoln v Daniels [1962] 1 QB 237 where His Lordship said, amongst others, as follows: Absolute privilege is granted only as a matter of public policy and must therefore on principle be confined to matters in which the public is interested and where therefore it is of importance that the whole truth should be elicited even at the risk that an injury inflicted maliciously may go unredressed. Republication [36] Learned counsel for the respondent had also raised concern over the issue of republication of a police report or a statement in a police report. However republication does not arise for our consideration since it is not an issue in these appeals. We will however venture to state that it is trite that a person who repeats another's defamatory statement without privilege may be held liable for republishing the same libel or slander. [37] Reverting to the question posed before us, we have perused the impugned letters in the present appeals. In the case of the appellant’s letter to the ACA, the appellant had alleged probable misuse of power by the respondent as President of Chinwoo and breach of trust. In the letter to the CCD, it is an allegation of probable criminal breach of trust or fraud. In the letter to the ROS, the appellant had alleged negligence on the part of the respondent and the GC based on the ICE report and probable breach of trust and professional ethics. Thus the common vein in these letters is the request for 23 these authorities to carry out investigations and to take action, if appropriate. [38] The ACA, the CCD and the ROS share a common feature in that they are statutorily empowered with investigative powers and to take appropriate action under the law against those who have breached the respective legislations applicable to them. We agree with the submissions by appellant’s counsel that there is no meaningful difference between a complaint or report lodged with the police and a complaint or report lodged with the ACA, the CCD or the ROS. As submitted by learned counsel for the appellant, similar considerations govern the lodging of reports or complaints with the ACA, the CCD and the ROS as the lodging of general police reports. The purpose is to notify these authorities of alleged unlawful conduct and to set an investigation in motion and, if appropriate, to take the necessary action against the alleged wrongdoer. [39] In respect of complaints lodged with the ACA, we agree with the High Court judge in the case of Dato’ Annas Khatib Jaafar v The New Straits Times Press (M) Bhd & Ors [2013] 4 CLJ 96 that ACA reports are akin to police reports (see also Sharifuddin Mohamed & Anor v Dato’ Annas Khatib Jaafar & Another Appeal [2016] 3 CLJ 574; [2016] 1 LNS 1). In respect of a complaint lodged with the CCD, such a complaint is in essence a police report since the CCD is part of the police. With regard to the ROS, the Societies Act 1966 (Act 335) allows the ROS to prosecute for certain offences under the Act (see s.61 of Act 335). 24 [40] In the appellant’s counsel written submissions, the Delhi High Court case of The Punjabi Bagh Cooperative v K.L. Kishwar and Anr. (2002) (61) DRJ 594 was cited in support of the submissions that absolute privilege also extends to the appellant’s letter of complaint to the ROS. In that case, the society and its office bearers had filed a suit for defamation against the defendants, who were members of the society. The defamatory statements were contained in various petitions filed by the defendants with the Joint Registrar of the Cooperative Societies. The second defendant then filed an application seeking rejection of the suit on the ground that the suit was not maintainable because the alleged defamatory statements were made in connection with the affairs of the society and such communications/petitions were privileged communications, so no civil action of defamation will lie. In his judgment Dwivedi J said, amongst others, as follows: ….. If a member of the society has reason to believe that some irregularity, illegality is being committed in the running of the affairs of the society, such member of the society is under a duty to bring it to the notice of the office bearer of the society or other authorities having control over the society. Such member will have an obligation cast on him to bring such things to the notice of the society and vice versa office bearers or other such authorities will be under obligation to receive such complaints and look into them…. …. I think the alleged defamatory statements made by the defendants in their various communications/petitions to the plaintiffs or to the Joint registrar or other authorities having control over the aforesaid Society fall in the category of privileged communications and no action for defamation will be maintainable…. 25 [41] For the reasons that we have set out, we agree with learned counsel for the appellant that the ratio in Lee Yoke Yam ought to be applied to complaints made with the ACA, the CCD and the ROS; consistent with the principle set out therein that the lodging of such complaints are occasions of absolute privilege. Whether the issue of authority was a relevant or necessary consideration for absolute privilege to apply? (Question 2) [42] The courts below found that the appellant had sent the impugned letters without authority or mandate and therefore the defence of absolute privilege and qualified privilege were not available to the appellant. We agree with learned counsel for the appellant that the courts below had misdirected themselves on this issue. [43] The defence of absolute privilege applies where the primary interest is the due administration of justice and the overriding public policy that those who have complaints should be free to make them. The case of Wescott v Wescott shows that even informants are entitled to the benefit of absolute privilege. Ward LJ said as follows: Because society expects that criminal activity will be reported and when reported investigated and, when appropriate, prosecuted, all those who participate in a criminal investigation are entitled to the benefit of absolute privilege in respect of the statements which they make. That applies whether they are informants, investigators, or prosecutors…... 26 In Buckley v Dalziel [2007] EWHC 1025 (Q.B.); [2007] 1 WLR 2933, Eady J said that “… public policy consideration applies with equal validity to those who are mere witnesses and to those who are initial complainants…”. Clearly, these statements negate the requirement of authority/mandate before the defence of absolute privilege can apply. To decide otherwise would be contrary to the principle that underlies the defence of privilege that those who have complaints should be free to make them. [44] Consequently we are unable to agree with the courts below that authority or mandate is a necessary consideration for the defence of absolute privilege to apply. Appeal No.02(f)-75-10/2015(W) Whether the lodging or writing of letter/s of complaint/s to the ROS/ACA/CCD/BC were, prima facie, occasions of qualified privilege (Question 3) [45] In question 1 we have resolved that complaints lodged with the ACA, the CCD and the ROS were occasions of absolute privilege. The only issue remaining for consideration in this question is the appellant’s contention that the letter sent by the appellant to the BC is prima facie an occasion of qualified privilege. [46] Qualified privilege depends on the occasion upon which the communication is made, and not the communication itself. A qualified privilege occasion is an occasion where the person who makes a communication has an interest or a duty, legal, 27 social or moral to make it to the person to whom it is made, and the person to whom it is so made has a corresponding interest or duty to receive it. If the communication were made in pursuance of a duty or on a matter in which there was a common interest in the party making and the party receiving it, the occasion is said to be one of qualified privilege. Whether an occasion is a privileged occasion depends on the circumstances of each case, the nature of the information and the relation of speaker and recipient. It is for the judge alone to determine as a matter of law whether the occasion is privileged (Adam v Ward [1917] AC 309; [1916-17] All E.R. Rep. 157). [47] The appellant herein had sent the letter to the BC because the respondent is an advocate and solicitor. The appellant had requested the BC to look into the complaint that he had sent to the DB regarding irregularities in the development of the Project and to take appropriate action. [48] It was submitted for the appellant that, being the President of Chinwoo at the material time, the appellant had a social and moral duty to make the complaint to the BC which is tasked with the duty to properly manage the affairs of the Malaysian Bar and to take cognizance of anything affecting the Malaysian Bar or the professional conduct of its members (s.47(1) and s.57 of the LPA). The purpose of vesting statutory functions in the BC is the protection of the public and to act in the best interest of the public (seen Swain v Law Society [1982] 2 All ER 827). 28 [49] The English cases of Lincoln v Daniels [1962] 1 QB 237 and Beech and another v Freeson [1971] 2 All ER 854 were referred to in the written submissions of the appellant’s counsel to support the contention that the publication of a complaint to the BC was an occasion of qualified privilege. [50] In the case of Lincoln v Daniels the defendant had claimed absolute immunity in respect of communications sent by him to the English Bar Council alleging professional misconduct by the plaintiff, a Queen’s Counsel. Disciplinary proceedings against barristers were at that time conducted by Benchers of their respective Inns. It was held that initial communications sent to the secretary of the Bar Council alleging professional misconduct by a barrister did not attract absolute privilege, since they were not yet a step in an inquiry before an Inn of Court. Devlin LJ concluded that it was sufficient for complaints to the Bar to be covered by qualified privilege since it was not a practical necessity for complaints about barristers to be channeled through the Bar Council even though it was convenient to do so. In the same case it was held that absolute privilege will apply in respect of disciplinary proceedings conducted by the Benchers of the Inns. Danckwerts LJ said: "I do not think that the absence of a statutory foundation or of some of these features such as the taking of evidence on oath need be fatal to the recognition of a tribunal as a judicial body to which it is necessary in the interests of a proper and complete hearing to attach the protection of absolute privilege. It seems to me that in the case of proceedings which may result in the deprivation of a barrister of the right to practise his profession, it is desirable that a judicial 29 determination of the matters by the Benchers of his Inn should be as free from harassing consequences as that of a military court of inquiry or the proceedings before the Disciplinary Committee of the Law Society." [51] In Beech and another v Freeson, the defendant was a member of Parliament who was informed by one of his constituents that his constituent’s solicitors, the plaintiffs, had grossly mismanaged his constituent’s affairs and the affairs of his relations. The constituent set out his complaints in a long letter to the defendant. The defendant was requested to refer the matter to the Law Society. The defendant wrote a letter to the Law Society and reproduced the complaints. He sent a copy of the letter to the Lord Chancellor. The defendant was sued for libel. The defendant claimed that his publication to the Law Society and the Lord Chancellor were protected by qualified privilege on the ground that as a member of Parliament, he had a duty or interest in passing on his constituent’s complaint and the Law Society and the Lord Chancellor had a reciprocal interest in receiving it. Geoffrey Lane J held that the reciprocal interest or duty of the Law Society in receiving the complaint cannot be in doubt and the publication to the Law Society was the subject of qualified privilege. With respect to the publication to the Lord Chancellor, the judge considered that the Lord Chancellor has no powers of disciplining or punishing a solicitor who misbehaves but the lack of any direct power to discipline or punish does not mean that the Lord Chancellor has no interest in the complaint, because solicitors are officers of the court and the Lord Chancellor is charged with responsibility to ensure that 30 the machinery of justice runs smoothly. He is sufficiently concerned in the proper behavior of solicitors, in solicitors who as potential holders of judicial office, in the expeditious prosecution of litigation and in ensuring that litigants are honestly and conscientiously advised, to give him the necessary interest to protect the communication with qualified privilege. [52] In the present appeals, the appellant, being the president of Chinwoo, is responsible for the proper conduct and management of the affairs of Chinwoo. The members of Chinwoo were unhappy that Chinwoo had been deprived of 46 units which was the agreed sharing ratio of 23:77 in the Project due to the Free Hand Clause included in the Additional Agreement which was drawn up by the respondent’s legal firm. Although the Trustees of Chinwoo had agreed to the Free Hand Clause, the respondent was a trustee of Chinwoo then. [53] The appellant clearly has an interest to forward to the BC for its attention the complaint that he had sent to the DB. The BC has a corresponding interest or duty to receive the communication as the respondent is an advocate and solicitor. We agree with the appellant’s counsel that the letter sent by the appellant to the BC is prima facie an occasion of qualified privilege. Whether malice as contemplated in the authority of Horrocks v Lowe [1974] 1 All ER 662 (“Horrocks”) may be inferred from the failure on the part of the defendant to take steps that he is not 31 obliged to in law for the purpose of defeating the defence of qualified privilege (Question 4) [54] Malice is a necessary element in an action for libel. The law prevents the inference of malice in the publication of statements which are false in fact and injurious to the character of another if such statements are fairly made by a person in the discharge of some public or private duty, whether legal or moral, or in the conduct of his own affairs, in matters where his interest is concerned. It affords a qualified defence depending upon the absence of actual malice (see Toogood v Spyring (1834) 1 CM & R 181, [1834] EngR 363, (1834) 1 CrM & R 181, (1834) 149 ER 1044). [55] The prima facie defence of qualified privilege is not available if it is shown that a defendant has been actuated by actual or express malice or if he has used the occasion for some indirect or wrong motive. In Royal Aquarium & Summer and Winter Garden Society v Parkinson (1892) 1 QB 43 Lopes LJ said: Not only must the occasion create the privilege, but the occasion must be made use of bona fide and without malice. The defendant is only entitled to the protection of the privilege if he uses the occasion in accordance with the purpose for which the occasion arose. He is not entitled to the protection of the privilege if he uses the occasion for some indirect or wrong motive. [56] In the case of Horrocks v Lowe [1974] 1 All ER 662; [1975] AC 135 the House of Lords held that a defendant was malicious if he “misused” the privileged occasion by not 32 speaking out of duty or to protect a moral interest. Lord Diplock said, amongst others, as follows: For in all cases of qualified privilege there is some special reason of public policy why the law accords immunity from suit – the existence of some public or private duty, whether legal or moral, on the part of the maker of the defamatory statement which justifies his communicating it or of some interest of his own which he is entitled to protect by doing so. If he uses the occasion for some other reason he loses the protection of the privilege. ....So, the motive with which the defendant on a privileged occasion made a statement defamatory of the plaintiff becomes crucial. The protection might, however, be illusory if the onus lay on him to prove that he was actuated solely by a sense of the relevant duty or a desire to protect relevant interest. So he is entitled to be protected by the privilege unless some other dominant and improper motive on his part is proved. ‘Express malice’ is the term of art descriptive of such a motive. Broadly speaking, it means malice in the popular sense of a desire to injure the person who is defamed and this is generally the motive with which the plaintiff sets out to prove. But to destroy the privilege the desire to injure must be the dominant motive for the defamatory publication; knowledge that it will have that effect is not enough if the defendant is nevertheless acting in accordance with a sense of duty or in bona fide protection of his own legitimate interest. [57] The courts below had found that the absence of mandate to lodge the complaints is per se sufficient to prove malice. For the appellant it is submitted that a lack of mandate per se does not constitute an indirect motive or the absence of honest belief as the appellant stood to gain nothing from making the complaints. The appellant had testified that he had wanted to carry out his duty as president and wanted the matter to be properly investigated by the proper authorities. The respondent 33 had alleged that the appellant was actuated by malice and that he had an ulterior motive because he had filed six complaints over the same issue within 28 days. [58] The minutes of the 2003 AGM and the GC meeting on 2.11.2004 show that there is sufficient mandate for the appellant to lodge the complaints. In our considered view, the appellant’s mere act of filing the complaints with the various relevant authorities, without more, is insufficient to prove malice. We find that the respondent failed to prove that the appellant was actuated by malice. Conclusion [59] Pursuant to our reasons aforementioned our answers to the questions posed are as follows: (a) questions 1 and 3 – affirmative (b) questions 2 and 4 – negative. In view of our findings above, we do not consider it necessary to answer question 5. [60] Consequently we allow all the four appeals. We set aside the decisions of the courts below. We award global costs in the sum of RM150,000.00 for the four appeals to the appellant. Costs is subject to the payment of allocator. The deposits paid are refunded to the appellant. 34 [61] Pursuant to our decision, we make the following consequential orders: (a) the 1st respondent is to refund the sum of RM510,301.00 to the appellant within 30 days with interest at 5% per annum from 28 September 2012 until full payment; (b) the 2nd respondent is to refund the sum of RM56,133.00 to the appellant within 30 days with interest at 5% per annum from 28 September 2012 until full payment. Dated: 7 August 2017 sgd AZIAH ALI JUDGE FEDERAL COURT 35 Counsel/solicitors : For the appellant : Dato’ Malik Imtiaz Sarwar together with Robert Low, Surendra Ananth and Helen Lim Solicitors : Messrs Ranjit Ooi & Robert Low For the respondent : Chan Tse Yuan together with Michael Teo, Lee Siew Lin, Tan Foong Luen and Koh Xiao Xuan Solicitors : Messrs Lim Fung Yin & Co.

Tika 2.6.0

02-72-10/2015(W)

PERAYU DATO' DR LOW BIN TICK RESPONDEN DATUK CHONG THO CHIN

Tort : Defamation - Absolute privilege - Letters alleged to be defamatory sent to various investigative agencies without authority or mandate - Whether absence of such authority or mandate would negate or make unavailable defence of absolute privilege - Whether requisite authority or mandate is necessary for absolute privilege to apply Tort : Defamation - Absolute privilege - Nature and scope of - Whether police report protected by absolute privilege - Public policy considerations Tort : Defamation - Absolute privilege - Reports to other public investigative agencies and authorities - Whether ratio in Lee Yoke Ham v. Chin Keat Seng ought to be applied to reports to other public investigative agencies and authorities - Whether report to other public investigative agencies and authorities protected by absolute privilege Tort : Defamation - Libel - Malice - Whether defence of qualified privilege not available if shown tortfeasor actuated by actual or express malice or if tortfeasor motivated by some indirect or wrong motive - Whether mere act of filing complaints with various relevant authorities, without more, insufficient to prove malice Tort : Defamation - Qualified privilege - Letter of complaint sent by Complainant as President of Association to Bar Council because Complainee an advocate and solicitor - Whether Complainant had an interest to make such complaint - Whether Bar Council had corresponding interest to receive such letter of complaint - Whether such letter of complaint protected by qualified privilege Tort : Defamation - Qualified privilege - Nature and scope of - Whether qualified privilege depended on the nature of the occasion in which the impugned communication was made - Whether a matter of law for the judge to decide whether occasion was privilege

07/08/2017

YA TAN SRI DATO' WIRA AZIAH BINTI ALIKorumYAA TAN SRI DATO' SRI AHMAD BIN HAJI MAAROPYAA TAN SRI DATUK SERI PANGLIMA RICHARD MALANJUMYA TAN SRI HASAN BIN LAHYA TAN SRI DATUK RAMLY BIN HAJI ALIYA TAN SRI DATO' WIRA AZIAH BINTI ALI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=beb966e8-36cc-4c39-a861-d1d942447df0&Inline=true

1 MAHKAMAH PERSEKUTUAN MALAYSIA DI PUTRAJAYA (BIDANGKUASA RAYUAN) RAYUAN SIVIL NO. 02-73-10/2015(W) ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN … RESPONDEN [DALAM MAHKAMAH RAYUAN MALAYSIA DI PUTRAJAYA RAYUAN SIVIL NO. W-02-1700-07/2012 ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN … RESPONDEN DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR GUAMAN SIVIL NO. S3-23-78-2007 ANTARA DATUK CHONG THO CHIN … PLAINTIF DAN DATO’ DR. LOW BIN TICK … DEFENDAN] 2 DIDENGAR BERSAMA DENGAN MAHKAMAH PERSEKUTUAN MALAYSIA DI PUTRAJAYA (BIDANGKUASA RAYUAN) RAYUAN SIVIL NO. 02-74-10/2015(W) ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN … RESPONDEN [DALAM MAHKAMAH RAYUAN MALAYSIA DI PUTRAJAYA RAYUAN SIVIL NO. W-02-1662-07/2012 ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN … RESPONDEN DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR GUAMAN SIVIL NO. S-23-709-2007 ANTARA DATUK CHONG THO CHIN … PLAINTIF DAN DATO’ DR. LOW BIN TICK … DEFENDAN] 3 DIDENGAR BERSAMA DENGAN MAHKAMAH PERSEKUTUAN MALAYSIA DI PUTRAJAYA (BIDANGKUASA RAYUAN) RAYUAN SIVIL NO. 02-75-10/2015(W) ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN … RESPONDEN [DALAM MAHKAMAH RAYUAN MALAYSIA DI PUTRAJAYA RAYUAN SIVIL NO.W-02-18-01/2013 ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN … RESPONDEN DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR GUAMAN SIVIL NO. S4-23-79-2007 ANTARA DATUK CHONG THO CHIN … PLAINTIF DAN DATO’ DR. LOW BIN TICK … DEFENDAN] 4 DIDENGAR BERSAMA DENGAN MAHKAMAH PERSEKUTUAN MALAYSIA DI PUTRAJAYA (BIDANGKUASA RAYUAN) RAYUAN SIVIL NO. 02-76-10/2015(W) ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN RESPONDEN- YAP HON KONG … RESPONDEN [DALAM MAHKAMAH RAYUAN MALAYSIA DI PUTRAJAYA RAYUAN SIVIL NO.W-02-1701-07/2012 ANTARA DATO’ DR. LOW BIN TICK … PERAYU DAN DATUK CHONG THO CHIN RESPONDEN- YAP HON KONG … RESPONDEN DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR GUAMAN SIVIL NO. S4-23-83-2007 ANTARA DATUK CHONG THO CHIN PLAINTIF- YAP HON KONG … PLAINTIF DAN DATO’ DR. LOW BIN TICK … DEFENDAN] 5 CORAM: AHMAD MAAROP, CJM RICHARD MALANJUM, CJSS HASAN LAH, FCJ RAMLY ALI, FCJ AZIAH ALI, FCJ JUDGMENT OF THE COURT Introduction [1] There are four appeals heard before us. These appeals are against the decision of the Court of Appeal dated 3.12.2014 in Civil Appeal No.W-02-1701-07/2012 which was heard together with Civil Appeal Nos.W-02-18-01/2013, W-02-1662- 07/2012 and W-02-1700-07/2012. [2] The Court of Appeal dismissed the appellant’s appeals (save for interest and costs) and affirmed the decision of the High Court dated 8.8.2012 allowing the respondent’s claims against the appellant for defamation. The High Court awarded general damages, exemplary damages and aggravated damages against the appellant. [3] The respondent’s claims against the appellant were in respect of a police report and letters of complaint lodged by the appellant with the Commercial Crime Division, Kuala Lumpur (‘CCD’), the Disciplinary Board (‘DB’), the Bar Council Malaysia (‘BC’), the Anti Corruption Agency (‘ACA’) and the Registrar of Societies (‘ROS’). 6 Questions of law [4] On 6.10.2015 this court granted leave to appeal on five questions of law which were consolidated by the learned counsel for the appellant as follows: (i) whether the lodging or writing of letter/s of complaint/s to the ROS/ACA/CCD were occasions of absolute privilege, consonant and/or consistent with the principle set out by the Federal Court in Lee Yoke Yam v Chin Keat Seng [2013] 1 MLJ 145 (“Lee Yoke Yam”)?; (ii) whether the issue of authority was a relevant or necessary consideration for absolute privilege to apply?; (iii) whether the lodging or writing of letter/s of complaint/s to the ROS/ACA/CCD/BC were, prima facie, occasions of qualified privilege?; (iv) whether malice as contemplated in the authority of Horrocks v Lowe [1974] 1 All ER 662 (“Horrocks”) may be inferred from the failure on the part of the defendant to take steps that he is not obliged to in law for the purpose of defeating the defence of qualified privilege, and (v) whether a High Court is empowered to award aggravated and/or exemplary damages in respect of a series of defamatory remarks premised upon the same factor raised or contended by a plaintiff? 7 Background facts [5] At the material time the appellant was the President of Chinwoo Athletic Association Selangor and Kuala Lumpur (‘Chinwoo’). The appellant became the President of Chinwoo in 2001. He succeeded the respondent who was the immediate past president of Chinwoo. [6] The respondent is an advocate and solicitor and the founder of the legal firm Messrs T.C. Chong & Rakan-Rakan. The respondent was the President of Chinwoo from 30.6.1991 till 24.6.2001. Prior to that, the respondent was the Vice- President of Chinwoo from 1983 to 1988. He was a member of the Chinwoo Property Committee (CPC) from 1984 and became Chairman of the CPC from 1989 till 1990. He was the Deputy President of Chinwoo from 1989 till 1991. [7] Chinwoo was the registered owner of a parcel of land known as GRT 2643 Lot 27, Section 69, Bandar Kuala Lumpur (‘the Land’). By a resolution made at Chinwoo’s extraordinary general meeting (‘EGM’) on 22.4.1984, the members resolved to enter into a joint venture with one Jiwa Realty Sdn Bhd (‘the Developer’) to develop the Land (the Project). [8] In 1985 and 1986 Chinwoo entered into two sale and purchase agreements with the Developer. Pursuant to the 1985 sale and purchase agreement (the 1985 SPA) Chinwoo agreed to sell the Land to the Developer and in return, according to the 1986 sale and purchase agreement (the 1986 SPA), the 8 Developer agreed to sell 23% of the units developed in the Project to Chinwoo. This reflected the agreed sharing ratio of 23:77. However no development took place. [9] On 30.6.1991 by an Extraordinary General Meeting (EGM), it was decided that the 1985 and 1986 SPAs be revoked and a new agreement be entered with the Developer. The respondent was then the President of Chinwoo. At this EGM it was decided that the total number of units was 669. Chinwoo would purchase 154 units and 159 car park bays. The 154 units represented 23% of the 669 pre-determined total and reflected the sharing ratio 23:77 that had been agreed previously. [10] On 26.3.1992, the 1985 and 1986 SPAs were revoked. On the same date Chinwoo and the Developer entered into two new sale and purchase agreements (the 1992 SPAs). One agreement was for the sale of the Land by Chinwoo to the Developer and the other was for the purchase of one block of 154 units and 159 car park bays by Chinwoo from the Developer. The parties also entered into an additional supplemental agreement on the same date (the Additional Agreement) which contained a new clause allowing the Developer to develop the Land “in whatever manner it may deem fit” (the Free Hand Clause). The Additional Agreement reveals that the Trustees of Chinwoo had agreed to the Free Hand Clause. The respondent was a trustee of Chinwoo then. He was also a member of the Chinwoo Property Committee 9 (CPC). The 1992 SPAs and the Additional Agreement were drawn up by the respondent’s legal firm. [11] On 14.6.1998 the apartment block containing 154 units and 159 car park bays were handed over to Chinwoo. Some members then realized that the 154 units was less than 23% of the agreed sharing ratio because, during the development of the Project, and by virtue of the Free Hand Clause, the Developer had obtained approval from the authorities to build an additional 201 units. Thus the total number of units built was 870 and not 669 units. The members were unhappy that the Developer was given a free hand to develop its portion of the Project as they saw fit which ultimately deprived Chinwoo of 46 units. [12] At the Annual General Meeting (AGM) on 29.6.2003 (the 2003 AGM), a unanimous resolution was passed (the 2003 resolution) directing Chinwoo’s General Committee (GC) to investigate the Project to determine whether there were any irregularities. The GC is the highest decision-making body in between General Meetings of Members. The GC comprises the President, Deputy President, two Vice Presidents and 22 Committee Members. During the debate leading to the resolution, the respondent had suggested that an independent committee be set up to investigate the Project. 10 [13] The 2003 resolution as contained in the minutes of the AGM reads, amongst others, as follows: “….. unanimously directed the new general committee to investigate the real facts of the development of Chinwoo Court, whether what our Association got is fair and conform to the principle win-win, if it is found that something is questionable, get advice from our Association’s legal adviser, contact the relevant department and authorities and take appropriate action.” [14] Subsequent to the 2003 AGM, the GC established an Independent General Committee (ICE) comprising of individuals who were not members of Chinwoo. ICE conducted its investigations based on documents provided by the secretariat of Chinwoo. No member was called for an interview or inquiry. In its qualified report (the ICE report), ICE found, amongst others, that: (a) the GC which was led by the respondent at the material time was in breach of its duty to Chinwoo and was negligent in failing to protect Chinwoo’s entitlement to 23% of the constructed units and these acts of breach of duty and negligence might be actionable by Chinwoo; (b) on the documents there was no evidence that any member of the GC or any other individual had committed any criminal act, and (c) a civil claim be commenced against the Developer for liquidated damages for late delivery of the Chinwoo’s units. 11 [15] On 2.11.2004 the meeting of the GC scrutinized the report by ICE and decided, amongst others, that the ICE report be submitted to the BC, the ACA and the ROS. On 29.3.2005 the GC agreed to table the ICE report during the upcoming AGM. The appellant also informed the GC that, in accordance with the 2003 resolution, he would forward the ICE report to the ROS, BC, ACA and CCD. No objection was raised by the members of the GC. [16] The appellant sent the ICE report to the CCD and the DB under two separate cover letters dated 18.5.2005 and 25.5.2005 respectively. On 31.5.2005 he reported this to the GC. He also informed the GC that he would seek legal advice before submitting the said report to the ACA. The appellant sent the report and the letters of complaint to the BC, ACA, police and ROS on 8.6.2005, 9.6.2005, 13.6.2005 and 16.6.2005 respectively. During the AGM on 26.6.2005 the appellant informed the members that following the 2003 resolution, he had sent the ICE report to these authorities for further action and investigation. [17] In the letters sent to the various authorities (the impugned letters), the appellant had, amongst others, alleged fraud, misuse of power and breach of trust and had named the respondent as the president of Chinwoo and who had held material positions in Chinwoo during the development of the Project. The appellant’s acts led to the filing of the numerous defamation actions against him by the respondent. The 12 appellant’s defence is primarily absolute and/or qualified privilege, and/or justification. The High Court [18] The trial judge found that the impugned letters were defamatory of the respondent and that all the defences raised were not available to the appellant. [19] On the defence of absolute privilege, the trial judge states as follows: Dengan beliau menulis kelima-lima aduan dan laporan polis berkenaan tanpa mendapat mandat dari Persatuan Chinwoo, saya berpandangan apa yang beliau lakukan adalah salah dan melanggar peraturan Persatuan Chinwoo, maka dengan itu aduan-aduan dan laporan polis berkenaan tidak boleh dipertimbangkan untuk mendapat perlindungan secara mutlak. Untuk sesuatu aduan dan laporan polis untuk mendapat perlindungan secara mutlak, aduan-aduan dan laporan polis itu sendiri hendaklah keluar dari sumber yang sah dan di dalam tindakan ini perlu mendapat mandat dari ahli- ahli Persatuan Chinwoo dahulu atau resolusi dari AGM 2003 dan juga Mesyuarat GC pada 2.11.2004. [20] In respect of the defence of qualified privilege, the trial judge states as follows: Setelah meneliti keseluruhan keterangan di dalam kes ini, Mahkamah berpendapat bahawa Defendan gagal untuk buktikan wujudnya keadaan yang dilindungi. Alasan utama mengapa Mahkamah berpendapat demikian adalah bahawa kerana kelima-lima aduan dan laporan polis berkenaan merupakan aduan-aduan dan laporan polis yang dibuat tanpa mendapat kelulusan atau tanpa resolusi dari Ahli-Ahli Persatuan Chinwoo melalui AGM 2003 mereka dan Mesyuarat GC pada 2.11.2004. 13 Pengataan di dalam kelima-lima aduan dan laporan polis yang diterbitkan atau disiarkan oleh Defendan kepada pihak ketiga, dengan tidak mendapat mandat melalui resolusi dari AGM 2003 Persatuan Chinwoo dan Mesyuarat GC berkenaan, saya berpendapat pembelaan perlindungan bersyarat tidak terpakai dalam keadaan begini. Dengan Defendan tidak mendapat mandat dari Ahli-Ahli Persatuan Chinwoo juga resolusi dari AGM 2003 dan Mesyuarat GC pada 2.11.2004 untuk membuat kelima-lima aduan dan laporan polis maka secara per se telah membuktikan niat jahat di pihak Defendan. [21] On the defence of justification, the trial judge states as follows: Pihak Defendan semasa disoalbalas mengaku bahawa alegasi beliau terhadap Plaintif terutamanya untuk pecah amanah jenayah, frod dalam kesemua aduan Defendan adalah berdasarkan pada syak wasangka. Defendan juga akui bahawa tidak terdapat dalam minit EGM 1991 atau Resolusi 1991 dinyatakan yang Chinwoo berhak kepada 23% jumlah keseluruhan unit yang akan dibina dalam projek berkenaan. Her Ladyship then concludes as follows: Isu mengenai dengan kebebasan Pemaju untuk memajukan hartanah pada bahagian hartanah yang diperuntukkan untuk mereka adalah tidak relevan dalam tindakan fitnah ini. Defendan gagal tunjukkan yang mereka mempunyai pembelaan justifikasi yang bermerit di dalam tindakan ini. The Court of Appeal [22] The appellant appealed to the Court of Appeal. By a unanimous decision, the Court of Appeal dismissed the appellant’s appeals and agreed with the trial judge that the defence of absolute privilege and qualified privilege were not 14 available to the appellant because the appellant had sent the impugned letters without the authority or mandate or resolution of the AGM 2003 and the GC Meeting on 2.11.2004. On the defence of justification, the Court of Appeal agreed with the trial judge that the appellant had failed to prove that the allegations made in the impugned letters were true and that the lack of mandate showed that the appellant had mala fide intent in writing the impugned letters and lodging the police report. Before this Court Appeals No.02(f)-73-10/2015(W); 02(f)-74-10/2015(W) and 02(f)-76-10/2015(W) Whether the lodging or writing of letter/s of complaint/s to the ROS/ACA/CCD were occasions of absolute privilege, consonant and/or consistent with the principle set out by the Federal Court in Lee Yoke Yam v Chin Keat Seng [2013] 1 MLJ 145 (“Lee Yoke Yam”) (Question 1) [23] In Lee Yoke Yam v Chin Keat Seng [2013] 1 MLJ 145 the Federal Court held that “....absolute privilege should be extended to a statement contained in a police report lodged under s.107 of the CPC as in the case of statement made under s.112 of the CPC.”. The ratio in Lee Yoke Yam as expressed in the judgment of the Federal Court through Arifin Zakaria, CJ (as he then was) is as follows: …..The underlying reason behind this, is the overriding public interest that a member of the public should be encouraged to make police report with regard to any crime that comes to his or her notice. Such report is important to set the criminal investigation in motion. With such report, the alleged crime may be investigated and the perpetrator be brought to justice. 15 It is without doubt that public interest should override the countervailing consideration that this may sometime lead to an abuse by a malicious informant. In any event, if a false report is lodged by a complainant, he is liable to be prosecuted for making false report under s.117, s.182 or s.203 of the Penal Code. That we believe provides a sufficient safeguard against any person from making a false report.”. [24] The thrust of the submissions made by learned counsel for the appellant before us is that the ratio in Lee Yoke Yam should apply to the complaints lodged by the appellant with the CCD, the ACA and the ROS. It is submitted that considerations that govern the lodging of general police reports similarly apply to the lodging of reports or complaints with the ACA, the CCD and the ROS. The ACA, the CCD and the ROS are conferred with the power to investigate wrong doings under their respective laws and the power to take enforcement action. The purpose of lodging reports or complaints with these authorities is to bring to their attention possible unlawful conduct and to urge these authorities to investigate and to take action, if appropriate. Therefore the ratio in Lee Yoke Yam ought to be extended to letters of complaints lodged with the ACA, the CCD and the ROS. [25] For the respondent the learned counsel submitted that the decision in Lee Yoke Yam did not apply to the present appeals because the present appeals do not concern any police report. According to learned counsel, read as a whole, Lee Yoke Yam shows that police reports per se are merely accorded with the status of qualified privilege and demonstrates that a police report 16 and a statement contained in a police report which is not with regard to any crime or which cannot set a criminal investigation in motion does not fall within the ambit of the decision in Lee Yoke Yam [26] Learned counsel urged this court to reconsider the case of Lee Yoke Yam and not to extend the ratio in Lee Yoke Yam to letters of complaints sent to the CCD, the ACA and the ROS. To this end and after the hearing of these appeals had been completed, learned counsel for the respondent had forwarded for our consideration the recent decisions by the Singapore High Court and Court of Appeal in Goh Lay Khim and Others v Isabel Redrup Agency Pte Ltd and another appeal [2017] SGCA 11 and Isabel Redrup Agency Pte Ltd v A L Dakshnamoorthy and others and another suit [2016] SGHC 30. Goh Lay Khim is the decision of the Singapore Court of Appeal on an appeal from the decision of the High Court in Isabel Redrup Agency Pte Ltd. [27] We have given careful and anxious consideration to the submissions made by learned counsel for the parties. However before we proceed further, we feel that it is necessary to address some issues raised by learned counsel for the respondent before us including his submissions that the case of Lee Yoke Yam shows that police reports per se are merely accorded with the status of qualified privilege. 17 Police report [28] In the case of Goh Lay Khim, one of the issues before the Singapore Court of Appeal was whether absolute privilege covers gratuitous complaints to the authorities. The Singapore Court of Appeal was of the considered view that the balance between freedom of expression and protection of reputation depends on local political and social conditions and held that, in the context of Singapore, gratuitous complaints to prosecuting authorities should be protected by qualified privilege only. In the judgment delivered by Judith Prakash JA, Her Ladyship said: A balance must be struck between the freedom of speech and the protection of reputation. In this regard, the foreign authorities that have been cited in respect of absolute privilege must be viewed with some circumspection since the balance between freedom of expression and protection of reputation depends on local political and social conditions…. It must not be readily assumed that the foreign judicial pronouncements on defamation should apply in our local context without modification. The determination of “necessity” is an exercise that must be carried out in the context of a particular society and its mores, values and expectations of the proper behavior of its members. Her Ladyship said further: In our judgment, in Singapore, the suggested extension to the scope of absolute privilege would be wholly disproportionate to and unnecessary for the aim of encouraging members of the public to report suspected wrongdoings. [29] In Lee Yoke Yam, appellant’s counsel in that case had made submissions similar to the submissions made by respondent’s counsel in the present appeals that police reports 18 are only protected by qualified privilege. In paragraph 21 of the judgment it is stated as follows: [21] Counsel for the appellant submitted that Abdul Manaf bin Ahmad’s case was wrongly decided and urged this court to restore the long standing position that such statement is only protected by qualified privilege. The submissions did not find favour with the Federal Court. The Federal Court agreed with the decision of the Court of Appeal in Abdul Manaf Ahmad v Mohd Kamil Datuk Hj Mohd Kassim [2011] 4 MLJ 346. In that case, Gopal Sri Ram, JCA (as he then was) had said as follows: [4] …..There is no doubt that defamatory statements in police reports must attract the defence of absolute privilege for reasons of public policy. If actions can be brought against complainants who lodge police reports, then it would discourage the reporting of crimes to the police thereby placing the detection and punishment of crime at serious risk….. [30] A police report lodged under s.107 of the Criminal Procedure Code (CPC) and commonly known as a ‘first information report’ (FIR) is a report that is drawn up by a police officer upon receiving information about the commission of an offence. Section 107 of the CPC states as follows: (1) Every information relating to the commission of an offence, if given orally to an officer in charge of a police station, shall be reduced to writing by him or under his direction and be read over to the informant. 19 [31] The FIR is made to provide the police early information of criminal activity. In Emperor v Khwaja Nazir Ahmad A.I.R. 1945 P.C. 18, Lord Porter in delivering the judgment of the Privy Council said: 10. In truth the provisions as to an information report (commonly called a first information report) are enacted for other reasons. Its object is to obtain early information of alleged criminal activity, to record the circumstances before there is time for them to be forgotten or embellished, and it has to be remembered that the report can be put in evidence when the informant is examined if it is desired to do so. [32] In the case of In Re: Muthusami Naidu vs Unknown ILR 37 Mad 110; A.I.R. 1914 Madras 472, the question for decision was whether a defamatory statement made by one person regarding another in a complaint presented by the former against the latter is absolutely privileged. The court said as follows: We do not think that a statement in a complaint which initiates a proceeding should be held to be entitled to less privilege than other statements made by parties in the subsequent stages of the proceedings. If the complaint is false, then the defendant would be entitled to prosecute the complainant for preferring a false charge. We think the proper rule to lay down is that a statement contained in a complaint should be held to be absolutely privileged. [33] The Federal Court in Lee Yoke Yam had cited with approval the case of Taylor and Others v Director of the Serious Fraud Office And Others [1999] 2 AC 177; [1998] 4 All ER 801; [1998] 3 WLR 1040 wherein the House of Lords held that persons who take part in the administration of justice require 20 nothing less than absolute immunity from suit. In that case, the defendant had requested the Isle of Man authorities to investigate the part, if any, taken by the plaintiff in a major fraud. No charges were brought against the plaintiff. The plaintiff sought damages in defamation. Lord Hoffmann said: I find it impossible to identify any rational principle which would confine the immunity for out of court statements to persons who are subsequently called as witnesses. The policy of the immunity is to enable people to speak freely without fear of being sued, whether successfully or not. If this object is to be achieved, the person in question must know at the time he speaks whether or not the immunity will attach. If it depends upon the contingencies of whether he will be called as a witness, the value of the immunity is destroyed. At the time of the investigation it is often unclear whether any crime has been committed at all. Persons assisting the police with their inquiries may not be able to give any admissible evidence; for example, their information may be hearsay, but none the less valuable for the purposes of the investigation. But the proper administration of justice requires that such people should have the same inducement to speak freely as those whose information subsequently forms the basis of evidence at a trial. We respectfully agree with the views expressed by Lord Sands in Dunnet vs. Nelson (1926) S.C 769 as follows: It may be unfortunate that a person against whom a charge that is not true is made should have no redress, but it would be contrary to public policy and the general interest of business and society that persons should be hampered in the discharge of their duty or the exercise of their rights by constant fear of actions for slander. 21 [34] For the reasons stated above, we find no ground to depart from the decision in Lee Yoke Yam. It behoves this court to reiterate that, in Malaysia, on public policy consideration, a police report is protected by absolute privilege. Malicious complainant [35] Another issue raised by learned counsel for the respondent is the issue of a malicious complainant. We find that this issue was addressed by Ward LJ in Wescott v Wescott [2008] EWCA Civ 818 (which was cited with approval in Lee Yoke Yam) when His Lordship referred to the judgment of Lord Simon of Glaisdale in the case of D v National Society for the Prevention of Cruelty to Children [1977] 1 All ER 589; [1978] AC 222. We take the liberty of reproducing the relevant passage of the judgment of Ward LJ in Wescott v Wescott as follows: …. The answer to the argument that immunity should not give protection to a malicious informer was tellingly given by Lord Simon of Glaisdale in D v National Society for the Prevention of Cruelty to Children [1977] 1 All ER 589 at 607; [1978] AC 222 at 233: I cannot leave this particular class of relevant evidence withheld from the court (the identity of the informer who gave information of ill treatment of children to the NSPCC) without noting, in view of an argument for the respondent, that the rule can operate to the advantage of the untruthful or malicious or revengeful or self-interested or even demented police informant as much as one who brings information from a high-minded sense of civic duty. Experience seems to have shown that though the resulting immunity from disclosure can be abused, the balance of public advantage lies in generally respecting it. 22 We respectfully adopt the view expressed by Devlin LJ in the case of Lincoln v Daniels [1962] 1 QB 237 where His Lordship said, amongst others, as follows: Absolute privilege is granted only as a matter of public policy and must therefore on principle be confined to matters in which the public is interested and where therefore it is of importance that the whole truth should be elicited even at the risk that an injury inflicted maliciously may go unredressed. Republication [36] Learned counsel for the respondent had also raised concern over the issue of republication of a police report or a statement in a police report. However republication does not arise for our consideration since it is not an issue in these appeals. We will however venture to state that it is trite that a person who repeats another's defamatory statement without privilege may be held liable for republishing the same libel or slander. [37] Reverting to the question posed before us, we have perused the impugned letters in the present appeals. In the case of the appellant’s letter to the ACA, the appellant had alleged probable misuse of power by the respondent as President of Chinwoo and breach of trust. In the letter to the CCD, it is an allegation of probable criminal breach of trust or fraud. In the letter to the ROS, the appellant had alleged negligence on the part of the respondent and the GC based on the ICE report and probable breach of trust and professional ethics. Thus the common vein in these letters is the request for 23 these authorities to carry out investigations and to take action, if appropriate. [38] The ACA, the CCD and the ROS share a common feature in that they are statutorily empowered with investigative powers and to take appropriate action under the law against those who have breached the respective legislations applicable to them. We agree with the submissions by appellant’s counsel that there is no meaningful difference between a complaint or report lodged with the police and a complaint or report lodged with the ACA, the CCD or the ROS. As submitted by learned counsel for the appellant, similar considerations govern the lodging of reports or complaints with the ACA, the CCD and the ROS as the lodging of general police reports. The purpose is to notify these authorities of alleged unlawful conduct and to set an investigation in motion and, if appropriate, to take the necessary action against the alleged wrongdoer. [39] In respect of complaints lodged with the ACA, we agree with the High Court judge in the case of Dato’ Annas Khatib Jaafar v The New Straits Times Press (M) Bhd & Ors [2013] 4 CLJ 96 that ACA reports are akin to police reports (see also Sharifuddin Mohamed & Anor v Dato’ Annas Khatib Jaafar & Another Appeal [2016] 3 CLJ 574; [2016] 1 LNS 1). In respect of a complaint lodged with the CCD, such a complaint is in essence a police report since the CCD is part of the police. With regard to the ROS, the Societies Act 1966 (Act 335) allows the ROS to prosecute for certain offences under the Act (see s.61 of Act 335). 24 [40] In the appellant’s counsel written submissions, the Delhi High Court case of The Punjabi Bagh Cooperative v K.L. Kishwar and Anr. (2002) (61) DRJ 594 was cited in support of the submissions that absolute privilege also extends to the appellant’s letter of complaint to the ROS. In that case, the society and its office bearers had filed a suit for defamation against the defendants, who were members of the society. The defamatory statements were contained in various petitions filed by the defendants with the Joint Registrar of the Cooperative Societies. The second defendant then filed an application seeking rejection of the suit on the ground that the suit was not maintainable because the alleged defamatory statements were made in connection with the affairs of the society and such communications/petitions were privileged communications, so no civil action of defamation will lie. In his judgment Dwivedi J said, amongst others, as follows: ….. If a member of the society has reason to believe that some irregularity, illegality is being committed in the running of the affairs of the society, such member of the society is under a duty to bring it to the notice of the office bearer of the society or other authorities having control over the society. Such member will have an obligation cast on him to bring such things to the notice of the society and vice versa office bearers or other such authorities will be under obligation to receive such complaints and look into them…. …. I think the alleged defamatory statements made by the defendants in their various communications/petitions to the plaintiffs or to the Joint registrar or other authorities having control over the aforesaid Society fall in the category of privileged communications and no action for defamation will be maintainable…. 25 [41] For the reasons that we have set out, we agree with learned counsel for the appellant that the ratio in Lee Yoke Yam ought to be applied to complaints made with the ACA, the CCD and the ROS; consistent with the principle set out therein that the lodging of such complaints are occasions of absolute privilege. Whether the issue of authority was a relevant or necessary consideration for absolute privilege to apply? (Question 2) [42] The courts below found that the appellant had sent the impugned letters without authority or mandate and therefore the defence of absolute privilege and qualified privilege were not available to the appellant. We agree with learned counsel for the appellant that the courts below had misdirected themselves on this issue. [43] The defence of absolute privilege applies where the primary interest is the due administration of justice and the overriding public policy that those who have complaints should be free to make them. The case of Wescott v Wescott shows that even informants are entitled to the benefit of absolute privilege. Ward LJ said as follows: Because society expects that criminal activity will be reported and when reported investigated and, when appropriate, prosecuted, all those who participate in a criminal investigation are entitled to the benefit of absolute privilege in respect of the statements which they make. That applies whether they are informants, investigators, or prosecutors…... 26 In Buckley v Dalziel [2007] EWHC 1025 (Q.B.); [2007] 1 WLR 2933, Eady J said that “… public policy consideration applies with equal validity to those who are mere witnesses and to those who are initial complainants…”. Clearly, these statements negate the requirement of authority/mandate before the defence of absolute privilege can apply. To decide otherwise would be contrary to the principle that underlies the defence of privilege that those who have complaints should be free to make them. [44] Consequently we are unable to agree with the courts below that authority or mandate is a necessary consideration for the defence of absolute privilege to apply. Appeal No.02(f)-75-10/2015(W) Whether the lodging or writing of letter/s of complaint/s to the ROS/ACA/CCD/BC were, prima facie, occasions of qualified privilege (Question 3) [45] In question 1 we have resolved that complaints lodged with the ACA, the CCD and the ROS were occasions of absolute privilege. The only issue remaining for consideration in this question is the appellant’s contention that the letter sent by the appellant to the BC is prima facie an occasion of qualified privilege. [46] Qualified privilege depends on the occasion upon which the communication is made, and not the communication itself. A qualified privilege occasion is an occasion where the person who makes a communication has an interest or a duty, legal, 27 social or moral to make it to the person to whom it is made, and the person to whom it is so made has a corresponding interest or duty to receive it. If the communication were made in pursuance of a duty or on a matter in which there was a common interest in the party making and the party receiving it, the occasion is said to be one of qualified privilege. Whether an occasion is a privileged occasion depends on the circumstances of each case, the nature of the information and the relation of speaker and recipient. It is for the judge alone to determine as a matter of law whether the occasion is privileged (Adam v Ward [1917] AC 309; [1916-17] All E.R. Rep. 157). [47] The appellant herein had sent the letter to the BC because the respondent is an advocate and solicitor. The appellant had requested the BC to look into the complaint that he had sent to the DB regarding irregularities in the development of the Project and to take appropriate action. [48] It was submitted for the appellant that, being the President of Chinwoo at the material time, the appellant had a social and moral duty to make the complaint to the BC which is tasked with the duty to properly manage the affairs of the Malaysian Bar and to take cognizance of anything affecting the Malaysian Bar or the professional conduct of its members (s.47(1) and s.57 of the LPA). The purpose of vesting statutory functions in the BC is the protection of the public and to act in the best interest of the public (seen Swain v Law Society [1982] 2 All ER 827). 28 [49] The English cases of Lincoln v Daniels [1962] 1 QB 237 and Beech and another v Freeson [1971] 2 All ER 854 were referred to in the written submissions of the appellant’s counsel to support the contention that the publication of a complaint to the BC was an occasion of qualified privilege. [50] In the case of Lincoln v Daniels the defendant had claimed absolute immunity in respect of communications sent by him to the English Bar Council alleging professional misconduct by the plaintiff, a Queen’s Counsel. Disciplinary proceedings against barristers were at that time conducted by Benchers of their respective Inns. It was held that initial communications sent to the secretary of the Bar Council alleging professional misconduct by a barrister did not attract absolute privilege, since they were not yet a step in an inquiry before an Inn of Court. Devlin LJ concluded that it was sufficient for complaints to the Bar to be covered by qualified privilege since it was not a practical necessity for complaints about barristers to be channeled through the Bar Council even though it was convenient to do so. In the same case it was held that absolute privilege will apply in respect of disciplinary proceedings conducted by the Benchers of the Inns. Danckwerts LJ said: "I do not think that the absence of a statutory foundation or of some of these features such as the taking of evidence on oath need be fatal to the recognition of a tribunal as a judicial body to which it is necessary in the interests of a proper and complete hearing to attach the protection of absolute privilege. It seems to me that in the case of proceedings which may result in the deprivation of a barrister of the right to practise his profession, it is desirable that a judicial 29 determination of the matters by the Benchers of his Inn should be as free from harassing consequences as that of a military court of inquiry or the proceedings before the Disciplinary Committee of the Law Society." [51] In Beech and another v Freeson, the defendant was a member of Parliament who was informed by one of his constituents that his constituent’s solicitors, the plaintiffs, had grossly mismanaged his constituent’s affairs and the affairs of his relations. The constituent set out his complaints in a long letter to the defendant. The defendant was requested to refer the matter to the Law Society. The defendant wrote a letter to the Law Society and reproduced the complaints. He sent a copy of the letter to the Lord Chancellor. The defendant was sued for libel. The defendant claimed that his publication to the Law Society and the Lord Chancellor were protected by qualified privilege on the ground that as a member of Parliament, he had a duty or interest in passing on his constituent’s complaint and the Law Society and the Lord Chancellor had a reciprocal interest in receiving it. Geoffrey Lane J held that the reciprocal interest or duty of the Law Society in receiving the complaint cannot be in doubt and the publication to the Law Society was the subject of qualified privilege. With respect to the publication to the Lord Chancellor, the judge considered that the Lord Chancellor has no powers of disciplining or punishing a solicitor who misbehaves but the lack of any direct power to discipline or punish does not mean that the Lord Chancellor has no interest in the complaint, because solicitors are officers of the court and the Lord Chancellor is charged with responsibility to ensure that 30 the machinery of justice runs smoothly. He is sufficiently concerned in the proper behavior of solicitors, in solicitors who as potential holders of judicial office, in the expeditious prosecution of litigation and in ensuring that litigants are honestly and conscientiously advised, to give him the necessary interest to protect the communication with qualified privilege. [52] In the present appeals, the appellant, being the president of Chinwoo, is responsible for the proper conduct and management of the affairs of Chinwoo. The members of Chinwoo were unhappy that Chinwoo had been deprived of 46 units which was the agreed sharing ratio of 23:77 in the Project due to the Free Hand Clause included in the Additional Agreement which was drawn up by the respondent’s legal firm. Although the Trustees of Chinwoo had agreed to the Free Hand Clause, the respondent was a trustee of Chinwoo then. [53] The appellant clearly has an interest to forward to the BC for its attention the complaint that he had sent to the DB. The BC has a corresponding interest or duty to receive the communication as the respondent is an advocate and solicitor. We agree with the appellant’s counsel that the letter sent by the appellant to the BC is prima facie an occasion of qualified privilege. Whether malice as contemplated in the authority of Horrocks v Lowe [1974] 1 All ER 662 (“Horrocks”) may be inferred from the failure on the part of the defendant to take steps that he is not 31 obliged to in law for the purpose of defeating the defence of qualified privilege (Question 4) [54] Malice is a necessary element in an action for libel. The law prevents the inference of malice in the publication of statements which are false in fact and injurious to the character of another if such statements are fairly made by a person in the discharge of some public or private duty, whether legal or moral, or in the conduct of his own affairs, in matters where his interest is concerned. It affords a qualified defence depending upon the absence of actual malice (see Toogood v Spyring (1834) 1 CM & R 181, [1834] EngR 363, (1834) 1 CrM & R 181, (1834) 149 ER 1044). [55] The prima facie defence of qualified privilege is not available if it is shown that a defendant has been actuated by actual or express malice or if he has used the occasion for some indirect or wrong motive. In Royal Aquarium & Summer and Winter Garden Society v Parkinson (1892) 1 QB 43 Lopes LJ said: Not only must the occasion create the privilege, but the occasion must be made use of bona fide and without malice. The defendant is only entitled to the protection of the privilege if he uses the occasion in accordance with the purpose for which the occasion arose. He is not entitled to the protection of the privilege if he uses the occasion for some indirect or wrong motive. [56] In the case of Horrocks v Lowe [1974] 1 All ER 662; [1975] AC 135 the House of Lords held that a defendant was malicious if he “misused” the privileged occasion by not 32 speaking out of duty or to protect a moral interest. Lord Diplock said, amongst others, as follows: For in all cases of qualified privilege there is some special reason of public policy why the law accords immunity from suit – the existence of some public or private duty, whether legal or moral, on the part of the maker of the defamatory statement which justifies his communicating it or of some interest of his own which he is entitled to protect by doing so. If he uses the occasion for some other reason he loses the protection of the privilege. ....So, the motive with which the defendant on a privileged occasion made a statement defamatory of the plaintiff becomes crucial. The protection might, however, be illusory if the onus lay on him to prove that he was actuated solely by a sense of the relevant duty or a desire to protect relevant interest. So he is entitled to be protected by the privilege unless some other dominant and improper motive on his part is proved. ‘Express malice’ is the term of art descriptive of such a motive. Broadly speaking, it means malice in the popular sense of a desire to injure the person who is defamed and this is generally the motive with which the plaintiff sets out to prove. But to destroy the privilege the desire to injure must be the dominant motive for the defamatory publication; knowledge that it will have that effect is not enough if the defendant is nevertheless acting in accordance with a sense of duty or in bona fide protection of his own legitimate interest. [57] The courts below had found that the absence of mandate to lodge the complaints is per se sufficient to prove malice. For the appellant it is submitted that a lack of mandate per se does not constitute an indirect motive or the absence of honest belief as the appellant stood to gain nothing from making the complaints. The appellant had testified that he had wanted to carry out his duty as president and wanted the matter to be properly investigated by the proper authorities. The respondent 33 had alleged that the appellant was actuated by malice and that he had an ulterior motive because he had filed six complaints over the same issue within 28 days. [58] The minutes of the 2003 AGM and the GC meeting on 2.11.2004 show that there is sufficient mandate for the appellant to lodge the complaints. In our considered view, the appellant’s mere act of filing the complaints with the various relevant authorities, without more, is insufficient to prove malice. We find that the respondent failed to prove that the appellant was actuated by malice. Conclusion [59] Pursuant to our reasons aforementioned our answers to the questions posed are as follows: (a) questions 1 and 3 – affirmative (b) questions 2 and 4 – negative. In view of our findings above, we do not consider it necessary to answer question 5. [60] Consequently we allow all the four appeals. We set aside the decisions of the courts below. We award global costs in the sum of RM150,000.00 for the four appeals to the appellant. Costs is subject to the payment of allocator. The deposits paid are refunded to the appellant. 34 [61] Pursuant to our decision, we make the following consequential orders: (a) the 1st respondent is to refund the sum of RM510,301.00 to the appellant within 30 days with interest at 5% per annum from 28 September 2012 until full payment; (b) the 2nd respondent is to refund the sum of RM56,133.00 to the appellant within 30 days with interest at 5% per annum from 28 September 2012 until full payment. Dated: 7 August 2017 sgd AZIAH ALI JUDGE FEDERAL COURT 35 Counsel/solicitors : For the appellant : Dato’ Malik Imtiaz Sarwar together with Robert Low, Surendra Ananth and Helen Lim Solicitors : Messrs Ranjit Ooi & Robert Low For the respondent : Chan Tse Yuan together with Michael Teo, Lee Siew Lin, Tan Foong Luen and Koh Xiao Xuan Solicitors : Messrs Lim Fung Yin & Co.

Tika 2.6.0

A73KJ-178-05/2015

PLAINTIF Puan Arnie Azreen binti Che Arifin. Tetuan Che Arifin & Co, Kuantan. DEFENDAN Puan Selvarasee Manimuthu. T/N Bodi, Chan & Partners, Kuantan.

04/08/2017

PN NURUNAIM BINTI ABDULLAH

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=659dda94-643e-4d14-a5e2-710f8334d244&Inline=true

1 | P a g e DALAM MAHKAMAH MAJISTRET DI KUANTAN DALAM NEGERI PAHANG DARUL MAKMUR KES SIVIL NO: A73KJ-178-05/2015 ANTARA 1. MUHAMMAD AZRIMAN BIN MAT ARIS. (Seorang budak menuntut melalui bapa dan sahabat wakilnya, MAT ARIS BIN ISMAIL) 2. MUHAMMAD FIKRI AMEIR BIN WAHAB. (Seorang budak menuntut melalui bapa dan sahabat wakilnya,WAHAB BIN ISMAIL) 3. AHMAD FAIRUL IKHWAN BIN ISHAK. …Plaintif-Plaintif DAN 1. ABDUL RAZAK BIN MOHAMAD 2. NORAZIDA BINTI ABDUL RAZAK …Defendan-Defendan ALASAN PENGHAKIMAN 2 | P a g e FAKTA KES Plaintif Pertama, sebagai penunggang motorsikal no. pendaftaran NAX 7534 (selepas ini dirujuk sebagai “motorsikal Plaintif Pertama” tersebut ) dan Plaintif Kedua sebagai pembonceng motosikal tersebut manakala Plaintif Ketiga adalah tuan punya motosikal tersebut. Plaintif-plaintif menuntut gantirugi am dan khas termasuk faedah dan kos daripada Defendan Pertama, pemandu berdaftar motokar no. pendaftaran CDG 4947 dan Defendan Kedua sebagai pemilik berdaftar motokar tersebut (selepas ini dirujuk sebagai “motokar Defendan” tersebut) Kemalangan berlaku pada 25-07-2014 jam lebih kurang 12:10 tengahari di Simpang Kampung Derhaka, Kuantan, Pahang semasa Plaintif Pertama dalam perjalanan dan berada di lorong kiri tiba-tiba motokar Defendan yang berada di belakang Plaintif Pertama telah memotong motosikal Plaintif Pertama dan membelok ke kiri secara mengejut sehingga mengakibatkan pergeselan dengan motosikal Plaintif Pertama juga kemalangan dan kecederaan kepada Plaintif Pertama dan Kedua. Defendan telah tidak berpuashati dengan keputusan Mahkamah ini dari segi liabiliti dan kuantum dan memfailkan notis rayuan ini. 3 | P a g e KES PLAINTIF. Plaintif Pertama dalam perjalanan dari rumah kawan di Perkampungan Kempadang menuju ke rumahnya di Kampung Peramu iaitu dari bawah ke atas dalam rajah kasar (P1, P1(k)). Apabila Plaintif Pertama sampai di persimpangan Kampung Derhaka, tiba-tiba motokar Defendan datang dari arah belakang telah memotong motosikal Plaintif Pertama dan terus membelok ke sebelah kiri jalan lalu menggesel dan melanggar motosikal Plaintif Pertama. Keterangan Plaintif Pertama ini disokong oleh Keterangan Plaintif Kedua selaku pembonceng motosikal Plaintif Pertama ini. SP-1 iaitu Pegawai Penyiasat telah pergi ke tempat kejadian sehari selepas kemalangan iaitu pada 26-07-2014. Hasil daripada siasatan SP-1, terdapat 2 lorong untuk satu hala di laluan kiri dan kanan jalan. Arah perjalanan motosikal Plaintif adalah dari bawah ke atas lorong kiri manakala arah perjalanan motokar Defendan adalah dari bawah ke atas lorong kanan sebelum kemalangan berlaku. Menurut SP-1, terdapat kesan gurisan dan darah di atas jalan laluan Plaintif Pertama yang ditandakan sebagai “D” dalam rajah kasar (P1, P1(k)). Oleh sebab itu, saman telah dikeluarkan ke atas Defendan Pertama di bawah Rule 8 LN166/59, Lorong-lorong Lalulintas. KES DEFENDAN. Defendan Pertama dalam perjalanan dari Peramu ke Astaka Village iaitu dari bawah ke atas dalam rajah kasar (P1, P1(k)). Apabila sampai di persimpangan Kampung Derhaka, Jalan Kampung Soi, Defendan Pertama telah 4 | P a g e memberi isyarat dan memperlahankan kenderaan untuk membelok ke kiri. Tiba-tiba motosikal Plaintif telah datang dengan laju dan melanggar bahagian kanan belakang motokar Defendan. Versi Defendan Pertama ini disokong oleh keterangan SD-2 iaitu anak Defendan Pertama yang melihat kejadian berlaku dalam jarak sejauh 3 meter dari tempat SD-2 berada. ALASAN PENGHAKIMAN Liabiliti. [ 1 ] Keterangan dan Pliding Plaintif adalah Plaintif Pertama dalam perjalanan di lorong kiri secara terus, tiba-tiba datang motokar Defendan dari lorong kanan jalan telah memotong motosikal Plaintif Pertama terus membelok masuk ke simpang sebelah kiri laluan sah Plaintif Pertama secara mengejut. Perkara ini turut disahkan oleh Pegawai Penyiasat hasil rakaman percakapan kedua-dua pihak. [ 2 ] Ternyata Defendan Pertama telah menghalang laluan sah Plaintif Pertama tanpa memberi laluan terlebih dahulu kepada Plaintif Pertama untuk selesaikan laluannya adalah sepatutnya dipersalahkan sepenuhnya (Murugan v. Lew Chu Cheong [1980] 1 LNS 49; [1980] 2 MLJ 139). [ 3 ] Fakta bahawa Defendan Pertama telah menghalang laluan sah Plaintif Pertama dan ianya bertentangan dengan seksyen 18 Highway Code yang memperuntukkan: javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2161181185&SearchId=1perpm15E','_DisplayCase','');DispCase.focus() 5 | P a g e “When turning left or right, drivers must always give way to through traffic including pedestrians” Atas kegagalan Defendan Pertama memberi laluan terlebih dahulu kepada Plaintif Pertama untuk meneruskan perjalanannya menjadikan Defendan Pertama cuai dan bertanggungan sepenuhnya di dalam kes ini. [ 4 ] Kegagalan Defendan Pertama mematuhi Highway Code ini juga menjadikan peruntukan seksyen 68(3) Akta Pengangkutan Jalan 1987 adalah terpakai sebagaimana diplidkan oleh Plaintif. [ 5 ] Keterangan SP-1 selaku Pegawai Penyiasat dengan merujuk kepada rajah kasar (P1, P1(k)) telah mengesahkan bahawa tempat kejadian adalah di simpang tiga. Plaintif Pertama menandakan ‘X’ sebagai tempat perlanggaran dan ianya di dalam laluan sah Plaintif Pertama. Maka, ‘inescapable evidence’ adalah Defendan Pertama terlebih dahulu menceroboh masuk ke laluan sah Plaintif Pertama sehingga mengakibatkan kemalangan. [ 6 ] Terdapat juga kesan goresan dan darah yang ditandakan sebagai “D” dalam rajah kasar (P1, P1(k)) di laluan kiri jalan iaitu laluan sah Plaintif Pertama. Bukti senyap ini telah sekali lagi menyokong versi Plaintif Pertama bahawa perlanggaran berlaku di laluan sah Plaintif Pertama iaitu di lorong kiri jalan. 6 | P a g e [ 7 ] Di dalam kes yang terdapat 2 versi yang bercanggah, maka Mahkamah perlu menilai versi mana yang ‘inherently probable or improbable’ (Noorianti bt Zainol Abidin (F) & 8 Others v. Tang Lei Nge & Tang Lye Chang [1990] 1 CLJ 943). Fakta bahawa Defendan Pertama berada di lorong kanan jalan sebelum kemalangan berlaku adalah tidak dipertikai sepanjang perbicaraan. Kegagalan menyoal balas berkenaan fakta ini menjadikan fakta ini tidak tercabar ( Aik Ming (M) Sdn Bhd & Ors v. Chang Ching Chuen & Ors & Another Case [1995] 3 CLJ 639) sekaligus ia menjadikan versi Plaintif Pertama adalah ‘inherently probable’. [ 8 ] Pemanduan Plaintif Pertama selaju 40km/j di kawasan yang dibenarkan tidak menjadikan Plaintif Pertama cuai dan memandu dengan laju sepertimana Pernyataan saksi Defendan Pertama dalam soalan dan jawapan no. 5. [ 9 ] Tiada keterangan bahawa Defendan Pertama nampak Plaintif Pertama memandu dengan laju. Jikalaupun Plaintif Pertama memandu dengan laju sekalipun, pasti Plaintif Pertama menggunakan lorong yang kosong dan tiada kenderaan di hadapannya memandangkan laluan tempat kejadian adalah satu hala yang mempunyai 2 lorong. Melainkan versi Plaintif Pertama adalah lebih berkemungkinan iaitu Plaintif Pertama sememangnya berada di lorong kiri jalan dan Defendan Pertama memasuki lorong Plaintif Pertama, terus membelok ke kiri jalan sehingga menyebabkan kemalangan. javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2526479362&SearchId=perpm14E-98','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2526479362&SearchId=perpm14E-98','_DisplayCase','');DispCase.focus() 7 | P a g e [ 10 ] Plaintif Pertama telah berusaha mengelak ke kanan namun masih bergesel dan terlanggar juga motokar Defendan. Ini kerana tindakan Defendan Pertama amatlah tidak dijangka (unforeseeable) dan amat mustahil untuk Plaintif Pertama mengambil tindakan yang wajar bagi mengelak kemalangan ini (Murugan v Lew Chu Cheong [1980] 2 MLJ 139). [ 11 ] Plaintif Pertama tidak pasif dan bertindak dengan membrek dan mengelak motokar Defendan tetapi bergesel dan terlanggar juga di bahagian kanan motokar defendan . Di sini menunjukkan bahawa Plaintif Pertama ada usaha untuk mengelak kemalangan daripada berlaku namun gagal. Fakta ini tidak menunjukkan kecuaian yang turut disumbang oleh Plaintif Pertama di dalam kemalangan ini. [ 12 ] Kerosakan motosikal milik Plaintif Ketiga adalah rim bengkok, handle hancur dan calar tepi motosikal manakala kerosakan motokar Defendan adalah kemek teruk sebelah belakang kanan. Kerosakan kenderaan secara keseluruhannya adalah selari dengan versi Plaintif Pertama bagaimana kemalangan ini berlaku iaitu motosikal bergesel dan Plaintif Pertama mengelak ke kanan dan terlanggar bahagian belakang kanan motokar Defendan. Perkara ini turut disokong oleh Keterangan SD-2 bahawa selepas kemalangan berlaku, motosikal Plaintif Pertama telah jatuh ke kanan jalan. 8 | P a g e [13 ] Mahkamah juga berhati-hati dalam menerima keterangan SD-2 iaitu anak Defendan Pertama sendiri dan ini adalah saksi berkepentingan kerana keterangan saksi boleh mempengaruhi bukti Defendan (Ahmad Sukeri Ibrahim v Mohd Faizal Adnan [2013] 1 LNS 733). Tambahan pula tiada laporan polis dibuat bagi menyokong keterangannya. [ 14 ] Fakta bahawa Plaintif Pertama tiada lesen menunggang motosikal adalah ‘prima facie evidence’ bahawa Plaintif tidak ‘competent’ mengendalikan motosikalnya dan tiada pengalaman mengenai ‘traffic codes’ (Chua May Yin & Anor v Muhammad Dzul Amri bin Idrus (Seorang kanak-Kanak mendakwa melalui ibunya dan sahabat wakil, Zaini bt Baba) & Anor [2008] 1 PIR [69] tetapi harus diingat juga bahawa fakta Plaintif tiada lesen bukanlah faktor relevan yang boleh digunakan di dalam menilai tahap kecuaian Plaintif Pertama (Mohamad Amir Shahid Imran & Anor v Rozita Saleh & Anor [2013] 1 LNS 641). Tambahan pula tiada keterangan oleh Defendan menunjukkan bahawa Plaintif Pertama tidak ‘competent’, cuai dan tiada pengalaman dalam mengendalikan motosikalnya. [ 15 ] Menurut SP-1, Defendan Pertama telah disaman di bawah Rule 8 LN 166/59 iaitu kesalahan tidak mematuhi lorong yang betul semasa di persimpangan tiga lorong. Menurut SP-1, kenderaan yang ingin masuk simpang sepatutnya berada di lorong A A1 dalam rajah kasar (P1, P1(k)) sebaliknya Defendan Pertama berada di lorong kanan A2 A3 dan masuk 9 | P a g e ke lorong kiri A1 A2 iaitu laluan sah Plaintif Pertama. Ini menunjukkan Defendan Pertama telah cuai dalam memastikan lorong yang betul sebelum masuk ke simpang kiri. [ 16 ] Keterangan SP-1 selaku Pegawai Penyiasat menyatakan bahawa Defendan disaman di bawah Rule 8 LN 166/59 dan saman telah dijelaskan pada 22-01-2016. Walaupun fakta ini bukan bukti yang ‘conclusive’ bahawa Defendan cuai keluar masuk simpang (Mohd Salleh Samad v Zainodin Dongking [2002] 1 CLJ 139) tetapi ia ‘admissible’ dan boleh diterima oleh Mahkamah bagi menimbang darjah tanggungan kecuaian Defendan di dalam kes ini (Chock Kek Ling v. Patt Hup Transport Co Ltd [1965] 1 LNS 25; [1966] 1 MLJ 120). [ 17 ] Berdasarkan kepada prinsip kenderaan yang keluar masuk simpang adalah bertanggungan sepenuhnya cuai (Kek Kee Leng v Theresa Bong Nyok Chin & Anor [1987] 1 MLJ 61). Maka, di dalam kes ini, di atas imbangan kebarangkalian Mahkamah mendapati Defendan Pertama bertanggungan cuai 100%. [ 18 ] Plaintif Kedua adalah merupakan pembonceng motorsikal Plaintif Pertama, maka Plaintif Kedua adalah termaktub di bawah prinsip ‘penumpang tidak berdosa dan berhak menikmati pampasan penuh’ (Samsuri bin Saad & Anor v Chew Kit Toh (t/a Kit Thong Who Hup) & Another Appeal[1996] 1 MLJ 576 Hakim merujuk kepada kes Reliance javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=1812729857&SearchId=1perpm15E','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=1812729857&SearchId=1perpm15E','_DisplayCase','');DispCase.focus() 10 | P a g e Omnibus Co. Sdn. Bhd & Anor v Ishak Bin Mohd Jaafar & Anor [1993] 4 CLJ 291). Maka, Plaintif Kedua berhak untuk menuntut gantirugi 100% terhadap Defendan-Defendan. [ 19 ] Memandangkan Defendan bertanggungan cuai 100% di dalam kes ini, Defendan Kedua bertanggungan secara vikarius. Tuntutan balas dan tolakan Defendan-Defendan terhadap Plaintif Pertama ditolak dengan kos. Kuantum. Gantirugi Am Plaintif Pertama. Mahkamah merujuk kapada Laporan Perubatan yang dikeluarkan oleh Hospital Tengku Ampuan Afzan Kuantan bertarikh 27-05-2015 (P5) di bahagian diagnosis muktamad adalah sepertimana berikut: a) Cerebral concussion. b) Close salter Harris type II fracture left ulna. c) Close torus fracture distal end left radius. d) Laceration wound over left cheek and chin. e) Abrasion wound ovel right arm and forehead. f) Left oblique parasymphysis of mandible fracture. g) Scars 15 cm. 11 | P a g e (a) Cerebral concussion. Peguamcara Plaintif berhujah bahawa jumlah RM 5, 500.00 adalah berpatutan dan munasabah. Peguamcara Defendan berhujah bahawa jumlah RM 4, 000.00 adalah satu award munasabah dengan merujuk kepada Compendium of Personal Injury Awards Revised As At 26 Oct 2010. Setelah Mahkamah membaca hujahan kedua-dua pihak, Maka Mahkamah membenarkan award sebanyak RM 5, 500.00 adalah wajar dan munasabah berdasarkan kepada Compendium yang dirujuk oleh Peguamcara Defendan iaitu tiada amaun lain bagi kecederaan ini melainkan RM 5, 500.00 yang dicadangkan dalam Compendium tersebut. (b) Close salter Harris type II fracture left ulna. (c) Close torus fracture distal end left radius with muscle wasting. Peguamcara Plaintif menggabungkan dua kecederaan ini dan menghujahkan bahawa jumlah sebanyak RM 25, 000.00 adalah munasabah diberikan kepada Plaintif berdasarkan kes: i) Azri Ayub v Shanmugam Balakrishnan & Satu Lagi; Ayub Othman (Pihak Ketiga) [2011] 1 LNS 1960 di mana Mahkamah membenarkan award sebanyak RM 25, 000.00 untuk kecederaan ‘fracture of left radius and ulna’. 12 | P a g e Peguamcara Defendan menghujahkan award berasingan bagi kes ini. Bagi kecederaan Close salter Harris type II fracture left ulna, sejumlah RM 8, 000.00 adalah award yang munasabah berdasarkan kepada Compendium of Personal Injury Awards Revised As At 26 Oct 2010. Manakala bagi kecederaan Close torus fracture distal end left radius Peguamcara Defendan menghujahkan bahawa sejumlah RM 10, 000.00 adalah satu award yang munasabah dan berpatutan berdasarkan kepada Compendium of Personal Injury Awards Revised As At 26 Oct 2010. Setelah membaca hujahan kedua-dua pihak, Mahkamah membenarkan award sebanyak RM 23, 000.00 untuk kedua-dua kecederaan ini. Berdasarkan kepada Compendium of Personal Injury Awards Revised As At 26 Oct 2010 ada mencadangkan kecederaan untuk kedua-dua tulang ini digabungkan iaitu julat bagi kecederaan ‘Radius and ulna’ adalah antara RM 18, 000.00 hingga RM 30, 000.00. Maka award yang munasabah adalah RM 23, 000.00 untuk ‘radius and ulna with muscle wasting’. Ini kerana laporan pakar Plaintif Pertama (P6) tidak menunjukkan sebarang komplikasi berpanjangan terhadap kecederaan yang dialami oleh Plaintif Pertama. Tambahan pula, kecederaan Plaintif Pertama adalah ‘torus fracture’ distal end left radius iaitu ‘incomplete fractures of the shaft of a long bone’. Ia bukan ‘open fracture’. Laporan pakar juga menunjukkan bahawa kedua-dua tulang radius dan ulna ini telah ‘united’. Maka satu award rendah patut diberikan berbanding ‘open fracture’. 13 | P a g e Begitu juga kecederaan ulna adalah jenis ‘closed sater Harris type II’ bukanlah ‘chronic disability’ berbanding ‘type v’. Maka satu award rendah patut diberikan. Tambahan pula laporan pakar tidak menunjukkan apa-apa ‘disability’ akibat daripada kecederaan ini sebaliknya ianya sudah ‘united’. Maka award sebanyak RM 20, 000.00 adalah munasabah untuk kecederaan ‘radius and ulna’ mengikut garis panduan dalam Compendium of Personal Injury Awards Revised as at 26 Oct 2010. Manakala RM 3, 000.00 adalah berpatutan untuk kecederaan ‘muscle wasting ‘sebagaimana digariskan dalam Compendium of Personal Injury Awards Revised As At 26 Oct 2010. (d) Laceration wound over left cheek and chin Peguamcara Plaintif menghujahkan bahawa jumlah sebanyak RM 5, 000.00 adalah munasabah diberikan kepada Plaintif memandangkan kecederaan ini merupakan luka di bahagian muka. Peguamcara Defendan menghujahkan RM 3, 000.00 adalah munasabah untuk kecederaan ini berdasarkan kepada Compendium of Personal Injury Awards Revised as at 26 Oct 2010. Mahkamah membenarkan award sebanyak RM3, 000.00 adalah munasabah berdasarkan kepada Compendium of Personal Injury Awards Revised As At 26 Oct 2010 yang menetapkan julat award antara RM 1, 500.00 14 | P a g e hingga RM 8, 000.00. Tambahan pula, laporan perubatan tidak menyatakan ukuran panjang dan kedalaman kecederaan ini. Maka award RM 3, 000.00 adalah wajar dan munasabah. (e) Abrasion wound over right arm and forehead Peguamcara Plaintif menghujahkan bahawa jumlah sebanyak RM 3, 000.00 adalah berpatutan dan munasabah. Manakala Peguamcara Defendan menghujahkan jumlah sebanyak RM 2, 000.00 adalah munasabah berdasarkan kepada Compendium of Personal Injury Awards Revised as at 26 Oct 2010. Merujuk kepada Compendium of Personal Injury Awards Revised As At 26 Oct 2010 mencadangkan jumlah antara RM 1, 000.00 hingga RM 4, 000.00 untuk kecederaan ‘abrasion (single to multiple)’. Maka award sebanyak RM 2, 000.00 adalah munasabah untuk kecederaan di dua tempat iaitu tangan kanan dan dahi. (f) Left oblique parasymphysis of mandible fracture Peguamcara Plaintif menghujahkan bahawa jumlah sebanyak RM 18, 000.00 adalah munasabah diberikan kepada Plaintif berdasarkan Compendium of Personal Injury Awards yang meletakkan cadangan award antara RM 14, 000.00 ke RM 27, 500.00. 15 | P a g e Peguamcara Defendan menghujahkan RM 12, 000.00 adalah munasabah untuk kecederaan ini berdasarkan kepada Compendium of Personal Injury Awards Revised as at 26 Oct 2010. Mahkamah mempertimbangkan hujahan kedua-dua pihak dan membenarkan award sebanyak RM 14, 000.00 adalah munasabah memandangkan tiada kesan jangka panjang yang akan dialami oleh Plaintif Pertama. (g) Scars 15cm Peguamcara Plaintif menghujahkan bahawa jumlah sebanyak RM 10, 000.00 adalah munasabah diberikan kepada Plaintif kerana ianya merupakan parut di bahagian muka iaitu ‘scar at left cheek around 15cm extending from left angle of mouth to ear tragus’. Peguamcara Defendan tidak menghujahkan berkenaan award yang sesuai untuk kecederaan ini. Mahkamah berpandukan kepada Compendium of Personal Injury Awards Revised As At 26 Oct 2010 yang mencadangkan award antara RM 2, 000.00 hingga RM 10, 000 untuk ‘operation scar’ dan Mahkamah membenarkan award sebanyak RM 5, 000.00 adalah munasabah dan berpatutan. Mahkamah juga mengambilkira laporan pakar Plaintif Pertama 16 | P a g e (P6) yang menyatakan bahawa ‘all scars are permanent and will affect the patient aesthetically’. Kesimpulan award (gantirugi am) Plaintif Pertama. a) Cerebral concussion RM 5, 500.00 b) Close salter harris type II fracture left ulna (muscle wasting) RM 23, 000.00 c) Close torus fracture distal end left radius. d) Laceration wound over left cheek and chin. RM 3, 000.00 e) Abrasion wound ovel right arm and forehead. RM 2, 000.00 f) Left oblique parasymphysis of mandible fracture. RM 14, 000.00 g) Scars 15 cm. RM 5, 000.00 Jumlah : RM 52, 500.00 Kuantum. Gantirugi khas Plaintif Pertama. Plaintif haruslah membuktikan secara ketat berkenaan fakta dan amaun yang dituntut bagi gantirugi ini berpandukan kepada prinsip di dalam kes (Ria Enterprise & Ors v MBF Finance Berhad [2001] 1 CLJ 687). (a) Kos dokumen : RM 1, 800.00 17 | P a g e (i) Laporan perubatan dibenarkan sebanyak RM 40.00 sebagaimana resit rasmi dilampirkan di dalam Ikatan B muka surat 18. (ii) Carian JPJ dibenarkan sebanyak RM 10.00 sebagaimana resit rasmi dilampirkan di dalam Ikatan B muka surat 17. (iii) Laporan Pakar orthopaedic dibenarkan sebanyak RM 750.00 sebagaimana resit rasmi dilampirkan di dalam Ikatan D muka surat 6. (iv) Laporan Pakar Maxillofacial dibenarkan sebanyak RM 1, 000.00 sebagaimana resit rasmi dilampirkan di dalam Ikatan D muka surat 10. (b) Kos perjalanan ke hospital dan makanan untuk diri sendiri dan keluarga: ditolak. Peguamcara Plaintif menghujahkan bahawa Plaintif Pertama berasal dari Kampung Peramu, Kuantan dan Plaintif Pertama telah dimasukkan ke Hoapital Tengku Ampuan Afzan, Kuantan. Maka, kos perjalanan dan makan bagi Plaintif Pertama dan keluarga sebanyak RM 100.00 adalah munasabah. Peguamcara Defendan tidak berhujah untuk isu ini. Meneliti kepada pernyata saksi dan keterangan Plaintif Pertama, tiada dalam mana-mana keterangan Plaintif Pertama yang menyentuh berkenaan dengan kos ini. Maka, tuntutan kos ini tidak dibuktikan dan ditolak. 18 | P a g e (c) Kerosakan pakaian dan barangan peribadi dibenarkan: RM 150.00. Peguamcara Plaintif menghujahkan bahawa sejumlah RM 150.00 adalah munasabah berdasarkan kepada kes Raja Kumar Veerasamy v Ripin Mamat & Yang Lain [2012] 5 LNS 113. Peguamcara Defendan menolak kos ini kerana tiada resit dikemukakan bagi membuktikan tuntutan ini. Mahkamah membenarkan kos sebanyak RM 150.00. Ini kerana Plaintif Pertama ada menyatakan di dalam keterangannya bahawa Plaintif Pertama menanggung kerugian kos kerosakan pakaian dan barangan peribadi sebanyak RM 300.00. Pada hemat Mahkamah, walaupun tiada bukti dokumentari dikemukakan namun melihat kepada tempat kecederaan Plaintif Pertama yang serius, sudah pasti pakaian Plaintif Pertama juga mengalami kerosakan yang teruk akibat kemalangan ini. Maka, award yang munasabah adalah dibenarkan sebanyak RM 150.00. (d) Kos rawatan (implant, bil hospital, dll): ditarik balik oleh Peguamcara Plaintif. (e) Kos rawatan lanjut (pembedahan dan perubatan): ditarik balik oleh Peguamcara Plaintif. 19 | P a g e (f) Kos rawatan tradisional: ditarik balik oleh Peguamcara Plaintif. (g) Makanan berkhasiat: ditarik balik oleh Peguamcara Plaintif. (h) Kehilangan pendapatan dan masih berterusan: ditarik balik oleh Peguamcara Plaintif. (i) Kos penjagaan: ditarik balik oleh Peguamcara Plaintif. (j) Kos membeli kerusi roda dan tongkat: ditarik balik oleh Peguamcara Plaintif. Kesimpulan (gantirugi khas) Plaintif Pertama. (a) Kos dokumen : RM 1, 800.00 (b) Kos kerosakan pakaian dan barangan peribadi : RM 150.00 Jumlah : RM 1, 950.00 Kuantam (gantirugi am) Plaintif Kedua. Mahkamah merujuk kepada Laporan Perubatan yang dikeluarkan oleh Hospital Tengku Ampuan Afzan Kuantan bertarikh 24-04-2015 (dokumen dipersetujui) adalah sepertimana berikut: 20 | P a g e (a) Cerebral concussion. (b) Soft tissue injuries. (a) Cerebral concussion. Peguamcara Plaintif menghujahkan bahawa jumlah sebanyak RM 5, 500.00 adalah berpatutan dan munasabah diberikan kepada Plaintif Kedua. Peguamcara Defendan menghujahkan award sebanyak RM 5, 000.00 adalah munasabah dan berpatutan berpandukan kepada Compendium of Personal Injury Awards Revised as at 26 Oct 2010. Pada hemat Mahkamah, award yang munasabah adalah dibenarkan sebanyak RM 5, 500.00 berdasarkan kepada Compendium of Personal Injury Awards Revised as at 26 Oct 2010 dan trend kes-kes masa kini. (b) Soft tissue injury Peguamcara Plaintif menghujahkan bahawa jumlah sebanyak RM 3, 000.00 untuk kecederaan ‘abrasion wounds’. Peguamcara Defendan menghujahkan sebanyak RM 1, 000.00 untuk kecederaan ‘soft tissue injury’ sebagai munasabah dan berpatutan 21 | P a g e berpandukan kepada Compendium of Personal Injury Awards Revised As At 26 Oct 2010. Mahkamah merujuk kepada laporan perubatan Plaintif Kedua di Ikatan B muka surat 6. Perkataan yang digunakan di bahagian diagnosis dalam laporan perubatan bertarikh 24-04-2015 adalah ‘soft tissue injury’. Maka, jumlah award sebanyak RM 1, 000.00 adalah munasabah dan wajar diberikan kepada Plaintif Kedua. Kesimpulan (gantirugi am) Plaintif kedua. (a) Cerebral concussion RM 5, 500.00 (b) Soft tissue injury RM 1, 000.00 Jumlah RM 6, 500.00 Kuantum (gantirugi khas) Plaintif Kedua (a) Kos dokumen : 40.00 Kos bagi item ini dibenarkan sebanyak RM40.00 sebagaimana resit rasmi yang dilampirkan di dalam Ikatan B muka surat 18. (b) Kos perjalanan ke hospital dan makanan untuk diri sendiri dan keluarga: ditolak Peguamcara Plaintif menghujahkan bahawa Plaintif Kedua berasal dari Kampung Peramu, Kuantan dan Plaintif Kedua telah dimasukkan ke Hospital 22 | P a g e Tengku Ampuan Afzan, Kuantan. Maka, kos perjalanan dan makan bagi Plaintif Kedua dan keluarga sebanyak RM 100.00 adalah munasabah. Peguamcara Defendan tidak berhujah untuk isu ini. Meneliti kepada pernyata saksi dan keterangan Plaintif Kedua, tiada dalam mana-mana keterangan Plaintif Kedua yang menyentuh tentang kos ini. Maka, tuntutan kos ini tidak dibuktikan dan ditolak. (c) Kerosakan pakaian dan barangan peribadi: RM 150.00 Peguamcara Plaintif menghujahkan bahawa sejumlah RM 150.00 untuk item ini adalah munasabah berdasarkan kepada kes Raja Kumar Veerasamy v Ripin Mamat & Yang Lain [2012] 5 LNS 113. Peguamcara Defendan menolak kos ini kerana tiada sebarang bukti seperti resit dikemukakan berhubung tuntutan ini. Mahkamah membenarkan kos bagi item ini sebanyak RM150.00. Ini kerana Plaintif Kedua di dalam keterangannya ada menyatakan bahawa Plaintif Kedua menanggung kerugian kos kerosakan pakaian dan barangan peribadi sebanyak RM 300.00. 23 | P a g e Pada hemat Mahkamah, walaupun tiada bukti dokumentari dikemukakan namun melihat kepada tempat kecederaan Plaintif Kedua, sudah pasti pakaian Plaintif Kedua juga mengalami kerosakan yang akibat kemalangan ini. Maka, award yang munasabah adalah sebanyak RM 150.00 dibenarkan. (d) Kos rawatan (implant, bil hospital, dll): ditarik balik oleh Peguamcara Plaintif. (e) Kos rawatan lanjut (pembedahan dan perubatan): ditarik balik oleh Peguamcara Plaintif. (f) Kos rawatan tradisional: ditarik balik oleh Peguamcara Plaintif. (g) Makanan berkhasiat: ditarik balik oleh Peguamcara Plaintif. (h) Kehilangan pendapatan dan masih berterusan: ditarik balik oleh Peguamcara Plaintif. (i) Kos penjagaan: ditarik balik oleh Peguamcara Plaintif. 24 | P a g e (j) Kos membeli kerusi roda dan tongkat: ditarik balik oleh Peguamcara Plaintif. Kesimpulan (gantirugi khas) Plaintif Kedua. (a) Kos dokumen : RM 40.00 (b) Kos kerosakan pakaian dan barangan peribadi : RM 150.00 Jumlah : RM 190.00 Kuantum (gantirugi khas Plaintif Ketiga) Berdasarkan fakta, keterangan dan dokumen yang dikemukakan tiada satu pun yang menyokong tuntutan bagi gantirugi khas ini. (a) Kos membawa motosikal ke workshop: ditarik balik oleh Peguamcara Plaintif. (b) Kos membaiki motosikal: ditarik balik oleh Peguamcara Plaintif. (c) Kehilangan kegunaan motosikal: ditarik balik oleh Peguamcara Plaintif. 25 | P a g e FAEDAH 1. 5% setahun atas gantirugi am daripada tarikh penyerahan writ sehingga ke tarikh penghakiman. 2. 2.5% setahun atas gantirugi khas dari tarikh kemalangan ke tarikh penghakiman. 3. 5 % setahun atas atas jumlah penghakiman ke tarikh penyelesaian penuh. KOS Perintah untuk kos adalah mengikut skala sepertimana Kaedah-Kaedah Mahkamah 2012. KESIMPULAN Setelah mengambilkira peruntukan undang-undang dan fakta kes ini, Mahkamah mendapati atas imbangan kebarangkalian bahawa Penghakiman yang dimasukkan adalah adil dan munasabah di sisi undang-undang dari segi liabiliti dan kuantum. 26 | P a g e Disediakan oleh: NURUNAIM BINTI ABDULLAH Majistret, Mahkamah Majistret Kuantan. Tarikh : 4 Ogos 2017. Cik/Puan Arnie Azreen binti Che Arifin. Tetuan Che Arifin & Co, Kuantan. ….bagi pihak Plaintif-Plaintif /responden-responden. Cik/Puan Selvarasee Manimuthu. T/N Bodi, Chan & Partners, Kuantan. …bagi pihak Defendan-Defendan /Perayu-Perayu.

Tika 2.6.0

52-1647-06/2012

PLAINTIF MANOHARAN MALAYALAM DEFENDAN MANIAM A/L SAPPANI

03/08/2017

DATO' ISHAK BAKRI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=f802a36e-d270-4680-937b-7ccd2777ef20&Inline=true

DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA SAMAN NO. 52-1647-06/2012 ANTARA MANOHARAN MALAYALAM …PLAINTIF DAN MANIAM A/L SAPPANI …DEFENDAN ALASAN KEPUTUSAN (Permohonan Defendan Mengenepikan Penghakiman Ingkar) PENGENALAN 1. Ini adalah permohonan defendan untuk mengenepikan penghakiman ingkar yang direkodkan terhadap defendan pada 14.8.2012. 2. Kertas-kertas kausa yang telah difailkan dalam tindakan ini adalah seperti berikut: a) Writ saman dan pernyataan tuntutan bertarikh 21.6.2012; b) Afidavit penyampaian yang diikrarkan oleh Rathakrishnan A/L Appoo bertarikh 26.7.2012; c) Perakuan Ketidakhadiran bertarikh 14.8.2012; d) Penghakiman ingkar bertarikh 14.8.2012; e) Notis permohonan untuk mengenepikan penghakiman ingkar bertarikh 3.5.2017. 3. Setelah meneliti permohonan defendan dan mempertimbangkan hujah-hujah plaintif dan defendan, mahkamah memutuskan permohonan defendan untuk mengenepikan penghakiman ingkar ditolak dengan kos. Kos ditetapkan atas jumlah RM1,500.00 dibayar oleh defendan kepada plaintif. 4. Defendan tidak berpuas hati dengan keputusan mahkamah dan memfailkan rayuan ke Mahkamah Tinggi Shah Alam. Berikut adalah alasan-alasan kepada keputsan mahkamah yang menolak permohonan defendan dengan kos. FAKTA KES 5. Pada sekitar bulan Januari 2006, plaintif telah membayar kepada defendan wang berjumlah RM 60,000.00 untuk mendapatkan sebidang tanah dalam tempoh masa dua (2) tahun dari tarikh pembayaran dibuat. 6. Plaintif mendakwa defendan telah gagal untuk mendapatkan apa-apa tanah untuk plaintif setelah tempoh masa dua (2) tahun tersebut tamat. 7. Plaintif membuat permintaan kepada defendan supaya memulangkan wang berjumlah RM 60,000.00 tersebut. Pada 30.12.2011 defendan telah berjanji untuk mengembalikan wang tersebut kepada plaintif dalam tempoh tiga (3) bulan iaitu pada atau sebelum 31.3.2012. Begitupun, defendan gagal untuk membayar wang yang dituntut pada tarikh terakhir yang ditetapkan. 8. Pada 5.6.2012 plaintif telah menuntut melalui surat peguamcaranya Tetuan M Manoharan & Co. wang berjumlah RM 60,000.00 tersebut daripada defendan. 9. Memandangkan tiada pembayaran dikemukakan oleh defendan, plaintif telah memfailkan tindakan ini pada 21.06.2012. 10. Defendan juga tidak memasukkan sebarang kehadiran selepas saman diserahkan kepada defendan. Plaintif seterusnya memfailkan Perakuan Ketidakhadiran untuk mendapatkan penghakiman ingkar ke atas defendan. 11. Selepas penghakiman ingkar direkodkan, defendan membuat bayaran berjumlah RM 30,000.00 melalui anaknya di pejabat plaintif. 12. Plaintif mendakwa plaintif tidak pernah membuat sebarang perjanjian dengan defendan untuk menyelesaikan hutang tersebut setakat RM30,000.00 sebagai penyelesaian penuh dan muktamad tuntutan plaintif terhadap defendan. KEPUTUSAN MAHKAMAH Prinsip Undang-Undang 13. Dalam kes Yap Ke Huat & Ors v Pembangunan Warisan Murni Sejahtera Sdn Bhd & Anor [2008] 5 MLJ Mahkamah Rayuan menyatakan seperti berikut dalam mempertimbangkan suatu permohonan untuk mengenepikan penghakiman ingkar:- “[15] It is trite that when considering an application to set aside a judgment in default, the first task is to ascertain whether it is a regular or irregular judgment. If it is an irregular judgment, then the default judgment ought to be set aside ex debito justitiae. If it is regularly obtained, then the principle expounded in Evans v Bartlam [1937] AC 473 applies — see the judgment of the Federal Court in Hasil Bumi Perumahan Sdn Bhd & Ors v United Malayan Banking Corp Bhd [1994] 1 MLJ 312. This requires the defendant to show that he has a defence on merits. Delay in making such application is a factor to be considered by the court in deciding whether to grant or refuse the application — see Tuan Haji Ahmed Abdul Rahman v Arab-Malaysian Finance Bhd [1996] 1 MLJ 30.” 14. Seterusnya dalam kes Chai Say Fah v Hartanah Aman Sdn Bhd [2015] 6 MLJ 277 Mahkamah Rayuan telah menggariskan elemen-elemen penting dalam permohonan untuk mengenepikan penghakiman ingkar: [6] The law requires that a plaintiff to be prepared to prove his case upon a balance of probabilities. Thus, it has been held by the Supreme Court in Fira Development Sdn Bhd v Goldwin Sdn Bhd [1989] 1 MLJ 40;[1989] 1 CLJ 1 SC that: Where judgment is entered on the failure of a defendant to take any of the procedural steps laid down under the Rules of the High Court 1980, the Court has an absolute discretion to set aside the judgment, if necessary, on terms and allow the case to be heard on the merits. Lord Atkin stated clearly the principles in which the Court should act in Evans v Bartlam [1937] AC 473 at 480 in these words: ... The principle obviously is that unless and until the Court has pronounced a judgment upon the merits or by consent, it is to have the power to revoke the expression of its coercive power where that has only been obtained by a failure to follow any of the rules of procedure. In the instant case, the learned Judge did not consider the judgment to be irregular. Mallal’s Supreme Court Practice, 2nd Ed, Vol I at p 84 explains the position where the judgment is regular thus: The discretion will only be exercised if the affidavit supporting the application to set aside discloses facts showing a defence on the merits, or for some very sufficient reason: Bank Bumiputra Malaysia Bhd v Majlis Amanah Ra’ayat [1978] 1 LNS 15; Farden v Richter [1889] 23 QBD 124. A defence on the merits means merely raising only an arguable or triable issue, e.g. contributory negligence in a running down case in White v Weston [1968] 2 QB 647. A judgment in default is not a judgment on the merits: L Oppenheim And Company v Mahomed Haneef [1922] 1 AC 482. As to delay there is no rigid rule that an applicant must satisfy Court that there is a reasonable explanation only when judgment was allowed to go by default. Obviously, the reason, if any, for allowing the judgment and thereafter applying to set it aside is one of the matters to which the Court will have regard in exercising discretion. Clearly, the application should be made promptly and within a reasonable time. But the Court will in a fit case disregard lapse of time: Beale v Mac Gregor [1886] 2 TLR 311. 15. Berdasarkan kepada prinsip undang-undang terdapat 3 perkara penting yang perlu dipertimbangkan dalam permohonan ini iaitu: a) Samada penghakiman itu dimasukkan secara teratur,; b) Sekiranya teratur, samada pembelaan defendaan mempunyai merit; c) Samada terdapat kelewatan dalam memfailkan permohonan untuk mengenepikan penghakiman ingkar. Samada Penghakiman Ingkar Direkodkan Secara Teratur 16. Dalam kes ini perakuan ketidakhadiran dan penghakiman ingkar yang telah dimasukkan pada 14.8.2012. Mahkamah berpendapat penghakiman ingkar tersebut adalah teratur memandangkan penyerahan writ saman dan pernyataan tuntutan kepada defendan adalah sempurna dan tidak dijadikan isu dalam permohonan ini. 17. Defendan sendiri telah mengakui penerimaan saman daripada plaintif. Ini adalah jelas bahawa defendan mempunyai pengetahuan penuh mengenai tindakan mahkamah yang telah dimulakan terhadapanya tetapi abai, cuai dan ingkar untuk memasukkan kehadiran. 18. Dalam kes Lembaga Kemajuan Tanah Persekutuan (Felda) & Anor v Awang Soh bin Mamat & Anor Mahkamah Rayuan memutuskan seperti berikut: In the English Court of Appeal case of Shocked & Anor v Goldschmidt & Ors [1998] 1 All ER 372, the major factors to be considered to set aside such default judgment differ from that in Evans v Bartlamin the order of priority and prominence. The reason for the absence of the party at the trial has become the 'predominant consideration' over that of a defence on merit. This can be observed from the judgment of Leggatt LJ when he said: 1) Where a party with notice of proceedings has disregarded the opportunity of appearing at and participating in the trial, he will normally be bound by the decision. 2) Where judgment has been given after a trial it is the explanation for the absence of the absent party that is most important: unless the absence was not deliberate but was due to accident or mistake, the court will be unlikely to allow a rehearing. 3) Where the setting aside would entail a complete retrial on matters of fact which have already been investigated by the court the application will not be granted unless there are strong reasons for doing so 4) The court will not consider setting aside judgment regularly obtained unless the party applying enjoys real prospects of success. 5) Delaying in applying to set aside is relevant, particularly if during the period of delay the successful party has acted on the judgment, or third parties have acquired rights by reference to it. 6) In considering justice between parties, the conduct of the person applying to set aside the judgment has to be considered: where he has failed to comply with orders of the court, the court will be less ready to exercise its discretion in his favour. 7) A material consideration is whether the successful party would be prejudiced by the judgment being set aside, especially if he cannot be protected against the financial consequences. 8) There is a public interest in there being an end to litigation and in not having the time of the court occupied by two trials, particularly if neither is short. 19. Secara umumnya adalah menjadi tanggungjawab defendan untuk memasukkan kehadiran setelah menerima saman tersebut. Samada Defendan Mempunyai Pembelaan Bermerit 20. Defendan telah membangkitkan isu-isu dan dakwaan seperti berikut: I. Bahawa defendan telah mendapatkan satu Lesen Pendudukan Sementara atas nama isteri plaintif, Pushpaneela a/p V.N. Suppiah pada tahun 2003 dan jumlah RM 60,000.00 adalah sebagai yuran perkhidmatan untuk mendapatkan lesen menduduki tanah tersebut. II. Bahawa defendan memulangkan RM 30,000.00 kepada plaintif sebagai gantirugi selepas Lesen Pendudukan Sementara tersebut ditamatkan Pihak Berkuasa Negeri pada tahun 2011. III. Bahawa terdapat perjanjian lisan antara anak lelaki defendan, Encik Prakash a/l Maniyam dengan plaintif untuk satu penyelesaian penuh dan muktamad atas jumlah RM 30,000.00. IV. Bahawa perjanjian lisan itu dibuat selepas bayaran wang tunai berjumlah RM30,000.00 pada sekitar selepas Januari 2012 dan sebelum 24.07.2012. V. Bahawa plaintif sepatutnya menarik balik writ saman dan pernyataan tuntutan pada hari sebutan 24.7.2012 yang mana plaintif telah meneruskan dengan memfailkan penghakiman ingkar tanpa pengetahuannya. 21. Plaintif berhujah bahawa isu-isu dan dakwaan defendan tidak berkaitan langsung dengan fakta-fakta kes plaintif. Meneliti kepada isu-isu yang dibangkitkan oleh defendan, mahkamah mendapati ianya tidak menunjukkan sebarang ciri-ciri pembelaan bona fide dan bermerit memandangkan isu mengenai Lesen Pendudukan Sementara yang disebut oleh defendan adalah berkaitan dengan tindakan yang dimulakan oleh plaintif terhadap defendan. Isu tersebut adalah di antara defendan dan isteri plaintif. 22. Plaintif telah menjelaskan bahawa isu dalam tindakan ini adalah berkaitan dengan tanah yang berbeza di antara plaintif dan defendan. 23. Plaintif berhujah bahawa defendan cuba mengelirukan mahkamah dengan mengaitkan kedua-dua isu berkenaan dan menjadikannya sebagai pembelaan. Defendan pula menyatakan plaintif tidak berhak untuk meminta semula jumlah RM 60,000.00 yang telah dibayar kepadanya kerana defendan telah menunaikan perjanjian untuk mendapatkan Lesen Pendudukan Sementara. 24. Begitupun, tindakan defendan memulangkan RM30,000.00 tersebut kepada plaintif menunjukkan perkara sebaliknya. Sekiranya defendan mematuhi perjanjian berkenaan, mengapa defendan perlu membayar semula separuh daripada bayaran yuran perkhidmatan tersebut? Ini menunjukkan bayaran semula RM 30,000.00 kepada plaintif adalah dibuat untuk urusan yang berbeza. 25. Plaintif berhujah defendan telah gagal untuk menunaikan perjanjian dengan plaintif dan perlu membayar semula keseluruhan wang RM 60,000.00 yang telah diterima oleh defendan. Oleh sebab itulah, defendan telah memulangkan separuh daripada jumlah wang berkenaan kepada plaintif dan masih berhutang bakinya. 26. Defendan turut mempersoalkan mengenai bukti bayaran RM 30,000.00 yang diterima oleh plaintif pada 17.8.2015 tetapi defendan sendiri gagal mengemukakan bukti bayaran telah dibuat olehnya antara Januari-Julai 2012. 27. Plaintif juga berhujah defendan dan anak lelakinya yang telah membuat bayaran kepada plaintif juga gagal untuk menunjukkan sebarang bukti terdapatnya persetujuan untuk penyelesaian penuh atas jumlah RM30,000.00 sepertimana yang didakwa oleh defendan. Defendan hanya membuat bayaran setelah dimaklumkan mengenai penghakiman ingkar yang direkodkan terhadapnya. 28. Mahkamah bersetuju dengan hujahan plaintif bahawa sekiranya benar plaintif bersetuju untuk menarik balik saman setelah menerima separuh bayaran daripada defendan, defendan sepatutnya memasukkan kehadiran dan seterusnya merekodkan penghakiman persetujuan. 29. Plaintif berhujah dakwaan hubungan persaudaraan tidak wajar ditimbulkan kerana hubungan itu tidak dapat melawan atau menggantikan penghakiman mahkamah. Dakwaan bahawa defendan mengalami tekanan mental dan emosi juga adalah satu afterthought yang dipertikaikan memandangkan laporan perubatan yang dilampirkan dalam ekshibit MS-7 adalah bertarikh 2.6.2017. 30. Hakim Mahkamah Rayuan Abdul Malik Ishak (ketika itu) dalam kes Lembaga Kemajuan Tanah Persekutuan (Felda) & Anor v Awang Soh bin Mamat & Anor (supra) memutuskan bahawa: In an application to set aside a judgment in default of appearance by the defendant after trial, different considerations will apply compared to an application to set aside such default judgment before trial. Although the court has an unfettered discretion to grant or refuse an application to set aside a judgment in default of appearance after a trial, there must be some material on which the court can exercise its discretion in favour of the applicant. The predominant consideration is not whether there is a defence on the merits but rather the reason why the defendant had absented itself. If the absence was deliberate and not due to accident or mistake, the court would be unlikely to allow a rehearing. Other relevant factors to be considered in such an application include: i. the defendant's prospects of success in a retrial; ii. the delay in applying to set aside the judgment; iii. the conduct of the defendant; iv. whether the successful party would be prejudiced by the judgment being set aside; and v. the public interest in there being an end to litigation (see para 80); Shocked & Anor v Goldschmidt & Ors [1998] 1 All ER 372 and Buga Singh v Koh Bon Keo [1967] 1 MLJ 16 followed.” 31. Mahkamah juga mendapati bahawa terdapat kelewatan yang melampau iaitu selama 5 tahun setelah penghakiman ingkar direkodkan terhadap defendan. Tidak ada penjelasan yang munasabah mengapa defendan menunggu begitu lama untuk memfailkan permohonan ini. 32. Berdasarkan kepada alasan-alasan bahawa penghakiman ingkar adalah teratur, defendan tiada pembelaan bermerit dan permohonan defendan adalah terlalu lewat maka mahkamah memutuskan permohonan defendan ditolak dengan kos. Kos ditetapkan atas kadar RM1,500.00 dibayar oleh defendan kepada plaintif Bertarikh pada 3 haribulan Ogos 2017 tt (ISHAK BIN BAKRI) Hakim Mahkamah Sesyen Shah Alam. Selangor

Tika 2.6.0

52-1647-06/2012

PLAINTIF MANOHARAN MALAYALAM DEFENDAN MANIAM A/L SAPPANI

03/08/2017

DATO' ISHAK BAKRI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=f802a36e-d270-4680-937b-7ccd2777ef20&Inline=true

DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA SAMAN NO. 52-1647-06/2012 ANTARA MANOHARAN MALAYALAM …PLAINTIF DAN MANIAM A/L SAPPANI …DEFENDAN ALASAN KEPUTUSAN (Permohonan Defendan Mengenepikan Penghakiman Ingkar) PENGENALAN 1. Ini adalah permohonan defendan untuk mengenepikan penghakiman ingkar yang direkodkan terhadap defendan pada 14.8.2012. 2. Kertas-kertas kausa yang telah difailkan dalam tindakan ini adalah seperti berikut: a) Writ saman dan pernyataan tuntutan bertarikh 21.6.2012; b) Afidavit penyampaian yang diikrarkan oleh Rathakrishnan A/L Appoo bertarikh 26.7.2012; c) Perakuan Ketidakhadiran bertarikh 14.8.2012; d) Penghakiman ingkar bertarikh 14.8.2012; e) Notis permohonan untuk mengenepikan penghakiman ingkar bertarikh 3.5.2017. 3. Setelah meneliti permohonan defendan dan mempertimbangkan hujah-hujah plaintif dan defendan, mahkamah memutuskan permohonan defendan untuk mengenepikan penghakiman ingkar ditolak dengan kos. Kos ditetapkan atas jumlah RM1,500.00 dibayar oleh defendan kepada plaintif. 4. Defendan tidak berpuas hati dengan keputusan mahkamah dan memfailkan rayuan ke Mahkamah Tinggi Shah Alam. Berikut adalah alasan-alasan kepada keputsan mahkamah yang menolak permohonan defendan dengan kos. FAKTA KES 5. Pada sekitar bulan Januari 2006, plaintif telah membayar kepada defendan wang berjumlah RM 60,000.00 untuk mendapatkan sebidang tanah dalam tempoh masa dua (2) tahun dari tarikh pembayaran dibuat. 6. Plaintif mendakwa defendan telah gagal untuk mendapatkan apa-apa tanah untuk plaintif setelah tempoh masa dua (2) tahun tersebut tamat. 7. Plaintif membuat permintaan kepada defendan supaya memulangkan wang berjumlah RM 60,000.00 tersebut. Pada 30.12.2011 defendan telah berjanji untuk mengembalikan wang tersebut kepada plaintif dalam tempoh tiga (3) bulan iaitu pada atau sebelum 31.3.2012. Begitupun, defendan gagal untuk membayar wang yang dituntut pada tarikh terakhir yang ditetapkan. 8. Pada 5.6.2012 plaintif telah menuntut melalui surat peguamcaranya Tetuan M Manoharan & Co. wang berjumlah RM 60,000.00 tersebut daripada defendan. 9. Memandangkan tiada pembayaran dikemukakan oleh defendan, plaintif telah memfailkan tindakan ini pada 21.06.2012. 10. Defendan juga tidak memasukkan sebarang kehadiran selepas saman diserahkan kepada defendan. Plaintif seterusnya memfailkan Perakuan Ketidakhadiran untuk mendapatkan penghakiman ingkar ke atas defendan. 11. Selepas penghakiman ingkar direkodkan, defendan membuat bayaran berjumlah RM 30,000.00 melalui anaknya di pejabat plaintif. 12. Plaintif mendakwa plaintif tidak pernah membuat sebarang perjanjian dengan defendan untuk menyelesaikan hutang tersebut setakat RM30,000.00 sebagai penyelesaian penuh dan muktamad tuntutan plaintif terhadap defendan. KEPUTUSAN MAHKAMAH Prinsip Undang-Undang 13. Dalam kes Yap Ke Huat & Ors v Pembangunan Warisan Murni Sejahtera Sdn Bhd & Anor [2008] 5 MLJ Mahkamah Rayuan menyatakan seperti berikut dalam mempertimbangkan suatu permohonan untuk mengenepikan penghakiman ingkar:- “[15] It is trite that when considering an application to set aside a judgment in default, the first task is to ascertain whether it is a regular or irregular judgment. If it is an irregular judgment, then the default judgment ought to be set aside ex debito justitiae. If it is regularly obtained, then the principle expounded in Evans v Bartlam [1937] AC 473 applies — see the judgment of the Federal Court in Hasil Bumi Perumahan Sdn Bhd & Ors v United Malayan Banking Corp Bhd [1994] 1 MLJ 312. This requires the defendant to show that he has a defence on merits. Delay in making such application is a factor to be considered by the court in deciding whether to grant or refuse the application — see Tuan Haji Ahmed Abdul Rahman v Arab-Malaysian Finance Bhd [1996] 1 MLJ 30.” 14. Seterusnya dalam kes Chai Say Fah v Hartanah Aman Sdn Bhd [2015] 6 MLJ 277 Mahkamah Rayuan telah menggariskan elemen-elemen penting dalam permohonan untuk mengenepikan penghakiman ingkar: [6] The law requires that a plaintiff to be prepared to prove his case upon a balance of probabilities. Thus, it has been held by the Supreme Court in Fira Development Sdn Bhd v Goldwin Sdn Bhd [1989] 1 MLJ 40;[1989] 1 CLJ 1 SC that: Where judgment is entered on the failure of a defendant to take any of the procedural steps laid down under the Rules of the High Court 1980, the Court has an absolute discretion to set aside the judgment, if necessary, on terms and allow the case to be heard on the merits. Lord Atkin stated clearly the principles in which the Court should act in Evans v Bartlam [1937] AC 473 at 480 in these words: ... The principle obviously is that unless and until the Court has pronounced a judgment upon the merits or by consent, it is to have the power to revoke the expression of its coercive power where that has only been obtained by a failure to follow any of the rules of procedure. In the instant case, the learned Judge did not consider the judgment to be irregular. Mallal’s Supreme Court Practice, 2nd Ed, Vol I at p 84 explains the position where the judgment is regular thus: The discretion will only be exercised if the affidavit supporting the application to set aside discloses facts showing a defence on the merits, or for some very sufficient reason: Bank Bumiputra Malaysia Bhd v Majlis Amanah Ra’ayat [1978] 1 LNS 15; Farden v Richter [1889] 23 QBD 124. A defence on the merits means merely raising only an arguable or triable issue, e.g. contributory negligence in a running down case in White v Weston [1968] 2 QB 647. A judgment in default is not a judgment on the merits: L Oppenheim And Company v Mahomed Haneef [1922] 1 AC 482. As to delay there is no rigid rule that an applicant must satisfy Court that there is a reasonable explanation only when judgment was allowed to go by default. Obviously, the reason, if any, for allowing the judgment and thereafter applying to set it aside is one of the matters to which the Court will have regard in exercising discretion. Clearly, the application should be made promptly and within a reasonable time. But the Court will in a fit case disregard lapse of time: Beale v Mac Gregor [1886] 2 TLR 311. 15. Berdasarkan kepada prinsip undang-undang terdapat 3 perkara penting yang perlu dipertimbangkan dalam permohonan ini iaitu: a) Samada penghakiman itu dimasukkan secara teratur,; b) Sekiranya teratur, samada pembelaan defendaan mempunyai merit; c) Samada terdapat kelewatan dalam memfailkan permohonan untuk mengenepikan penghakiman ingkar. Samada Penghakiman Ingkar Direkodkan Secara Teratur 16. Dalam kes ini perakuan ketidakhadiran dan penghakiman ingkar yang telah dimasukkan pada 14.8.2012. Mahkamah berpendapat penghakiman ingkar tersebut adalah teratur memandangkan penyerahan writ saman dan pernyataan tuntutan kepada defendan adalah sempurna dan tidak dijadikan isu dalam permohonan ini. 17. Defendan sendiri telah mengakui penerimaan saman daripada plaintif. Ini adalah jelas bahawa defendan mempunyai pengetahuan penuh mengenai tindakan mahkamah yang telah dimulakan terhadapanya tetapi abai, cuai dan ingkar untuk memasukkan kehadiran. 18. Dalam kes Lembaga Kemajuan Tanah Persekutuan (Felda) & Anor v Awang Soh bin Mamat & Anor Mahkamah Rayuan memutuskan seperti berikut: In the English Court of Appeal case of Shocked & Anor v Goldschmidt & Ors [1998] 1 All ER 372, the major factors to be considered to set aside such default judgment differ from that in Evans v Bartlamin the order of priority and prominence. The reason for the absence of the party at the trial has become the 'predominant consideration' over that of a defence on merit. This can be observed from the judgment of Leggatt LJ when he said: 1) Where a party with notice of proceedings has disregarded the opportunity of appearing at and participating in the trial, he will normally be bound by the decision. 2) Where judgment has been given after a trial it is the explanation for the absence of the absent party that is most important: unless the absence was not deliberate but was due to accident or mistake, the court will be unlikely to allow a rehearing. 3) Where the setting aside would entail a complete retrial on matters of fact which have already been investigated by the court the application will not be granted unless there are strong reasons for doing so 4) The court will not consider setting aside judgment regularly obtained unless the party applying enjoys real prospects of success. 5) Delaying in applying to set aside is relevant, particularly if during the period of delay the successful party has acted on the judgment, or third parties have acquired rights by reference to it. 6) In considering justice between parties, the conduct of the person applying to set aside the judgment has to be considered: where he has failed to comply with orders of the court, the court will be less ready to exercise its discretion in his favour. 7) A material consideration is whether the successful party would be prejudiced by the judgment being set aside, especially if he cannot be protected against the financial consequences. 8) There is a public interest in there being an end to litigation and in not having the time of the court occupied by two trials, particularly if neither is short. 19. Secara umumnya adalah menjadi tanggungjawab defendan untuk memasukkan kehadiran setelah menerima saman tersebut. Samada Defendan Mempunyai Pembelaan Bermerit 20. Defendan telah membangkitkan isu-isu dan dakwaan seperti berikut: I. Bahawa defendan telah mendapatkan satu Lesen Pendudukan Sementara atas nama isteri plaintif, Pushpaneela a/p V.N. Suppiah pada tahun 2003 dan jumlah RM 60,000.00 adalah sebagai yuran perkhidmatan untuk mendapatkan lesen menduduki tanah tersebut. II. Bahawa defendan memulangkan RM 30,000.00 kepada plaintif sebagai gantirugi selepas Lesen Pendudukan Sementara tersebut ditamatkan Pihak Berkuasa Negeri pada tahun 2011. III. Bahawa terdapat perjanjian lisan antara anak lelaki defendan, Encik Prakash a/l Maniyam dengan plaintif untuk satu penyelesaian penuh dan muktamad atas jumlah RM 30,000.00. IV. Bahawa perjanjian lisan itu dibuat selepas bayaran wang tunai berjumlah RM30,000.00 pada sekitar selepas Januari 2012 dan sebelum 24.07.2012. V. Bahawa plaintif sepatutnya menarik balik writ saman dan pernyataan tuntutan pada hari sebutan 24.7.2012 yang mana plaintif telah meneruskan dengan memfailkan penghakiman ingkar tanpa pengetahuannya. 21. Plaintif berhujah bahawa isu-isu dan dakwaan defendan tidak berkaitan langsung dengan fakta-fakta kes plaintif. Meneliti kepada isu-isu yang dibangkitkan oleh defendan, mahkamah mendapati ianya tidak menunjukkan sebarang ciri-ciri pembelaan bona fide dan bermerit memandangkan isu mengenai Lesen Pendudukan Sementara yang disebut oleh defendan adalah berkaitan dengan tindakan yang dimulakan oleh plaintif terhadap defendan. Isu tersebut adalah di antara defendan dan isteri plaintif. 22. Plaintif telah menjelaskan bahawa isu dalam tindakan ini adalah berkaitan dengan tanah yang berbeza di antara plaintif dan defendan. 23. Plaintif berhujah bahawa defendan cuba mengelirukan mahkamah dengan mengaitkan kedua-dua isu berkenaan dan menjadikannya sebagai pembelaan. Defendan pula menyatakan plaintif tidak berhak untuk meminta semula jumlah RM 60,000.00 yang telah dibayar kepadanya kerana defendan telah menunaikan perjanjian untuk mendapatkan Lesen Pendudukan Sementara. 24. Begitupun, tindakan defendan memulangkan RM30,000.00 tersebut kepada plaintif menunjukkan perkara sebaliknya. Sekiranya defendan mematuhi perjanjian berkenaan, mengapa defendan perlu membayar semula separuh daripada bayaran yuran perkhidmatan tersebut? Ini menunjukkan bayaran semula RM 30,000.00 kepada plaintif adalah dibuat untuk urusan yang berbeza. 25. Plaintif berhujah defendan telah gagal untuk menunaikan perjanjian dengan plaintif dan perlu membayar semula keseluruhan wang RM 60,000.00 yang telah diterima oleh defendan. Oleh sebab itulah, defendan telah memulangkan separuh daripada jumlah wang berkenaan kepada plaintif dan masih berhutang bakinya. 26. Defendan turut mempersoalkan mengenai bukti bayaran RM 30,000.00 yang diterima oleh plaintif pada 17.8.2015 tetapi defendan sendiri gagal mengemukakan bukti bayaran telah dibuat olehnya antara Januari-Julai 2012. 27. Plaintif juga berhujah defendan dan anak lelakinya yang telah membuat bayaran kepada plaintif juga gagal untuk menunjukkan sebarang bukti terdapatnya persetujuan untuk penyelesaian penuh atas jumlah RM30,000.00 sepertimana yang didakwa oleh defendan. Defendan hanya membuat bayaran setelah dimaklumkan mengenai penghakiman ingkar yang direkodkan terhadapnya. 28. Mahkamah bersetuju dengan hujahan plaintif bahawa sekiranya benar plaintif bersetuju untuk menarik balik saman setelah menerima separuh bayaran daripada defendan, defendan sepatutnya memasukkan kehadiran dan seterusnya merekodkan penghakiman persetujuan. 29. Plaintif berhujah dakwaan hubungan persaudaraan tidak wajar ditimbulkan kerana hubungan itu tidak dapat melawan atau menggantikan penghakiman mahkamah. Dakwaan bahawa defendan mengalami tekanan mental dan emosi juga adalah satu afterthought yang dipertikaikan memandangkan laporan perubatan yang dilampirkan dalam ekshibit MS-7 adalah bertarikh 2.6.2017. 30. Hakim Mahkamah Rayuan Abdul Malik Ishak (ketika itu) dalam kes Lembaga Kemajuan Tanah Persekutuan (Felda) & Anor v Awang Soh bin Mamat & Anor (supra) memutuskan bahawa: In an application to set aside a judgment in default of appearance by the defendant after trial, different considerations will apply compared to an application to set aside such default judgment before trial. Although the court has an unfettered discretion to grant or refuse an application to set aside a judgment in default of appearance after a trial, there must be some material on which the court can exercise its discretion in favour of the applicant. The predominant consideration is not whether there is a defence on the merits but rather the reason why the defendant had absented itself. If the absence was deliberate and not due to accident or mistake, the court would be unlikely to allow a rehearing. Other relevant factors to be considered in such an application include: i. the defendant's prospects of success in a retrial; ii. the delay in applying to set aside the judgment; iii. the conduct of the defendant; iv. whether the successful party would be prejudiced by the judgment being set aside; and v. the public interest in there being an end to litigation (see para 80); Shocked & Anor v Goldschmidt & Ors [1998] 1 All ER 372 and Buga Singh v Koh Bon Keo [1967] 1 MLJ 16 followed.” 31. Mahkamah juga mendapati bahawa terdapat kelewatan yang melampau iaitu selama 5 tahun setelah penghakiman ingkar direkodkan terhadap defendan. Tidak ada penjelasan yang munasabah mengapa defendan menunggu begitu lama untuk memfailkan permohonan ini. 32. Berdasarkan kepada alasan-alasan bahawa penghakiman ingkar adalah teratur, defendan tiada pembelaan bermerit dan permohonan defendan adalah terlalu lewat maka mahkamah memutuskan permohonan defendan ditolak dengan kos. Kos ditetapkan atas kadar RM1,500.00 dibayar oleh defendan kepada plaintif Bertarikh pada 3 haribulan Ogos 2017 tt (ISHAK BIN BAKRI) Hakim Mahkamah Sesyen Shah Alam. Selangor

Tika 2.6.0

S-06A-1-08/2014

PERAYU PUBLIC PROSECUTOR … APPELLANT RESPONDEN AHMAD RIZAL BIN UMAR … RESPONDEN T

Criminal Procedure — Appeal — Close of the prosecution’s case — Have the prosecution proved a prima facie case — Whether trial judge failed to consider all evidence adduced before him — Whether trial judge erred when his Lordship held that there was a break in chain of the exhibits — Whether trial judge failed to evaluate the evidence in totality — Whether trial judge subjected all evidence to maximum evaluation in order to determine whether a prima facie case is made out that would justify a court in calling for the defence — Criminal Procedure Code, s 182A(1)

03/08/2017

YA DATUK SERI HAJI MOHD ZAWAWI BIN SALLEHKorumYA DATUK SERI HAJI MOHD ZAWAWI BIN SALLEHYA DATUK DR. PRASAD SANDOSHAM ABRAHAMYA PUAN SRI DATO' ZALEHA BINTI YUSOF

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- 1 - IN THE COURT OF APPEAL OF MALAYSIA HOLDEN IN KOTA KINABALU, SABAH [APPELLATE JURISDICTION] CRIMINAL APPEAL NO. : S-06A-1-08/2014 BETWEEN PUBLIC PROSECUTOR … APPELLANT AND AHMAD RIZAL BIN UMAR … RESPONDENT (In the High Court of Sabah and Sarawak in Kota Kinabalu Criminal Trial No.BKI-46-1/6-2012 Between Public Prosecutor And Ahmad Rizal Bin Umar) CORAM: MOHD ZAWAWI BIN SALLEH, JCA PRASAD SANDOSHAM ABRAHAM, JCA (now FCJ) ZALEHA YUSOF, HCJ (now JCA) - 2 - JUDGMENT OF THE COURT Introduction [1] The respondent, a police inspector, was charged and tried before the Kota Kinabalu High Court with the murder of one Kartini binti Borhan, his intimate friend. The charge read as follows:- “That you on the 29th day of September 2011 between the hours of 4.00 a.m. and 5.00 a.m., in the house located at Lot 7 , Phasa 5, Taman Adika, Keningau, in the District of Keningau, in the State of Sabah, did commit a murder by causing a death to one Kartini binti Borhan (NRIC: 840512-12-6008) and thereby committed an offence punishable under section 302 of the Penal Code.”. [2] At the close of the prosecution’s case, the respondent was acquitted and discharged by the learned trial Judge without his defence being called (“impugned order”). [3] Aggrieved by the said order of acquittal and discharged, the Public Prosecutor (“PP”) has now appealed to this court urging the reversal of the said impugned order. [4] We have heard learned Deputy Public Prosecutor (“DPP”) and learned counsel for the respondent at some length. We have also carefully perused the written submissions and gone through the record of appeal in its entirety. For the reasons that follow, we found the appeal was devoid of merits and accordingly we - 3 - dismissed the appeal by the learned DPP and affirmed the decision of the learned trial Judge. The Factual Background [5] The facts of the case have been fully set out by the learned trial Judge in his Grounds of Judgment. We do not wish to regurgitate except for the relevant facts that are germane to the disposal of this instant appeal. The Prosecution’s Case [6] On 29.9.2011, at about 5.10am, the respondent arrived at IPD Keningau and sought help from Cpl. Jasni Jualis (PW1) and L/Cpl Kristin to save a woman who was allegedly severely injured in an alleged robbery. The respondent was shirtless and covered in blood. [7] PW1, L/Cpl Kristin and the respondent then drove to the scene at the address mentioned in the charge. Upon arrival at the scene, PW1 and L/Cpl Kristin entered a single-storey house. They found the deceased lying on her back at the living room. The deceased was covered with blood. The deceased was brought to the Emergency Ward at Keningau Hospital. Dr. Ooi Kok Min, (PW3), the Medical Officer attached to the Keningau Hospital, tried to resuscitate her but failed and she was then pronounced dead. - 4 - [8] On 30.9.2011, Dr Jessie Hiu (PW2), conducted a post mortem on the deceased at Queen Elizabeth Hospital and prepared a post mortem report (P5). She found one stab wound on the deceased’s face, another one on the deceased’s chest directed downward cutting the ribs, muscles, left lung, the covering of the heart and penetrated the heart from the top right to the bottom of the heart. There was one incised wound on the front of left forearm while other injuries were bruises, abrasions on the chest, left thigh and knees. She opined that it was the stab wound on the chest that caused the deceased’s death. PW2 also collected blood samples, the deceased’s finger nails scrapping and clippings, eight strands of hair, vaginal, anal, oral swabs and the deceased’s clothing for further investigation. [9] Dr Ridwan Hisham (PW5) who was attached to the Orthopaedics Department of Keningau Hospital testified that he examined the respondent on 29.9.2011 after the respondent was referred to him by PW3. PW5 prepared a medical report (P21). The respondent was found to have a 4cm wound at the hypothenar region of his palm, a 1cm wound on his right chest, a wound at his right knee, a stab wound at his right neck and the shoulder muscles partially cut, a 3cm wound in mid-back close to the spine, a 4cm wound at left paravertebral at mid-back, a wound at left axilla tract which runs downward towards the centre of the body from posterior nipple line. The injuries were considered serious and - 5 - it was due to a contact with a sharp object. PW5 had performed surgery and the injuries were satured. The injuries sustained by the respondent were recorded by Detective Steven Ak Tani (PW4) on 2.10.2011. The photographs were produced as P13(1)-13(7). [10] Inspector Razlan bin Abdul Razak (PW20), the Head of the Forensic Team IPK Sabah, visited the crime scene on 29.9.2011 and collected exhibits for chemical analysis. Among the 17 exhibits taken were various swabs of blood, 3 cigarette butts on the cement floor at the car porch, swab of urine, 1 Nike shoe, 1 white bag, 1 cigarette butt from a rubbish bin, DVD/VCD, a beer can, saliva swab, a towel, a night dress and a white t-shirt. He prepared the forensic examination report (P40). [11] Inspector Jaimi bin Jamil (PW21) conducted further examination at the crime scene on 4.10.2011 and collected exhibits for chemical analysis. Among the exhibits taken were various swabs of blood, a sanitary pad, a plastic bottle cap, a silver necklace, mattress cover, slippers and toothbrushes. He also prepared the forensic examination report (P42). On 11.10.2011, PW21 conducted further examination on the footprints. D/Cpl Manzoor Hussien (PW22) took 65 photographs of the footprints which were produced as P30(1) to P30(65). [12] The items were analysed by science officers from Chemistry Deportment, Abdul Razak Mohd Iman (PW24) and Zahila binti - 6 - Suadi (PW25). PW25 found that the respondent and the deceased were the contributors of the mixed DNA profiles on cotton swab ‘A6’, nightdress ‘A16’, bottle cap ‘C2’, sanitary pad ‘C1’ and hair ‘K6a’. PW25 also found that 4 unknown males, the respondent and Lim Guan Heng (PW12) were contributors of the DNA profiles on various items i.e. cigarette butts ‘A3i’, ‘A4’, ‘A11’, mattress cover ‘C9’, toothbrushes ‘C13b’, ‘C13c’ and ‘C13d’. [13] On 2.10.2011, the respondent lodged a police report (P35) and claimed that he received a call from a girl and attended to her at her home. He saw a robber struggling with her and tried to help her but she and the respondent were wounded. [14] The respondent was later charged for the murder of the deceased. [15] The prosecution called 25 witnesses. PW9, the deceased’s neighbour, claimed that she was awakened on that faithful day by sounds and scream from the deceased’s house. [16] Azlyanna binti Sadiken, (PW7) the deceased’s friend and Hasnizah binti Borhan, (PW11) the deceased’s sister, informed the Court that the deceased was having a love affair with the respondent. The deceased was also in a relationship with PW12. [17] The investigation officer (PW16) explained that all exhibits involved in this case had been destroyed as a consequence of a fire - 7 - which broke out at the Exhibits Store in IPD Keningau on 26.4.2013. PW16 lodged a police report dated 17.6.2013 (P31) with a list of exhibits (ID31A) annexed to the said report. Findings of the High Court at the Close of the Prosecution’s Case [18] At the close of the prosecution’s case, the learned trial Judge found that the prosecution had failed to establish a prima facie case against the respondent. [19] According to the learned trial Judge, the circumstantial evidence adduced by the prosecution was insufficient to prove that the respondent had killed or caused bodily injuries that would lead to her death. [20] The learned trial Judge was of the opinion that the respondent’s police report (P35) may probably be a fabricated version which may be calculated to cover up something. However, this fact alone was insufficient to establish conclusively or irresistibly that the respondent had done so to cover his commission of the crime. [21] The learned trial Judge rejected the DNA evidence as there was a break in chain of the exhibits analysed by the chemists (PW24 and PW25). [22] According to the learned trial Judge, the presence of the respondent at the scene of the crime was not in dispute. Therefore, - 8 - the mere existence of two footprints of the respondent alone at the scene cannot be irresistibly inferred that the respondent was the person who had committed the killing or causing or inflicting the fatal injuries on the deceased. There were many footprints and there was no explanation on that. [23] The learned trial Judge also found that the respondent had no motive to kill the deceased. On the purported triangular love affair, there was no evidence to show any purported quarrels, fight or animosity or indication of jealousy between the deceased, the respondent and PW12. In fact, on that faithful morning, the neighbours did not hear any quarrel before the screaming. The Appeal [24] Before us, the impugned order was challenged on two main grounds: (a) That the learned trial Judge had erred when his Lordship held that there was a break in chain of the exhibits; and (b) That the learned trial Judge had erred when his Lordship failed to evaluate the evidence in totality. [25] We will deal with each of the grounds advanced by the DPP in turn. - 9 - Ground (a): Break in Chain of the Exhibits [26] As alluded to earlier, PW24 had examined the exhibits at the scene and had taken photographs of the exhibits which were produced as P52(A)-(M), P53(A)-(C), P54, P55(1)-(47), P56(A)-(Q), P57(1)-(7), P58(1)-(17), P59(1)-(47), P60(1)-(3) and P61(1)-(2). Similarly, PW25 also had taken photographs of all the exhibits which she had conducted for the purpose of DNA analysis. These photographs showing the respective exhibits were produced as P67(1)(A1), P67(2)(A2), P67(3)(A3) until P67(15)(A17), P68, P69(1)(C1), P69(14)(13), P69(8)(C8), P69(8)(C8a), P70(1)(E8) to P70(4)(E6), P71(1)(F1) to P71(6)(F6), P72(1)(G2) to P72(2)(G3), P73, P74(1)(K1) to P74(15)(K15), P75(1)(R1) to P75(7)(R7) and P76(1)(S1) to P76(25)(S25). [27] Learned DPP mounted a frontal attack on the findings of the learned trial Judge in rejecting the DNA evidence. The DNA evidence should not have been rejected simply on the ground that PW2, PW20 and PW21 did not identify the photographs taken by PW24 and PW25. According to the learned DPP, PW2, PW20, PW21, PW24 and PW25 had each explained the markings placed by each of them on the exhibits. There was also a reasonable explanation proffered by PW16 as to how the exhibits were destroyed. - 10 - [28] Now, our courts have time and again emphasised that it is essential for the prosecution to prove that the exhibits collected or recovered from the scene of crime are the very same exhibits submitted for laboratory examination or analysis. The underlying purpose of testimony relating to the chain of custody is to prove that the evidence which is sought to be tendered has not been altered, compromised, contaminated, substituted or otherwise tampered with, thus ensuring its integrity from collection to its production in court. Proof of continuity is not a legal requirement and gaps in continuity are not fatal to the prosecution’s case unless they raise a reasonable doubt about the exhibit’s integrity. There is also no specific requirement that every person who may have possession of the exhibit during the chain of custody should himself or herself give evidence. It is a question of fact for the Court to determine whether or not the DNA result is accurate because of the possibility that security or continuity was not maintained. (See Gunalan Ramachandran & Ors v Public Prosecutor [2004] 4 CLJ 551; R v Larsen 2001 BCSC 597; R v Stafford [2009] QCA 407). [29] Let us now examine the facts in relation to the chain of custody of the exhibits in question. The material evidence on this issue are that of PW2, PW16, PW20, PW21, PW24 and PW25. PW2 testified that she had collected specimens and handed them to PW16 who acknowledged receipt through P7(A). PW2 also prepared a form requesting for forensic or toxicology examination - 11 - (P7). PW2 further explained that the deceased’s blood sample for DNA profiling was on the FTA card. The blood for ABO Grouping was in the blood tube. The nail scrapings and nail clippings were in the envelopes. The hair was put in separate plastic containers. [30] According to PW2 those specimens and items were sealed and marked so that she would be able to identify them. It is pertinent to note that PW2’s oral testimony and the documentary evidence in respect of P7 and P7A made no mention of the markings that were placed on exhibits. [31] PW20 testified that on 29.9.2011, exhibits marked ‘1’ to ‘17’ were recovered and photographed. PW20 also lifted 2 fingerprints (marked ‘C1’ and ‘C2’). The photographs showing the respective exhibits were produced as P9(10) to P9(28). It could be seen from the photographs that a yellow crime scene identifying number card was placed nearby the respective exhibit. PW20 packaged the exhibits and handed them to PW16 who acknowledged receipt through P40. [32] PW21 further testified that on 4.10.2011, exhibits marked ‘1’ to ‘13’ were recovered and photographed. PW21 also took 25 blood sample swabs and they were marked ‘S1’ to ‘S25’. The 7 strands of hair were marked ‘R1’ to ‘R7’. The photographs showing the respective exhibits were produced as P17(1) to P17(75). It could be seen from the photographs that crime scene identifying marker was - 12 - placed nearby the respective exhibit. PW21 testified that he packaged the exhibits and handed them to PW16 who acknowledged receipt through P43. [33] PW16 in his testimony confirmed that he received the exhibits from PW20 on 29.9.2011. On 30.9.2011, at 7a.m., PW16 went to the hospital and witnessed the post mortem. PW16 took the respondent’s blood sample at about 5p.m. on the same day. PW16 sent the exhibits to PW24, together with a few forms requesting chemical analysis, POL 31 (P36A-C). The description of the exhibits and the markings were stated in P36A-C. However, PW16 could not recall the actual date he sent the exhibits to the Chemistry Department. [34] PW24 testified that he received 7 packages marked ‘AI’, ‘AII’, ‘C1’, ‘D’, ‘E’ and ‘F’ from PW16 on 11.10.2011 and issued receipt P48. On 21.10.2011, PW24 received 3 envelopes marked ‘CII’, ‘G’ and ‘H’ from PW16 and issued receipt P49. PW24 conducted test and examination and prepared a report P51 dated 16.11.2011. All the exhibits were returned to PW16 on 25.11.2011 together with the report. On 3.1.2012, PW24 received a package marked ‘I’ from PW16 and issued receipt P50. PW24 conducted test and examination and prepared a report P62 dated 9.1.2012. On 29.2.2012, all the exhibits contained in package ‘I’ were returned to one Inspector Khairu Amra bin Haron. - 13 - [35] PW25 testified that she received 82 envelopes and 8 packages from PW16 on 2.12.2011. She had issued receipt (P65). PW25 conducted test and examination and prepared a report (P66) dated 8.3.2012. All the exhibits were returned to ASP Taruna bin Madian (PW19) together with the report. [36] The sample of blood alleged to be of the respondent was referred to as “E4c” in the Chemist Report (P66). The respondent’s DNA profile was found on cotton swab ‘A6’, nightdress ‘A16’, bottle cap ‘C2’, sanitary pad ‘C1’ and hair ‘K6a’. [37] We have tooth-combed the evidence on the chain of custody of the exhibits. Notwithstanding the detailed testimonies of witnesses regarding the handling of the exhibits concerned, we found some vital link was not accounted for or missing. The point was rightly observed by the learned trial Judge when His Lordship concluded that there was a serious break in the chain of evidence affecting proof as to the identity of the exhibits. We entertained serious doubt whether in fact the exhibits analysed by PW24 and PW25 were the same exhibits recovered and handed over to PW16. We will elaborate on this point in the following paragraphs. [38] The specimen of the respondent’s blood (E4a) was taken so that a comparison can be made with the exhibits recovered from the crime scene. However, the prosecution did not adduce evidence to establish the fact who actually took the sample of blood from the - 14 - respondent, how and when. Further, there was also no evidence to show on how the sample of blood was preserved and kept until it was handed to PW16. [39] There was no evidence adduced by the prosecution to show exactly what had happened to the exhibits between the time of handing over by PW2, PW20 and PW21 to the investigation officer (PW16) and the subsequent examination by the chemist. It was not disputed that PW16 was given custody of the exhibits. However, there were nagging questions about what did PW16 do with the exhibits after he receive them from PW2, PW20 and PW21; where did he keep them; were they kept under lock and key; who placed the markings on the exhibits; and did PW24 and PW25 received the very same exhibits that were recovered by PW2, PW20 and PW21. [40] After an assiduous review of the evidence on record, we found the preservation of the integrity and identity of the exhibits prior to the items reaching the laboratory had been seriously compromised. [41] In the circumstances, the learned trial Judge was correct in rejecting the evidence of PW25 on the DNA profiling and the comparison made with the view to implicate the respondent. [42] On these reasons, the first ground raised by the learned DPP must fail. - 15 - Ground (b): None Appreciation of the Prosecution’s Evidence [43] Learned DPP vehemently contended there are sufficient circumstantial evidence that proved the nexus between the respondent and the deceased’s death and a prima facie case against the respondent has been made out. The evidence may be summarised as follows:- (i) That there was no sign of any break into the deceased’s house suggesting that her killer was someone known to her; (ii) The respondent’s DNA profile was found on cotton swab ‘A6’, nightdress ‘A16’, bottle cap ‘C2’, sanitary pad ‘C1’ and hair ‘K6a’; (iii) The respondent had motive to kill the deceased due to jealousy; (iv) The respondent had injured himself; (v) The respondent had lodged a false police report; and (vi) The respondent’s foot print impression was found at the crime scene. [44] The prosecution’s case is based entirely on the circumstantial evidence. Concerning the heavy onus placed by the law on the prosecution when relying on circumstantial evidence, the following - 16 - passages are definitive and this Court need not add any further. In the House of Lords case of Belhaven & Stenton Peerage [1875- 1976] App. Case.278 at page 279, Lord Cairn remarked:- “My Lords in dealing with circumstantial evidence we have to consider the weight which is to be given to the united force of all the circumstances put together. You may have a ray of light so feeble that by itself it will do little to elucidate a dark corner. But on the other hand you may have a number of rays, each of them insufficient, but all converging and brought to bear upon the same point, when united, producing a body of illumination which will clear away the darkness which you are endeavouring to dispel.”. [45] Hill Ag. CJ in Idris v Public Prosecutor [1960] MLJ 296 had this to say:- “In other words circumstantial evidence consist of this: that when you look at all surrounding circumstances, you find such a series of undersigned, unexpected, coincidences that, as a reasonable person, you will find your judgment is compelled to one conclusion. If the circumstantial evidence is such as to fall short of that standard, if it does not satisfy that test, if it leaves gaps then it is of no use at all. As I have stated this case depends entirely upon circumstantial evidence.”. [See also Chan Chwen Kong v. Public Prosecutor [1962] 1 LNS 22; Magendran a/l Mohan v. Public Prosecutor [2011] https://www.lexisnexis.com/my/legal/search/runRemoteLink.do?langcountry=MY&linkInfo=F%23MY%23MLJ%23sel2%256%25year%252011%25page%251%25sel1%252011%25vol%256%25&risb=21_T16883069283&bct=A&service=citation&A=0.6519518196647287 - 17 - 6 MLJ 1; [2011] 1 CLJ 805, Mazlan bin Othman v. Public Prosecutor [2013] 1 AMR 615] [46] The principles distilled from the cases cited above seem to be this, that for a conviction to be based on circumstantial evidence, the circumstances must unerringly lead to one conclusion consistent only with the hypothesis of the guilt of the accused and every incriminating circumstances must be clearly established by reliable and clinching evidence. Circumstances so proved must form a chain of events from which the only irresistible conclusion that could be drawn is the guilt of the accused and that no other hypothesis against the guilt is possible. In other words, in order to secure conviction based on circumstantial evidence, there must not be any other co-existing circumstances which would weaken or destroy the inference of the guilt of the accused. That fact must be such that they cannot be accounted for any other rational hypothesis, other than the guilt of the accused. [47] We have already given our reasons why we rejected the DNA evidence adduced by the prosecution. Now, even if we were to assume for the sake of argument that scientific evidence ought to have been accepted by this Court, at its highest, the discovery of respondent’s DNA may have created suspicion of his guilt but not enough to prove his guilt. In this context, Zaki Azmi PCA (as his https://www.lexisnexis.com/my/legal/search/runRemoteLink.do?langcountry=MY&linkInfo=F%23MY%23MLJ%23sel2%256%25year%252011%25page%251%25sel1%252011%25vol%256%25&risb=21_T16883069283&bct=A&service=citation&A=0.6519518196647287 - 18 - Lordship then was) explained in the case of Public Prosecutor v Hanif Basree Abdul Rahman [2008] 4 CLJ 1:- “Therefore it is only when a person is identified and the DNA matches that of the identified person can it be of any use towards solving a crime investigation. But even then the prosecution needs to go one step further to show that the DNA of the suspect (together with any other evidence) is such that it points to one conclusion only, ie that the offence was committed by the suspect.”. [48] The presence of the respondent’s DNA at the crime scene left no doubt that the respondent was in the house but it is not enough to implicate the respondent with the murder of the deceased. The existence of 4 unknown males had further hampered the prosecution’s case. [49] Now, we turn to motive. In a criminal prosecution, it is not incumbent upon the prosecution to prove the motive for a crime. However, when a case is based on circumstantial evidence, the motive behind a crime assumes greater importance as it is an important strand of circumstantial evidence to impute the accused’s guilt. In the two leading cases where, based on circumstantial evidence, a conviction for murder was upheld, the motives for the killings were clearly established. In Sunny Ang v. Public Prosecutor [1965] 1 LNS 171, [1966] 2 MLJ 195, it was clearly established that the accused committed the murder so as to benefit javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=1816330753&SearchId=3hakim32','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=1816330753&SearchId=3hakim32','_DisplayCase','');DispCase.focus() - 19 - from some insurance policies which had recently been taken out in the deceased's name. Likewise in Dato' Mokhtar Hashim & Anor v. Public Prosecutor [1983] CLJ 101 (Rep), [1983] 2 MLJ 232, it was established that the motive for the killing was political rivalry and ambition. [50] In this instant appeal, the prosecution alleges only one motive, i.e jealousy, which the learned trial Judge found to be non-existent. It was the prosecution’s case that the deceased had two lovers simultaneously and the evidence of SP12 was introduced towards this end. However, there was not an iota of evidence showing that the respondent in fact knew of their relationship to excite the respondent’s feeling of jealousy. In the circumstances, we agreed with the findings of the learned trial Judge that there was no evidence to show that the respondent is prone to jealousy or had such a disposition. [51] The prosecution sought to adduce evidence through Dr Siew Sheue Feng (PW23) that the injuries suffered by the respondent were self-inflicted. PW23 had examined the respondent on 24.10.2012 and photographs P13(1)-13(7) were given to PW23 for the purpose of his assessment. PW23 prepared a report (P39) in which he expressed his opinions that the injuries sustained by the respondent were inconsistent with combative encounter and were possibly self-inflicted. Based on P39, learned DPP submitted that - 20 - the conduct of the respondent in injuring himself was a relevant fact pursuant to section 8 of the Evidence Act 1950 and the defence should be called for the respondent to explain why he injured himself. [52] It is trite that an expert witness must give reasons for his conclusions (see Public Prosecutor v Loo Seng Yip [2004] 8 CLJ 496). In this regard, PW23 had testified in great detail the reasons for his conclusion. We observed that the learned trial Judge was very critical of the manner in which PW23 gave his evidence. PW23’s opinion in respect of the nature and severity of the injuries sustained by the respondent, according to the learned trial Judge, was highly questionable and no weight should be accorded. In this context, in the case of Dato’ Mokhtar Hashim (supra), Hashim Yeop Sani FJ had this to say:- “Human judgment is fallible and human knowledge is limited and imperfect. Moreover it is also not uncommon that an expert witness, however impartial he may wish to be is likely to be unconsciously prejudiced, in favour of the side which calls him. This is the area of caution that the court must always bear in mind assessing the evidence of an expert.”. [53] Having scrutinized the evidence of PW23 and the Grounds of Judgment, we were satisfied that the findings of the learned Judge was correct in law and should be accepted. In our considered - 21 - opinion, PW23’s evidence was unreliable as he had no first hand knowledge on the matter and was basing his opinion on photographs P13(1) – 13(7) and cynical examination conducted long after the incident. The photographs were taken after PW5 had performed surgery. Those photographs depict wounds that were sutured and do not reflect the actual severity of the injuries sustained by the respondent. [54] In the case of Ong Chen Tow v Regina [1963] 1 MLJ 160, Wilson J had this to say on an expert who had no first-hand knowledge or experience on the matter:- “The learned District Judge also rejected the evidence of the expert on the ground that it was extremely biased against the prosecution and bordered on the ridiculous as he was basing his opinion on 2 visits to the scene long after the accident and after examining the same materials as were already before the court. The learned District Judge held that the factual evidence was a simple and straight forward nature and with this I cannot agree.”. [55] Further, PW23 himself had admitted that PW5 would be in a better position to ascertain the nature and severity of the respondent’s injuries. Considering the nature of the evidence proffered by PW23, we must say that the evidence of PW23 and the report (P39) were lacking in probative value for the reasons we have adumbrated earlier. - 22 - [56] It is pertinent to note that the purpose of expert evidence of fact (e.g observation, test, calculation) and opinion is to assist the court in areas of science or other technical matters upon which the court cannot be expected to form a view without expert assistance. Nevertheless, the ultimate decision on the matters about which the expert was expressed an opinion remains one for the court and not for the expert. It is always for the court to decide the fact in the light of the evidence as a whole. Whilst the court must, of course, pay due regard to the expertise of an expert witness, the court is neither obliged to agree with him or her, nor obliged to share doubts or reservations expressed by him or her. [57] As stated earlier, the learned trial Judge had held that the police report (P35) lodged by the respondent may be fabricated to cover up something. Although the report might be incriminating against the respondent, we agreed with the learned trial Judge’s findings that this does not necessarily lead to an irresistible inference that the respondent had committed the crime. There must be other circumstances that may go to show that the respondent alone had committed this murder. Learned DPP submitted that there was scientific evidence to prove that the respondent had committed the offence. According to PW21, he found 23 footprints impressions that could be categorised into two patterns. PW15, the Assistant Registrar of the Criminal Registration Centre Malaysia, found that the respondent’s footprint impression (P29A and P29B) - 23 - were similar to the footprints shown in photographs P30(39) and P30(41). We disagreed with the submission on the ground that the other footprints were unaccounted for. Without the elimination process to rule out the possible involvement of third party, this piece of evidence fell short of the standard needed in establishing a prima facie case against the respondent. [58] Finally, learned DPP submitted that the learned trial Judge erred and/or misdirected himself in failing to evaluate the prosecution’s evidence in totality. [59] It is trite that in assessing circumstantial evidence one needs to be careful not to approach such evidence upon a piece-meal basis and to subject each individual piece of evidence to a consideration of whether it excludes the reasonable possibility that the explanation given by an accused is true. The evidence needs to be considered in its totality. [60] The court must not take each circumstance separately and give the accused the benefit of any reasonable doubt as to the inference to the drawn from each one so taken. It must carefully weigh the cumulative effect of all of them together, and it is only after it has done so that the accused in entitled to the benefit of any reasonable doubt which it may have as to whether the inference of guilt is the only inference which can reasonably be drawn. To put the matter in another way: the prosecution must satisfy the court, - 24 - not that each separate fact is inconsistent with the innocence of the accused, but that the evidence as a whole is beyond reasonable doubt inconsistent with such innocence. [61] In our view, the learned trial Judge delivered a well-reasoned judgment which accounted for all the proven facts. We could not detect any misdirection on fact and law by the learned trial Judge. We must bear in mind that no judgment can ever be perfect and all- embracing. As stated in the South Africa case of S v Noble 2002 NR 67 (HC):- “[No] judgment can ever be “perfect and all embracing, and it does not necessarily follow that, because something has not been mentioned therefore it has not been considered”. (See S v De Beer 190 NR 379 (HC) at 381 – J quoting from S v Pillay, 1977 (4) SA(a) at 534H – 535 G and R v Dhlumayo and Others, 1948 (2) SA 677 (A) at 706)...”. [62] Having considered the cumulative effect of the circumstantial evidence adduced by the prosecution against the respondent, we have no doubt in our mind that such evidence fell gravely short of the standard required by the law. The prosecution had evidently failed to establish a prima facie case against the respondent. We refer to the decision of the Federal Court in Sia Soon Suan v Public Prosecutor [1966] 1 MLJ page 116 holding (3):- - 25 - “(3) the requirements of strict proof in a criminal case cannot be relaxed to bridge any material gap in the prosecution evidence. Irrespective of whether the court is otherwise convinced in its own mind of the guilt or innocence of an accused, its decision must be based on the evidence adduced and nothing else and therefore the appeal must be allowed and the conviction quashed.”, and to the judgment of Ong Hock Thye AG CJ (Malaya) as he then was and we quote at page 118 holding F-1:- “In the circumstances, had counsel's application for further cross-examination of the prosecution witness been permitted, it might well have brought out into greater relief the break in the chain, so that it could not have been passed over. It is impossible for us to say that in the circumstances the denial of the application might not have occasioned a miscarriage of justice. We appreciate that on the day of the Pontian landing there must have been great confusion when routine procedural machinery was jammed, if not broken down by the rush of exciting and grave events. We must accordingly exonerate all police and military personnel as well as the public prosecutor's officers from any sort of blame for the flaws which had developed in the prosecution case. Nevertheless, the requirements of strict proof in a criminal case cannot be relaxed to bridge any material gap in the prosecution evidence. Irrespective of whether this court is otherwise convinced in its own mind of the guilt or - 26 - innocence of an accused, its decision must be based on the evidence adduced and nothing else. This is axiomatic. The directions that we give a jury are no less to be hearkened to by ourselves.”. Conclusion [63] For the foregoing reasons, the appeal must fail and accordingly we dismissed the appeal and affirmed the decision of High Court. So ordered. Dated: 3rd August 2017 sgd. (DATO’ SETIA MOHD ZAWAWI SALLEH) Judge Court of Appeal Malaysia Counsel for the Appellant: Hanim binti Mohd Rashid Deputy Public Prosecutor Appellate and Trial Division Attorney General’s Chambers Putrajaya. Counsel for the Respondent: Ram Singh (Ridwadeen M. Borhan with him) Messrs. Ram Singh Harban & Co Advocates & Solicitors No.3, 2nd Floor, Block F Damai Plaza Phase IV Lorong Pokok Kayu Manis 2 Luyang 88300 Kota Kinabalu, Sabah.

Tika 2.6.0

W-01(A)-412-10/2016

PERAYU CEMERLANG LAND SDN BHD … PERAYU RESPONDEN 1. ALI BIN SAAT [NO. K.P: 600928-08-6075] 2. TRIBUNAL TUNTUTAN PEMBELI RUMAH … RESPONDEN - RESPONDEN

Judicial Review — Decisions of the President of Tribunal for House-Buyers’ Claims — Damages for late delivery of vacant possession — Revived housing project under PR1MA Scheme — A new sale and purchase agreement was drawn up and executed between Appellant and Respondent — By the Deed of Revocation the Respondent had agreed to revoke and rescind the 1st Agreement — Benefit enjoyed by Respondent — Respondent was given vacant possession of the unit which he bought under the 2nd Agreement with the same purchase price and deposit paid under the 1st Agreement was refunded — Deed of Revocation and 2nd Agreement were not in accordance to the prescribed forms — Whether tribunal acts within the proper scope of its statutory function — Whether decision of tribunal may be reviewed on the grounds of illegality, irrationality and proportionality — Whether courts are permitted to scrutinize such decisions not only for process but also for substance — Order of the High Court was set aside — Appeal is allowed — Housing Development (Control and Licensing) Act 1966 [Act 118], section 8A, section 16 N (2); Housing Development (Control and Licensing) Regulations, 1989 [P.U.(A) 58/89], Regulation 11, Schedule G & H

01/08/2017

YA DATO' SRI HASNAH DATO' MOHAMMED HASHIMKorumYAA TUN TENGKU MAIMUN BINTI TUAN MATYA DATUK VERNON ONG LAM KIATYA DATO' SRI HASNAH DATO' MOHAMMED HASHIM

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1 DALAM MAHKAMAH RAYUAN MALAYSIA (BIDANGKUASA RAYUAN) RAYUAN SIVIL NO. : W-01(A)-412-10/2016 ANTARA CEMERLANG LAND SDN BHD … PERAYU DAN 1. ALI BIN SAAT [NO. K.P: 600928-08-6075] 2. TRIBUNAL TUNTUTAN PEMBELI RUMAH … RESPONDEN- RESPONDEN DI DENGAR BERSAMA [RAYUAN SIVIL NO.: W-01(A)-415-10/2016] ANTARA CEMERLANG LAND SDN BHD … PERAYU DAN 1. ABDUL RAHIM BIN KHAIRULDIN [NO. K.P: 521104-01-5519] 2. NORAZMAN BIN ABDUL RAHIM [NO. K.P: 880410-01-5829] … RESPONDEN- RESPONDEN DAN 2 [RAYUAN SIVIL NO: W-01(A)-417-10/2016] ANTARA CEMERLANG LAND SDN BHD … PERAYU DAN 1. SITI AMAH BT JA’AFAR [NO. K.P: 550817-01-5298] 2. TRIBUNAL TUNTUTAN PEMBELI RUMAH … RESPONDEN- RESPONDEN Dalam Mahkamah Tinggi Malaya di Kuala Lumpur (Bahagian Rayuan dan Kuasa-Kuasa Khas) Permohonan Untuk Semakan Kehakiman No: 25-66-04/2015 Antara Cemerlang Land Sdn Bhd … Pemohon Dan 1. Ali Bin Saat [No. K.P: 600928-08-6075] 2. Tribunal Tuntutan Pembeli Rumah … Responden- Responden Dalam Mahkamah Tinggi Malaya Di Kuala Lumpur (Bahagian Rayuan dan Kuasa-Kuasa Khas) Permohonan Untuk Semakan Kehakiman No: 25-66-04/2015 3 Antara Cemerlang Land Sdn Bhd … Pemohon Dan 1. Abdul Rahim Bin Khairuldin [No. K.P: 521104-01-5519] 2. Norazman Bin Abdul Rahim [No. K.P: 880410-01-5829] … Responden- Responden Dalam Mahkamah Tinggi Malaya Di Kuala Lumpur (Bahagian Rayuan dan Kuasa-Kuasa Khas) Permohonan Untuk Semakan Kehakiman No: R2-25-67-04/2015 Antara Cemerlang Land Sdn Bhd … Pemohon Dan 1. Siti Amah Bt Ja’afar [No. K.P: 550817-01-5298] 2. Tribunal Tuntutan Pembeli Rumah … Responden- Responden Judicial Review — Decisions of the President of Tribunal for House-Buyers’ Claims — Damages for late delivery of vacant possession — Revived housing project under PR1MA Scheme — A new sale and purchase agreement was drawn up and executed between Appellant and Respondent — By the Deed of Revocation the Respondent had agreed to revoke and rescind the 1st Agreement — Benefit enjoyed by Respondent — Respondent was given vacant possession of the unit which he bought under the 2nd Agreement with the same purchase price and deposit paid under the 1st Agreement was 4 refunded — Deed of Revocation and 2nd Agreement were not in accordance to the prescribed forms — Whether tribunal acts within the proper scope of its statutory function — Whether decision of tribunal may be reviewed on the grounds of illegality, irrationality and proportionality — Whether courts are permitted to scrutinize such decisions not only for process but also for substance — Order of the High Court was set aside — Appeal is allowed — Housing Development (Control and Licensing) Act 1966 [Act 118], section 8A, section 16 N (2); Housing Development (Control and Licensing) Regulations, 1989 [P.U.(A) 58/89], Regulation 11, Schedule G & H CORAM: TENGKU MAIMUN BINTI TUAN MAT, JCA VERNON ONG LAM KIAT, JCA HASNAH BINTI DATO’ MOHAMMED HASHIM, JCA JUDGMENT INTRODUCTION [1] There were three appeals before us arising from three applications for judicial review in the High Court emanating from one judgment of the learned Judicial Commissioning. They involved different Respondents but the same Applicant (Appellant) and were all heard together. The three appeals were against the decision of the learned Judicial Commissioner dismissing the Appellant's application for judicial review. The Appellant had applied for an order of certiorari to quash the decision of the President of the Tribunal 5 Tuntutan Pembeli Rumah (“the Tribunal”) made on 26.1.2015 (‘the Award’). The Tribunal had on the said date awarded the Respondents damages for late delivery of vacant possession by the Appellant. The Appellant, dissatisfied with the decision of the learned Judicial Commissioner appealed to this Court. [2] We heard the appeal on 27.3.2017. After due deliberation and having carefully considered the submissions of both parties we found that there are merits in the appeals and allowed all the appeals with costs. We propose to give reasons for our decisions with respect to all the appeals in one common judgment. Since the facts are common for all the three appeals, for purposes of this judgment, we will only be referring to the facts in Appeal No. W-01(A)- 412-10/2016, which parties had agreed to refer in their submissions. MATERIAL FACTS [3] The background facts are important to understand the context in which these appeals were brought. The Appellant, is a company incorporated in Malaysia and is a housing developer previously known as Genting Unggul Sdn. Bhd. The Respondent entered into a Sale and Purchase Agreement dated 25.6.2002 ("the 1st Agreement") with the Appellant to purchase one apartment unit described as No. AC-03-02 at Amber Court, Desa Larkin, 6 Johor (‘Amber Court Project’). The purchase price of the said unit was RM25,000.00. Clause 22 of the 1st Agreement stipulates that the handing over of vacant possession of the unit shall be within thirty-six (36) months from the date of the aforesaid agreement. [4] The Amber Court Project consists of five blocks of 700 units of low cost flats i.e Blocks A-E. Under the 1st Agreement the Respondent‘s unit was located on the 3rd floor Block C. Unfortunately, the Amber Court Project could not be completed within the period stipulated in the said agreement. On 31.12.2005 the Jabatan Perumahan Negara declared and classified the Amber Court Project as an abandoned project. [5] However, steps were undertaken by the authorities to revive the abandoned project. Subsequently a new development order was issued to revive the project and to build “…179 Unit Rumah Teres 2 ½ Tingkat di atas Lot 20203, Jalan Merak dan 3 Blok Rumah Pangsa 5 Tingkat (248 Unit Rumah Kos Rendah 650 kaki persegi di atas Lot PTB 20184, Jalan Rajawali, Mukim Larkin, Johor.’ In 2014 the Jabatan Perumahan Negara after having classified the housing project as ‘Projek Perumahan Bermasaalah di Negeri Johor’ took steps to revive the housing project 7 under the PR1MA Scheme. The Appellant was appointed as the developer of the said project by the relevant authorities. [6] The original purchasers of the abandoned project (including the Respondent) were offered by the Appellant to participate in the said revived project. Sometime in 2010 the Respondent was offered by the Appellant to purchase one unit of the low cost flat known as Project Larkin Court 1 i.e Unit A-2-1 Blok A Tingkat 2 Rumah Pangsa No.1. By a letter of acceptance the Respondent accepted the offer and agreed to revoke the 1st Agreement. [7] A Deed of Revocation dated 9.7.2013 was executed between the parties whereby it was mutually agreed to revoke and rescind the 1st Agreement and to treat the said agreement as null and void, “1. In consideration of the premises herein the parties hereto mutually agree to revoke and rescind the sale and Purchase Agreement as null and void.” [8] A new sale and purchase agreement dated 9.7.2013 was drawn up and executed between the Appellant and the Respondent (“the 2nd Agreement’). The purchase price of the new unit remained at RM25,000.00 8 and the completion date as stipulated in the said agreement is within 3 months from the date of the said 2nd Agreement. [9] The said revived project was completed and vacant possession of the unit was duly handed over to all the purchasers including the Respondent within the time stipulated in the aforesaid 2nd Agreement. [10] Sometime in 2014 the Respondent filed a claim against the Appellant with the Tribunal for late delivery of the unit he purchased under the 1st Agreement. The Tribunal awarded to the Respondent compensation for late delivery of vacant possession. Dissatisfied with the decision of the Tribunal the Appellant filed the judicial review in the High Court. The Tribunal [11] The decision of the President can be found at pages 295-335 of the Appeal Records. He concluded that the 2nd Agreement together with the Deed of Revocation were executed without the approval of the Jabatan Perumahan Negara and that the 2nd Agreement executed by the parties was not in accordance to the agreement as prescribed in Schedule H of the Housing Development (Control and Licensing) Regulations, 1989 (‘HDR’). Regulation 11 of HDR provides as follows: javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_PUA_1989_058&SearchId=7hakim154','_DisplayAct','');DispAct.focus() javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_PUA_1989_058&SearchId=7hakim154','_DisplayAct','');DispAct.focus() 9 “Every contract of sale for the sale and purchase of a housing accommodation together with the subdivisional portion of land appurtenant thereto shall be in the form prescribed in Schedule G and where the contract of sale is for the sale and purchase of a housing accommodation in a subdivided building in the form of a parcel of a building or land intended for subdivision into parcels, as the case may be, it shall be in the form prescribed in Schedule H.” [12] The President of the Tribunal opined that the 1st Agreement can only be terminated in accordance to section 8A of the Housing Development (Control and Licensing) Act 1966 (“the Act”) and concluded that the revocation of the 1st Agreement as well as the execution of the 2nd Agreement were null and void as they were not in accordance with the requirement of the law. The Appellant was therefore still bound by the terms and conditions of the 1st Agreement. Furthermore, the Appellant failed to obtain the approval of the Jabatan Perumahan Negara as required under Regulation 11(3) HDR. He explained in his written findings as follows: “52. Selaras dengan dapatan Tribunal keatas Isu-Isu (i), (ii) dan (iii) diatas, Tribunal mendapati bahawa penghujahan-penghujahan yang 10 dikemukakan oleh Responden seperti dinyatakan dalam perenggan 26 (i), (ii) dan (vi) di atas adalah tidak berasas dan adalah ditolak atas alasan bahawa – (i) Responden tidak boleh menamatkan sesuatu perjanjian jual beli rumah melainkan selaras dengan peruntukan 8A Akta 118 dan Peraturan dibawahnya; (ii) Pembatalan Perjanjian Pertama dan pemeteraian Surat Indemniti, Surat Kuasa dan Perjanjian Kedua tanpa kelulusan atau kebenaran khas oleh JPN di bawah Peraturan 11(3) adalah tidak sah kerana ia merupakan suatu perbuatan berkontrak keluar daripada peruntukan khusus Akta 118 dan Peraturan dibawahnya. Responden adalah masih terikat dengan syarat-syarat Perjanjian Pertama untuk menyerahkan milikan kosong rumah dan kemudahan kemasyarakatan yang dibeli oleh Pemohon di bawah Perjanjian Pertama dalam tempoh 36 bulan dari tarikh Perjanjian Pertama ditandatangani; 11 (iii) Sekiranya Responden, sebagai kontraktor penyelamat, hendak mengecualikan dirinya daripada membayar gantirugi yang ditentukan atas kelewatan menyerahkan milikan kosong rumah dan kemudahan kemasyarakatan di bawah projek yang terbengkalai kepada Pemohon dan pembeli-pembeli lain, Responden hendaklah memohon dan mendapatkan kebenaran khas sedemikian daripada JPN di bawah Peraturan 11 (3) Peraturan Pembangunan Perumahan (Kawalan dan Pelesenan)1989…” [13] The President concluded that the Respondent’s claim for compensation for late delivery was not time barred. The Appellant failed to hand over vacant possession to the Respondent under the 1st Agreement and there was therefore a delay of 3111 days calculated from 25.6.2005 until 31.12.2013. The High Court [14] The learned Judicial Commissioner dismissed the judicial review application as he found that the President of the Tribunal did not commit any serious errors of law in arriving at his Award. The Respondent had no other remedy as a result of the breach of the 1st Agreement by the Appellant. He was of the considered view that if an order for certiorari was 12 granted the Appellant would not be responsible for the breach of the agreement for the failure of not handing over vacant possession as stipulated in the 1stAgreement. In his grounds of judgment the learned Judicial Commissioner said this when refusing judicial review: “[20] Pada pendapat mahkamah ini: (a) mengikut autoriti kes Law Pang Ching & Ors v. Tawau Municipal Council, oleh kerana pihak pemohon sebagai pemaju projek perumahan telah melanggar terma kontrak-kontrak yang diikat pada tahun 2002, mahkamah ini tidak akan melaksanakan budi bicaranya bagi membantu pemohon, sekalipun jika terdapat kekhilafan undang-undang pada keputusan Presiden yang terpelajar; dan (b) mengaplikasikan formula yang digubal oleh Lord Woolf MR dalam kes exparte Douglas-Williams (supra), suatu perintah certiorari tidak menjadi wajar atau perlu demi kepentingan keadilan, kerana dalam kes ini, responden- responden tiada remedi lain terhadap perlanggaran kontrak oleh pihak pemohon berkenaan dengan persetujuan tahun 2002, seperti yang pihak pemohon sendiri akui. Jika javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2850685956&SearchId=2hakim154','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2850685956&SearchId=2hakim154','_DisplayCase','');DispCase.focus() 13 perintah certiorari diberikan kepada pemohon, ini akan bermakna bahawa pemohon tidak perlu menanggung akibat perlanggaran kontraknya sendiri.” The Appeal [15] Before us, learned counsel for the Appellant submitted that the Award made by the President of the Tribunal was wrong and could not be sustained in law and that the learned Judicial Commissioner had erred in upholding the said Award. It was submitted that in the light of the facts and the circumstances of the case put forth before the Tribunal, the decision arrived at was tainted with illegality and irrationality. The President had taken into account irrelevant considerations, failed to take into account relevant considerations and material facts and had acted against the weight and totality of the evidence. [16] The Federal Court case of R. Rama Chandran v. Industrial Court of Malaysia & Anor [1997] 1 CLJ 147; [1997] 1 MLJ 145 and the case of Ranjit Kaur a/p S Gopal Singh v. Hotel Excelsior (M) Sdn Bhd [2010] 8 CLJ 629; [2010] 6 MLJ 1 held that the decision of the inferior tribunal may be reviewed on the grounds of illegality, irrationality and possibly javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2550399489&SearchId=hakim154-99','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2550399489&SearchId=hakim154-99','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2880963074&SearchId=hakim154-99','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2880963074&SearchId=hakim154-99','_DisplayCase','');DispCase.focus() 14 proportionality and the courts are permitted to scrutinize such decisions not only for process but also for substance. [17] It is trite law that courts should not reverse an award of a tribunal unless there is proven a clear jurisdictional error. A jurisdictional error can arise when a tribunal does not act within the proper scope of its statutory function such as whether it has acted without sufficient evidence or on no evidence, or has misconstrued the law on an issue on which its decision is founded. (Re: Syarikat Kenderaan Melayu Kelantan Bhd v. Transport Workers' Union [1995] 2 CLJ 748; [1995] 2 MLJ 317). [18] As Gopal Sri Ram, JCA (as he then was) said in Datuk Bandar Kuala Lumpur v. Zain Azahari Zainal Abidin [1997] 2 CLJ 248 at page 269 : "... where the exercise of a decision is challenged on grounds of vires that is illegality, or unreasonableness, the Court is not confined merely to the decision-making process, but may examine the merits of the decision itself." [19] We are further guided by what was stated in the Federal Court case of Wong Yuen Hock v. Syarikat Hong Leong Assurance Sdn Bhd and Another Appeal [1995] 3 CLJ 344 at page 348: javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2521629697&SearchId=0hakim154','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2521629697&SearchId=0hakim154','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2564293633&SearchId=0hakim154','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2564293633&SearchId=0hakim154','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2526740993&SearchId=0hakim154','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2526740993&SearchId=0hakim154','_DisplayCase','');DispCase.focus() 15 "In exercising judicial review, the High Court was obliged not to interfere with the findings of the Industrial Court unless they were found to be unreasonable, in the sense that no reasonable man or body of men could reasonably come to the conclusion that it did, or that the decisions of the Industrial Court looked at objectively, are so devoid of any plausible justification that no reasonable person or body of persons could have reached them (see Lord Denning's judgment in Griffiths (Inspector of Taxes) v. J.P Harrison (Watford) Ltd [1962] 1 AER 909 at 916, and judgment of Lord Diplock in Bromley London Borough Council v. Greater London Council and Anor [1983] 1 AC 768 at 821)." [20] It is trite law that certiorari will lie to quash a decision made by a public authority in excess or abuse of jurisdiction or contrary to the rules of natural justice or where there is an error of law on the face of the decision of the public authority. For a decision to be quashed on judicial review, there must first be a decision by a decision maker, and the said decision affected the aggrieved party by either altering the rights or obligations or depriving him of the benefits which he has been permitted to enjoy. [21] The court must review the decision in order to determine the basis of a material mistake of fact on the part of the person who made the decision or 16 where the decision was arrived at arbitrarily, capriciously or mala fide or as a result of unwarranted adherence to a fixed principle or in order to further an ulterior or improper process, or where the functionary misconceived the nature of the discretion conferred upon him and took into consideration irrelevant issues or ignored relevant ones. [22] In the instant appeal the functions, powers and jurisdiction of the Tribunal are spelt out in the Act. Section 16 N (2) of the Act provides for the limitation to the jurisdiction of the Tribunal as follows: “(2) The jurisdiction of the Tribunal shall be limited to a claim that is based on a cause of action arising from the sale and purchase agreement entered into between the homebuyer and the licensed housing developer which is brought by a homebuyer not later than twelve months from- (a) the date of issuance of the certificate of completion and compliance for the housing accommodation or the common facilities of the housing accommodation intended for subdivision, whichever is later; 17 (b) the expiry date of the defects liability period as set out in the sale and purchase agreement; or (c) the date of termination of the sale and purchase agreement by either party and such termination occurred before the date of issuance of the certificate of completion and compliance for the housing accommodation or the common facilities of the housing accommodation intended for subdivision, whichever is later.” [23] Section16N (2) of the Act requires the Respondent as a house buyer to file the complaint 12 months from the date of termination of the sale and purchase agreement which would be the 1st Agreement. The essential facts to be considered is that under the 1st Agreement dated 25.6.2002 it was clearly provided by clause 22 of the said agreement, as follows: “22(1) Vacant possession of the said Parcel to which the water and electricity supply are ready for connection shall be handed over to the Purchaser within thirty-six (36) calendar months from the date of this Agreement; and (2) If the Vendor fails to hand over vacant possession of the said Parcel, to which water and electricity supply are ready for connection to the said Parcel in time, the Vendor shall pay immediately to the 18 Purchaser liquidated damages to be calculated from day to day at the rate of ten per centum (10%) per annum of the purchase price.” [24] It was common ground that the unit was not completed and available for delivery as provided under agreement. The purchaser's right of action for damages for breach of contract, following the general rule, accrued on the date of the breach, which in this case was the day after the time limited under clause 22, that is to say, on 24.6.2005 when the Appellant failed to deliver vacant possession as stipulated under the 1st Agreement. [25] The Respondent, however did not file any complaint to the Tribunal within the time as provided under the Act. The complaint for late delivery under the 1st Agreement was only filed after the execution of the 2nd Agreement and the handing over of the property to him. [26] By the Deed of Revocation the Respondent had agreed to revoke and rescind the 1st Agreement and to treat the said agreement as null and void subject to and upon the terms and conditions as agreed. It was also agreed that the progressive amount (i.e the deposit of RM2,500) paid by the Respondent to the developer shall be refunded. 19 [27] Counsel for the Appellant argued that in the present appeal the cause of action arose in the year 2005 which was the earliest instance when the Respondent has a complete cause of action where all the material facts to be proved has happened. It is further submitted that the cause of action under the 1st Agreement due to the failure to deliver vacant possession arose in year 2005. However, the parties had mutually revoked the 1st Agreement and executed the 2nd Agreement whereby the unit purchased by the Respondent was duly handed over. [28] The President of the Tribunal was also fully aware and conscious of the fact that the Respondent had by the Deed of Revocation revoked the 1st Agreement which was the basis of his complaint to the Tribunal the jurisdiction of the Tribunal that is, to hear and determine a homebuyer's claim arising out of a sale and purchase agreement entered into by the parties. He was also aware that the unit as described under the 2nd Agreement was handed over to the Respondent within the time stipulated. [29] This court is guided by the principles enunciated in the case of Aw Yong Wai Choo & Ors v Arief Trading Sdn Bhd & Anor [1991] 3 CLJ 2834; [1991] 2 CLJ (Rep) 294. The facts of the case are almost similar to the facts in the appeal before us. The plaintiffs in that case were purchasers javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2434800129&SearchId=0hakim154','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2434800129&SearchId=0hakim154','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2434800129&SearchId=0hakim154','_DisplayCase','');DispCase.focus() 20 of houses developed by the first defendant under sale and purchase agreements entered into between the plaintiffs and the first defendant. The first defendant, however was unable to complete the project and the second defendant took over and completed the project. The court held that the second defendant decided to take over the project and built the houses according to more expensive specifications. The plaintiffs had all gained and enjoyed the benefit of such specifications. The court held that the plaintiffs were not entitled to claim liquidated damages for late delivery of the houses against the second defendant. His Lordship Peh Swee Chin J referred to the principles in the case of Shaw v. Applegate [1977] 1 WLR 970 in which Justice Buckley LJ held as follows:- “... the real test, I think, must be whether upon the facts of the particular case, the situation has become such, that it would be dishonest or unconscionable for the plaintiffs or the person having the right sought to be enforced, to continue to seek to enforce it.” [30] Relying on this principle, His Lordship held as follows:- ‘The extraordinary situation described above was such that it would be unconscionable for the plaintiffs to insist on strictly enforcing the obligation providing for the payment of the said liquidated damages for 21 late delivery of houses, and it was for this Court to decide how an equity should be satisfied.” [31] We find that that the learned Judicial Commissioner had misdirected himself when he said in his written judgement: “ Jika sekalipun terdapat apa-apa kekhilafan dari segi undang-undang yang telah dilakukan oleh Presiden Tribunal terpelajar, ianya tidak akan sama sekali menjejaskan keputusan untuk menolak permohonan certiorari yang dipinta. Oleh yang demikian, tidak perlu lagi mahkamah ini mempertimbangkan hujahan-hujahan peguam pemohon yang mendakwa bahawa Presiden Tribunal telah terkhilaf dari segi undang- undang.” [32] In his grounds of judgment the learned Judicial Commissioner said: “(b) mengaplikasikan formula yang digubal oleh Lord Woolf MR dalam kes ex parte Douglas- Williams (supra), suatu perintah certiorari tidak menjadi wajar atau perlu demi kepentingan keadilan, kerana dalam kes ini, responden-responden tiada remedi lain terhadap perlanggaran kontrak oleh pihak pemohon berkenaan dengan persetujuan tahun 2002, seperti yang pihak pemohon sendiri akui. Jika perintah certiorari 22 diberikan kepada pemohon, ini akan bermakna bahawa pemohon tidak perlu menanggung akibat pelanggaran kontraknya sendiri.” [33] With respect, we do not agree with the reasoning of the learned Judicial Commissioner that when it comes to exercising its discretion the test for the court to apply when deciding whether it should give relief is that it should be necessary or desirable to do so in the interest of justice . The facts of the case of Regina v HM Coroner for Inner London South District, ex parte Douglas-Williams CA [1999] 1 All ER 344 relied on by the learned Judicial Commissioner can be distinguished. In ex parte Douglas- Williams the deceased died in custody. The jury returned a verdict of accidental death and it was suggested that the coroner’s direction as to unlawful killing had been confusing, and that he was wrong not to leave open the possibility of a verdict of neglect. Lord Woolf MR in his judgment explained as follows: “The conclusion I have come to is that, so far as the evidence called before the jury is concerned, a coroner should adopt the Galbraith approach in deciding whether to leave a verdict. The strength of the evidence is not the only consideration and in relation to wider issues, the coroner has a broader discretion. If it appears there are circumstances which, in a particular situation, where in the judgment http://swarb.co.uk/regina-v-hm-coroner-for-inner-london-south-district-ex-parte-douglas-williams-ca-29-jan-1998/ http://swarb.co.uk/regina-v-hm-coroner-for-inner-london-south-district-ex-parte-douglas-williams-ca-29-jan-1998/ 23 of the coroner, acting reasonably and fairly, it is not in the interest of justice that a particular verdict should be left to the jury, he need not leave that verdict. He, for example, need not leave all possible verdicts just because there is technically evidence to support them. It is sufficient if he leaves those verdicts which realistically reflect the thrust of the evidence as a whole. To leave all possible verdicts could in some situations merely confuse and overburden the jury and if that is the coroner’s conclusion he cannot be criticised if he does not leave a particular verdict.” [34] The facts in the instant appeal are far from similar. The laws applicable, are also different. The relevant legislations in this appeal are the Housing Developers (Control And Licensing) Act 1966 and the Housing Development (Control and Licensing) Regulations, 1989. The Act provides for the control and licensing of the business of housing development, the protection of the interest of purchasers and for matters connected therewith. It confers the Tribunal, amongst others, the jurisdiction to hear claims for late delivery. There is also the issue of the 2nd Agreement entered into between the Appellant and the Respondent revoking the 1st Agreement. javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1973_118&ActSectionNo=16N.&SearchId=3hakim154','_DisplayAct','');DispAct.focus() javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1973_118&ActSectionNo=16N.&SearchId=3hakim154','_DisplayAct','');DispAct.focus() 24 [35] In our view the learned Judicial Commissioner had committed a grave error when he applied the principle formulated by Lord Woolf MR in the case of ex parte Douglas- Williams (supra) and brushed aside the facts and the law applicable before him. He decided not to consider the submission of the applicant whether there was an error on the part of the Tribunal and not to determine as well as to identify the error, if at all committed by the Tribunal. [36] As a judge, in exercising judicial review powers, the Judicial Commissioner must examine the decision of the Tribunal not only in relation to the process, but also for substance in order to ascertain if such decision was tainted with illegality, irrationality or procedural impropriety within the principles amongst others outlined in the case of Council of Civil Service Unions & Ors v. Minister for the Civil Service [1984] 3 All ER 935; Rama Chandran v. Industrial Court of Malaysia & Anor [supra] and Ranjit Kaur a/p S Gopal Singh v. Hotel Excelsior (M) Sdn Bhd [supra]. [37] It is an undisputed fact that the Respondent had executed the Deed of Revocation revoking the 1st Agreement and then executed the 2nd Agreement. The Judicial Commissioner had ignored the issue of jurisdiction of the Tribunal. Under the Act the Tribunal can only consider the complaint if it was made within the time stipulated and that the Tribunal can only award compensation for late delivery. The Respondent had benefitted from the transaction as he was not only given vacant possession of the unit which he 25 bought under the 2nd Agreement with the same purchase price but the deposit paid under the 1st Agreement was refunded to him. [38] We agree with the submissions of the Appellant's learned counsel that the decision of the President of the Tribunal ought to be set aside on the grounds that the decision is irrational and unreasonable. The Tribunal had also acted in excess of its jurisdiction as the complaint was made after the 2nd Agreement and the Deed of Revocation were executed. In the light of the facts and the factual matrix of the circumstances, we are satisfied that the decision of the President of the Tribunal when looked at objectively, is devoid of any plausible justification that no reasonable person or body of persons could have come to. On this ground alone the appeal ought to be allowed. [39] Thus, for the reasons given, we were of the unanimous view that the appeal must be allowed. The Order of the High Court was set aside. We made no order as to cost. The deposit was refunded. sgn (HASNAH BINTI DATO’ MOHAMMED HASHIM) Judge Court of Appeal, Malaysia Putrajaya Date: 1 August 2017 26 Counsels: For Appellant: Tetuan Mei Fun & Rajashree No. 17-2, Jalan Radin Bagus 6, Sri Petaling 57000 Kuala Lumpur. (Attention : Encik Rajashnee Suppiah) For Respondent, Tetuan Mohd Najid & Partners No. 6.01, Jalan Padi Emas 5/2, Bandar Baru Uda, 81200 Johor Bahru, Johor Darul Takzim. (Attention : Encik Mohd Fairuz bin Abdullah)

Tika 2.6.0

WA-22C-92-12/2016

PLAINTIF Thien Seng Chan Sdn Bhd DEFENDAN 1. Teguh Wiramas Sdn Bhd; 2. YL Design Consultancy Services

31/07/2017

YA DATO' LEE SWEE SENG

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=614c30a6-b73a-4ff6-bf69-90603215e974&Inline=true

1 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE STATE OF WILAYAH PERSEKUTUAN, MALAYSIA (CIVIL DIVISION) SUIT NO: WA-22C-92-12/2016 BETWEEN THIEN SENG CHAN SDN BHD ... PLAINTIFF (Company No: 299325-X) AND 1. TEGUH WIRAMAS SDN BHD (Company No: 92564-T) 2. YL DESIGN CONSULTANCY SERVICES ... DEFENDANTS JUDGMENT OF Y.A. LEE SWEE SENG [1] This is the 1st Defendant’s (D1) Notice of Application (Enclosure 6) to stay the proceedings between the Plaintiff and D1 pending arbitration to be held between the Plaintiff and D1 pursuant to the Section 10 of Arbitration Act 2005 and/or Order 92 Rule 4 Rules of Court 2012 (“ROC 2012”). 2 [2] In reply to the Supporting Affidavit of D1 dated 11.1.2017 to the Notice of Application, the Plaintiff had filed an Affidavit in opposition by Lee Kok Tian dated 2.3.2017. Preliminaries [3] D1 raised a preliminary objection to the admission of the Plaintiff’s Affidavit on ground that its jurat is defective. It was argued that the contents of the Plaintiff’s Affidavit was not interpreted by the Commissioner for Oaths to the deponent Lee Kok Tian as mandated by law. Instead, it was interpreted by someone else without the necessary qualification stated. Further, the format of the jurat used is also wrong. [4] Learned counsel for D1 referred to the case of Han Euu Tiam v Phang Kui Fatt & Ors [1999] 4 MLJ 683 at p 687, para F - G where non- compliance with the proper jurat form is fatal: "... If the deponent is neither blind nor illiterate but is not conversant in the Malay language (bearing in mind in the present case that the affidavit is in the Malay language), then Form 78(a) must be used. The affidavit must be interpreted to him in the language that he understands by a competent interpreter, and thereafter that part of the form which reads (‘Through the interpretation of ...') must be 3 completed accordingly. The full name of the interpreter (together with his identity card number) and the language (for example, Mandarin or Cantonese) used by him to interpret the contents of the affidavit to the deponent must be recorded in the blank spaces provided in the brackets." (emphasis added) [5] It was further held at p 688 para B – D that: "If the deponent is blind or illiterate, then Form 78(c) must be used. ... it is my finding that there has been a departure from the prescribed format and such departure is not trivial in nature. ... In view of the substantial deviation, and bearing in mind that O 41 r 1(7) and (8) use the word 'must', I am unable to accept the jurat as used by the plaintiff, as a valid jurat. ... The interlocutory application is thus without a supporting affidavit. It must fail". (emphasis added) [6] Learned counsel for D1 submitted that the Plaintiff had wrongly used an incomplete Forms of Jurat No. 74(c) or (d) under the ROC 2012 instead of the correct Form 74(a). It was also submitted that the contents was not interpreted by someone with the necessary qualification to the deponent Lee Kok Tian. 4 [7] As can be seen from the jurat used the said deponent does not understand Bahasa Malaysia and could only understand through the interpretation into Mandarin by a 3rd party. [8] I agree that the strict requirement of the ROC 2012 in relation to the right jurat had not been complied. The Court can exact an undertaking from learned counsel for the Plaintiff to refile the affidavit concerned and this time to follow with the strict requirements of the law on jurat. [9] Learned counsel for D1 argued that the prejudice suffered by them is that had the affidavit of D1 been properly explained, the Plaintiff might not be objecting to the stay application at all and that this objection had caused unnecessary costs and expense to D1. [10] I am not persuaded by this argument. I think in matters like this we must assume, in the absence of evidence to the contrary, that the said solicitors for the Plaintiff has the necessary instruction from their client, the Plaintiff, to object to the said application for stay. Whether there are merits or not in the objection to the stay is a separate matter altogether. 5 [11] I agree with learned counsel for the Plaintiff that the rules are a procedural code subject to the overriding objective of enabling the Court to deal with cases justly (Order 1(2) ROC 2012). [12] The Court should not allow such a preliminary objection only on the ground of non-compliance with the Rules unless the Court is of the opinion that such non-compliance has occasioned a substantial miscarriage of justice or occasioned prejudice that cannot be cured by amendment or an appropriate order for costs or both – Order 2 rule 3 ROC 2012. [13] I am not persuaded that D1 had suffered any prejudice or that a substantial miscarriage of justice had been caused by the jurat being defective. As it is D1 had no problem filing a reply to the Plaintiff’s Affidavit in opposition. Indeed all the arguments that D1 had wanted to raise are in their Affidavit in support. The Plaintiff’s objection to the stay are more arguments of law as all the necessary averment of facts are found in D1’s Affidavit in support. [14] The argument of law is that the arbitration clause was in the CIDB Contract, which though referred to in the Letter of Award, duly signed by the parties, the CIDB Contract itself was not signed by the parties. The question of whether the arbitration clause has been properly imported into 6 the Letter of Award that had been signed by a reference to it in the Letter of Award is a question of law that may be raised at the hearing of the application without the need to rely on any Affidavit. [15] Likewise whether the arbitration clause is in conflict with the “Proper Law and Jurisdiction of the Court Clause” is a legal argument that could be raised at the hearing of the application without reference to any Affidavit on the part of the Plaintiff. [16] I also inclined to agree with learned counsel for the Plaintiff that the authority of Han Euu Tiam (supra) was decided in 1999 prior to the amendments to the Rules of the High Court 1980 then and now the ROC 2012. There is a palpable paradigm shift where the truth of the matter that is sought to be proved should trump and triumph over the technical non- compliance with the Rules. [17] The language used in Order 1A of ROC 2012 cannot be clearer in enjoining the overriding interest of justice and eschewing technical objections of non-compliance. It reads: "In administering these Rules, the Court or Judge shall have regard to the overriding interest of justice and not only to the technical non- compliance with the Rules." 7 [18] I would dismiss the preliminary objection raised and proceed to hear the parties on the merits of the arguments of the parties for and against the stay of proceedings. Principles Whether there is a valid arbitration agreement as required under section 10 of Arbitration Act 2005 [19] Section 10 of Arbitration Act 2005 stipulates, among others, as follows: "A court before which proceedings are brought in respect of a matter which is the subject of an arbitration agreement shall, where a party makes an application before taking any other steps in the proceedings, stay those proceedings and refer the parties to arbitration unless it finds that the agreement is null and void, inoperative or incapable of being performed." (emphasis added) [20] At the outset, let it be recorded that it is not in dispute that D1 had not taken any other steps in the litigation proceedings other than entering its appearance. That is acceptable for without it the Plaintiff may take a judgment in default of appearance. The Federal Court in Sanwell Corp v 8 Trans Resources Corp Sdn Bhd & Anor [2002] 2 MLJ 625 observed as follows at p 638: “We reaffirm that Sime Axa Assurance correctly decided that an entry of an unconditional appearance does not constitute a step in the proceedings within the meaning of s 6 of the Act. It is obvious that a conditional appearance entered with a view of making an application to set aside the writ or service of the writ under O 12 r 7 of the RHC would not amount to a step in the proceedings either. In short, an entry of appearance under O 12 of the RHC would not amount to a step in the proceedings within the meaning of s 6 of the Act.” (emphasis added) [21] Though decided under the old section 6 of the Arbitration Act 1952 the same principle would apply and more so when there is now no O. 12 r. 6 ROC on the entry of conditional appearance and with that O.12 r.7 has been deleted too with respect to an application to set aside writ arising from the entry of a conditional appearance. [22] The Court of Appeal in Albilt Resources Sdn Bhd v Casaria Construction Sdn Bhd [2010] 7 CLJ 785 stressed as follows: 9 "Section 10 of the Act imposes a mandatory obligation to stay the proceedings and refer the parties to arbitration. The word "shall" that appears in s. 10 must necessarily mean "directory" or "mandatory". (emphasis added) [23] An arbitration agreement, being a term of the contract between the parties, every effort must be made to uphold it. The Federal Court in Press Metal Sarawak Sdn Bhd v Etiqa Takaful bhd [2016] 9 CLJ 1 went on to state as follows as summarized in headnote (1) at pp 2 - 3: "In order to grant a stay order under s. 10(1) (after the 2011 Amendment), the court has to consider whether there is in existence a binding arbitration agreement or clause between the parties, which agreement is not null and void, inoperative or incapable of being performed. The question as to whether there is a dispute in existence or not is no longer a requirement to be considered in granting a stay under s. 10(1). The clear effect of the present s. 10(1) of the 2005 Act is to render a stay mandatory if the court finds that all the relevant requirements have been fulfilled." (emphasis added) [24] The brunt of the complaint of the Plaintiff is that though the Letter of Award dated 2.4.2013 was signed by the parties, yet the arbitration 10 agreement in the CIDB Standard Form of Contract for Building Works 2000 Edition which formed the Addenda to the Letter of Award was not signed by the parties. [25] The Plaintiff had appointed D1 as sub-contractor by a Letter of Award dated 2.4.2013 ("the Letter of Award") based on CIDB Standard Form of Contract for Building Works 2000 Edition ("Conditions of Contract"). The signing portion of the Letter of Award specifically stipulates that: “The undersigned hereby acknowledged receipt of the above letter, copy of which has been retained by us. We hereby confirm our acceptance of all terms and conditions stated herein and as stipulated in the Tender Document and Addenda herewith attached.” [26] Paragraph 9 in the Supporting Affidavit of D1 states as follows: "Surat Awad tersebut menyatakan, antara lain, bahawa perjanjian dan syarat-syarat di antara Plaintiff dan Defendan Pertama adalah juga termasuk dan tertakluk pada Dokumen Kontrak iaitu CIDB Standard Form of Contract for Building Works Edisi 2000 (Syarat- Syarat Kontrak)." 11 [27] The undersigned referred to is D1. It is not disputed that the Addenda referred to the CIDB Standard Form of Contract for Building Works 2000 Edition ("Conditions of Contract") is as exhibited in Exhibit A-2 of D1’s Affidavit in Support in Enclosure 7. [28] The Conditions of Contract in turn refers to an arbitration agreement in Clause 47.3 which states that any dispute arise between the parties shall be referred to arbitration. [29] Clause 47.3 Conditions of Contract reads as follows: "47.3 (a) Subject to sub-clause 47.2(c), the Employer or the Contractor may within 14 Days after the termination of the mediation, give notice to the other party with a copy of the Superintending Officer of his intention to refer the dispute or difference to arbitration and the final decision of an arbitrator. The Arbitrator may be agreed upon by the parties and where the parties fail to agree within 14 Days of the Notice of Arbitration then either party may request the Appointer of Arbitrator named in the Appendix to appoint an arbitrator." [30] Clause 47.3 (c) further provides as follows: 12 “The Notice of Arbitration under this Clause 47.3 shall be deemed to be a submission to arbitration within the meaning if the Arbitration Act 1952 or any amendment or re-enactment of the said Act.” [31] That being the case, there is no need for further agreement and consent of the parties to refer any matter to arbitration. The word “deemed” means to “be regarded as if” or to “considered as it.” [32] The intention of the parties that the outcome of the arbitration shall be final and binding on the parties is further expressed in Clause 47.3 (f) as follows: “The Award of the arbitrator shall be final and binding on the parties.” [33] This matter of an agreement in writing making reference to a document containing an arbitration clause has been addressed in section 9(5) of the Arbitration Act 2005. The whole section 9 is reproduced below for context: “Definition and form of arbitration agreement 9. (1) In this Act, “arbitration agreement” means an agreement by the parties to submit to arbitration all or certain disputes which have 13 arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not. (2) An arbitration agreement may be in the form of an arbitration clause in an agreement or in the form of a separate agreement. (3) An arbitration agreement shall be in writing. (4) An arbitration agreement is in writing where it is contained in— (a) a document signed by the parties; (b) an exchange of letters, telex, facsimile or other means of communication which provide a record of the agreement; or (c) an exchange of statement of claim and defence in which the existence of an agreement is alleged by one party and not denied by the other. (5) A reference in an agreement to a document containing an arbitration clause shall constitute an arbitration agreement, provided that the agreement is in writing and the reference is such as to make that clause part of the agreement.” (emphasis added) [34] Based on the requirements of section 9(5) above, “A reference in an agreement to a document containing an arbitration clause” refers to “A 14 reference in the Letter of Award to the Conditions of Contract in the CIDB Standard Form of Contract for Building Works containing an arbitration clause in Clause 47.3”. [35] That Clause 47.3 is the arbitration agreement for the agreement in writing in the Letter of Award makes specific reference to it as to make Clause 47.3 on arbitration agreement part of the agreement. [36] In CLLS Power System Sdn Bhd v Sara Timur Sdn Bhd [2015] 11 MLJ 485 Justice Mary Lim J (now JCA) pointed out that section 9 of the Arbitration Act 2005 allows for an arbitration agreement located in a different document to be incorporated by reference. The written arbitration agreement need not necessarily be found in the same contract containing the terms and conditions of the contract. [37] The issue had also been considered by the Federal Court in Press Metal Sarawak Sdn Bhd v Etiqa Takaful Bhd [2016] 9 CLJ 1 at para (3) of the headnotes as follows: "(3) The parties are bound by the terms of the arbitration agreement which they had voluntarily executed which includes reference to another document where the terms can be found. The HCJ found that the expired Jerneh Policy contained an 15 arbitration clause which was effectively incorporated in the latter policies by the reference made in the placement slip, and that it was the intention of the parties to refer any disputes to arbitration as per the terms and conditions of the expiring Jerneh Policies. These findings were consistent with the provisions of s. 9 of the 2005 Act, particularly sub-s. (5) which clearly provides that a reference in an agreement to a document containing an arbitration clause shall constitute an arbitration agreement; and the agreement is in writing and the reference is such as to make that clause part of the agreement. There was no reason to disturb the findings." (emphasis added) [38] The Plaintiff did not dispute the existence of the arbitration clause in the Conditions of Contract. Their only complaint is that the Conditions of Contract was not signed and so the arbitration agreement therein could not be incorporated into the Letter of Award which is the agreement between the parties. [39] Such a distinction is artificial for there is no requirement that a document has to be signed before it is binding on the parties. Whilst that is the most common mode as provided in section 9(4)(a) it may nevertheless 16 be incorporated into an agreement by express reference to it via that agreement. [40] Such an issue has already been decided by our apex Court in the Federal Court’s decision of Ajwa for Food Industries Co (MIGOP), Egypt v Pacific Inter-Link Sdn Bhd [2013] 5 MLJ 625. [41] In that case there were the sales contracts that did not contain the signatures of the parties. The Federal Court held that the sales contracts are not subject to any condition that they be signed before coming into effect. The Federal Court went on to observe that it is common knowledge that international agreements between parties doing business from different parts of the world ranging especially in international sales of goods and charter parties are concluded and performed without the need for signatures so long as the parties have agreed on the terms. The Federal Court opined as follows: “[22] … Likewise, the sales contracts setting out the agreed terms, despite the lack of signature as in the present case are valid and enforceable contracts. On this point we would refer to the two English cases of Baker v Yorkshire Fire and Life Assurance Company [1892] 1 QB 144 where it was held that it is not necessary that in all cases 17 the written agreement to refer the matter to arbitration must be signed by both parties; and Morgan v William Harrison Ltd [1907] 2 Ch 137 (CA) at p 104 where the court held that an arbitration agreement may be deduced from correspondence between the parties.” [42] In the instant case the Letter of Award is signed. It is only the CIDB Conditions of Contract that was not signed though referred to as Addenda to the Letter of Award. The Federal Court specifically addressed the issue of the arbitration agreement being not signed as the Conditions of Contract was not signed. In para [25] the Federal Court stressed the requirement that the arbitration agreement must be in writing and that it need not be a formal agreement executed by the parties as follows: “[25] We are of the view that an arbitration agreement need not be signed. Sections 9(3) –9(4) of the Act provide that the arbitration agreement must be in writing and the writing requirement is satisfied if the arbitration agreement is in a document signed by the parties or is in an exchange of letters, telex, facsimile or other means of communication which provide for a record of the agreement. As such a written agreement to arbitrate does not necessarily mean a formal agreement executed by both parties. It would be sufficient so long as the arbitration agreement is incorporated http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.8682062182478255&bct=A&service=citation&risb=21_T26338163695&langcountry=MY&linkInfo=F%23GB%23CH%23vol%252%25sel1%251907%25page%25137%25year%251907%25sel2%252%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.5150127966655142&bct=A&service=citation&risb=21_T26338163695&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%250646%25section%259%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.7832146651382235&bct=A&service=citation&risb=21_T26338163695&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%250646%25 18 into a written document. Section 9(5) of the Act further provides as follows: “A reference in an agreement to a document containing an arbitration clause shall constitute an arbitration agreement provided that the agreement is in writing and the reference is such as to make that clause part of the agreement.” (emphasis added) [43] There was also the complaint raised in this case that there was no specific reference in the Letter of Award to arbitration and that the closest to it was a reference to mediation which fell short of arbitration. Clause 13.0 of the Letter of Award reads as follows: “All disputes or claims should be settled in a friendly and amicable manner. Independent Mediator shall be engaged should need arise where both parties are unable to agree on such dispute. Under such conditions, the party in default shall bear all cost incurred, including loss in income and profit as s result of this dispute.” [44] It is only too obvious that much as parties may want to first try to resolve their disputes through mediation, there may be times when resolution through mediation fail. Whilst hoping for the best, one must be http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.6095521649821796&bct=A&service=citation&risb=21_T26338163695&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%250646%25section%259%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.45820910935836223&bct=A&service=citation&risb=21_T26338163695&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%250646%25 19 prepared for the worst. The CIDB Conditions of Contract takes over where mediation is terminated. Clause 47.2 of the Conditions of Contract refer to “Reference to Mediation” and Clause 47.3(a) takes over where mediation fails for it begins with: “(a) Subject to sub-clause 47.2(c), the Employer or the Contractor may within 14 Days after the termination of the mediation, give notice to the other party with a copy of the Superintending Officer of his intention to refer the dispute or difference to arbitration and the final decision of an arbitrator...” [45] There is no conflict between the Letter of Award and the CIDB Conditions of Contract. The latter supplements the former and compliments it. The fact there is no specific reference in the Letter of Award is not a bar to incorporating the arbitration agreement in another document by reference. The Federal Court in Ajwa for Food Industries Co’s case (supra) confronted this complain as follows: “[26] Section 9(5) of the Act therefore clarifies that the applicable contract law remains available to determine the level of consent necessary for a party to become bound by an arbitration made 'by reference'. Section 9(5) of the Act in our view addresses the situation http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.7468353617710037&bct=A&service=citation&risb=21_T26338163695&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%250646%25section%259%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.5791844962930697&bct=A&service=citation&risb=21_T26338163695&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%250646%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.7604851207098339&bct=A&service=citation&risb=21_T26338163695&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%250646%25section%259%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.742436729738063&bct=A&service=citation&risb=21_T26338163695&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%250646%25 20 where the parties, instead of including an arbitration clause in their agreement, include a reference to a document containing an arbitration agreement or clause. It also confirms that an arbitration agreement may be formed in that manner provided, firstly, that the agreement in which the reference is found meets the writing requirement and secondly, that the reference is such as to make that clause part of the agreement. The document referred to need not to be signed by the parties to the contract (see the case of Astel- Peiniger Joint Venture v Amos Engineering & Heavy Industries Co Ltd [1994] 3 HKC 328). We are of the view that the mere fact the arbitration clause is not referred to in the contract and that there is a mere reference to standard conditions which was neither accepted nor signed, is not sufficient to exclude the existence of the valid arbitration clause. There is no requirement that the arbitration agreement contained in the document must be explicitly referred to in the reference. The reference need only be to the document and no explicit reference to the arbitration clause contained therein is required.” (emphasis added) [46] It is clear in this case that parties had by both contract and conduct applied the terms in the Letter of Award together with the CIDB Conditions http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.474539975827058&bct=A&service=citation&risb=21_T26338163695&langcountry=MY&linkInfo=F%23AU%23HKC%23vol%253%25sel1%251994%25page%253281%25year%251994%25sel2%253%25 21 of Contract when progress claims and Interim Certificates No. 1 to 13 were issued with the Certificate of Practical Completion being finally issued. The provision in the CIDB Conditions of Contract governing Interim Certificates is Clause 42.2 on Valuation and Interim Certificates. As for Certificate of Practical Completion, that is provided for in Clause 20.2. The Plaintiff is claiming for LAD and that is governed by Clause 26.2 under Damages for Non-Completion. [47] It is too late in the day for the Plaintiff to now contend that the CIDB Conditions of Contract does not apply and that only the Letter of Award applies. [48] Clause 15.0 of the Letter of Award clearly refers to the Contract Documents which comprised of the Conditions of Contract, among others. [49] When parties have expressly addressed their mind to arbitration as the preferred mode of dispute resolution they must be held to the bargain as they must have been advised on the legal benefits of arbitration with respect to party autonomy, confidentiality, speed of resolving the dispute and finality. [50] If in spite of that the Plaintiff would still want to persuade D1 to proceed with litigation, then they must first get the consent of D1 or unless 22 D1 has waived that right by taking dirt her steps in the court proceedings which in this case, D1 clearly has not. [51] The Plaintiff now says that costs would increase if the parties were to proceed with arbitration. It is common knowledge that arbitration has now become generally more expensive than litigation but parties must be deemed to be aware of this when they entered into the Letter of Award and higher costs alone should not be a ground of not enforcing a valid arbitration agreement. [52] The Plaintiff further argued that this Court should proceed to hear this case as there is a 2nd Defendant (“D2”) who has agreed to the jurisdiction of the Court. There was no need for D2 the Superintending Officer appointed under the Contract to agree to proceed with the intended arbitration between D1 and the Plaintiff simply because there is no arbitration clause or agreement between the Plaintiff and D2. [53] The Plaintiff submitted that all parties including D1 should be present before this Court so that all issues can be ventilated justly and fairly. The Plaintiffs’ claim against D2 is for negligence in supervising the works and certifying the claims. It is a claim in tort. 23 [54] This Court cannot compel D2 to proceed with arbitration but what this Court could do is to fix trial dates after the arbitration between the Plaintiff and D1 has been concluded with an arbitration Award. This Court appreciates that some issues in the D1’s claims under the various Certificates of Payments may well straddle the Plaintiff’s claim against D2 in that if the works completed have not been correctly certified, then there may be a claim by the Plaintiff against D2. [55] The Court was able to persuade the parties to proceed with arbitration under the KLRCA Fast Track Arbitration Rules 2010. Rule 36 provides as follows: “With regard to an arbitration with a substantive oral hearing, the arbitrator shall publish his final award expeditiously and no later than hundred and forty (140) days from the commencement of the arbitration subject to such equivalent extensions as may have been agreed by the parties under rule 30.” [56] As such I do not see how the Plaintiff may be prejudiced in any way in wanting the disputes between them and D1 and D2 resolved fairly and fully. 24 Whether Clause 49.1 of the Conditions of Contract that states that the parties agree to submit to the jurisdiction of the Malaysian Courts for the purpose of any action or proceedings arising out of the Contract preclude arbitration [57] Clause 49.1 reads: “49 GOVERNING LAW 49.1 Law The law governing the Contract shall be the law of Malaysia and the parties hereby submit to the jurisdiction of the Malaysian Courts for the purpose of any action or proceedings arising out of the Contract.” [58] It comes after 47.3 on “Reference to Arbitration” and within that are subclauses (a) to (h). After having an elaborate provision on arbitration parties could not have intended Clause 49.1 on Governing Law and on submission to the jurisdiction of the Malaysian Courts to preclude arbitration and to nullify all the references to arbitration. [59] The Court must proceed on the basis that the parties did not intend to contradict themselves in the same document expressing their contractual obligations and intentions. Here is a case where the clause on “Reference 25 to Arbitration” could be read harmoniously with the clause on “Governing Law.” There is no conflict between the 2 clauses but a convergence of interest, with one complementing the other to form a composite and coherent whole. As was held in Hamidah Fazilah Sdn Bhd v Universiti Tun Hussein Onn Malaysia (UTHM) [2017] 7 MLJ 274 where there was a “Reference to Arbitration” and a submission to “Exclusive Jurisdiction” clause the High Court held as follows: “[54] As we are all aware, when it comes to certain reliefs in aid of arbitration and more so when it comes to setting aside and enforcement of an arbitral award, the parties seeking such reliefs would still have to come to the relevant Court for assistance. To avoid bickering over what law to apply and which court to apply for such reliefs, parties have addressed this issue at the outset in governing law clause. As both the parties are incorporated in Malaysia and carrying out their business here and as the Project is here, it makes every sense for the laws of Malaysia to apply. Parties have agreed to submit to the exclusive jurisdiction of the Courts of Malaysia where there is a need to come to the Malaysian Courts to apply for interim measures such as an injunction for instance under section 11 Arbitration Act 2005 or for setting aside the Award under section 37 26 or to refer a question of law under section 42 or under section 38 for enforcement of the arbitral award. [55] Section 11 Arbitration Act 2005 reads as follows: 11. Arbitration Agreement and Interim Measures by High Court 1) A party may, before or during arbitral proceedings, apply to a High Court for any interim measure and the High Court may make the following orders for: a) security for costs; b) discovery of documents and interrogatories; c) giving of evidence by affidavit; d) appointment of a receiver; e) securing the amount in dispute, whether by way of arrest of property or bail or other security pursuant to the admiralty jurisdiction of the High Court; [Am. Act A1395:s.5] f) the preservation, interim custody or sale of any property which is the subject-matter of the dispute; 27 g) ensuring that any award which may be made in the arbitral proceedings is not rendered ineffectual by the dissipation of assets by a party; and h) an interim injunction or any other interim measure." (emphasis added). [60] The High Court further observed as follows: “[56] Where a harmonious interpretation is possible in an apparent contradiction at first reading, that interpretation is to be preferred lest the baby is thrown out together with the water in the bath tub. It must not be forgotten that such clauses are present in almost all standard form contracts and here we are dealing with the PWD Form DB Contract. I cannot read Clause 70.0 here as reflecting the intention of the parties to abandon arbitration altogether after having addressed their mind on the procedure to be followed before a reference to arbitration is made and when arbitration can be commenced as well as the consequences of proceeding with arbitration and the obligations of the parties set out in 11 sub clauses in Clause 67.0. 28 [57] This is clearly a case where a holistic and harmonious approach is to be followed, giving effect to the clear intention of the parties to resolve all matters arising out of or in connection with the Contract to arbitration. At the same time parties affirm that where they have to approach the Court to aid and assist them in the instances set out above, they would then submit to the exclusive jurisdiction of the Malaysian Courts.” [61] There is thus no conflict in the 2 clauses but a complementarity leading to a convergence of interest and purpose where the aid of the Court shall be called upon if necessary for matters pending arbitration for example in cases of injunctive reliefs and even for matters after arbitration as in an enforcement of the award. Pronouncement [62] For the above reasons, the Court had allowed Enclosure 6 for stay of the proceedings between the Plaintiff and D1 pending reference to arbitration. 29 [63] After hearing parties on costs the Court allowed costs of RM8,000.00 to be paid by the Plaintiff to D1. Dated: 31 July 2017. Sgd Y.A. LEE SWEE SENG Judge Construction Court High Court Malaya For the Plaintiff : Patrick Dass and CW Chan (Messrs Patrick Dass & Co) For the 1st Defendant : Tan Chi Sian (Messrs P.Y. Hoh & Tai) Date of decision: 17 April 2017

Tika 2.6.0

BA-12NCVC-7-01/2016

PERAYU OBNET SDN BHD (DAHULU DIKENALI SEBAGAI INTELLIGENT EDGE SOLUTIONS SDN BHD) (No. Syarikat: 423095-H) ….. PERAYU RESPONDEN SURUHANJAYA KOMUNIKASI DAN MULTIMEDIA MALAYSIA ….. RESPONDEN

28/07/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=2015e8a6-317b-4caf-8e79-345f89e7dd12&Inline=true

1 DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA RAYUAN SIVIL NO: BA-12NCVC-7-01/2016 ANTARA OBNET SDN BHD (DAHULU DIKENALI SEBAGAI INTELLIGENT EDGE SOLUTIONS SDN BHD) (No. Syarikat: 423095-H) ….. PERAYU DAN SURUHANJAYA KOMUNIKASI DAN MULTIMEDIA MALAYSIA ….. RESPONDEN 2 (Dalam Perkara Mahkamah Sesyen di Shah Alam Dalam Negeri Selangor Darul Ehsan, Malaysia Guaman No. B52NCvC-145-07/2015) Antara Suruhanjaya Komunikasi Dan Multimedia Malaysia ….. Plaintif Dan Obnet Sdn Bhd (Dahulu dikenali sebagai Intelligent Solutions Sdn Bhd) (No. Syarikat: 423095-H) ….. Defendan 3 GROUNDS OF JUDGMENT Introduction [1] This is an appeal by the Appellant who was the Defendant on the decision of the Sessions Court dated 29.12.2015 which allowed the Respondent, which is the Plaintiff, for summary judgment dated 22.9.2015. [2] The dispute before this Court is in relation to the Plaintiff’s cause of action against the Defendant for the payment of license fee for the years 2009, 2010 and 2011 amounting to RM300,000.00. The Plaintiff is a body incorporated under the Malaysian Communications and Multimedia Commission Act 1998 (Act 589) (the MCMCA 1998) and the Defendant is a company incorporated under the Companies Act 1965. [3] The parties, in this judgment, will be referred to as they were in the Sessions Court. 4 Background Facts [4] The relevant background giving rise to this appeal based on the written submissions of both counsels may be briefly stated as follows: (a) On or about 20.4.2005, the Minister of Energy, Water and Communications, being the Minister charged with the responsibility for communications and multimedia back then (“Minister”) had granted an individual Network Facilities Provider (“NFP”) and Network Service Provider (“NSP”) licenses (collectively “Licenses’) to the Defendant who is the Licensee. (b) The Defendant claimed that the Defendant applied for an exemption of the payment for Individual License fee for 2009 and 2010 via its letters of 1.4.2009 and 8.6.2010 as the Selangor State Government due to the change of leadership in 2008 delayed the implementation of the Selnet Project. 5 (c) The Defendant claimed that the Selnet Project was based on two agreements with former Selangor State Government in year 2003, namely the Selangor Broadband Internet Access Agreement dated 10.10.2003 and Subscription Agreement dated 23.9.2005 to construct and provide an infrastructure for high-speed broadband network within the state. (d) The Defendant claimed that the Selangor State Government’s failure to meet its obligation under the Selnet Project caused the Defendant to suffer high losses and as a result the Defendant terminated the Selnet Project agreements and proceed with legal action against the Selangor State Government for breach of contract. (e) The Plaintiff issued the Licenses to the Defendant on behalf of the Minister and the Licenses are subjected to, inter alia, the following terms and conditions:- 6 (i) the validity of the Licenses are for a period as specified in the licenses, that is 10 years from 20.4.2005 until 19.4.2015. (ii) the Licensee was to pay the applicable annual license fee for each of the Licenses held as follows:-  on the 1st anniversary of each license and annually thereafter, a sum of Rm50,000.00 as an initial payment of the applicable annual license fee: and  the balance due, if any, within the time period specified in the notice by the Commission; (iii) the Licensee would comply with all the provisions of the CMA 1998 and the subsidiary legislations, instruments, guidelines and regulatory policies made thereunder. (f) The Plaintiff claimed that the Defendant had failed to make payment for the license fees for the years 2009, 2010 and 2011 7 which the Plaintiff claimed that the Defendant did not dispute this fact. (g) The Plaintiff issued various letters to the Defendant in respect of the payment for the license fees since the year 2009 dated 3.9.2009, 16.2.2010 and 24.3.2011 but to no avail. (h) The Plaintiff through its solicitors, Messrs. Shook Lin & Bok, had issued letters of demand to the Defendant since the year 2010 to demand for the payment of license fees for the Licenses for the years 2009, 2010, 2011 (two dated 6.7.2010 (A.R. Registered and Certificate of Posting), 16.3.2011 and 17.3.2015) (at pages 51, 53, 57, 61 and 63 of the Appeal Record). (i) However, the Defendant had failed, neglected and/or refused to payment the annual license fees for the Licenses amounting to a total sum of RM300,000.00 despite the said demands. 8 (j) On 16.7.2015, the Plaintiff filed its Writ and Statement of Claim against the Defendant. (k) On 30.7.2015, a copy of the Writ and Statement of Claim was served on the Defendant. (l) On 20.8.2015, the Defendant’s solicitors filed its Memorandum of Appearance. (m) On 22.9.2015, the Plaintiff filed its summary judgment application against the Licensee for the outstanding sum of RM300,000.00, judgment interest and costs. (n) On 29.12.2015, the learned Session Judge allowed the Plaintiff’s summary judgment application with costs of RM4,000.00. (o) Dissatisfied with the said judgment, the Defendant filed its appeal on 7.1.2016. 9 Defendant’s Submission [5] The learned counsel for the Defendant raised the triable issue as to whether the Plaintiff has the power to reject the Defendant’s application for exemption under Regulation 33(5) of the Communication and Multimedia (Licensing) Regulations 2000 [P.U.(A) 129/2000] (the Regulations 2000) without the decision of the Minister. The counsel submitted that the Sessions Court did not address this issue and is of the view that the Sessions Court did not reject the Defendant’s contention that it is for the Minister to decide on the Defendant’s application for exemption and not the Plaintiff. [6] The Defendant’s counsel relied on the wording of Regulation 33(5)(b) of the Regulations 2000 and referred to the case of Jill Ireland Bt Lawrence Bill v Menteri Bagi Kementerian Dalam Negeri & Anor [2015] 3 MLJ 743 stating that the power to decide rests with the Minister. In reference to Jill Ireland case (supra), the counsel highlighted the similarity of that case with the instant case which in the former was in relation to an undesirable publication that such power can only be 10 exercised by the Minister and no other person, by quoting, reproduced partly, “(1)…it is the Minister who has to exercise the power. Only him and no other person… (2) ….a statutory and discretionary power must be exercised by the person to whom the Parliament had vested the power onto and cannot be sub-delegated to any other authority or official.” (emphasis was from Defendant’s counsel) [7] On his submission for triable issue, the counsel for the Defendant argued on three issues: (a) The Sessions Court erred in its finding that the Defendant did not fulfill the pre-condition for an application under Regulation 33(5)(b) of the Regulations 2000; (b) There is no requirement for the return of the individual license to the Ministry before applying for a waiver under Regulation 33(5)(b) of the Regulations 2000; 11 (c) A Minister’s decision under Regulation 33(5)(b) of the Regulations 2000 will override the Plaintiff’s claim. [8] The counsel for the Defendant pointed out to this Court that the Plaintiff had admitted as in paragraph 5 of its Affidavit in Reply (page 149 of the Appeal Record) that the Plaintiff should implement directions given by the Minister consistent with the provisions of the CMA 1998 and therefore Plaintiff has acted ultra vires and in contrary of the Regulations 2000 and CMA 1998 for rejecting Defendant’s application for exemption. [9] The Defendant’s counsel submitted that the Defendant can seek for an exemption order from the Minister, arguing that it could be applied at any time and not just when applying for a license. It was submitted that based on paragraph 7 of the Defendant’s Affidavit in Reply, the Defendant believes that it has valid reasons to qualify and obtain exemption for payment of fee for the individual License. The counsel added that the Plaintiff’s claim is premature as Defendant’s application is pending Minister’s decision. 12 [10] The counsel for the Defendant referred this Court to the Session Judge’s grounds of judgment that the Defendant only failed to fulfill the precondition of Regulation 33(5)(b) of Regulations 2000 that the Selnet Project must be for non-commercial purpose as this would be for the Minister to decide and therefore there is a triable issue. It was also submitted that in the alternative if this Court has the authority to decide whether Selnet Project is commercial or non-commercial purpose, this would be a triable issue. [11] Counsel for the Defendant argued that the Plaintiff has not shown any material averment in its affidavit that the Minister had given directions to the Plaintiff regarding the Defendant’s application for exemption. The learned counsel for the Defendant further submitted that as there was no “material averment”, nor did the Plaintiff exhibit the Ministerial direction regarding Minister’s decision, this if left unanswered by the Plaintiff would mean a fact that there was no conclusive evidence that the Minister had rejected, based on the Federal Court’s case of Sunrise Sdn Bhd v. Profile (1996) 3 MLJ 533. 13 [12] The Defendant’s counsel also submitted that there was no statutory requirement under the Regulations for the Defendant to surrender the license to the Plaintiff pending the Minister’s decision. Plaintiff’s Submission [13] The learned counsel for the Plaintiff advanced several grounds against the Defendant’s appeal. In relation to the pertinent triable issue that the Plaintiff has no power to reject Defendant’s application for an exemption and that the learned Session Judge did not address this issue was raised for the purpose of opposing the Plaintiff’s summary judgment. The Plaintiff’s counsel submitted that the Defendant’s alleged defence for that Defendant ought not to be liable to pay the license fees lacks merit and relied on the Supreme Court case of Bank Negara Malaysia v Mohd Ismail & Ors [1992] 1 MLJ 400, for the following reasons: “(a) the Licensee is bound under Clauses A(5) of the Licences, B(4) of the NSP License and B(5) of the NFP License, Section 43(5) of the CMA (Tab 1, RBA) and Regulations 33(1)(b) and 33(3) of the Communications and Multimedia (Licensing) Regulations 2000 14 (Tab 2, RBA) to continue to pay for the annual license fees for the Licenses unless and until the Licenses have been surrendered to the Minister pursuant to Section 38 of the CMA (Tab 1, RBA) through a Ministerial Declaration – the learned Judge did not err in making this determination in her grounds of decision (at pp. 15 and 16 of the Appeal Record); (b) the Licensee did not surrender the Licences to the Minister even though the Licensee terminated the Selnet Project in 2009. The Licenses were ultimately cancelled by the Minister through the Ministerial Declaration dated 21.7.2011; (c) therefore, the Licensee is obligated to pay the annual license fees for the Licenses until the Licenses were cancelled by the Minister through the Ministerial Declaration dated 21.7.2011; (d) furthermore, it is undeniable that the Licensee has utilized the Licenses; 15 (e) the Licenses were issued by the Commission in favour of the Licensee for a period of 10 years; (f) the burden to surrender the Licenses upon termination of the Selnet Project is on the Licensee. There is no legal obligation on the part of the Commission to demand for the surrender of the Licenses from the Licensee; (g) it was the Licensee themselves that terminated the Selnet Project; and (h) in the Licensee’s letters dated 1.4.2009 and 8.6.2010 to the Commission, the Licensee did not raise the issue of them not needing to pay the license fees for the Licenses as the Selnet Project was terminated. This issue was only raised for the first time after the writ and statement of claim and the summary judgment application were served on the Licensee in 2016 even though demands had been issued by the Commission for payment of the said fees in 2009, 2010, 2011 and 2015. It is clear that this issue is an afterthought.” 16 [14] On that note, the Plaintiff’s counsel further submitted by referring to the case of OCBC BANK (M) v Omega Horizon Sdn. Bhd. & Ors [2005] 1MLJ 183 (Tab 6, RBA) quoting Lau Bee Lan JC (as Her Ladyship then was) at page 195: “[23] … If what they contend is genuine, they should as any reasonable man would grab the earliest opportunity possible rather than remain silent and raise it as a defence only when proceedings are commenced against them…”. [15] It was submitted that the fact still remains that the Defendant had defaulted under the Licenses preconditions and the Regulations 2000 which are not disputed. In relation to the issue of exemption by the Minister, the Plaintiff’s counsel submitted that the Defendant as Licensee is misconceived in contending that the Plaintiff’s action against them is premature on the basis that the Plaintiff cannot make any decision with regards to the Defendant’s application for exemption to pay its annual license fees. [16] The Plaintiff’s counsel referred to the letter by the Defendant of 1.4.2009 (at page 77 of the Appeal Record) showing that it was a request 17 for a kind averment, for an exemption from the Plaintiff. The counsel for the Plaintiff further submitted that the letter of 8.6.2010 (at page 79 of Appeal Record) showed that the letter was addressed to the Plaintiff and not to the Minister. [17] On the material averment, as argued under paragraph 13 at page 73 of the Appeal Record, the Plaintiff submitted that it had replied to the Defendant’s request on 3.9.2009, 16.6.2010 and 24.3.2011 (pages 39 – 46 of the Appeal Record) and asserted that there is no factual information to prove that the Defendant applied for exemption from the Minister. The Plaintiff’s counsel also referred to Regulation 33(5)(b) of the Regulations 2000 that the Minister is to be satisfied that the service to be provided to be exempted is on a non-commercial basis, as follows: “The Minister may by an order published in the Gazette- (a) Exempt any person from the payment of any or al l of the fees under subregulation (1) if the Minister is satisfied that the facility or service is provided on a non-commercial basis and for the benefit of the public or national interest.” 18 On this basis, the counsel for the Plaintiff submitted that the Defendant has made no application to the Minister to be exempted from paying its outstanding annual license fee. [18] On the issue that the senior officer of the Plaintiff had exceeded its powers and acted ultra vires, it was asserted by the Plaintiff’s counsel in its submission in reply that this Court is not the proper forum and the Defendant should make an application for a judicial review. Authority referred is the Federal Court’s case of Ahmad Jefri bin Mohd Jahri @ Md Johari v Pengarah Kebudayaan & Kesenian Johor & Ors [2010] 3 MLJ 145. The counsel for the Plaintiff further asserts that the Plaintiff regulates licenses on national objectives under section 3 of the CMA 1998. [19] The Plaintiff’s counsel also submitted that Defendant is estopped to from reverting to its earlier position that it had accepted the Plaintiff’s decision based on Defendant’s letter of 19.7.2010 and could not now raise the legality of the Plaintiff’s rejection and referred to the case of Boustead Trading (1985) Sdn Bhd v Arab-Malaysian Merchant Bank Bhd [1995] 3 MLJ 331. 19 Session Court’s Decision [20] The Sessions Court allowed Plaintiff’s application as follows: “Keputusan Mahkamah “Kedua-dua pihak telah memfailkan hujahan bertulis di dalam kes ini. Setelah membaca hujahan bertulis dan otoriti-otoriti yang dikemukakan Mahkamah memutuskan Notis Permohonan, Lampiran 4 dibenarkan dengan kos. Kos dibenarkan RM4,000.00. Peguam Defendan telah memfailkan rayuan di dalam kes ini kerana tidak berpuas hati dengan keputusan Mahkamah. Alasan-Alasan Penghakiman 1. Di dalam membaut keputusan Mahkamah telah meneliti kesemua Afidavit Sokongan, Afidavit Balasan dan ekhsibit- ekhsibit yang telah disertakan di dalam affidavit-afidavit yang berkaitan. Pada 20.4.2005, Menteri Tenaga, Pada 20.04.2005, Menteri Tenaga Air dan Komunikasi telah memberikan lesen- lesen Individu “Network Facilities Provider” serta “Network 20 Service Provider” (secara kolektif “lesen-lesen tersebut’) kepada Defendan. Plaintif telah mengeluarkan lesen-lesen tersebut kepada Defendan bagi pihak Menteri selaku badan pengawasan yang diperbadankan di bawah Akta Suruhanjaya Komunikasi dan Multimedia Malaysia 1998 yang terlibat, dalam penyelarasan industri-industri komunikasi dan multimedia di bawah Akta Komunikasi dan Multimedia Malaysia 1998. 2. Lesen-lesen tersebut tertakluk antara lainnya kepada terma-terma dan syarat-syarat yang berikut:- a. bahawa keesahan lesen-lesen adalah bagi satu tempoh sepertimana yang ditetapkan di dalam lesen tersebut iaitu 10 tahun bermula dari tarikh 20.4.2005 sehingga 19.4.2015; b. bahawa Defendan henadaklah membayar kepada Plaintif fi lesen tahunan yang boleh dipakai untuk setiap daripada lesen-lesen tersebut; dan 21 c. bahawa Defendan akan mematuhi kesemua peruntukan Akta Komunikasi dan Multimedia Malaysia 1998 dan perundiangna subsidiary yang dibuat di bawahnya. 3. Sejak tahun 2009, Defendan telah gagal untuk membuat bayaran fi tahunan sebanyak RM50,000.00 setahun untuk lesen-lesen tersebut. Peguamcara Plaintif telah mengeluarkan sura-surat tuntutan kepada Defendan sejak tahun 2010. Walau bagaimanapun Defendan telah gagal, abai dan/atau enggan untuk membayar kepada Plaintif fi lesen-lesen tahunan yang dituntut sebanyak RM300,000.00. 4. Berdasarkan di dalam kes Mahkamah Persekutuan, National Company For Foreinh Trade v. Kayu Raya Sdn Bhd [1984] 2 MLJ 300, di muka surat 301 perenggan F dipetik:- “……. We think it appropriate to remind ourselves once again that in every application under Order 14 the first considerations ara (1) whether the case comes within the Order and (b) whether the plaintiff has established the preliminary 22 requirements for proceeding under Order 14. For the purpose of an application under Order 14, the preliminary requirements are: (i) The defendant must have entered and appearance; (ii) The statement of claim must have been served on the defendant; and (iii) The affidavit in support of the application must comply with the requirements of Rule 2 of the Order 14…….”. Dan di muka surat 302 perenggan B;- “…….. if however, these consideration are satisfied, the plaintiff will have established a prima facie case and he becomes entitled to judgment. The burden then shifts to the defendant to satisfy the Court why judgment should not be given against him…….” 23 Plaintif adalah secara prima facie berhak diberi suatu penghakiman terhadap Defendan kerana pra-syarat yang dinyatakan di dalam Aturan 14 kaedah 1(1) dan kaedah 2 (1) Kaedah-Kaedah Mahkamah 2012 telah dipatuhi. 5. Mahkamah mendapati Defendan tidak mempunyai pembelaan bermerit. Defendan mendakwa bahawa Projek Selnet yang dikendalikan oleh Defendan merupakan suatu projek demi kepentingan dan manfaat awam dan kepentingan nasional dan Defendan beranggapan boleh dikecualikan daripda pembayaran fi lesen individu. Penegasan Defendan bahawa mereka boleh meminta suatu pengecualian daripada pembayaran fi lesen individu adalah tidak benar kerana Defendan memang tidak memenuhi syarat-syarat yang telah ditetapkan khususnya Projek Selnet adalah bersifat komersial. Projek Selnet hanya merupakan suatu jaringan dalam komputer bagi agensi-agensi kerajaan Negeri Selangor dan bukannya untuk manfaat orang awam. Walau bagaimanapun Projek Selnet tersebut telah ditamatkan. 24 6. Defendan diwajibkan di bawah Klausa-Klausa A(5) dan B(5) lesen-lesen tersebut, Seksyen 43(5) AKMM dan Peraturan 33(1)(b) dan 33(3) Peraturan-Peraturan Komunikasi dan Multimedia (Perlesenan) 2000 yang digubal oleh Menteri di dalam Perlaksanaan kuasanya di bawah Seksyen 16(1)(b) dan (d) AKMM bagi pembayaran fi lesen tahunan bagi lesen-lesen tersebut dipulangkan kepada Menteri selaras dengan Seksyen 35 AKMM. Walau bagaimanapun, Defendan tidak pernah menyerah balik lesen-lesen tersebut kepada Menteri walaupun Projek Selnet telah ditamatkan. Tanggungjawab Defendan untuk membayar fi lesen tahunan adalah berterusan walaupun projek Selnet telah ditamatkan. Kesimpulannya Plaintif telah memenuhi pra-syarat permohonan sepertimana yang diperuntukkan oleh Aturan 14, kaedah 1(1) dan kaedah 2(1) Kaedah- Kaedah Mahkamah 2012. Defendan telah gagal menunjukkan sebarang pembelaan yang bermerit dan tidak membangkitkan sebarang isu yang perlu dibicarakan ataupun isu bona fide. Atas alasan-alasan seperti yang dinyatakan seperti di atas, Notis 25 Permohonan, Lampiran 4 dibenarkan dengan kos. Kos dibenarkan RM4,000.00. Bertarikh: 12 Januari 2017…” THE COURT’S FINDINGS [21] This is an appeal against the Session Judge in allowing Plaintiff’s application under Order 14 rule 1 ROC 2012. The Plaintiff submitted that it had complied with the conditions of Order 14 rule 1 ROC 2012 following the Federal Court’s decision in National Company For Foreign Trade v Kayu Raya Sdn Bhd [1984] 2 MLJ 300 and the case of Bank Negara Malaysia v Mohd Ismail & Ors [1992] 1 MLJ 400, Supreme Court’s decision that the Plaintiff had established a prima facie case and is entitled to the judgment and that the Defendant’s defence lacks merit. [22] The Defendant’s contention as a triable issue was that the Plaintiff has no power to reject the Defendant’s application for exemption under Regulation 33(5) of Regulations 2000 on behalf of the Minister when it is 26 only the Minister who decides. The Defendant argued that the letter of 1.4.2009 was an application to the Minister for an exemption. [23] Generally for summary judgment under Order 14 ROC 2012, there are preliminary requirements to be followed where the burden is on the plaintiff to discharge and once the burden had been discharged by the plaintiff, the onus then shifts to the defendant with the burden to raise triable issues, as decided in the Federal Court case of Cempaka Finance Bhd v Ho Lai Ying (trading as KH Trading) [2006] 2 MLJ 685 . Therefore it is for the Plaintiff who brought this suit to establish its cause of action that the Plaintiff has a prima facie case and whether the defence could show that there is a triable issue or some other reason that there ought to be a trial. [24] Based on the Bank Negara Malaysia (supra) case, the requirement under Order 14 is that it is for the Court to be satisfied on affidavit evidence that the defence not only has raised an issue but also that the said issue is triable. As the heart of the matter revolves around the licenses fee exemption and its application for exemption, it is incumbent upon the Court to see the intention of the parties sought based on the letter of 1.4.2009 (at 27 page 77-78 of the Appeal Record). Surely, the Plaintiff must have the functions and powers to grant licenses to the Defendant with the required terms and conditions provided under the governing laws. [25] Of pertinence to note would be, for the Plaintiff to prove that it has a prima facie case. The Plaintiff is established under the MCMCA 1998 and is governed by its law, MCMCA 1998 and the CMA 1998. The CMA 1998 provides for and to regulate the converging communications and multimedia industries where the objectives of the CMA 1998 are meted out under section 3 of the CMA 1998 which at subsection 3(1)(b) and (c) are among others, to establish a licensing and regulatory framework in support of national policy objectives for the communications and multimedia industry and to establish the powers and functions for the Malaysian Communications and Multimedia Commission. [26] Section 16 of the MCMCA 1998 provides the powers and functions of the Plaintiff as a Commission. The Plaintiff is to advise the Minister on all matters concerning the national policy objectives for communications and multimedia activities under part (a) of subsection 16(1) and at part (j) of the same, 28 “(j) to carry out any function under any written law as may be prescribed by the Minister by notification published in the Gazette.” Section 16(2) of the MCMCA 1998 provides that, “(2) The Commission shall have all such powers as may be necessary for, or in connection with, or reasonably incidental to, the performance of its functions under the communications and multimedia laws.” [27] In interpreting statutory functions and powers, it would be ideal to read the whole Act but for the purpose of this judgment, suffice to say that only the relevant provisions pertinent to this case will be referred. In interpreting the provisions governing the powers and duties stipulated in a statute, we look at section 93 of the Interpretation Acts 1948 and 1967 for guidance which is stated as follows, “Construction of provisions as to exercise of powers and duties 93. (1) Where a written law confers a power or impose a duty, then unless the contrary intention appears, the power may be 29 exercised and the duty shall be performed from time to time as occasion requires. (2) Where a written law confers a power or imposes a duty on the holder of an office as such, then, unless the contrary intention appears, the power may be exercised and the duty shall be performed by the holder of the office for the time being or by a person duly appointed to act for him. (3) (deleted by Ord. No. 41 of 1953).” Therefore in view of MCMCA 1998 confers the powers to the Plaintiff, unless the contrary intention appears, the powers may be exercised by the Plaintiff. [28] Reverting to the facts, the Plaintiff has granted two individual Licenses (at page 25 – 37 of the Appeal Record) with effect from 20.4.2005 until 19.4.2015. The Licenses were granted pursuant to sections 30 and 126 of the CMA 1998. The Licenses come with the conditions which is consistent with section 43 of the CMA 1998. Based on the CMA 1998 and 30 the MCMCA 1998 governing the Plaintiff, the Licenses can be suspended or cancelled and such Licenses must be surrendered to the Minister by virtue of section 38 and section 35 of the CMA 1998 respectively. [29] Therefore based on the Defendant’s defence that the exemption application was to the Minister, the intention of the parties must be sought to ascertain the true intention behind the said application. The letter of 1.4.2009 is reproduced here for ease of reference, as follows: “1st April 2009 SURUHANJAYA KOMUNIKASI DAN MULTIMEDIA MALAYSIA 63000 Cyberjaya Selangor Darul Ehsan Attn: En Megat Ishak Maamunor Director Licensing Department ANNUAL FEE FOR NSP (NSP/I/2000/48) & NFP (NFP/I/2000/45) INDIVIDUAL LICENSE REQUEST FOR EXEMPTION We would like to refer to our above request for your kind assessment and the Commission’s approval accordingly. 31 Our due date for payment of the Annual Fee falls on the 19 th of April 2009 amounting to minimum of RM100,000.00 in total for the two individual licenses. The underlying adverse factors for our humble request are as follows: 1. Our core business revenue is major based upon our SELNET concession agreement with the State of Selangor where we provide high speed broadband connectivity and integration within all Departments and Agencies for them to be in one electronic platform. However, due to unforeseen circumstances with the change in the Selangor Government, our project was stalled since early 2008 and to date we only managed to connect 33 sites out of the 345 sites. 2. This shortfall has affected us financially especially in our commitments to our financing bank which we are failing to meet all out scheduled obligations on repayments of interest and principal sums. 3. Due to the long delay and non-positive response as yet from the Selangor State, we are now on drastic cost-cutting measures to reduce our operating expenses to the bare minimum. 32 4. In the mean time we are also trying to seek for new business outside of the concession, but due to the current economic downturn most organizations are on austerity drive and securing higher sales are getting more difficult. 5. Our operational costs to keep SELNET running and maintaining our current assets are very high as we developed our network based upon the contention of 345 sites to be connected and these expenses exceeds our revenues from the current 33 sites connected. 6. Lastly, since SELNET is a government network, closing it is not an option as this will affect the service delivery systems to the public and in general this constitutes a non-commercial basis and for the benefit of the public or national interest as specified under Part V LICENSE FEES sub-clause 33.(5)(b) or the COMMUNICATIONS AND MULTIMEDIA (LICENSING) REGULATIONS 2000*. Due to the above underlying factors, we hope the Commission will give due considerations to our request for the exemption of annual fees for the current year 2009-2010. Should our SELNET project become viable upon positive commitment from the Selangor State in the nearest future, we will re-confirm the Commission to commit our payment of the annual fees respectively. Thanking you in advance for you kind consideration. 33 Yours faithfully, For, OBNET SDN BHD t.t…………… Jonedi Mohamed Chief Executive Officer” [30] Upon careful perusal of the 1.4.2009 letter, on its plain reading, the request by the Defendant for the exemption of the annual fees for two years was addressed to the Plaintiff and not to the Minister. As a matter of fact, the letter was for the attention of one Encik Megat Ishak Maamunor whom, as the designation stated, the Director of Licensing Department. The content of the said letter is plain and unambiguous, simply for Plaintiff’s assessment due to the predicament faced by the Defendant and for the Plaintiff’s approval. I cannot find anywhere in the letter requesting for the Minister’s decision on exemption nor a request by the Defendant for the exemption application to be brought to the Minister’s attention. [31] The Defendant’s counsel raised the issue that the Plaintiff has no power to reject the Defendant’s application for exemption and that only the 34 Minister can exercise such power based on Regulation 33(5)(b) of Regulations 2000. Regulation 33(5)(b) stated: “(5) Menteri boleh melalui perintah yang disiarkan dalam Warta--- (a) Mengecualikan mana-mana pemegang lesen berdaftar di bawah Akta-Akta yagn dimansuhkan, yang memohon untuk suatu lesen individu di bawah Akta bagi menggantikan lesen lamanya, daripda pembayaran fi walau apa pun perenggan (1)(a) dan subperaturan (2); atau (b) Mengecualikan seseorang daripada membayar mana- mana atau semua fi di bawah subperaturan (1) sekiranya Menteri berpuas hati bahawa kemudahan atau perkhidmatan yang diberikan tidak berasaskan komersial dan adalah untuk manfaat awam atau kepentingan nasional.” (emphasis added) 35 [32] First and foremost, Regulations 2000 is a subsidiary legislation of the CMA 1998. Section 16 of the CMA 1998 provides the Minister with the power to make regulations. The enabling law for the Minister to be responsible on matters regarding communications and multimedia is the Ministerial Functions Act 1969, the relevant order under the Ministerial Functions Act 1969, the governing laws in particular the CMA 1998 and the MCMCA 1998 including its subsidiary legislations. Based on Regulations 33(5)(b) of Regulations 2000, the Minister may exempt if the Minister is satisfied that the facility or the service provided is of non- commercial and for the public or national interest. In its literal meaning, the Minister may exempt if the Minister is satisfied which is based on the two criteria for the facility or the service may be exempted, that is, of non- commercial and for public or national interest. This is consistent with the reading of the CMA 1998 that is in support of national policy objectives. [33] Based on the facts given, the Plaintiff in its Affidavit in Reply stated that the Selnet Project that was agreed between the Defendant and the State Government prior to termination was on non-commercial basis and that the Defendant had received the payment for the Selangor State Government under the concession agreement (paragraphs 6(a), (b) and (c) 36 of pages 149 -150 of the Appeal Record. The Court finds that at paragraph 6(b) of the Plaintiff’s Affidavit in Reply that, “b) Projek Selnet hanya merupakan suatu jaringan dalaman komputer (Ethernet) bagi agensi-agensi kerajaan negeri Selangor yang tidak boleh diakses oleh orang awam dan bukannya untuk manfaat orang awam atau kepentingan nasional. …” [34] This is corroborated by a list of users tendered as exhibit “SK-2” (at pages 115 – 133 of the Appeal Record). Scanning through the list of users I do not find them to be non-commercial based as the facility and services are specifically meant for those named persons and bodies comprising Government service, local authorities and statutory bodies. Obviously, the fact that the service is for those in the list of users connote that the service is not extended to the public nor could the public have access to such service provided for the listed users. Based on the affidavit and documentary evidence, the service does not conform to the conditions as stipulated under Regulation 33(5)(b) of the Regulations 2000. Having said that, the admission by the Defendant that Selnet Project had been terminated does not give rise to a defence on the part of the Defendant. 37 [35] According to the Plaintiff, the Defendant’s Licenses had been cancelled by way of Ministerial Declaration (at pages 169 – 170 of the Appeal Record) on 21.7.2011. Notwithstanding the cancellation, the Defendant has yet to make payments for the annual fees which is part and parcel of the statutory requirements that comes with the Licenses pursuant to sections 30 and 126 of the CMA 1998 and Regulation 33(1)(b) and (5)(b) of Regulations 2000. The Defendant remains liable for the outstanding annual fees for the years 2009, 2010 and 2011. [36] I must agree with the Plaintiff’s counsel that if the Defendant was dissatisfied with the Plaintiff’s decision, the Defendant could have made an application for judicial review. Judicial review is not an appeal from a decision. Judicial review is concerned, not with the decision, but with the decision-making process: Chief Constable of the North Wales Police v Evans [1982] 3 All ER 141, at page 154 and Order 53 ROC 2012. [37] I wish to revert to the letter of the Defendant dated 19.7.2010 (at page 49 - 50 of the Appeal Record), in particular of the second last paragraph which states, 38 “We, therefore seek your kind consideration and co-operation to grant us six (6) months time to settle the annual fees for 2009 and 2010 amounting to RM200,000.” On its plain reading, this Court finds that the Defendant had fully understood and accepted the Plaintiff’s decision in rejecting the exemption application and that there was a request for a six months period to settle the outstanding annual fees for 2009 and 2010 amounting to RM200,000. [38] In addition, the Defendant is estopped from reverting to his earlier position and raising this as a triable issue based on the authority attributed by the Plaintiff’s counsel in the case of Boustead Trading (1985) Sdn Bhd v Arab-Malaysia Merchant Bank Bhd [1995] 3 MLJ 331. The Court f inds that the Defendant had replied to the Plaintiff’s demand via letter of 19.7.2010 requesting for an extension of time to pay the Licenses for the year 2009 and 2010 as pleaded in the Plaintiff’s Affidavit (at paragraph 7, page 21 of the Appeal Record). [39] This appeal arises from a summary judgment under Order 14 ROC 2012. It is incumbent upon the Court to have the overall view to ascertain 39 whether the Defendant has a real or bona fide defence. This Court has carefully perused the affidavits and documentary evidence and finds that the Defendant did not apply for an exemption to the Minister charged with communications and multimedia. It is this Court’s finding that the Defendant in fact requested for an extension of time to settle the said outstanding annual fees. I do not find a single issue meriting trial. The legal position is clear as stated in the case of Eng Say Kuang v Hong Leong Bank Bhd [2008] MLJU 38 which made reference to the case of Abdullah Rohani v Punca Klasik Sdn Bhd [2004] 1 CLJ 772, Court of Appeal, “It is trite law that in such an application the onus on the defendant to be entitled to defend the action in a full trial, is to satisfy the court that "there is an issue or question in dispute which ought to be tried or that there ought for some other reason to be a trial..." [40] In light of the above reasons, the Defendant could not satisfy this Court nor am I convinced that there is an issue or question in dispute which ought to be tried. The Plaintiff, to my view has on the balance of probabilities, a prima facie case for summary judgment to be entered against the Defendant. I find that the Defendant’s grounds for appeal did 40 not give rise to any bona fide triable issue. I therefore dismiss the appeal with cost. Dated: 28 July 2017 (DATIN ZALITA BINTI DATO’ ZAIDAN) Judicial Commissioner Shah Alam High Court 41 SOLICITORS: APPELLANT : AHMAD HANAFI BIN LOP AHMAD Tetuan S Murthi & Associates Lot BM-05, Mezzanine Floor PJ Industrial Park No. 13, Jalan Kemajuan 46200, Petaling Jaya Selangor Darul Ehsan Tel : 03-7957 5780 Fax : 03-7957 5784 [(Ref: SM16750/L/SKMM(APP)] (MN: 1990074)] RESPONDENT : G. C. TAN NINA LAI Tetuan Shook Lin & Bok Tingkat 20 Bangunan Kumpulan Ambank 55, Jalan Raja Chulan 50200 Kuala Lumpur Tel : 03-2031 1788 Fax : 03-2031 1775 [Ref: TGC/17383/15SKMM/0SB/018]

Tika 2.6.0

24-752-06/2015

PLAINTIF 1. LER CHENG CHYE 2. LUM TUCK CHEONG DEFENDAN BILLION SHOPPING CENTRE SDN BHD

27/07/2017

YA DATUK AZIMAH BINTI OMAR

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=936ed45d-0736-491f-aab2-fe5db740de39&Inline=true

1 IN THE HIGH COURT OF MALAYA IN SHAH ALAM IN THE STATE OF SELANGOR DARUL EHSAN, MALAYSIA ORIGINATING SUMMONS NO. 24-752-06/2015 In the matter of Billion Shopping Centre Sdn Bhd (Company No. 97690-X). AND In the matter of Shah Alam High Court Order dated 23.8.2010 in Petition No. 26-5-2000. AND In the matter of Order 15 Rule 16 and Order 30 Rule 3 of the Rule of High Court 2012. AND In the matter of Section 184 of the Companies Act 1965. BETWEEN 1. LER CHENG CHYE 2. LUM TUCK CHEONG … PLAINTIFFS AND BILLION SHOPPING CENTRE SDN BHD … DEFENDANT 2 GROUNDS OF JUDGMENT (Enclosure 1) A. INTRODUCTION [1] By their originating summons (Enclosure 1), the Plaintiffs sought from this Court inter alia for the following orders: i. A declaration that the Plaintiffs are entitled to be paid their remuneration on the terms contained in the Order dated 20.7.2011. ii. That the Plaintiffs’ remuneration as Interim Receivers from 23.8.2010 to 20.7.2011 be approved in the amount of RM926,809.00. iii. That all costs and expenses incurred by the Plaintiffs from July 2010 to July 2011 be approved in the sum of RM135,496.45. 3 iv. That the remuneration paid to the Plaintiffs totaling RM176,299.55 out of the assets of the Defendant towards payment of their remuneration as Interim Receivers and out of pocket expenses be approved. v. That the Defendant do pay the Plaintiffs the outstanding remuneration and costs and expenses of RM886,005.90 as fixed by this Honourable Court. vi. That the costs of this application on solicitor-client basis be paid by the Defendant. [2] Both the Plaintiffs were appointed as interim receivers of the Defendant pursuant to a High Court Order dated 18.8.2010 (the said Order). Having executed their duties and responsibilities under the said Order, the Plaintiffs through their letter dated 18.8.2011 to the Defendant’s Board of Directors had demanded payment of their remuneration and charges for interim receivership period between 23.8.2010 to 20.7.2011 be paid by the Defendant. The Defendant did not accede to the Plaintiffs’ demand and instead by its letter dated 4 14.9.2011, the Defendant’s Board of Directors had insisted that the Plaintiffs are to apply to the Court for approval of their remuneration and charges or have the same be validated by the Court. B. BACKGROUND FACTS [3] For easy understanding of the Plaintiffs’ application, it is only appropriate for this Court to set out the background facts which has led the Plaintiffs in filing Enclosure 1. 3.1 Both the Plaintiffs (Ler Cheng Chye & Lum Tuck Cheong) are accountants by profession having an address at C/O Ler Lum Advisory Services Sdn Bhd, B-3-11, Megan Avenue 11, No.12 Jalan Yap Kwan Seng, Kuala Lumpur. 3.2 The Defendant (Billion Shopping Centre Sdn Bhd) is a company incorporated under the Companies Act 1965 which operates Billion Shopping Centre in Kajang, Selangor and has investments in unquoted shares in 35 other subsidiary companies throughout Malaysia. 5 3.3 In 2006, an individual by the name of Chin Keat Seng had filed a petition under Section 181 (“181 Petition”) of the Companies Act 1965 in the Shah Alam High Court vide Petition No. 26-5- 2006 against the Defendant and six other individuals. Chin Keat Seng (Petitioner), at the material time was one of the Defendant’s directors and was also a shareholder. It must be noted that the Defendant here was the First Respondent in the 181 Petition. 3.4 Pending the hearing and disposal of the 181 Petition, the Petitioner had filed an interlocutory application for an Interim Receiver to be appointed to take control and manage all assets, money and/or proceeds of the Defendant and to operate and manage the Defendant’s bank accounts and/or cash balances. 3.5 The Petitioner’s application was granted by the High Court on 23.8.2010 (“the said Order”). The said Order also set out provisions for the appointed Interim Receiver’s remunerations, liabilities, payments, costs, charges and expenses relating to their tasks and duties during the receivership. The relevant 6 terms of the said Order in respect of such provisions can be found in items 1, 5 and 6 of the order which are as follows: “Item 1: Bahawa sehingga perbicaraan tindakan ini atau sehingga sebarang perintah selanjutnya, Ler Cheng Chye (No. K.P. 531103-10-5757) [Lesen Liquidator No. 871/04/11 (J/PH)] dan Lum Tuck Cheong (No. K.P. 581012-10-6389) [Lesen Liquidator No. 1005/05/11 (J/PH)] dilantik untuk mengendali dan mengurus semua aset, wang dan/atau hasil Responden Pertama dan diberi autoriti untuk mengoperasi dan mengendalikan akaun-akaun bank dan/atau baki-baki tunai Responden Pertama;” Item 5: Bahawa Pemegang Interim diberi indemniti terhadap semua liabiliti, upah, kos, caj dan bayaran yang dibuat secara berpatutan oleh Pemegang Interim semasa menggunakan kuasa dan menjalankan kewajipan yang dinyatakan, DAN BAHAWA bayaran tersebut dibuat dari aset Responden Pertama dan diberi keutamaan sebelum semua pemiutang. 7 Item 6: Bahawa upah Pemegang Interim dibuat dari aset Responden Pertama secara bulanan menurut bil yang dikeluarkan, dan dibayar berasaskan kos masa yang dihabiskan oleh Pemegang Interim dan/atau pekerjanya pada kadar jam biasanya;” 3.6 Subsequently, pursuant to the said Order the Plaintiffs were then appointed as Interim Receivers (IR) of the Defendant. 3.7 To ensure that the overdraft of the Defendant does not exceed its closing balance as at the date of appointment of the Plaintiffs and the return from investment in the form of dividends is received by the Defendant, the Plaintiffs had obtained an order from the Shah Alam High Court on the 17.2.2011 (“the High Court Order dated 17.2.2011”). The High Court Order dated 17.2.2011 gave direction to the Plaintiffs to maintain the Defendant’s overdraft as at 23.8.2010 and to appoint a Corporate Representative to the subsidiaries of the Defendant. 3.8 Five of the six individuals named as the Respondents in the 181 Petition namely; i. Chin Choon Min, ii. Lee Yoke Lam, iii. 8 Wong Chee Leong, iv. Lee Siew Hung and v. Mak Joon Cheong had filed an appeal in the Court of Appeal against the said Order. 3.9 On 20.7.2011, the Court of Appeal had allowed the appeal in part wherein in respect of the appointment of the Plaintiffs, the said Order was amended so that the Plaintiffs’ position instead of being IR was substituted to be Monitoring Accountants and this substitution is to take effect from the date of the Court of Appeal’s order (“Court of Appeal Order”). 3.10 The Court of Appeal Order reads inter-alia as follows: “1. Rayuan ini dibenarkan sebahagian seperti terma-terma dibawah:- (a) pelantikan penerima-penerima interim Encik Ler Cheng Chye (No. K/P: 531103-10-5757) Lesen Likuidator No. 871/04/11 (J/PH) dan Encik Lum Tuck Cheong (No. K/P: 581012-10-6389) Lesen Likuidator No. 1005/05/11 (J/PH) (“PI”) bukanlah suatu perkara yang diperlukan (not 9 necessary) untuk memelihara aset-aset Billion Shopping Centre Sdn Bhd (“BSCSB”) sementara menunggu pelupusan Petisyen No. 26-5-2006 (“Tindakan tersebut”). (b) … (c) PI dilantik sebagai Akauntan Pemantau BSCSB berkuatkuasa dari hari perintah ini. (d) Pengurusan BSCSB dikembalikan sepenuhnya kepada lembaga pengarah BSCSB. (e) Fi akauntan Pemantau hendaklah dibayar oleh pihak yang kalah dalam Tindakan tersebut. (f) … (g) Terma-terma dalam perintah Mahkamah Tinggi bertarikh 23.08.2010 dipinda selaras dengan terma perintah ini. 3.11 On the premise of Items 5 and 6 of the said Order, the Plaintiffs had demanded from the Defendant the outstanding 10 remuneration/ costs/ expenses/ charges due to them for the interim receivership period between 23.8.2010 to 20.7.2011. 3.12 Together with their letter of demand, the Plaintiffs had also enclosed a schedule (the schedule) containing full particulars of time spent and the basis of time cost for the various tasks and duties dated 21.4.2011 comprising of 197 pages. 3.13 In response to the Plaintiffs’ demand, the Defendant by its Board of Director’s letter dated 14.9.2011 to the Plaintiff had insisted that the Plaintiffs are to apply to the Court for approval of their remuneration and charges or have the same be validated by the Court. Hence, this Enclosure 1 was filed by the Plaintiffs. C. THE DEFENDANT’S OBJECTION [4] In contrary of their earlier stand that the Plaintiffs should obtain Court’s approval or validation of their remuneration and charges, the Plaintiffs’ application was strongly challenged by the Defendant. The 11 Defendant now contends that the Plaintiffs are not entitled to any payment of remuneration, expenses or charges. [5] In addition to the strenuous challenge, the Defendant is also counter claiming for declaratory relief and orders which was set out in paragraph 47 of its affidavit in opposition (Enclosure 14). D. THE DEFENDANT’S PRELIMINARY OBJECTION [6] At the commencement of the hearing of the Plaintiffs’ application, the learned counsel for the Defendant raised a preliminary objection that this Court did not have jurisdiction to hear the Plaintiffs’ application on the following grounds: i. the hearing of the Plaintiffs’ application would tantamount to this Court making a further order in respect of the interim receivership of the Plaintiffs, whereas in fact and in law, the Court of Appeal had on 20.7.2011 reversed the said Order appointing the IR of the Defendant and had substituted the IR’s position to monitoring accountants. 12 ii. in allegedly reversing the said Order, the Court of Appeal did not pronounce any order with regard to IR’s remuneration and charges. And thus it was the contention of the Defendant that when the Court of Appeal allegedly set aside the IR’s appointment, by implication the effect of the said order is also setting aside the High Court order allowing that the IR’s remuneration and charges be paid out of the assets Defendant. Hence, if this Court were to allow the Plaintiffs’ application, it would be akin to acting on a void order of the Court. [7] In other words, the Defendant is contending that this Court has no jurisdiction to make further orders in respect of the IR after the Court of Appeal allegedly reversed and set aside the High Court’s Order. [8] In support of these contentions, the counsel for the Defendant had referred to this Court the decision of an Australian Supreme Court of New South Wales in the case of Starr v Trafalgar Financial Corporation Ltd (No. 2) (1983) 1 ACLC 872; 1,056. The New South Wales Supreme Court has held inter alia: “The questions to be determined are whether the provisional liquidator of the defendant, appointed by me ex parte on 15 March last, but whose appointment was rescinded by me 13 on 21 March last, is entitled to be paid remuneration for the work he did as such provisional liquidator and, if so, which of the parties should bear the cost. …. For these reasons, I conclude that the appointment of Mr. Grant ceased on the date upon which the order was rescinded. Such being the case, can the Court order that Mr. Grant’s costs, expenses and remuneration be paid to him and, if so to whom may that order be directed? The joint judgment in Wilde’s case (at CLC p. 3, 119 ALJR p.285) contains the conclusion that “it is true that from the moment it is set aside the order can no longer provide the lawful justification for further action…” It was submitted for the Plaintiffs that, as the summons had been dismissed and the order appointing Mr. Grant rescinded, no power existed to order that he be paid his remuneration. I think the matter is to be considered more as one of substance than of one depending upon the order of events, but I agree with the submission that no further order of the court is appropriate or permissible. It seems to me that to order one of the parties to pay Mr. Grant’s remuneration would be to take “further action” on the rescinded order. What has been done has been validly done, but no further orders based upon the validity of that order would be justified.” [9] This Court did not find any merit in the contentions put forth by the counsel for the Defendant on the these reasons; firstly, paragraph 1(g) of the Court of Appeal‘s order dated 20.7.2011 clearly reads:- “Terma-terma dalam perintah Mahkamah Tinggi bertarikh 23.08.2010 dipinda selaras dengan terma-terma perintah ini.” 14 The English translation of the above order will be this: “The terms contained in the High Court Order are amended/ varied in accordance with the terms of this Order.” (Emphasis given) [10] The Court is of the view that with the clear wordings of the order, the order of the Court of Appeal cannot be read (as interpreted by the counsel for Defendant) that the Court of Appeal had set aside or reversed the order of the High Court. [11] This Court is in total agreement with the counsel for the Plaintiff that the Court of Appeal had actually amended the order of the High Court with regards to the appointment both the Plaintiffs. Instead of being IR to the Defendant, the Court of Appeal had substituted the Plaintiffs to the position of a Monitoring Accountants. [12] Hence, with the substitution of the Plaintiffs’ appointment to monitoring accountants, the Plaintiffs’ receivership ceases with effect from 20.7.2011. However, prior to 20.7.2011 (i.e. from the date of the High Court order until the Court of Appeal handed down its decision of substitution), the Plaintiffs’ appointment as IR must be rendered a valid appointment and during such period, having carried out their 15 duties as appointed, the Plaintiffs must not be deprived of their remuneration, expenses and charges. [13] This Court also agrees with the submission of the counsel for the Plaintiffs that the Court of Appeal did not have to specifically provide for the Interim Receivers’ remuneration prior to 20.7.2011 because the remuneration was already fixed by the High Court as per items (5) and (6) of the High Court Order. If the Court of Appeal is of the view that the Plaintiffs must not be remunerated within the period of appointment, the Court of Appeal would have already amended/varied the items (which the Court of Appeal never did). But on 20.7.2011, the Court of Appeal only amended items 1, 2 and 3 of the High Court Order by substituting items 1(a), (b), (c), (d), (e), (f) of the Court of Appeal Order. [14] Secondly, the decision of the Supreme Court of New South Wales in the case of Starr which was cited by the counsel for Defendant has no application in the present case simply because the facts in the case of Starr is vastly different from the present case and appropriately ought to be distinguished. 16 [15] It is pertinent to note that the learned counsel for the Defendants had somehow overlooked salient facts of the case of Starr which should have been put forth before this Court. In the case of Starr, the issue dealt with by the Court was far more grievous, as even the entire conduct of winding up was found to be wrongful. The Court in Starr had found that it lacked even the proper jurisdiction to even wind up the company. Of course naturally, if the winding up is already improper, the entire appointment of provisional liquidators is improper (and hence should rightfully be set aside). [16] But this is exactly NOT the facts and circumstances in the present case before this Court. In the present case, it is clear that at the time when the High Court allowed the petitioner’s application for interim receiver of the Defendant to be appointed pending the disposal of the 181 petition, as well as when the Court of Appeal amended the High Court’s order, it was not even at the juncture / stage to determine the propriety of the petitioner’s petition or winding up of the company. At that material time, the conduct of the 181 Petition in the present case is still on-going and there has yet been any determination on the liquidation. 17 [17] The Order appointing provisional liquidators in the case of Starr was clearly inappropriate owing to the improper winding up of the company. And it is the same impropriety that the Order appointing provisional liquidators in Starr was rescinded. This is exactly NOT the facts in the present case. [18] In the present case, there has yet to be any determination on the propriety of the petition that could or could not deem the appointment of the Plaintiffs as interim receivers to be inappropriate. [19] Furthermore, the present case is entirely different from the case of Starr, wherein the High Court’s order in the present case was NOT set aside or rescinded and was only amended. The Court’s hesitation in the case of Starr to order remuneration of the provisional liquidators was that the Court’s hand was tied from ordering remuneration under an Order which was already deemed improper and was rescinded on the grounds of improper winding up of a company. 18 [20] This is exactly not the case in the present case as the High Court’s order appointing the Plaintiffs as interim receivers was never rescinded or set aside. The Order was merely amended and in fact the amendment did not disturb at all the Plaintiffs’ rights to be remunerated for their works. Distinct and different from the case of Starr, the High Court Order in the present case remains in subsistence and remains enforceable albeit with some amendments (which does not affect the Plaintiffs’ rights for remuneration). [21] It is abundantly clear that any order for remuneration of the Plaintiffs’ work is exactly NOT “to take “further action” on the rescinded order” as the High Court Order in the present case was never at all material times rescinded. [22] Based on the above reasons, it is this Court’s judgment that the issue on jurisdiction raised by the Defendant must fail. C. OTHER OBJECTION BY THE DEFENDANT [23] It was contended on behalf of the Defendant that there is no provision in the Companies Act 1965 which mandates remuneration to be paid 19 to Interim Receivers. According to the counsel for the Defendant, unlike provisional liquidators whose remuneration is specifically provided for in section 232(2) of the Companies Act 1965, there is no similar provision that is applicable for interim receivers. [24] It was further contended by the counsel for the Defendant that the Plaintiffs were appointed as interim receiver vide a court order under Order 30 of the Rules of Court 2012 (ROC 2012) and since Order 30 did not provide for remuneration to the interim receiver, it is therefore contended that whether the interim receivers is entitled to their remuneration is entirely within the discretion of court. In exercising its discretion, it is incumbent on the Court to decide whether to allow the Plaintiffs of their remuneration and who shall be responsible to pay the said remuneration. [25] In the present case, it was further contended by the counsel for the Defendant that since the order of the High Court appointing the IR was the consequence of a 181 petition initiated by Chin Keat Seng and was strenuously objected by the Defendant (which was made one of the Respondent), thus the Defendant should not be made 20 liable to pay the remuneration and charges of the Plaintiffs. To this contention, the counsel for the Defendant had relied on a decision of the United Kingdom Supreme Court in the case of Barnes v Eastenders Cash & Carry plc and others v Crown Prosecution Service [2015] AC 1. [26] This Court finds the arguments forwarded by the counsel for the Defendant is clearly misconceived. [27] Order 30 rule 3 of the ROC 2012 clearly provides that: “A person appointed as a receiver shall be allowed such proper remuneration, if any, as may be fixed by the Court.” [28] In the present case, the High Court in appointing the Plaintiffs as the IR of the Defendant had also in clear terms set out items 5 and 6. Item 5 reads: Bahawa Pemegang Interim diberi indemniti terhadap semua liabiliti, upah, kos, caj dan bayaran yang dibuat secara berpatutan oleh Pemegang Interim semasa menggunakan kuasa dan menjalankan kewajipan yang dinyatakan, DAN BAHAWA bayaran tersebut dibuat dari aset Responden Pertama dan diberi keutamaan sebelum semua pemiutang. 21 While items 6 reads: Bahawa upah Pemegang Interim dibuat dari aset Responden Pertama secara bulanan menurut bil yang dikeluarkan, dan dibayar berasaskan kos masa yang dihabiskan oleh Pemegang Interim dan/atau pekerjanya pada kadar jam biasanya;” [29] The High Court judge in appointing the Plaintiffs as the IR of the Defendant had also pronounced items 5 and 6 in the order dated 23.8.2010. Additionally, items 5 and 6 remain unchanged and undisturbed by the Court of Appeal’s amendment to the Order. These orders were made pursuant to Order 30 rule 3 of the ROC 2012. Considering that even the Court of Appeal upheld items 5 and 6, this Court is obviously duty bound to comply with the spirit of the order. [30] In construing Order 30 rule 3 of the ROC 2012 with regards to the court’s power in fixing proper remuneration for court’s appointed receiver, this Court refers to the case of Lim Poh Choo v Absolute Ascend Sdn Bhd [2008] 7 CLJ 810 which was brought to this Court’s attention by the counsel for the Plaintiffs. In Lim Poh Choo, the High Court had considered the principles applicable to 22 appointment of a receiver with the object of preserving property pending determination of a cause or matter and stated in paragraph [18] pages 816/817 that:- [18] A receiver appointed by the court is an officer of the court put in to discharge certain duties prescribed by the order appointing him……………. A court appointed receiver is allowed such proper remuneration, if any as may be fixed by the court (see O.30 r.3 of RHC 1980). As such the court can stipulate the remuneration of the receiver at the time of appointment.” [31] The meaning of “proper remuneration” has recently been considered by the High Court of Singapore in the case Kao Chai-Chau Linda v Fong Wai Lyn Carolyn and others [2016] 1 SLR 21. In this case Justice Steven Chong had in paragraph 31 construed the provision of Order 30 r3(3) of the Singapore ROC and stated this: [31] Order 30 r3(3) of the ROC provides that “[a] person appointed receiver shall be allowed such proper remuneration, if any, as may be fixed by the court” [emphasis added]. The trouble, however, is that the expression “proper” is the statement of a 23 legal conclusion rather than an aid to analysis. It still begs the question: what is “proper”? In my judgment, “proper” remuneration is one which is fair, reasonable and proportionate reflection of the value of services rendered. [32] In this regard also, this Court is in total agreement with the submission by the counsel for the Plaintiffs that the Rules of Court confer a statutory right on the Court to fix the receivers’ remuneration while the procedure for payment is at the discretion of the Court, once the Court fixes such proper remuneration and the method of payment this confers a right to be paid. (See: Vestime Corp Sdn Bhd v YBLE Resources Sdn Bhd & Ors [2006] 3 MLJ 554 & Dato Mohamed Hashim Shamsuddin v Attorney-General, Hong Kong [1986] 2 MLJ 112) [33] In the case of Goh Swee Oh @ Khoo Swee Cheng & Ors v Heng Ji Keng & Anor [2012] 7 MLJ 102, Varghese George JC (as he then was) had this to say in respect of a provisional liquidator’s entitlement to remuneration. 24 [13] It was clear, as was pointed out further to me, that even where there was no committee of inspection in place (as was the case here), by r 142(3) of the Companies (Winding-Up) Rules 1974, a liquidator was always entitled to remuneration, which, unless ordered otherwise by the court, would follow the scale of fees and percentages for the time being payable to official receiver discharging duties as a liquidator. Here too there was no requirement that ‘prior approval’ had to be secured first. It could therefore only mean, firstly, that a private liquidator is entitled to be paid remuneration, and, secondly, that such entitlement or payment is not subject to any prior approval of the court before it is availed of by the liquidator. [34] Based on the above mentioned considerations, it is this Court’s judgment without any inkling of hesitation or any shade of doubt that where an order appointing an interim receivers is subsequently amended and substituted to monitoring accountants, the interim receivers who were appointed by court as an officer of the Court remains entitled to his just remuneration and expenses during the validity of the appointment until the substitution. This is especially so when there is clear order by the Court pronouncing the entitlement (which was upheld by the Court of Appeal) and such entitlement is payable by the Defendant. 25 [35] Hence the Plaintiffs’ application in prayer (1) of their Enclosure 1 namely; for a declaration that the Plaintiffs are entitled to be paid their remuneration on the terms contained in the order dated 23.8.2010 until their appointments as Interim Receivers was substituted by the Court of Appeal Order dated 20.7.2011 is hereby allowed and the Defendant’s counterclaim is dismissed. [36] Finally, at end of their oral submissions before this Court, both the counsels for the Plaintiff and the Defendant had agreed that in the event that this Court rules that the Plaintiffs is entitled to their remuneration and expenses, then the assessment of a fair, reasonable and justified remuneration/ expenses/ charges payable to the Plaintiffs shall be carried out by the Deputy Registrar. Issue of Costs [37] On the issue of costs, this Court hereby orders that the Defendant is to pay the Plaintiffs costs in the sum RM20,000.00. 26 t.t. …………………………………………….. (DATUK AZIMAH BINTI OMAR) Judge High Court Shah Alam Selangor Darul Ehsan Dated the 27th July, 2017 For the Plaintiff - Messrs Iza Ng Yeoh & Kit Izabella De Silve Chow Yee Wah For the Defendant - Messrs Wang Kuo Shing & Co Karen Lee Roger Peter Sean Tan

Tika 2.6.0

Q-02(W)-1129-06/2016

PERAYU HOCK PENG REALTY SDN. BHD … APPELLANT [COMPANY NO. 20325-D] Wisma Hock Peng No. 123, Jalan Lapangan Terbang 93250 Kuching RESPONDEN TING SIE CHUNG @ TING SIEH CHUNG … RESPONDEN T [WN.KP.441211-13-5217] No. 508, Taman Li Hua Bintulu

Tort — Appeal — Defamation — Action based on defamation and tort of abuse of process — Absolute privilege — Prohibitory order — Whether prohibitory order fell within categories of absolute privilege in Lincoln v. Daniels — Whether prohibitory order published — Whether process of court had been misused — Decision in favour of respondent —Trial court ordered for damages to be assessed by deputy registrar

27/07/2017

YA DATUK DR HAJI HAMID SULTAN BIN ABU BACKERKorumYAA TAN SRI DATUK SERI PANGLIMA DAVID WONG DAK WAHYA DATUK DR HAJI HAMID SULTAN BIN ABU BACKERYA DATO' UMI KALTHUM BINTI ABDUL MAJID

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=67abdcd1-5f50-4ded-b994-55813a07d57a&Inline=true

1 IN THE COURT OF APPEAL OF MALAYSIA (APPELLATE JURISDICTION) AT KUCHING CIVIL APPEAL NO: Q-02(W)-1129-06/2016 BETWEEN HOCK PENG REALTY SDN. BHD … APPELLANT [COMPANY NO. 20325-D] Wisma Hock Peng No. 123, Jalan Lapangan Terbang 93250 Kuching AND TING SIE CHUNG @ TING SIEH CHUNG …RESPONDENT [WN.KP.441211-13-5217] No. 508, Taman Li Hua Bintulu OR c/o Messrs. Ting & Ting Advocates 7D, Drive 4 Brooke Drive 96000 Sibu. [In the matter of Civil Suit No: 22-53-2009 In the High Court of Sabah and Sarawak at Kuching] BETWEEN HOCK PENG REALTY SDN BHD …PLAINTIFF [COMPANY NO. 20325-D] Wisma Hock Peng No. 123, Jalan Lapangan Terbang 93250 Kuching. AND 2 TING SIE CHUNG @ TING SIEH CHUNG [WN. KP.441211-13-5217] No. 508, Taman Li Hua Bintulu. OR c/o Messrs. Ting & Ting Advocates 7D, Drive 4 Brooke Drive 96000 Sibu. … DEFENDANT HEARD TOGETHER WITH IN THE COURT OF APPEAL OF MALAYSIA (APPELLATE JURISDICTION) AT KUCHING CIVIL APPEAL NO: Q-02(W)-343-02/2017 BETWEEN TING SIE CHUNG @ TING SIEH CHUNG [WN. KP.441211-13-5217] No. 508, Taman Li Hua Bintulu. OR c/o Messrs. Ting & Ting Advocates 7D, Drive 4 Brooke Drive 96000 Sibu. … APPELLANT AND HOCK PENG REALTY SDN BHD [COMPANY NO. 20325-D] Wisma Hock Peng No. 123, Jalan Lapangan Terbang 93250 Kuching. …RESPONDENT 3 [In the matter of Civil Suit No: 22-53-2009 In the High Court of Sabah and Sarawak at Kuching] BETWEEN HOCK PENG REALTY SDN BHD [COMPANY NO. 20325-D] Wisma Hock Peng No. 123, Jalan Lapangan Terbang 93250 Kuching. … PLAINTIFF AND TING SIE CHUNG @ TING SIEH CHUNG [WN. KP.441211-13-5217] No. 508, Taman Li Hua Bintulu. OR c/o Messrs. Ting & Ting Advocates 7D, Drive 4 Brooke Drive 96000 Sibu. … DEFENDANT CORAM: David Wong Dak Wah, JCA Hamid Sultan bin Abu Backer, JCA Umi Kalthum binti Abdul Majid, JCA Hamid Sultan Bin Abu Backer, JCA (Delivering Judgment of The Court) 4 GROUNDS OF JUDGMENT [1] There were two appeals fixed for hearing before us on 18-4-2017 arising from the same decision of the High Court related to defamation and tort of abuse of process of court. [2] Appeal No. Q-02(W)-1129-06/2016 (1st appeal) is the appeal of the plaintiff in the High Court suit No. 22-53-2009 and appeal No. Q- 02(W)-343-02/2017 (2nd appeal) is the appeal by the defendant. [3] The 1st appeal is related to the complaint of the plaintiff that the learned judge had dismissed the cause of action in defamation and only provided a sum of RM50,000.00 for the tort of abuse of process of court. [4] The 2nd appeal is related to the complaint that the court should not have allowed the claim for tort of abuse of process. Brief Facts [5] The plaintiff’s action has a chequered history. The learned trial judge has documented the history, the facts and law in articulate manner. [See [2016] 8 CLJ 393]. For the purpose of both the appeals, we do not wish to repeat what was said in the judgment, save to say that this judgment must be read together with our judgment to appreciate our grounds in the proper perspective. [6] We will summarise the facts in our own words as follows: 5 (a) The plaintiff, a property development company, has advanced some money to the defendant in anticipation of developing the land belonging to the defendant. (b) The deal did not go through and the defendant did not pay the sum advanced and the plaintiff took the opportunity to caveat the defendant’s land. (c) The caveat was subsequently removed and damages were asked to be assessed before the court. (d) The plaintiff and defendant had by a consent order agreed that they will proceed with the assessment of damages but the payment of the assessment was to be stayed pending appeal process. (e) The deputy registrar had assessed the damages and the defendant in breach of the agreed terms issued a writ of seizure and sale and subsequently obtained a prohibitory order against the plaintiff’s land and that too ex-parte, without having served any papers on the plaintiff, notwithstanding the appeal process has not been exhausted. (f) The plaintiff says that in consequence of the conduct of the defendant, there is cause of action for defamation for false and malicious statements in the prohibitory order. The said prohibitory order lodged against the plaintiff reads as follows: 6 “MALAYSIA IN THE HIGH COURT OF SABAH AND SARAWAK AT BINTULU APPLICATION FOR EXECUTION NO. 36 - 01 - 2007 (BTU) [ORIGINATING SUMMONS NO. 24-47-2000 (BTU)] BETWEEN TING SIEH CHUNG 508, Taman Li Hua, Bintulu, Sarawak. ... Plain tiff/Judgment Creditor AND HOCK PENG REALTY SDN BHD Bangunan Toh Boon Khim & Soon Pek Guaxi, 186A-B, Jalan Tun Haji Openg Sibu, Sarawak. ... Defendant/Judgment Debtor PROHIBITORY ORDER (O.47 R.6) TO: The abovenamed Defendant/Judgment Debtor HOCK PENG REALTY SDN BHD Bangunan Toh Boon Khim & Soon Pek Guan, 186A-B, Jalan Tun Haji Openg, Sibu, Sarawak WHEREAS you the said HOCK PENG REALTY SENDIRIAN BERHAD, the above-named Defendant/Judgment Debtor has failed to satisfy an Order given on 30th day of January 2007 and dated the 29th day of February 2007 in favour of TING SIEH CHUNG, the Plaintiff/Judgment Creditor, for the sum of RM1,842.073.91 (as at 15th May 2007) together with the interest at the rate of 8% per annum from the 30.01.2007 until the full settlement and costs which shall be paid by the Defendant/Judgment Debtor to the Advocates for the Plaintiff/Judgment Creditor. 7 IT Is ORDERED that you the said HOCK PENG REALTY SENDIRIAN BERHAD be and you are hereby, for a period commencing from of the date of registration of this Order under the provisions expiry of six(6) months from the date of this Order, prohibited and restrained from transferring, charging or leasing the properties specified in the SCHEDULE hereunder or creating any lien or equitable charge thereof by deposit of any instrument of title. SCHEDULE (1) All that the said HOCK PENG REALTY SENDIRIAN BERHAD’S right title share and interest in all that parcel of land together with the building thereon and appurtenances thereof situate at Upper Lanang Road, Sibu, containing an area of 3,534 Sq. Metres, more or less, and described as LOT 3368 BLOCK 19 SEDUAN LAND DISTRICT. (2) All that the said HOCK PENG REALTY SENDIRIAN BERHAD’S right title share and interest in all that parcel of land together with the building thereon and appurtenances thereof situate at Upper Lanang Road, Sibu, containing an area of 2,964 Sq. Metres, more or less, and described as LOT 3369 BLOCK 19 SEDUAN LAND DISTRICT. (3) All that the said HOCK PENG REALTY SENDIRIAN BERHAD’S right title share and interest in all that parcel of land together with the building and appurtenances thereof situate at Upper Lanang Road, Sibu, containing an area of 2,999 Sq. Metres, more or less, and described as LOT 3158 BLOCK 19 SEDUAN LAND DISTRICT. (4) All that the said HOCK PENG REALTY SENDIRIAN BERHAD’s right title share and interest in all that parcel of land with the building thereon and appurtenances thereof situate at Upper Lanang Road, Sibu, containing an area of 4,855 Sq. Metres, more or less, and described as LOT 3801 BLOCK 19 SEDUAN LAND DISTRICT. 8 (5) All that the said HOCK PENG REALTY SENDIRIAN BERHAD’S right title share and interest in all that parcel of land together with the building thereon and appurtenances thereof situate at Jalan Wong King Huo, Sibu, containing an area of 1,4324 Hectares, more or less, and described as LOT 3585 BLOCK 7 SIBU TOWN DISTRICT. (6) All that the said HOCK PENG REALTY SENDIRIAN BERHAD’S right title share and interest in all that parcel of land together with the building thereon and appurtenances thereof situate at Upper Lanang Road, Sibu, containing an area of 4,471 Hectares, more or less, and described as LOT 976 BLOCK 10 SIBU TOWN DISTRICT. (7) All that the said HOCK PENG REALTY SENDIRIAN BERHAD's right title share and interest in all that parcel of land together with the building thereon and appurtenances thereof situate at Jalan Deshon, Sibu, containing an area of 994.1 Sq. Metres, more or less, and described as LOT 2923 BLOCK 4 SUNGAI MERAH TOWN DISTRICT.” (hereinafter referred to as “the said 7 pieces of Lands”). (g) The plaintiff also says the breach of consent terms leading to the writ of seizure and sale as well as the prohibitory order entitles it to a cause of action in tort of abuse of process of court. (h) The learned trial judge held that the publications complained of in respect of and/or related to court proceedings will not attract a successful cause of action in defamation based on the concept of absolute privilege. (i) The learned judge held that the plaintiff had succeeded in the cause of action against the tort of abuse of process of court 9 and awarded only damages in the sum of RM50,000.00 on the ground that the writ of seizure and sale and the prohibitory order were never served on the plaintiff and was only discovered by the plaintiff upon search being done. Preliminaries [7] In the instant case, we note that the plaintiff’s claim is essentially based on defamation and the claim in respect of abuse of process of court was incidental in nature without any specifics. However, parties in the submission did not take up the issue what are the elements needed to be proved for tort of abuse of process of court. In consequence, we will not dwell with this issue. [8] The Memorandum of Appeal for the 1st appeal reads as follows: “The Appellant, HOCK PENG REALTY SDN BHD being dissatisfied with such part of the learned High Court Judge's decision given on 20.5.2016 concerning: (a) The Appellant's claim for defamation is dismissed; (b) Damages to the Appellant for abuse of process is assessed at RM50,000.00 with interest of 5% per annum from 20.05.2016 until full and final payment; and (c) Each party to bear their own cost. appeal against the above parts of the said High Court Judge's decision to the Court of Appeal on the following grounds. 10 ABSOLUTE PRIVILEGE SHOULD NOT APPLY TO EX-PARTE ORDER (1) The learned High Court Judge erred in law and in fact in holding that the absolute privilege in legal proceedings in defamation case as decided in Lincoln v Daniels [1961] 3 All ER 740, and in particular, the second category would apply to an ex-parte Prohibitory Order contrary to the two House of Lord cases of Roy v Prior [1970] 2 All ER 729 and Taylor v Serious Fraud Office [1999] 2 AC 177. (2) The learned High Court Judge failed to appreciate that the ex-parte Prohibitory Order obtained against the Appellant's 7 parcels of lands where the Respondent deliberately failed to serve on the Appellant but registered the said ex-parte Prohibitory Order and extended 3 times without valid reason on ex-parte basis and registered in the Land Registry at Sibu would amount to malice on the part of the Respondent. (3) The learned High Court Judge had misdirected herself and made erroneous finding that the failure to serve the ex-parte Prohibitory Order and its 3 extensions which were registered against the Appellant's 7 parcels of lands were not malicious. (4) The learned High Court Judge failed to appreciate that the ex-parte Prohibitory Order with its 3 extensions and registered against the Appellant's 7 parcels of lands without serving on the same on the Appellant and without applying for the directions for sale would clearly show the true, bad and malicious intention of the Respondent to use ex-parte Prohibitory Order to tarnish the good reputation of the Appellant. In such a situation, the learned High Court Judge ought to apply the principles enunciated in Roy v Prior [1970] 2 All ER 729 to disallow the Respondent to abuse the Court process and enjoy the total protection of the Court to defame and tarnish the good reputation of the appellant. 11 INADEQUATE DAMAGES TO THE APPELLANT FOR ABUSE OF PROCESS IS ASSESSED AT RM50,000.00 WITH INTEREST OF 5% PER ANNUM FROM 20.05.2016 UNTIL FULL AND FINAL PAYMENT (5) The learned High Court Judge erred in law and in fact in awarding RM50,000.00 damages for abuse of the Court process by taking into improper consideration that there is overlapping with the assessment of damages of unlawful caveats to be assessed in Sibu (as the previous assessment of RM 14,766,900.00 as shown in page 5 of the Judgment was set aside by the Court of Appeal). The learned High Court Judge should not take into account any overlapping in this appeal as the Sibu Court has yet to reassess damages as the result of unlawful caveats. (6) The learned High Court Judge had failed to appreciate that there is no damages assessed for the unlawful caveats in Sibu as the assessment in Sibu Court was set aside by the Court of Appeal. As such, there is no assessment of damages by the Sibu Court on the unlawful caveats. The learned High Court erred and made erroneous finding by speculating about the assessment of damages and erroneously took into consideration the non-existing assessment for unlawful caveat in Sibu over the same 7 parcels of lands. Such serious misdirection of law and facts had caused a miscarriage of justice. (7) The learned High Court Judge erred in law and in fact in holding that the ex-parte Prohibitory Order without serving on the Appellant did not amount to extortion. The learned High Court Judge failed to appreciate that the extortionate act of the Respondent was the ex-parte application for a Prohibitory Order with 3 extensions and registered in the Appellant's 7 parcels of lands by falsely claiming that the Appellant had failed to satisfy the debt at the Land Registry Sibu thereby forcing the Appellant to make payment for the amount not due and payable due to the Consent Order. 12 (8) The learned High Court Judge should have appreciated that the extortionate act is this appeal was not the extortionate act as defined in the criminal law. The learned High Court Judge should have appreciated that the extortionate act was the unlawful demand through the ex-parte Prohibitory Order with 3 extensions registered against the Appellant's 7 parcels of lands thereby forcing, coercing or unlawfully putting the Appellant in a very difficult position to make payment to the Respondent which was not due and payable. (9) The learned High Court Judge had also failed to appreciate and made erroneous findings by wrongly accepting the Respondent's evidence that the Respondent took out the Writ of Seizure and Sale and the Prohibitory Order against the Appellant's 7 parcels of lands was merely to secure payment and with no intention to sell the Appellant's 7 parcels of lands to satisfy the debt which was not due and payable. The learned High Court Judge should appreciate that the Writ of Seizure and Sale and Prohibitory Order was an execution proceeding to seize the Appellant's 7 parcels of lands for sale by public auction to satisfy the debt which was not due and payable and not for security of payment. The learned High Court Judge should have concluded such extortionate action by the Respondent would clearly show malice in this case to enhance the quantum of damages to be awarded to the Appellant. (10) The learned High Court Judge had misdirected herself in taking all the improper considerations or factors to diminish the award of damages to RM50,000.00 to the Appellant for the seizure of the Appellant's 7 parcels of lands which were in the various stages of development. The learned High Court Judge in referring to Abdullah bin Mohammad Noor v Syarikat Pembangunan Setia Jaya (Civil Suit No. 22-98-2011) case where the learned High Court Judge had awarded RM350,000.00 with RM50,000.00 cost for the abuse of the Court process in obtaining 13 the Writ of Seizure and Sale and Prohibitory Order for one parcel of land belonging to an individual (the Plaintiff) and the said land was not subject to any development. The learned High Court Judge erred in not appreciating that the Appellant's 7 parcels of lands were under various stages of development to be entitled much higher damages than the award the learned High Court Judge gave in Abdullah bin Mohammad Noor v Syarikat Pembangunan Setia Jaya (Civil Suit No. 22-98-2011) case. The Appellant had submitted that the general damages should be RM15,000,000.00 and aggravated damages of RM5,000,000.00. (11) The learned High Court Judge should not have taken irrelevant and improper factors and consideration to award RM50,000.00 to the Appellant against the Respondent to deliberately and maliciously abused the Court process by seizing the Appellant's 7 parcels of lands with the ex-parte Prohibitory Order (which were extended 3 times) and registered in the titles of the Appellant's 7 parcels of lands at the Land Registry Sibu. The total period of the ex-parte Prohibitory Order was 2 years and the learned High Court Judge failed to direct her mind that the 7 parcels of lands' land titles and the records at the Land Registry Sibu would still show the Prohibitory Orders until now thereby permanently tarnish the good name of the Appellant that badly affected the Appellant's business and their dealings with trading partners, sub- contractors and financial institutions which were not rebutted by the Respondent. (12) The learned High Court Judge failed to refer and accept the undisputed evidence of PW1 as to how the Appellant's business was badly affected in that the suppliers and sub-contractors who demanded upfront payments before supply and work could be carried out. The financial institutions also required more documents to obtain banking facilities. The learned High Court Judge therefore erred in law and in fact in awarding RM50,000.00 damages to the Appellant. 14 PARTIES BEAR THEIR OWN COST (13) The learned High Court Judge erred in not awarding any cost to the Appellant by wrongly concluding that the failure of the Appellant's cause of action on defamation would disentitle the Appellant to any cost in succeeding in the Appellant's cause of action on abuse of Court process in the same action. (14) The learned High Court Judge failed to appreciate that the Appellant was entitled to commence an action against the Respondent on two different causes of actions i.e. defamation and/or abuse of the Court process. The Appellant in succeeding to prove the case against the Respondent in the cause of action of abuse of the Court process, the learned High Court Judge ought to have awarded cost to the Appellant as cost would follow the event. (15) The learned High Court Judge erred in law and in fact in not awarding cost to the Appellant when the Appellant succeeded in the proving on balance of probabilities that the Respondent had abused the Court process by taking out the Writ of Seizure and Sale and Prohibitory Order on an ex-parte basis to seize the Appellant's 7 parcels of lands whereby the Appellant had suffered loss and damages and should be entitled to cost against the Respondent. (16) The learned High Court Judge erred in law and in fact in disallowing any cost to be awarded to the Appellant without appreciating the facts that there was no misconduct or improper act on the part of the Appellant to be disentitled to cost. The learned High Court ought to have awarded cost of RM 150,000.00 as prayed for by the Appellant. (17) Based on the evidence adduced in the High Court, the learned High Court Judge had erred in law and in fact in erroneously finding that absolute privilege in defamation applied to ex-parte Prohibitory Order, 15 failed to take into consideration relevant and proper factors in awarding general damages and failed to appreciate that cost should follow the event thereby caused a miscarriage of justice.” [9] The Memorandum of Appeal for the 2nd appeal reads as follows: “1. The learned Judge erred in law and in fact in finding that the Prohibitory Order obtained by the Appellant constituted the tort of abuse of the Court process for the following reasons:- 1.1 On 30.01.2007, the Appellant had obtained Judgment against the Respondent for the sum of RM 1,789,938.50 with interests and costs. 1.2 The Judgment was subject to an earlier consent order made on 28.03.2001 that "payment of the amount assessed shall be stayed, till the disposal of the appeal". 1.3 On 16.05.2007, the Appellant applied ex parte for a Prohibitory Order to restrain the Respondent from selling seven [7] parcels of land together with Writ of Seizure & Sale. 1.4 It is undisputed that the Appellant did not serve the Writ of Seizure & Sale and the Prohibitory Order on the Respondent and did not proceed with execution on the said lands to enforce payment on the Judgment. 1.5 The learned Judge accepted that the Appellant applied for the Prohibitory Order only to preserve Appellant under the Judgment in his favour. 1.6 The learned Judge accepted that the Appellant applied for the Prohibitory Order without malice. 16 1.7 There was no evidence that the Appellant tried to use the Prohibitory Order to coerce or extort the Respondent to do anything in order to accomplish a purpose other than that for which the Prohibitory Order was designed and as a result to cause damage. 1.8 The learned Judge ought to have found that the Respondent had not proven that the Prohibitory Order breached the Consent Order and that the elements of the tort of abuse of Court process had not been proven as the consent order does not restrain Appellant from preserving his right under the judgment in his favour. 2. The learned Judge ought to have found that the Respondent's claim in the High Court is barred by res judicata as the Respondent had filed the same claim in respect of the same Prohibitory Order in Suit No.22-51-2009-III for alleged malicious prosecution /abuse of the Court process and the claim was struck out all and the appeals were unsuccessful up to the Federal Court. 3. The learned Judge ought to have held that there was no abuse of the court's process since the learned Judge found that "the prohibitory order was obtained as a form of extortion is unsubstantiated because the said order was never served on the plaintiff. In my view, in order for extortion to arise, the threat must be brought home to the victim and the non-service of the order means that there was no such threat at all" stated in the paragraph iii (a) of the short ruling at page 1(f) of the Record of Appeal. 4. The Learned Judge ought to have held that there was no abuse of the process of court because the process was honesty for the purpose of maintaining the status quo of the subject-matter. It was used to seek a purpose which the very process designed for and not for other collateral purpose or ulterior motive. 17 5. The learned Judge erred in law and in fact in awarding damages of RM50,000.00 to the Respondent when the Respondent had failed to prove any special damages suffered during the trial.” Preliminaries on Tort of Abuse of Process of Court, Abuse of Court Proceedings and Defamation, in relation to publications arising from Rules of Court [10] (a) Defamation (i) It is now well established that a limited company will only have a limited cause of action in defamation as opposed to an individual person. [See Yeo Ing King v Melawangi Sdn Bhd [2016] MLJU 555]. As this issue was not raised by the defendants in the court below or here, we will not deliberate on this issue. (ii) It is also well established that any publication within the norms of court proceedings will attract the concept of absolute privilege. [See Royal Aquarium v Parkinson [1892] 1 QB 431]. Absolute privilege are two types, one specifically conferred by statutes and the other arising in consequence of case laws originating from England. [See Defamation Act 1957; Gatley on Libel and Slander, 12th edn. Page 461]. Where the statute provides for privilege the usage of publications for the purpose stated as per the statute will always be accorded, the status of absolute privilege. However, if absolute privilege arises from the decisions of court, then one has to scrutinize the decisions of the court to ascertain on what fact and conduct of parties the concept of absolute privilege was accorded. [See Wescott v Wescott [2008] EWCA Civ 818; Ramasamy Iyer’s ‘The Law of Torts’ (10th ed.) at pages 407 to 410]. 18 (b) Abuse of Process of Court (i) It is now well recognized that there are two types of abuse of process of court. One is related to court proceedings itself where for example the court can order a matter to be struck out under Order 18 rule 19 or inherent jurisdiction or stay proceedings, etc. The applicant who succeeds in such a procedure will only be entitled to costs and not damages. (ii) The other type is the common law action of tort of abuse of process of the court. A claimant who succeeds in the action will be entitled to costs as well as damages, etc. (iii) Both are abuse in a generic term only but the relief and the elements required to establish will be different. It will be based on rules of court and/or laws. Abuse in both generally means everything, which is contrary to good order established by usage. Abuse of process of court refers to situation where the court’s process is used for unlawful and not for the actual purpose intended to achieve justice. [See Castro v Murray (1875) 10 Ex.213; Janab’s Key To Civil Procedure, 5th edn. Pages 252 to 255]. [11] In the instant case, it is not one related to abuse of process in a matter before the court and an action taken in the court proceedings itself to arrest the abuse. The action in this case is related to common law tort and on the facts the learned judge had taken the view that it is a sustainable cause of action based on the primary facts that the defendant in breach of consent terms has initiated proceedings through court process. 19 [12] We have read the appeal record and the able submissions of the parties. After giving much consideration to the submission in respect of both the appeals, we take the view that both the appeals should be dismissed. Our reasons inter alia are as follows: (i) The cause of action for defamation on the facts of the instant case must fail in limine as it is related to proceedings as per rules of court. The court had relied on the well established principles in the case of Lincoln v Daniels [1961] 3 ALL ER 740 to hold that absolute privilege applies. (ii) In Lincoln’s case the defendant claimed absolute immunity in respect of communications sent by him to the Bar Council relating to professional misconduct of the plaintiff who was a Queen Counsel. The court made a distinction between A Bench of Inns of Court (which was responsible for conduct of barristers then) and Bar Council (which was an association). The court held that A Bench of the Inns of Court which inquire into the conduct of a member of the Bar will be accorded absolute privilege to the proceedings. However, a complaint to the Bar Council will only have a qualified privilege. Delvin LJ opined that absolute privilege fell into three categories, namely: (a) All matters that are done coram judice and it extends to everything said in the proceedings by the judges, parties, counsel, witnesses and includes documents put in evidence. 20 (b) Everything done from the inception of the proceedings and extends to all pleadings and other documents brought into existence for the purpose of the proceedings and including the writ or other document which is instrumental for instituting the proceedings. (c) Privilege attaching to evidence which a witness gave coram judice extends to the precognition or proof of that evidence taken by solicitor. (iii) The third category stated above is said to be the most difficult to define. [See Watson v McEwan [1905] AC 480]. It is immaterial whether the proof is or is not taken in the course of proceedings. [See Beresford v White (1914) 30 TLR 591]. (iv) In the instant case, the learned High Court judge took the view that the second category of absolute privilege set out in Lincoln’s case applies. (v) We are in agreement with reasoning of the learned trial judge to hold that absolute privilege applies. The said part of the judgment reads as follows: “In the joint reply submission of Hock Peng's 5 counsels, it was submitted that the prohibitory order is not a pleading and neither does it come within the meaning of "other documents brought into existence for the purpose of the proceedings" i.e. the second category in Lincoln's case (supra). With respect I am unable to agree with them. Although the prohibitory order is obviously not a pleading nor an 21 affidavit but the order would still in my view fall within the meaning of "other documents....." stated in the category. This is because the order was made after the application for a writ of seizure and sale has been approved by the court which followed the award of damages in the originating summons and which in the context of this case is the pleading. Since the registration with the Land Office of Sibu is mandated by law for without it, i.e. the registration, the prohibitory order would be totally useless and will not have the legal effect for which it was intended, I am further of the view that it does not come within the meaning of publication in the law of defamation. Thus, on these grounds the cause of action founded on defamation fails for the prohibitory order was not published and even if it were, it is completely excused by the defence of absolute privilege.” (vi) On the issue of tort of abuse of process of court and damages thereof, we are inclined to agree with the grounds of judgment of the learned trial judge which read as follows: “In Abdullah's case (supra), I had ordered RM350,000.00 as damages for abusing the court process. Based on the considerations above and using Abdullah's case (supra) as a guideline (which I think that I am entitled to since the decision has gone through the rigours of the appeal process), I would award Hock Peng damages in the sum of RM50,000.00 - not the RM20 million prayed by it. I further order interest at 5% per annum with effect today until full and final settlement thereof. As for cost, since this action is premised on two causes of action but Hock Peng only succeeded in one and also failed to prove their allegation on extortion, I would not order cost against the defendant. In other words, each party is to bear their own costs.” [13] For reasons stated above, both the appeals are dismissed with no order as to costs. Deposits are to be refunded. 22 We hereby order so. Dated: 27 July 2017 sgd (DATUK DR. HJ. HAMID SULTAN BIN ABU BACKER) Judge Court of Appeal Malaysia. Note: Grounds of judgment subject to correction of error and editorial adjustment etc. Counsel for Appellant [Q-02(W)-1129-06/2016] And for Respondent [Q-02(W)-343-02/2017] Mr. Lim Heng Choo [with Mr. George Lim and Mr. Alvin Wong] Messrs Lim & Lim Advocates Advocates & Solicitors 7H, Lot 303 Lorong 1, Rubber Road 93400 Kuching, Sarawak. Counsel for Appellant [Q-02(W)-343-02/2017]: Mr. Chong Siew Chiang [with Mr. George Lo and Ms Carole Ngu] Messrs Chong Brothers Advocates Advocates & Solicitors No. 48-49, 1st Floor, Block F King’s Centre, Jalan Simpang Tiga 933500 Kuching, Sarawak. [Ref: T219/024/gl] 23 Counsel for Respondent [Q-02(W)-1129-06/2016]: Mr. Chong Siew Chiang [with Mr. George Lo and Ms Carole Ngu] Messrs George Lo & Partners Advocates & Solicitors No. 68, Lot 131 (1st Floor) Jalan Petanak 93100 Kuching, Sarawak.

Tika 2.6.0

Q-01(IM)346-09/2016

PERAYU 1. LIMBA JAYA TIMBER SDN. BHD. 2. LEE LING TIMBER SDN. BHD. …APPELLANTS RESPONDEN 1. SUPERINTENDENT OF LANDS AND SURVEYS, LIMBANG 2. KOMASAE HOLDINGS SDN. BHD. … RESPONDEN TS

Civil Procedure — Appeal against decision of the High Court that allowed striking out application of 1st Respondent — Right of way inquiry — 1st Respondent was the adjudicator in the right of way inquiry — Appeal to the High Court against decision of the 1st Respondent to grant the right of way to 2nd Respondent — Striking out application by the 1st Respondent — Whether, in the appeal to the High Court, the 1st Respondent should be cited as a party — Whether the Respondent, a decision maker whose decision being appealed against, shall be a respondent in the appeal — Appeal is allowed with costs — National Land Code, section 418(1); Sarawak Land Code, section 34(6); Rules of Court 2012, Order 15 rule 6(2)(a), Order 18 rule 19(1)(a),(b),(c) or (d), Order 33 rule 1, Order 55A and Order 92 rule 4

27/07/2017

YA DATO' UMI KALTHUM BINTI ABDUL MAJIDKorumYAA TAN SRI DATUK SERI PANGLIMA DAVID WONG DAK WAHYA DATUK DR HAJI HAMID SULTAN BIN ABU BACKERYA DATO' UMI KALTHUM BINTI ABDUL MAJID

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1 IN THE COURT OF APPEAL MALAYSIA (APPELLATE JURISDICTION) CIVIL APPEAL NO. Q-01(IM)346-09/2016 BETWEEN 1. LIMBA JAYA TIMBER SDN. BHD. 2. LEE LING TIMBER SDN. BHD. …APPELLANTS AND 1. SUPERINTENDENT OF LANDS AND SURVEYS, LIMBANG 2. KOMASAE HOLDINGS SDN. BHD. …RESPONDENTS [In the matter of Originating Summons No. LMN-24-2/1-2016 in the High Court of Sabah and Sarawak at Limbang BETWEEN 1. LIMBA JAYA TIMBER SDN. BHD. 2. LEE LING TIMBER SDN. BHD. …APPELLANTS AND 1. SUPERINTENDENT OF LANDS AND SURVEYS, LIMBANG 2. KOMASAE HOLDINGS SDN. BHD. …RESPONDENTS] 2 CORAM DAVID WONG DAK WAH, JCA HAMID SULTAN BIN ABU BACKER, JCA UMI KALTHUM BINTI ABDUL MAJID, JCA GROUNDS OFJUDGMENT BRIEF FACTS 1. This appeal is in relation to the 1st Respondent’s decision dated 4.1.2016 to grant the right of way to the 2nd Respondent pursuant to section 34 of the Sarawak Land Code (SLC). Dissatisfied with the 1st Respondent’s decision, the Appellants filed an appeal to the High Court by way of an Originating Summons pursuant to section 34(6) of the SLC, citing the 1st Respondent and the 2nd Respondent as parties to the appeal. 2. The 1st Respondent then applied in Enclosure 7 to strike out the Appellants’ appeal to the High Court as well as for his name to be struck out as party to the Originating Summons under Order 33 rule 1, Order 15 rule 6(2)(a), Order 18 rule 19(1)(a),(b),(c) or (d) and Order 92 rule 4 of the Rules of Court 2012 (RC). DECISION OF THE HIGH COURT 3. The learned Judicial Commissioner (JC) allowed the 1st Respondent’s application with costs of RM2,000.00. In deciding so, the 3 learned JC felt he was bound by the Federal Court case of Tan Guan Seng v Sibuti Yon Seng Quarry Sdn. Bhd. & Ors [1973] 2 MLJ 116 which ruled that the Superintendent of Lands and Surveys, who was the adjudicator in the right of way inquiry, should not be made as the Respondent and it sufficed that the party who is claiming the right of way to be made a party instead. THE APPEAL 4. In the appeal before us, the Appellants had withdrawn their appeal against the 2nd Respondent. 5. The Appellants’ appeal against the 1st Respondent is centered on only the issue of law which is, is it proper for the decision maker/the 1st Respondent to be made a respondent to an Order 55A RC appeal to the High Court against his decision. The Notice of Appeal was filed on 5.8.2016, which means the RC apply to the Appellants’ appeal. Order 55A is a new Order which replaces the previous Order 55 rule 13 of the Rules of the High Court 1980 (RHC). In replacing Order 55 rule 13 RHC, Order 55A had made more detailed provisions on appeals from statutory bodies and tribunals. Order 55A sets out the procedure for appeal from any decision made by any person or body of persons to the High Court as follows: 4 “ORDER 55A APPEALS TO HIGH COURT UNDER WRITTEN LAW Appeals to the High Court under written law (O. 55A, r. 1) 1. (1) Where under any written law an appeal lies from any decision of any person or body of persons to the High Court such appeal shall be made to the High Court in the State where the decision was given by way of an originating summons setting out the grounds of the appeal and supported by an affidavit, and if the Court so directs at the hearing of the appeal, by way of oral evidence. (2) The appellant shall annex the following documents as exhibits to the affidavit filed in support of the originating summons or to such further affidavit as may be filed in the appeal proceedings: (a) the notes of evidence, if available; recorded wholly or partly by mechanical means; (b) the grounds of decision, if available; (c) the decision of the statutory body, if available; and (d) all such documentary exhibits and other documents the parties shall consider relevant for the purposes of appeal: Provided that the originating summons shall be filed notwithstanding that the grounds of decision are not available or ready. If the grounds of decision become available, then they shall be filed by way of a further affidavit without the leave of the High Court. (3) Unless otherwise provided by any written law, such appeal must be filed in the manner prescribed in paragraph (2) within one month from the date on which the decision was given or the date on which such decision was notified to the person appealing, whichever is the later date. (4) Unless otherwise provided by any written law, the originating summons shall be served on the respondent in such appeal or where the respondent is a body of persons, on the secretary, registrar or such other officer of that body of persons.” 5 6. Order 55A RC has to be read together with section 34(6) of the SLC, which is as follows: “(6) Any person aggrieved by any decision of the Superintendent under this section may, within thirty days of being informed of such decision, appeal to the High Court and for the purpose of further appeal any decision of the High Court shall be deemed to be made in a civil proceeding.” 7. The learned JC in coming to his decision held that Order 55A RC does not prescribe that the decision maker whose decision being appealed against shall be a respondent in the appeal. The learned counsel for the Appellants argues that this interpretation of Order 55A is erroneous because, amongst others,- 7.1 when Order 55A rule 1(1) and 1(4) are read together, it does prescribe that the decision maker of the decision being appealed against, shall be a respondent in a statutory appeal; 7.2 in the other form of judicial redress/ control in respect of administrative action, that is, judicial review proceedings, the decision maker is always made a respondent to the same – see Ambiga Sreenevasan v Ketua Pengarah Imigresen Malaysia & Ors [2012] 7 CLJ 170; 7.3 the learned JC failed to apply the Federal Court decision of Bar Malaysia v Index Continent Sdn. Bhd. [2016] 2 CLJ 545 which held that statutes must be construed with a purposive approach. 6 8. Further, it is argued that learned JC was wrong when he – 8.1 found that the Appellants had failed to produce any authorities which interpret Order 55A RC as prescribing that the decision maker shall be a respondent in such an appeal. The Appellants had cited 10 cases where the Land Administrator was the respondent in the appeal to the High Court arising out of his decision, such as, Ng Meng Soon dan satu lagi lawan Pentadbir Tanah Daerah Muar dan satu lagi [2010] 8 MLJ 388 and Motif Unik Sdn. Bhd. v Khoo Ah Soon & Anor [2012] 10 CLJ 612; 8.2 found that the 10 authorities cited were irrelevant because they were made pursuant to section 418(1) of the National Land Code whereas the Appellants’ case concerned section 34(6) SLC, as the learned JC failed to appreciate/distinguish the difference between - 8.2.1 a provision which confers a right of appeal as in section 418(1) of the National Land Code and section 34(6) SLC; and 8.2.2 a procedural provision which prescribes the procedure for the appeal. 9. It is also the contention of the Appellants that the learned JC had erred in law and in fact and had seriously misdirected himself in holding 7 that Tan Guan Seng (supra) is still good law and/or binding on him as he – 9.1 failed to consider Order 59 rule 13(1), rule 13(3) Rules of the Supreme Court 1957 (the predecessor to the present Order 55A rule 1(1), 1(4) RC) was not highlighted to the Federal Court in Tan Guan Seng; 9.2 should have followed that Court of Appeal’s decision in Abu Bakar Ismail & Anor v Ismail Husin & Ors & Other Appeals [2007] 3 CLJ 97 and Alami Vegetable Oil Products Sdn. Bhd. v Lombard Commodities Ltd [2009] 4 CLJ 700 which held that a decision given in ignorance of the existence of a statutory provision is a per incuriam decision and cannot safely be relied on; 9.3 failed to consider the Federal Court’s opinion in Tan Guan Seng with regard to whether the Superintendent of Lands And Surveys should have been made a respondent to the appeal, was incidental and not directly upon the issue before the Federal Court. The actual issue before the Court was the limitation period in respect of an order for substitution of a party; 9.4 should have followed the authority of Alami Vegetable Oil Products Sdn. Bhd. (supra) which held that only the ratio decidendi of a prior case binds courts of lower jurisdiction; 8 9.5 failed to consider that there are no other case authorities in Malaysia since the 1973 decision of Tan Guan Seng which have followed and/or referred to the same. On the other hand, there are numerous case authorities since then and up to recent times where the decision maker was a respondent in the statutory appeal without issue; 9.6 should have followed the Federal Court’s decision in Dalip Bhagwan Singh v Public Prosecutor [1997] 4 CLJ 645 which held that the courts are permitted to depart from a previous decision which is wrong, unjust, outmoded and/or absolute in the modern conditions. 10. As for the opinion expressed by the learned JC that the 1st Respondent should not be made a party to the appeal because he has no interest in it, his role is merely to exercise his adjudicative function pursuant to the law, and whether the Appellants win or lose the appeal does not really matter to the 1st Respondent, it is contended by the Appellants that such opinion goes against the established principle that where permitted by statute, the courts have the jurisdiction to ensure that a decision-making authority does not commit errors of law in coming to its decision. 11. The learned Senior State Counsel, acting for the 1st Respondent, essentially supports the positions taken by the learned J.C. 9 OUR DECISION 12. After perusing the submissions of parties and the authorities cited, we unanimously hold that the appeal is allowed with costs of RM5,000.00 for here and below and subject to the payment of allocatur. The order of the High Court is set aside and the deposit is refunded to the Appellants. Our decision is based on the following grounds. 13. This Court was established by the Constitution (Amendment) Act 1994 (Act A 885) whereby section 13 thereof had added Clause (1B) to Article 121 of the Federal Constitution establishing the Court of Appeal on 24.6.1994. Before the establishment of this Court, the Federal Court was established on 16.9.1963 under the Malaysia Act 1963 (No. 26 of 1963). In the hierarchy of the superior courts then, below the Federal Court were the High Court in Malaya and the High Court in Sabah and Sarawak and above the Federal Court then was the Judicial Committee of the Privy Council. Tan Guan Seng’s case (supra) was decided by the Federal Court then in 1973. Being the highest court of appeal then (save for the Privy Council), the said Federal Court decision therefore is binding on this Court in view of the superior courts hierarchy. 14. Be that as it may, we wish to distinguish Tan Guan Seng’s case from the appeal before us. We find that the statement made by Ismail 10 Khan CJ (as hen then was), in delivering the judgment of the Federal Court at page 116, paragraphs H-I, right – ‘At the inquiry before the superintendent, the parties to the dispute were the respondents who claimed the right of way, and the appellant who opposed such claim. In the appeal by the appellant against his decision, the party claiming the right of way should have been made respondent and not the superintendent, the adjudicator. It is difficult to understand why he was made the respondent. He therefore took the right step in obtaining the order for the substitution of the respondents in his place. See Order 16 rule 12 which says:- “12. Any application to add or strike out or substitute a plaintiff or defendant may be made to the court or a judge at any time before trial by motion or summons, or at the trial of the action in a summary manner.” The respondents were added as a new party in place of the party removed…’ as being obiter dictum, incidental to the ratio of the case and thus not binding on us. The ratio of the case relate to the question of whether the order for substitution of parties was made after the prescribed limitation period and the Federal Court held that the appeal against the substituted respondents could only be deemed to be lodged on the day when they were substituted. Since this was after the expiry of the period of limitation, the appeal was out of time. In Alami Vegetable Oil Products Sdn. Bhd. (supra), Malik Ishak JCA (as he then was) said at page 713, paragraph 29, as follows: “[29] But more apt to the occasion and to the present appeal at hand would be the speech of May LJ in the case of Ashville Investments Ltd v Elmer Contractors Ltd [1988] 2 All ER 577 at 582, [1988] 3 W.L.R. 867 at 873 where he said: 11 In my opinion the doctrine of precedent only involves this: that when a case has been decided in a court it is only the legal principle or principles on which that court has so decided that bind courts of concurrent or lower jurisdictions and require them to follow and adopt them when they are relevant to the decision in later cases before those courts. The ratio decidendi of a prior case, the reason why it was decided as it was, is in my view only to be understood in this somewhat limited sense.” 15. Moreover, at the time when Tan Guan Seng was decided, the civil procedure rules in force were the Rules of the Supreme Court 1957 (L.N. 321/1951) (RSC), in particular Order 59 rule 13(1), 13(3) which stated as follows: “13. (1) Where under any written law an appeal lies from any decision of any person or body of persons to the High Court or to the Supreme Court such appeal shall be made to the High Court in the State where the decision was given by motion setting out the grounds of appeal, supported by affidavit and, if the Court so directs at the hearing, by oral evidence. … (3) Unless otherwise provided by any written law, notice of the motion shall be served on the respondent in such appeal or where the respondent is a body of persons, on the secretary, registrar or such other officer of that body of persons.” The provisions of Order 59 paragraphs 13(1) and 13(3) were not referred to the Federal Court. Only Order 16 rule 11 was addressed by the Federal Court. We are of the view that if the Federal Court had been referred to Order 59 paragraphs 13(1) and 13(2) of the RSC, it might have come to a different conclusion, as we do vis the similar provisions of Order 55A paragraphs 1(1) and 1(4) RC. 12 16. With regard to the current Order 55A RC provisions, we are in agreement with the submission of the learned counsel for the Appellants, in that, when paragraphs 1(1) and 1(4) of Order 55A are read together, it is clear that Order 55A provides for the decision maker (other than the interested party) be made the respondent to the appeal. Paragraph 1(1) makes a reference to “an appeal lies from any decision of any person or body or persons” to the High Court whilst paragraph 1(4) provides for “the originating summons shall be served on the respondent on such appeal or where the respondent is a body of persons, on the secretary, registrar or such other officer of that body of persons”. It stands to reason that the decision maker be served with the originating summons in this context since the Appellants’ appeal is in regard to his decision and in the process the Courts have the duty to supervise the decision maker’s decision to ensure that he does not commit errors of law in coming to his decision. There are numerous cases reiterating this principle of law, but suffice for us to refer to the book entitled Civil and Criminal Appeals in Malaysia, Third Edition, Sweet and Maxwell Thomson Reuters, by Tan Kee Heng where the learned author, at pages 87-88, stated as follows (in the context of judicial review, which equally applies to appeals from persons or body of persons): 13 “3.1.1 The right of appeal [3.001] A right of appeal against any decision of any person or body of persons is only available if there is any written law providing for that right. In Malaysia, there are numerous statutory provisions which provide that certain administrative decisions “shall be final and conclusive”, “shall not be questioned in any legal proceedings whatsoever”, “shall not be subject to appeal or review in any court” or “shall not be challenged, appealed against, reviewed, quashed or called in question in any court on any ground”. Generally speaking, the effect of all such words is to oust both the appellate and supervisory jurisdiction of the courts to review, reverse or set aside such decisions. However, it must be noted that an inferior tribunal or other decision-making authority, whether, exercising a quasi-judicial function or a purely administrative function, has no jurisdiction to commit an error of law, whether the error is jurisdictional or not and accordingly, its decision will not be immunised from judicial review by an ouster clause however widely drafted.” 17. We are fortified in our views when we refer to the many cases cited by the Appellants which no doubt relate to section 418 of the National Land Code but which section similarly enables a person to appeal to the High Court from a decision of the State Director, the Registrar or any Land Administrator. The Land Administrator has been cited as a respondent in, for example, Ng Meng Soon (supra); Motif Unik Sdn. Bhd. (supra); Thankam De Silva lawan Pentadbir Tanah, Daerah Larut Dan Matang, Taiping [1995] 4 CLJ 584; Kelab Renang Pulau Pinang v Pentadbir Tanah, Daerah Timur Laut, Pulau Pinang & Anor [2014] 5 CLJ 341. 18. Similarly, there are umpteenth cases in respect of judicial review applications where the decision maker is commonly cited as a party to the action – see for example Ambiga Sreenevasan (supra). So citing the 14 decision maker as a party to the action is not an isolated practice; in fact the opposite is true. sgd (UMI KALTHUM BINTI ABDUL MAJID) Judge Court of Appeal Malaysia Putrajaya Dated : 27.07.2017 Counsels/ Solicitors For the Appellants : Leong Hsin Ru, Tetuan Tang & Partners For 1st Respondent : Joseph Chioh Hock Hua (Senior State Counsel) together with Ronald Felix Hardin (State Legal Officer)

Tika 2.6.0

WA-12AC-1-01/2017

PLAINTIF 1. Bandar Teknik Sdn Bhd; 2. Kinta Sejati Sdn Bhd; 3. Centrepoint Building Materials Sdn Bhd & 4. Kemajuan Aluminium (M) Sdn Bhd DEFENDAN Desa Samudera Sdn Bhd

27/07/2017

YA DATO' LEE SWEE SENG

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1 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF WILAYAH PERSEKUTUAN, MALAYSIA (CIVIL DIVISION) CIVIL APPEAL NO: WA-12AC-1-01/2017 BETWEEN 1. BANDAR TEKNIK SDN BHD (COMPANY NO: 291322-D) 2. KINTA SEJATI SDN BHD (COMPANY NO: 224968-T) 3. CENTREPOINT BUILDING MATERIALS SDN BHD (COMPANY NO: 108757-V) 4. KEMAJUAN ALUMINIUM (M) SDN BHD (COMPANY NO: 75021-A) - APPELLANTS AND DESA SAMUDERA SDN BHD (COMPANY NO: 278016-K) - RESPONDENT IN THE SESSION COURT AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF WILAYAH PERSEKUTUAN, MALAYSIA CIVIL SUIT NO: WA-B52NCC-419-05/2016 2 BETWEEN 1. BANDAR TEKNIK SDN BHD (COMPANY NO: 291322-D) 2. KINTA SEJATI SDN BHD (COMPANY NO: 224968-T) 3. CENTREPOINT BUILDING MATERIALS SDN BHD (COMPANY NO: 108757-V) 4. KEMAJUAN ALUMINIUM (M) SDN BHD (COMPANY NO: 75021-A) - PLAINTIFFS AND DESA SAMUDERA SDN BHD (COMPANY NO: 278016-K) - DEFENDANT THE JUDGMENT OF Y.A. LEE SWEE SENG [1] The Plaintiffs in the Sessions Court had appealed against the decision of the Sessions Court Judge (SCJ) to strike out the Plaintiffs' claim against the Defendant for interest on a judgment debt. The Defendant had applied in Enclosure 9 to strike out the Plaintiffs’ claim in that it does not disclose a reasonable cause of action and for being 3 frivolous, vexatious and an abuse of the process of the Court under O. 18 r.19(1)(a),(b) and (c) of the Rules of Court 2012 (“ROC”). [2] The Plaintiffs claim is founded on the following: (i) O. 42 r. 12 of the Rules of the High Court 1980 (“RHC 1980”) and which has statutory force; (ii) an agreement dated 29.9.2010 by the parties to reserve their rights on the issue of post judgment interest on the judgment debt and reproduced/embodied in a Consent Order for Stay of Execution; and (iii) Rule 15 of the Rules of Court of Appeal 1994. [3] This case is the continuing saga of a case in Suit No. S1-2-484-98 launched in 1998 by the Defendant here as the Plaintiff there. The Plaintiff there had claimed for damages for trespass and conversion and the Defendants there, who are the Plaintiffs here, had counter-claimed for work done. Both claims and counterclaims were dismissed by the High Court on 6.5.2009. [4] On appeal to the Court of Appeal on 2.9.2010, the Plaintiffs here were awarded damages in the Court of Appeal for the sum of RM3,290,000.00 and the Defendant's claim there was dismissed. The prejudgment period was almost twelve years (22.9.1998 to 2.9.2010). At 4 the suggestion of the Court of Appeal's panel, the Plaintiffs agreed to limit it to 6 years. The principal judgment sum plus the prejudgment interest merged to form the judgment debt of RM4,919,200.00. [5] Had the Respondents settled the judgment debt on the 2.9.2010 that would have been the end of the matter. But they only settled the judgment debt on the 21.12.2012. [6] When payment of the judgment debt was not forthcoming on 2.9.2010 the Plaintiff commenced execution proceedings. [7] The Defendant then filed an application for leave to appeal against the Court of Appeal’s judgment and by a stay of execution agreement between the parties entered into on the 29.9.2010 a stay of execution was consented to inter alia on the following terms: (i) the judgment debt be placed on an interest bearing account in the joint names of the solicitors pending the outcome of the appeal to the Federal Court. Solicitors for both parties were present before the bank to open a joint interest bearing account in the names of the solicitors. (ii) term (i) above was without the prejudice to the right of both parties on the issue of post judgment interest. 5 (iii) if the appeal was successful the Defendant here would be entitled to the judgment debt plus accrued interest and if unsuccessful the Plaintiffs would be entitled to the judgment debt plus accrued interest. [8] The Plaintiffs submitted that the fact of the interest on post judgment is a right that both parties wanted to preserve is very significant for it could only mean that the Plaintiffs did not agree to waive their rights to post judgment interest. It was also in the interest of the Defendant to preserve their right to post judgment interest for they were hoping that the Federal Court might agree with them and grant them the amount claimed, in which case the post judgment interest would apply in their favour. [9] The appeal to the Federal Court was eventually dismissed by the Federal Court on the 13.12.2011. [10] On the 21.12.2011 solicitors for the Defendant here, directed the bank unconditionally to pay the judgment debt of RM4,919,200.00 including all accrued interest to the Plaintiffs. [11] The fixed deposit was uplifted in the presence of both solicitors and the sum of RM5,074,015.01 (RM4,919,200.00 together with the 6 accrued interest of RM154,815.01) was released to the Plaintiffs’ solicitors. [12] As agreed under the stay of execution agreement dated 29.9.2010 parties reserved their rights on the issue of post judgment interest. Upon the appeal being dismissed by the Federal Court on the 13.12.2011 post judgment interest became due. The Defendant’s solicitors on the 21.12.2011 directed the bank unconditionally to make payment of the judgment debt including all accrued interest to the Plaintiffs’ solicitors as being monies belonging to the Plaintiffs. There was no compulsion to pay the accrued interest otherwise. [13] The Plaintiffs thereafter demanded interest of the balance of the post judgment interest of RM326,053.63 (RM480,868.64 less the sum of RM154,815.01 already paid to avoid double benefit). Problem [14] The Defendant denied that they are liable to pay the post judgment interest as they now argued that the agreed period of six years of pre- judgment interest on the judgment sum covered post judgment interest as well and demanded the return of the sum of RM154,815.01. [15] The relevant part of the judgment read: 7 All judgment sums carry interest at the rate of 8% per annum from the date of filing of the counterclaim (22.9.1998) for the agreed term of six years. [16] An attempt to settle the order as to whether the agreed term of six years would also include post judgment interest before the Deputy Registrar on the 26.11.2011 was unsuccessful. At the request of the Deputy Registrar a joint motion before the same panel of Court of Appeal proved unproductive as the Court of Appeal held themselves functus officio. [17] The Plaintiffs obtained leave to appeal to the Federal Court. However after leave was obtained and at the hearing proper, the Federal Court declined to answer the question posed as they held that the matter was fact-sensitive. [18] Whilst the Motion for clarification before the Court of Appeal was pending the Defendant here abandoned the clarification sought as being irrelevant and demanded the return of RM154,815.01 on 21.2.2013 failing which they would commence legal proceedings. Aggrieved, the Plaintiffs filed an Originating Summons (“OS”) in the High Court for a declaration that they were entitled to post judgment interest. Upon being served with the OS the Defendant objected to the application, stating that the Motion to clarify the order was still pending before the Court of 8 Appeal and therefore the OS was multiplicitous and that the court had no jurisdiction. The OS was struck out on the preliminary objection without being heard on its merits. The Plaintiffs did not appeal against the decision of the High Court striking out the OS as they were of the view that the Motion for clarification was still intact. [19] With the dismissal by the Court of Appeal and subsequently by the Federal Court on the 22.2.2016 there was no variation of the judgment. Parties were back to where they had first started. The Plaintiffs had wanted the Court of Appeal to clarify that the agreement of pre-judgment interest was strictly for 6 years only and that their statutory rights to proceed with post judgment interest on the judgment debt remains intact. The Defendant on the other hand wanted the Court of Appeal to state categorically that the interest of 6 years on the judgment sum included post judgment interest as in that the interest of 6 years was all the interest the Plaintiffs here were allowed. [20] Things came to a head when the Plaintiffs here, on 25.6.2016, filed a fresh action in the Sessions Court, based on a different factual foundation which included their statutory right to claim for the remainder interest of RM326,053.63 on the judgment debt. 9 Pleadings [21] The Defendant cried foul and denied that they owed the balance sum of post judgment interest on the judgment debt. The Defendant also counter claimed for the sum RM154,815.01 being interest on the post judgment debt wrongfully released to the Plaintiffs as the Defendant took the view that no post judgment interest was granted by the Court of Appeal nor the Federal Court. [22] The Defendant further filed an application to strike out the writ and statement of claim on ground that the agreed period of 6 years on the judgment sum awarded on the 2.9.2010 included what the Plaintiffs are now claiming. [23] Further, the Defendant alleged that Court of Appeal and the Federal Court during clarification, had determined and disposed on merits the clarification sought i.e. the agreed period of 6 years on pre- judgment interest included post judgment interest as well and as such res judicata applied. [24] The SCJ allowed on 17.11.2016 the application of the Defendant with costs of RM3,000.00 chiefly on the ground that res judicata applies and that the matter had been decided by the Court of Appeal and the Federal Court when both Courts had dismissed the clarification 10 applications of the Plaintiffs here. Against that decision the Plaintiffs as Appellants here have appealed to this Court against the said decision. [25] In fact the Defendant had also in its Counterclaim prayed to declare the Plaintiffs as vexatious litigants and as the Sessions Court has no jurisdiction on this application, the case was being transferred to the High Court for hearing. [26] For ease of reference and to avoid confusion, the parties shall be referred to as Plaintiffs and Defendant as they appeared in the Sessions Court. Principles [27] Generally a Court would not allow a claim to be struck out without proceeding for trial unless it is so obviously unsustainable or that it is frivolous or vexatious or otherwise an abuse of the process of the court. [28] One need not go further than the Supreme Court’s decision in Bandar Builder Sdn Bhd & Ors v United Malayan Banking Corporation Bhd [1993] 4 CLJ 7. It distilled the law as follows at page 11 para e: “The principles upon which the Court acts in exercising its power under any of the four limbs of O. 18 r. 19(1) Rules of the High Court are well settled. It is only in plain and obvious cases that 11 recourse should be had to the summary process under this rule (per Lindley M.R. in Hubbuck v Wilkinson [1899] 1 QB 86, p. 91), and this summary procedure can only be adopted when it can be clearly seen that a claim or answer is on the face of it “obviously unsustainable” (Attorney General of Duchy of Lancaster v L. & N.W. Ry. Co. [1892] 3 Ch. 274, CA). It cannot be exercised by a minute examination of the documents and facts of the case, in order to see whether the party has a cause of action or a defence (Wenlock v Moloney [1965] 1 WLR 1238; [1965] 2 All ER 871, CA.” [29] The tests for striking out application under Order 18 rule 19 of the ROC, as adopted by the Supreme Court in Bandar Builder can be summarised inter alia as follows: (a) it is only in plain and obvious cases that recourse should be had to the summary process under the rule; (b) this summary procedure can only be adopted when it can be clearly seen that a claim or answer is on the face of it obviously unsustainable (emphasis added) (c) it cannot be exercised by a minute examination of the documents and facts of the case in order to see whether the party has a cause of action or a defence; 12 (d) if there is a point of law which requires serious discussion, an objection should be taken on the pleadings and the point set down for argument under O 33 r 3 of the ROC; and (e) The court must be satisfied that there is no reasonable cause of action or that the claims are frivolous or vexatious or that the defences raised are not arguable. [30] It has been said that so long as the pleadings disclose some cause of action or raise some question fit to be decided by the Judge, the mere fact that the case is weak and not likely to succeed at the trial is no ground for the pleadings to be struck out (Moore v Lawson [1915] 31 TLR 418 CA and Wenlock v Moloney [1965] 1 WLR 1238). [31] As this is an appeal from a decision of a lower Court, learned counsel for the Defendant drew my attention to the principle enunciated in the case of Ratnam v Cumarasamy & Anor [1965] 1 MLJ 228 at p. 229 (para C-D), where the Privy Council held as follows: “The principles upon which a court will act in reviewing the discretion exercised by a lower court are well settled. There is a presumption that the judge has rightly exercised his discretion (Charles Osenton and Company v Johnston [1942] AC 130 p 229 per Lord Wright at 148). The court will not interfere unless it is 13 clearly satisfied that the discretion has been exercised on a wrong principle and should have been exercised in a contrary way or that there has been a miscarriage of justice (Evans v Bartlam [1937] AC 473 p 148).” [32] I also bear in mind the approach taken in the case of Charles Osenton and Company v Johnston [1942] AC 130 (HL) at p.138, where the House of Lords held the following: “The law as to the reversal by a court of appeal of an order made by the judge below in the exercise of his discretion is well established, and any difficulty that arises is due only to the application of well settled principles in an individual case. The appellate tribunal is not at liberty merely to substitute its own exercise of discretion for the discretion already exercised by the judge. In other words, appellate authorities ought not to reverse the order merely because they would themselves have exercised the original discretion, had it attached to them, in a different way.” Whether the Plaintiffs’ claim for post judgment interest is a fresh cause of action based on a statutory right [33] The Plaintiffs’ cause of action is: 14 (i) premised on a judgment debt which is governed by O. 42 r. 12 of the Rules of the High Court 1980 and which has statutory force; (ii) premised on an agreement dated 29.9.2010 by the parties to reserve their rights on the issue of post judgment interest reproduced in a consent order; (iii) premised on rule 15 of the Rules of Court of Appeal 1994; and anyone of which will entitle it to judgment. [34] The power of the High Court to grant interest for the post judgment period is found in section 25(2) of the Courts of Judicature Act 1964 and paragraph 7 of the Schedule to the Act. Section 25(2) of this Act states: “Without prejudice to the generality of subsection (1) the High Court shall have the additional powers set out in the Schedule: Provided that all such powers shall be exercised in accordance with any written law or rules of court relating to the same.” [35] Paragraph 7 of the Schedule to the Act then confers upon the Courts the “Power to direct interest to be paid on debts including judgment debts, or on sums found due on taking accounts between parties, or on sums found due and unpaid by receivers or other persons liable to account to the Court ”. 15 [36] O. 42 r. 12 of the then Rules of the High Court 1980 provides as follows: "Every judgment debt shall carry interest at the rate of 8 per cent per annum or at such rate not exceeding the rate aforesaid as the court directs (unless the rate has been otherwise agreed upon between the parties), such interest to be calculated from the date of judgment until the judgment is satisfied." (emphasis added) [37] The words are clear. It is the default position that every judgment debt comes with and carries with it interest at the rate of 8% per annum. Little wonder that any variation is only with respect to the rate of interest on the judgment debt and not with respect to forgoing interest on judgment debt. If a judgment creditor chooses not to enforce interest on a judgment debt, that then is his prerogative. The law as it stood then granted interest on post-judgment debt as of right. [38] The current Rules of Court 2012 appears to accommodate parties agreement to forgo interest on post judgment debt as can be seen below: "Interest on judgment debts (O. 42, r. 12) 16 12. Subject to rule 12A, except when it has been otherwise agreed between the parties, every judgment debt shall carry interest at such rate as the Chief Justice may from time to time determine or at such other rate not exceeding the rate aforesaid as the Court determines, such interest to be calculated from the date of judgment until the judgment is satisfied." (emphasis added) [39] Post judgment interest had not arisen yet on the date judgment was pronounced on the 2.9.2010. Only upon default of payment of the judgement debt would there arise a claim for post judgment interest. The pre-judgment period of 6 years cannot denote interest which was not due. [40] The Plaintiffs’ contention is that attempts to clarify the said judgment dated 2.9.2010 was unsuccessful as the Court of Appeal held itself to be functus officio. The Federal Court declined to adjudicate as they held that the matter was fact-sensitive. [41] There was thus no judgment pronounced by either the Court of Appeal or the Federal Court and neither were there written grounds of judgment. No notes of proceedings nor court minutes were produced either. 17 [42] However in the Defendant’s application to strike out the Plaintiffs’ claim, the Defendant contended that the Deputy Registrar, the Court of Appeal and the Federal Court during clarification made a determination with precision on the clarification sought. [43] That seems to be contrary to what the Defendant had stated on affidavit that the Court of Appeal was functus when asked to clarify the judgment pronounced. There is also evidence by the Defendant’s counsel, admitted during the course of clarification before the Court of Appeal and the Federal Court that the agreed period of 6 years was in respect of pre-judgment interest. The relevant part of the Defendant’s solicitors averments read as follows: “... I humbly state in relation to paragraph 6 of the AIS that the act on the part of the Applicant to forgo a portion of the prejudgment interest is a wholly separate matter and was in accordance with the recommendation made by the Panel ... Given the foregoing, I humbly state that the Honourable court is functus officio.” [44] As pointed out above, the right of a successful claimant to post judgment interest is a statutory right. For that to be taken away, it must be a case where the claimant, in this case the Plaintiffs here, on successful appeal to the Court of Appeal, had relinquished or waived the post judgment interest altogether. 18 [45] All we can say of the judgment of the Court of Appeal is that it is silent on post judgment interest. It stands to reason that as it is a statutory right and default position, that interest has not been disallowed in the absence of clear words in the judgment. [46] In practice, most counsel would be careful to make sure it is written into the judgment of the Court. If it is not, it does not mean that the successful claimant has lost his right to post judgment interest but simply that he would have to sue for it as indeed the Plaintiffs are doing now in this Sessions Court writ of summons. [47] The Defendant can nevertheless argue that there was an agreement that post judgment interest be waived as the agreement to pre-judgment interest of 6 years would cover post judgment interest as well. However this dispute is not one that is best suited to be decided by way of affidavit evidence as each side is taking diametrically opposite positions. [48] At the trial the Court would of course want to hear from the Plaintiffs why they could not be said to have foregone their post judgment interests. Vital to this consideration would be why they would want to waive what was their statutory right under the old O. 42 r.12 RHC 1980. The Court would have to decide on the balance of probabilities whether it is reasonable for the Plaintiffs to have freely and 19 voluntarily agreed to confine themselves to a pre-judgment interest of 6 years and giving full liberty to the Defendant to pay as and when they feel like it on the pain of execution as there would be no post judgment interest that the Defendant need to bother. More than that, would it be reasonable to have the use of the judgment debt with no incentive to pay but every incentive to delay and drag payment on the pain of execution as while the Plaintiffs are deprived of the judgment debt, the Defendant has the advantage of using the said money for whatever purpose they deem fit even if it be the mere putting of the judgment debt into an interest-earning account?! Whether the Plaintiffs have a valid cause of action for post judgment interest based on the stay of execution agreement of 29.9.2010 [49] The Plaintiffs’ cause of action is also based on the stay of execution agreement of dated 29.9.2010 hammered out between the parties because the Plaintiffs were threatening a winding up action for inability of the Defendant to pay a judgment debt. [50] Assuming that the Plaintiffs could not claim post judgment interest because they had consented to the interest to be confined to just 6 years from the filing of their Counterclaim and that they have waived post judgment interest, there is then the terms of the stay of execution 20 agreement at p 272 Record of Appeal 2, that is enforceable by the Plaintiffs. [51] By the proviso to clause 4 of the said stay of execution agreement, in consideration of the Plaintiffs agreeing to stay execution proceedings including proceedings to wind up the Defendant (paragraph 3), the Defendant agreed to reserve the right of the Plaintiffs to post judgment interest, on the judgment debt of RM4,919,200.00 which was placed on fixed deposit pending the outcome of the Appeal to the Federal Court. The proviso to post judgment interest on the judgment debt also preserved the rights of both parties to post judgment interest and was only contingent upon the outcome of the Appeal to the Federal Court. [52] Accordingly the stay of execution agreement contained an express proviso reserving the right of both parties on the issue of post judgment interest. [53] The issue of post judgment interest is governed by O. 42 r. 12 of the RHC 1980. The consideration for agreeing to stay execution of the judgment was the right to post judgment interest in the event the appeal by the Defendant should fail and that the said sum be parked with the joint solicitors account as stakeholders pending the outcome of the appeal to the Federal Court by the Defendant here. Otherwise there was no reason for the Plaintiffs to stay execution. They could and would have 21 continued with execution proceedings and gotten their monies without having to wait for the outcome of the appeal. The Defendant is estopped from rejecting the burden imposed on them having taken the benefit of the agreement. The agreement dated the 29.9.2016 was embodied in a Consent Stay Order which is way after the Court of Appeal’s order of judgment of 2.9.2010. The Consent Stay Order of 11.10.2010 provided at para (iii) that the consent order is without prejudice to the rights of the parties on the issue of post judgment interest (Exhibit MKR 5 p 49 Appeal Record I). [54] In Anthony v Tasmanian Alkaloids Pty Ltd (LDR 77/2000 2005 Tassc) 68 the court held: “A stay order should be regarded as a separate action entered into after judgment.” [55] The words ‘without prejudice to the right of both parties on the issue of post judgment interest’ in clause 4 of the agreement meant that there was every entitlement on the part of the successful party in the Federal Court appeal to make an application for post judgment interest or to make a separate claim on post judgment interest under O. 42 r. 12 RHC 1980. See the case of Re Sri Datuk Lau Gek Poh [2012] HKCU 392 page 6 para 56, 58. 22 [56] A Consent Order is nothing more than an agreement for valuable consideration that has been entered into by parties entitling the aggrieved party to commence an action for failure of the Defendant to pay the balance of the sum due. In the present case the Plaintiffs have a right to commence action against the Defendant for failing to pay the balance of the post judgment interest pursuant to the stay of execution agreement that was embodied in a Consent order. [57] The rationale for the proviso to the stay of execution agreement is this: in agreeing to a stay, the Plaintiffs were going to be kept out of their money and the consideration was that in the event they should succeed in the appeal as in the Court of Appeal’s decision being affirmed by the Federal Court, they will be entitled to interest as compensation for being kept out of their monies. Likewise if the Defendant should succeed in their cross appeal and was awarded damages they would have been entitled to post judgment interest. [58] It was clear that both parties reserved their rights on the issue of post judgment interest. At that stage it is anybody’s guess what the outcome of the Federal Court would be. In the event the Plaintiffs’ claims are dismissed and the Defendant’s claims are allowed, then post judgment interest shall go to the Defendant. The Defendant did not want to forgo this as there was no good reason to. Likewise the Plaintiffs were 23 prepared to stay the winding up and other modes of execution as the judgment sum plus pre-judgment of interest of 6 years would be paid to a joint-solicitors’ interest bearing account. In fact what happened was that upon the Defendant’s appeal being dismissed by the Federal Court on 13.12.2011, the post judgment interest became due. Therefore so much of it as has been earned was paid by the Bank to the Plaintiff following the Defendant’s solicitors instruction to the Bank on the 21.11.2011 directed the bank unconditionally to make payment of the judgment debt including all accrued interest to the Plaintiffs’ solicitors as being monies belonging to the Plaintiffs. See p 279 Appeal Record 2. There was no contractual obligation to pay the accrued interest otherwise. [59] Was it an oversight on the part of the Defendant’s solicitors or perhaps more consistent with their understanding of the stay of execution agreement that the interest on post judgment debt should be paid over to the Plaintiffs as the Federal Court had dismissed the Defendant’s appeal and with that had affirmed the judgment of the Court of Appeal in favour of the Plaintiffs? [60] Even if the judgment is silent, yet there is still the stay of execution agreement that the Plaintiff is now relying on to found its cause of action for the balance of the post judgment interest. 24 [61] In Parker Flowerbulbs Pty Ltd v Coulter [2004] 212 ALR 605 the Federal Court of Australia held that there is no reason why a judgment creditor should be deprived of interest that would otherwise automatically accrue from the time that judgment was entered merely because the judgment debtor has been granted a stay of execution. [62] In Jones and Others v Secretary of State for Energy and Climate Change and Another [2014] 3 All ER 956 the Court of Appeal in UK held that the payment of interest was contingent on the claim being successful and thus the liability to pay interest crystallised when the claim was successful. [63] I see no good reason why this claim should not go for trial. Though the Plaintiffs had applied for summary judgment for this claim in Enclosure 14, they nevertheless appreciate that the matter should proceed to trial as the Defendant had raised issues that are fact- sensitive, requiring witnesses to be called. [64] Any doubts on the intention of the parties in the stay of execution agreement that had been encapsulated in the Consent Stay Order that would allow the Plaintiffs to claim for post judgment interest must certainly be ascertained at trial and not summarily determined and dismissed altogether by striking out the Plaintiffs’ claim at this stage. 25 Whether the Plaintiffs have a valid cause of action for interest on post judgment debt during the period of stay of execution of judgment pursuant to Rule 15 of the Rules of the Court of Appeal 1994 [65] The Plaintiffs’ claim is also premised on Rule 15 of the Rules of the Court of Appeal 1994. [66] As a result of the appeal filed by the Defendant and the stay that was granted, the Plaintiff’s execution of the judgment debt was postponed and the Plaintiffs were denied interest until the appeal was heard and disposed of. [67] Rule 15 of the Rules of the Court of Appeal 1994 clearly provides for successful parties entitlement to interest, for such time as execution has been delayed by the appeal pursuant to Rule 15 of the Rules of the Court of Appeal 1994. It is equivalent to damages for detention of the judgment debt. It reads: “15. On any appeal, interest, for such time as execution has been delayed by the appeal, shall be allowed, unless the Court otherwise orders, and the Registrar may compute such interest without any order for that purpose.” 26 [68] Whether or not the Court of Appeal has otherwise ordered when parties have entered into a stay of execution agreement that had been recorded as a Consent Stay Order by the Court of Appeal would be a matter that has to go for trial as the Plaintiffs have asserted that they have included post judgment interests as part of the consideration for the stay and that the interests earned in the joint solicitors account is to be paid over to the Plaintiffs should the Defendant fail in the Federal Court to get the judgment of the Court of Appeal set aside. These interests were indeed paid over to the Plaintiffs and treated as going towards reduction of the 8% per annum of the judgment debt that the Plaintiffs said the Defendant had agreed as part of the consideration for stay of execution. Whether res judicata applies to bar the Plaintiffs’ claim for post judgment interest as both the clarifications in the Court of Appeal and Federal Court had been dismissed [69] On the issue of res judicata, the Defendant drew the Court’s attention to the landmark judgment of the Supreme Court in the case of Asia Commercial Finance (M) Bhd v Kawal Teliti Sdn Bhd [1995] 3 MLJ 189 at p. 197 (para H-I) & 198 (para A-B), where the Supreme Court held the following: 27 “What is res judicata? It simply means a matter adjudged, and its significance lies in its effect of creating an estoppel per rem judicatum. When a matter between two parties has been adjudicated by a court of competent jurisdiction, the parties and their privies are not permitted to litigate once more the res judicata, because the judgment becomes the truth between such parties, or in other words, the parties should accept it as the truth; res judicata pro veritate accipitur. The public policy of the law is that, it is in the public interest that there should be finality in litigation – interest rei publicae ut sit finis litium. It is only just that no one ought to be vexed twice for the same cause of action – nemo debet bis vexari pro eadem causa …” [70] As pointed out by the Defendant, there are specific provisions of law which bar a fresh action based on the doctrine of res judicata as in section 40 of the Evidence Act 1950 which reads as follows: “Section 40. Previous judgments relevant to bar a second suit or trial - The existence of any judgment, order or decree which by law prevents any court from taking cognizance of a suit … is a 28 relevant fact when the question is whether the court ought to take cognizance of the suit …” [71] Whilst perhaps things could have been clearer, what cannot be seriously disputed was that the attempt to clarify the order or judgment of the Court of Appeal of 2.9.2010 was unsuccessful as the Court of Appeal held that it was functus. [72] It may be argued on behalf of the Plaintiffs that the Court of Appeal would not be acting to take away a statutory right to interest on a post judgment debt unless of course the Plaintiffs had agreed, and the Plaintiffs have vigorously and vehemently denied that. To the Plaintiffs there was no good reason to have agreed to forgo post judgment debt for then there would be no incentive for the Defendant to pay. [73] I can appreciate the Defendant’s argument that conversely the Court of Appeal could have allowed the words “together with interest at the rate of 8% per annum on the judgment debt from the date of judgment to realization” and parties would not be before the Court today. [74] As I said things could have been clearer but I am not prepared to say that silence on the Court of Appeal to clarify must invariably mean that the parties have been persuaded to cap the interest at 6 years pre- judgment irrespective of when this judgment sum plus interest is paid 29 finally. The Court of Appeal must be presumed to have known the position of the law on post judgment interest under O. 42 r. 12 RHC 1980 and more so when it had been submitted upon. One can surmise that it was not expressly spelt out because the parties had not specifically drew the Court of Appeal’s attention to the matter of post judgment interest and so the default position would apply. [75] The only hiccup would be that the Plaintiffs would now have to make a separate claim for the post judgment debt interest as they have done now. In the Canadian case of Imperial Roadways Ltd v Canadian Pacific Ltd (1982) 28 C.P.C. 151 the court entertained an application for post judgment interest. The court held that under section 40(1) of the Judicature Act the judgment bore interest from the time the judgment was pronounced. As the issue of post judgment interest was not raised it had now to be dealt with and the trial judge had jurisdiction to do so. [76] At this stage, we can only take note of the defence asserted by the Defendant and which defence they had reaffirmed in their affidavits that there was an agreement when the Court of Appeal pronounced the judgment that parties were persuaded to agree not just to limit the pre- judgment interest to just 6 years but that this limitation of interest covers post judgment debt interest as well. 30 [77] Surely that issue has to go for trial in a conflict of affidavits’ evidence from both sides. To decide summarily would be to prejudge the matter without hearing the parties’ oral testimonies of what happened on the day the Court of Appeal pronounced the judgment. [78] When the matter reached the Federal Court, both sides were waiting expectantly for the Federal Court to answer the questions posed which includes whether the Court of Appeal may deny a successful claimant of post judgment debt interest when O. 42 r. 12 RHC 1980 allows for it. To be precise the question that was allowed to be referred to the Federal Court is as follows: “Has the Court of Appeal the jurisdiction to make a fundamental variation of a radical nature of its own judgment on the substantive and statutory right of a successful party to post judgment interest under Order 42 Rule 12 of the Rules of the High Court 2012 by adding to the judgment an order denying the successful party of such interest, although the amendment does not concern the slip rule or that of its inherent jurisdiction to vary an order so as to carry out its own meaning on a mere clarification?” [79] The Federal Court in its wisdom had declined to answer the question posed as they were of the view that the matter was fact- sensitive. This fact has also been admitted by the Defendant’s counsel. 31 [80] One can appreciate why the Federal Court took that approach as if the Plaintiffs had agreed on the waiver of post judgment debt interest than the question does not arise. [81] There was in a very real sense no judgment pronounced by either the Court of Appeal or the Federal Court and neither were there written grounds of judgment. No notes of proceedings nor court minutes were produced either. [82] In the light of the above, can it be said that the issue of post judgment interest has been determinatively decided by the Court of Appeal and Federal Court and with it that res judicata applies? I do not think so. There are a legion of cases to support such a conclusion that there is no res judicata unless an issue has been specifically raised and determined with precision. [83] What was clear was the stand and stance taken by the Defendant through their learned counsel. In the Affidavit in Reply by Mr Mohana Krishan, learned counsel for the Defendant dated 24.4.2012 filed in the Court of Appeal no. W02-1094-2009 the following statement was made by him in paragraph 6: “... I humbly state that this Honourable court is functus officio.” 32 [84] Than at paragraph 27 of the Defendant’s counsel’s written submission dated 12.3.2015 filed in the Federal Court No. 02(F)69- 09/2014(W) where the Defendant stated as follows: “The Learned Justices of the Court of Appeal stated that there was nothing to clarify as the Broad grounds of Judgment was clear enough. The learned Justices of the Court of Appeal further pointed out that they were effectively functus officio given that the substantive appeal in respect of the COA Order had already been heard and disposed of in the Federal Court and judgment delivered on the 14.12.2011.” [85] It must not be forgotten that by the time the parties sought clarification the Federal Court had disposed of the substantive Appeal of the Defendant against the judgment of the Court of Appeal in favour of the Plaintiffs and dismissing at the same time the Defendant’s claim. There was then the issue of post judgment interest because the Defendant had taken the position that there was no such interest ordered and so the Plaintiffs are not entitled to it. [86] In the Federal Court Civil Appeal No. 02(F)-69-09/2014(W) Mr Mohana Krishnan, the Defendant’s counsel in the review application filed by the Defendants to review the Federal Court’s decision to dismiss the 33 reference on the question of law posed, in an affidavit affirmed on the 21.7.2015 stated in paragraph 24(1); “I verily believe that this Honourable Court held that the nature of the Applicants appeal was fact-sensitive and on that basis declined to answer the question posed, which the appellate court is not prevented from doing.” [87] In all these clarification exercises and excursions it must not be forgotten that a clarification does not vary the judgment of the Court of Appeal order and indeed it cannot. It merely clarifies and it is said that a court that clarifies its own order does not make a decision. The High Court in Chong Su Kong & Ors v Sia Hiong Tee & Ors [2013] 10 MLJ 317 has held that clarification is not itself a judgment, order or decision but a clarification of some ambiguity. It did not change the judgment. [88] What we have so far that cannot be seriously contested are as follows: (i) there was nothing to clarify before the Court of Appeal as they took the view that they were functus as by then the decision had been affirmed by the Federal Court; 34 (ii) the Federal Court declined to answer the question as the appeal was fact-sensitive and the Federal Court is not in the habit of answering hypothetical questions; (iii) the agreed 6 years was stated as applying to the pre-judgment period only; (v) the clarification of judgment was referred to the same panel of the Court of Appeal by the Deputy Registrar when he was unable to settle the order. [89] In Serac Asia Sdn Bhd v Sepakat Insurance Brokers Sdn Bhd [2013] 5 MLJ 1 at p.18 the Federal Court held as follows: “[44] … once a regularly obtained order or judgment had been perfected, the court was functus officio. The matter, as decided vide encl. 6, was thus res judicata and could not be re-litigated. The order made under encl. 6 was appealed and affirmed right up to the Federal Court. It could not now be revisited or re-asserted under any guise in a subsequent proceeding. The issues raised by the respondent in encl 29 could have been brought up during the appeal process. The law does not allow the respondent to have a second bite of the cherry and in the manner as it did. 35 … the re-litigation of a regularly and properly concluded matter as determined by the court is prohibited by the wide doctrine of res judicata. The judicial process rests on the twin pillars of certainty and finality. A final order or a judgment must therefore be vigorously protected by this doctrine” [90] I have no problem with the above proposition of law. The question is whether at this stage one can say that the Plaintiffs are not entitled to claim for post judgment interest unless they have waived their entitlement under O. 42 r. 12 RHC 1980. There was further the stay of execution of agreement reflected in the Consent Stay Order where this right to post judgment interest had been preserved and reserved by both parties. [91] I agree with the Plaintiffs that the Court before whom this claim has been brought will need to consider these admitted facts when it looks at all the surrounding factors to weigh and evaluate contemporaneous documents and oral evidence that may tend to establish the truth or otherwise of the disputed fact as to whether the parties have agreed to confine interest on judgment sum to just pre-judgment period of 6 years or that parties have agreed to waive post judgment interest or that the Plaintiffs had not agreed to waive post judgment interest though this interest element is stated in the judgment of the Court of Appeal. 36 [92] A full trial is necessary and should not be dispensed with and more so when the default position is that under the then O. 42 r. 12 RHC 1980 with interest at 5% per annum on the judgment debt from the date of judgment to realization. [93] I agree with the Plaintiffs that looking at the pleadings and the lengthy affidavits with various documentary exhibits filed therein, there is serious conflict on material facts and conflict of evidence particularly relating to issue of what was agreed upon on the 2.9.2010 and the clarification sought thereafter. This conflict can only be resolved by subjecting the deponents of the various affidavits to cross-examination and can only be evaluated by the court after seeing and hearing them. [94] With respect to the OS that was filed by the Plaintiff in the High Court before the Motion of clarification was heard in the Court of Appeal, the Plaintiffs were constrained to file it when the Defendant declared the Motion for clarification pending in the Court of Appeal irrelevant and demanded the return of RM154,815.01 on the 21.2.2013. Upon being served with the OS the Respondents objected stating that the Motion to clarify the order was still pending before the Court of Appeal and therefore the OS was multiplicitous and the court had no jurisdiction. The OS was struck out without being heard on its merits. Secure that the motion for clarification was intact, the Plaintiffs did not appeal the 37 decision. As the OS was not heard on the merits there is no room for res judicata to apply. Whether the issue of post judgment interest has been disposed of determinatively and with precision. [95] It is the Defendant’s contention that the clarification sought on the Order dated 2.9.2010 has determined that the pre-judgment interest for the agreed term of 6 years on the judgment sum covered both pre- judgement interest and post judgment interest and therefore res judicata applied. [96] The Plaintiffs on the other hand, took the stand that neither the Court of Appeal nor the Federal Court made any determination with precision in respect of the clarification sought. [97] In the case of Puah Kim Yen & Ors v Maju Steel Sdn Bhd [2013] 1 LNS 115 the Defendant applied to strike out the case on grounds of res judicata. The High Court held that at page 487 para 26 F: “... the doctrine of res judicata has its roots in equity and is designed to achieve justice, a court may decline to apply it where to do so would lead to an unjust result. The court referred to numerous authorities in support.” 38 [98] In the present case what the Plaintiffs are asking is plain. They wanted to be compensated for being kept out of the judgment debt for 13 months from the date of judgment in the Court of Appeal where the High Court’s decision to dismiss their Counterclaim was reversed. They see no good reason why they should be kept out of the use of the judgment debt for that period when conversely the Defendant as judgment debtor could have the benefit of the said judgment debt not paid out and earning interest presumably or being deployed to yield other investment returns. I accept that this is in keeping with the fundamental principle regarding the payment of interest to compensate the claimant for loss of use of funds, not to mention the statutory entitlement of the claimant to it. The issue of whether or not the Plaintiffs had agreed to waive this and to forgo interest post judgment would be something that has to go for trial. The question of why the Plaintiffs as successful judgment creditors would want to forgo their post judgment interest would become apparent at the trial if indeed it is true. [99] All that the Plaintiffs have to show at this stage to resist the Defendant’s application to strike out the suit under O. 18 r. 19 ROC is some evidentiary basis to merit the action proceeding to trial. [100] Far from being caught by res judicata, the Plaintiffs’ action in the present case is premised on distinct and separate causes of action 39 which include the stay of execution agreement to reserve the right to post judgment interest, the terms of which were embodied in a Consent order, its statutory right under O. 42 r. 12 Rules of the High Court 1980 and the remedy under Rule 17 of the Rules of the Court of Appeal. [101] As a clarification is not itself a judgment, order or decision but a clarification of some apparent ambiguity, no decision is made. This is even clearer when as in this case, there was no variance to the order after the clarification. It does not change the order which has been pronounced but only serves to make clear what might have appeared to be cloudy. See Chong Su Kong & Ors v Sia Hiong Tee & Ors [2013] 10 MLJ 317. [102] In Farlim Properties Sdn Bhd v Goh Keat Poh & Ors And Other Appeals (2003) 4 MLJ 654, on almost identical issues with the present case, the principal issue for determination was whether the Federal Court decision and the Court of Appeal decision in the aforesaid cases had decided with precision the point in issue and the Court held at page 666 para E: “When the plea of res judicata is raised it is necessary to identify with precision the issue that was decided in the earlier proceedings. In Tong Lee Hwa & Anor v Lee Yoke San [1979] 1 MLJ 24, Chang Min Tat FC held that to constitute a res judicata, 40 the earlier judgment must in terms of the Privy council decision in Kok Hoong v Leong Cheong Kweng Mines Ltd [1964]MLJ 49 ‘necessarily and with precision’ determine the point in issue. ... It is trite law that for res judicata to apply the proceedings must have resulted in a final judgment or decree, that is to say, the one which adjudges the ultimate rights of the parties of finally puts the case out of court. (page 666 para I)” [103] The court in Ramal Properties Sdn Bhd v East West-Umi Insurance Sdn Bhd [1998] 5 MLJ 233 held, at page 290, para G that for res judicata to apply the existence of a previous judgment is the very essence and a sine qua non for the doctrine of res judicata: “It is evident that the existence of a previous judgment is the very essence, and sine qua non of the doctrine of res judicata. Without a previous judgment on the merits of the cause of action or issue, there is simply no res judicata, for ‘res’ simply means ‘a thing’ and ‘judicata’ means ‘adjudicated’. Having held that res judicata could not apply to the instant case, it followed therefore that the plea of estoppel must perforce equally fail.” [104] The court in Thein Hong Teck & Ors v Tra Mining (Malaysia) Sdn Bhd & Ors [2013] MLJU 249 held that for res judicata to apply 41 there must be a decision on merits. The court went on to hold that the parties arguments are irrelevant in so far as the court has not made a final decision on a specific point. In determining if a decision was made the court needs to look at the notes of evidence and if there is no reason given for its decision it is unlikely that a court in later proceedings will find that there is identity of the subject matter and bar a claim for res judicata. [105] The Federal Court in Tong Lee Hwa & Anor v Lee Yoke San [1979] 1 MLJ 24 held that it had not shown that the court had with precision determined the point in issue and therefore res judicata did not apply as can be seen at page 24 para G as follows: “At the hearing of the appeal, it was put to counsel for the appellants that to constitute a res judicatura, the earlier judgment must judgment must in terms of the Privy Council decision in Kok Hoong v Leong Cheong Kweng Mines Ltd [1964] MLJ 49 ‘necessarily and with precision’ determine the point in issue and he was asked to indicate to the court how the earlier judgment did necessarily and with precision determine the liability of the appellants to pay the respondent for work done. He did not do so.” [106] In the case of Afad Sha Sdn Bhd v SPPIK Dagang Sdn Bhd & Anor [1997] 4 MLJ 90 the court held that both parties were at 42 diametrically opposed views on this, it became necessary for the court to read the minutes of the entry of the court file to know with precision what had been decided. The court there had the benefit of the minutes. At page 100 it was observed as follows: “It was the submission of En Faiz for the defendants that when Abdul Malek bin Hj Ahmad J rejected his application for stay (encl 30) he had said clearly that since there was no appeal pending (as the Court of Appeal had already dismissed the defendants’ application for leave to appeal to the Court of Appeal) there was no basis to continue with the hearing of encl 30. He contended that therefore the issue of locus standi of the plaintiff was not decided at that time. At this stage since both parties were at diametrically opposed views on this, it became necessary for the court to read the minutes of the entry of the court file on 4 October 1995. I read aloud the minutes as produced above for both counsel to hear. The minutes showed that the learned judge did not make a decision even though he heard submissions and he dismissed the application on the basis that since there was no appeal there was no reason for a stay to be granted. It must be noted that the learned judge had heard arguments 43 and reserved judgment. However, before he could decide the Court of Appeal had already dismissed the defendants’ motion. On this issue alone I decided that there was no question of the principle of res judicata being applicable and rule against the plaintiff in its preliminary submission. I then called upon En Faiz to address me fully on his application.” (emphasis added) [107] At the risk of being repetitive, the Court of Appeal declined to clarify as they were of the view that the order was clear and that they were functus anyway. The Federal Court declined to answer the questions of law posed as they were or the view that the matter is fact- sensitive. Whether to strike out the Plaintiffs’ claim for post judgment interest at this stage before trial would be to allow the Defendant to unjustly enrich themselves [108] In the case in Perak Motor Co Sdn Bhd v Estate Pekebun Kecil Sdn Bhd [2006] MLJU 386, the court followed the principle enunciated in Terengganu State Govt v Nadefinco [1982] 1 MLJ 365 which referred to the purpose of awarding interest. 44 [109] In Perak Motor Co (supra), what happened was that Perak Motor was required to pay a judgment sum to Espek, the defendant, together with interest for pre-judgment of 14% per annum and post judgment interest at 8% per annum. On Appeal the Court of Appeal had slashed down the pre-judgment interest to 8% per annum and also reduced the period of interest from date of filing of the writ to date of judgment. [110] As Perak Motors had paid over the judgment debt and interest in the meanwhile, of RM817,453.37 to Espek they sought a declaration from the High Court that the defendant has been unjustly enriched and filed an application for a declaration that the defendant among others have derived a benefit when they retained an excess sum of RM265,117.57 which was not paid gratitiously to them and having retained the said sum for six years and enjoyed benefits for the use thereof. [111] The plaintiff, Perak Motor, further sought a declaration that they are entitled for the return of a sum amounting to RM121,038.88 being the interest quantified on the said amount retained by the defendant from 1.7.1984 to 15.10.2002. [112] Following the above decision of the Court Of Appeal reducing the rate of interest from 14% to 8% there was therefore an overpayment of RM265,117.57 by Perak Motor (hereinafter referred to as overpayment 45 sum). On 15.11.2002, Solicitors for Perak Motors wrote to Espek requesting for the refund of RM265,117.57 and a further sum of RM121.038.88 being interest calculated at 8% per annum on the said overpayment sum as exhibited in exhibit "YTC2" of Enclosure 2. On 17.2.2003 Espek refunded the overpayment sum of RM265.117.57 and via a latter dated 18.2.2003 Perak Motor's solicitors accepted the said sum on a without prejudice basis and were still demanding for the interest amount of RM121.038.88 as shown in Exhibit "YTC5" of the same enclosure. [113] Perak Motors prayed for a declaration among others that they were entitled to recover the said sum of RM121,038.88 which represents the interest on the overpayment sum of RM265,117.57 which Espek had benefited from. The High Court held as follows: “Foremost in the plaintiff's contention is the principle of restitution and unjust enrichment. For the last seven years (from 17.3.1997 to be exact), Espek has retained the overpayment sum and has benefited from it. To allow Espek to keep the money and claimed benefits from it in the form of interest and for its use which rightfully is not theirs would amount to unjust enrichment and that would in turn entitles Perak Motor to claim for restitution. 46 Unjust enrichment and restitution goes hand and hand. Justice Gunn Chit Tuan (as he then was) in New Kok Ann Realty Sdn. Bhd. v Development & Commercial Bank Ltd New Hebrides (in liquidation) (1987) 2 MLJ 57 in quoting the English decision of Fibrosa Spolk Akeyjna v Fairbairn Law Son Combe Barboer Ltd. (1943) AC 32 stated at page 64 : "It is clear that any civilized system of law is bound to provide remedies for cases of what has been called unjust enrichment or unjust benefit, that is to prevent a man from retaining the money of or some benefit claimed from another which it is against conscience that he should keep. Such remedies in English law are generically different from remedies in contract or in tort, and are now recognized to fall within a third category of the common law which has been called quasi contract of restitution." [114] Further, it was held: Unjust enrichment as a principle of justice has been explained by Lord Goff of Chieveley and Gareth Jones QC in The Law of Restitution (Fifth Edition) at page 11: http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.3577847276170061&bct=A&service=citation&risb=21_T26311370300&langcountry=MY&linkInfo=F%23MY%23MLJ%23vol%252%25sel1%251987%25page%2557%25year%251987%25sel2%252%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.6159255426725817&bct=A&service=citation&risb=21_T26311370300&langcountry=MY&linkInfo=F%23GB%23AC%23sel1%251943%25page%2532%25year%251943%25tpage%2564%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.6159255426725817&bct=A&service=citation&risb=21_T26311370300&langcountry=MY&linkInfo=F%23GB%23AC%23sel1%251943%25page%2532%25year%251943%25tpage%2564%25 47 "Most mature systems of law have found it necessary to provide outside the fields of contract and civil wrongs for the restitution of benefits on grounds of unjust enrichment. There are many circumstances in which a Defendant may find himself in possession of a benefit which, in justice, he should restore to the Plaintiff. Obvious examples are where the Plaintiff has himself conferred the benefit on the Defendant through mistake or compulsion. To allow the Defendant to retain such a benefit would result in his being unjustly enriched at the plaintiff's expense, and this, subject to certain defined limits, the law will not allow. Unjust enrichment is simply, the name which is commonly given to the principle of justice which the law recognises and gives effect to in a vide variety of claims of this kind." The principle of unjust enrichment and restitution has found a place in our legal system which is embodied in Section 71 of the Contracts Act 1950. The section provides: "Where a person lawfully does anything for another person, or delivers anything to him, not intending to do so gratuitously, and such other person enjoys the benefit thereof, the latter is bound to make compensation to the http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.9072325945139038&bct=A&service=citation&risb=21_T26311370300&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%2582%25section%2571%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.6721391643887082&bct=A&service=citation&risb=21_T26311370300&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%2582%25 48 former in respect of, or to restore, the thing so done or delivered.” Section 71 of the Contracts Act 1950 is similar to Section 70 of the Indian Contract Act. According to Pollock and Mulla on the Indian Contract and Specific Relief Act (9th Edition) at page 497 there is good authority for saying that Section 70 of the Indian Contract Act was framed within its present form with a view to avoid niceties of English Law on the subject of quasi contract. According to the authors of the said book the section is not founded on contract but embodies the equitable principle of restitution and unjust enrichment. According to them the principle of unjust enrichment falls under Section 69 and 70 (Section 70 and 71 of our Contract Act). But these sections are wider in scope than the doctrine as applied in England and go far beyond it. The terms of Section 71 of the Contracts Acts 1950 are unquestionably wide but applied with discretion they enable the Courts to do substantial justice in cases where it would be difficult to impute to the persons concerned relations actually created by contract. [See: New Kok Ann Realty Sdn. Bhd. v Development and Commercial Bank Ltd. New Hebrides (in liquidation) (above)]. http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.9302778983167643&bct=A&service=citation&risb=21_T26311370300&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%2582%25section%2571%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.0913581081214897&bct=A&service=citation&risb=21_T26311370300&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%2582%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.3407557397794143&bct=A&service=citation&risb=21_T26311370300&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%25136%25section%2570%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.9580811043150661&bct=A&service=citation&risb=21_T26311370300&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%25136%25section%2571%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.7634729443075856&bct=A&service=citation&risb=21_T26311370300&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%25136%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.7634729443075856&bct=A&service=citation&risb=21_T26311370300&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%25136%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.5825148595388079&bct=A&service=citation&risb=21_T26311370300&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%25136%25section%2571%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.0741404319528377&bct=A&service=citation&risb=21_T26311370300&langcountry=MY&linkInfo=F%23MY%23USM_PA%23act%25136%25 49 On the facts of the case, it is without doubt that in so retaining the overpayment sum, Espek has been unjustly enriched. The payment made by Perak Motor in consequence of the Judgment of the High Court is far from being gratuitous and Espek has actually enjoyed the benefits from its retention. The money must have been made use of or could have been used and even if it has not been so, it would have earned interest. Espek has definitely done the right thing in refunding the sum of RM265,117.57 to Perak Motors for no Court of law would have allowed them to do so. The benefit which Espek has gained by retaining the overpayment sum may be quantified in the form of interest that the said sum would have earned during the period. That benefit rightfully must belong to Perak Motors and they must be granted the right to enjoy such benefit.” (emphasis added) [115] It can be seen that though the Court of Appeal did not state that the Plaintiff should be entitled to interest on the amount overpaid for the period during which the Defendant Espek had wrongly withheld the monies, that was no bar or prohibition against the Plaintiff claiming both on the ground of unjust enrichment and restitution. 50 [116] The Plaintiffs castigated the failure on the part of the Defendant in the present case lay in their failure to recognise and approach interest in two distinct stages – that for pre-judgment interest (covered by Section 11 of the Civil Law Act 1956) and post judgment interest (covered by O. 42 r. 12 Rules of High Court 1980) as follows: (i) Pre-judgment period – The length and extent of compensation of the pre-judgment period differs according to the circumstances of the case (eg. reason for the delay in prosecuting the case, etc) and what is reasonable is left to the discretion of the court. (Section 11) (ii) Post judgment period – interest is governed by the relevant statutory provisions (Section 16(i) of the Court of Judicature Act 1965) and Rules of Court 2012 or its predecessor the RHC 1980 (O42 r 12) concerning the period (date of judgment to realization). [117] The court in Pentadbir Tanah Wilayah Persekutuan Kuala Lumpur v Bangsar Hill Holding Sdn Bhd [2015] 8 MLJ 317 at pg 329 para 23-25 and page 331 para 35, 46 explained the distinction between pre and post judgment interest with lucid clarity. [118] Arising out of the failure to appreciate the above, the Plaintiffs argued, the Defendant has now erroneously contended that the Plaintiffs are asking for more monies on the judgment sum. What the Plaintiffs are 51 now claiming is their entitlement to post judgment interest which no Court has deprived them of and more than that which statutorily they are entitled to and which they said they have not waived or forgone. They should be allowed their day in Court for otherwise the specter of the Defendant having unjust enriched themselves at the expense of the Plaintiffs would be hovering over this case. [119] There are merits in the submission of the Plaintiffs that they are not asking for more monies on the judgment sum. They are asking to be compensated for being kept out of the judgment debt for 13 months. It is in keeping with the fundamental principle regarding the payment of interest which is to compensate the claimant for loss of use of funds. It is provided for statutorily. (O. 42 r. 12 of the RHC 1980; Rule 17 of the Rules of the Court of Appeal 1994). It was only fair that where a person had kept another out of funds he should be held liable for the loss of use of the funds. Section 6(3) of the Limitation Act 1953 provides that an action to recover arrears of interest must be brought within six years of the judgment and it distinguishes between pre and post judgment interest. See Re: Lim Ah Hee; ex p Perwira Affin Bank Bhd (2000) 3 MLJ 211. [120] The Plaintiffs are invoking the power of the Court in accordance with the Rules of High Court 1980, O. 42 r. 12 for the order in respect of 52 post judgment interest on the judgment debt. The language used in O. 42 r.12 RHC 1980 is mandatory in that “Every judgment shall carry interest at the rate of 8% per annum...” [121] The Plaintiffs were kept out of the judgment debt from the 2.9.2010 to the 21.12.2011 when it was finally paid. The Court of Appeal in Re: Lim Ah Hee; ex p Perwira Affin Bank Bhd [2000] 3 MLJ 211 stated at page 217 para A that: “The correct interpretation of the second limb of s 6(3) of the Limitation Act concerns post judgment interest and not the award of interest up to the date of judgment (pre judgment interest) as the latter together with the principal sum awarded in the judgment themselves constitute the judgment debt. Any interest due after the date of judgment is limited to six years and a creditor can recover it by way of a fresh action.” (emphasis added) [122] In Transmile Elite Equipment Rental Sdn Bhd v PSC-Naval Dockyard Sdn Bhd (2003) 4 MLJ 30 the court dealt with pre and post judgment interest comprehensively and defined the meaning of judgment debt as including both the principal sum and the pre judgment interest which merged to constitute the judgment debt. It was held at page 279 para f-h, 2980 para a: 53 “[1] That the post-judgment interest on the “judgment debt” ought to have been on the total sum of both the principal sum and the pre-judgment interest for the following salient reasons: (1) that both the principal sum and the pre-judgment interest (which represented damages for the period in which the plaintiff could not use the principal sum) merged into the judgment debt on 24 June 2002; (2) this is prescribed by statute, namely O. 42 r.12 of the Rules of the High Court 1980, and there was no room, at all, for the exercise of discretion by the learned SAR to award post-judgment interest on only the principal sum and not the judgment debt; and (iii) the awarding of post-judgment interest on both the principal sum and the pre-judgment interest was practised in Malaysia as well as in Singapore. [123] Abdul Malik J (as he then was) stated at pages 277 and 278 that the merger principal has been espoused universally and in particular by the Singapore courts: NM Rothschild & Sons Ltd v Rumah Nanas Rubber Estate Sdn Bhd (1994) 2 SLR 160 Chia Ah Sng v Hong Leong Finance Ltd (2001) 1 SLR 591 54 [124] Balia Yusof bin Hj Wan J (now FCJ) followed the approach of Abdul Malik J (as he then was) regarding merger in Perak Motor Co Sdn Bhd v Estate Pekebun Kecil Sdn Bhd [2006] MLJU 386 at page 3 last para. [125] The merger principle was also recognized in United Malayan Banking Corporation Bhd v Ernest Cheong Yong Yin (2002) 2 CLJ 413 (Federal Court) at page 397 G. [126] The merger principle was recently applied in Pentadbir Tanah Wilayah Persekutuan Kuala Lumpur v Bangsar Hill Holding Sdn Bhd [2015] 8 MLJ 317 at pg 330, which also clearly distinguished the mandatory nature of O. 42 r. 12 which carries interest for the post- judgment period and discretionary nature of prejudgment interest under s 11 of the Civil Law Act 1956. [127] I agree that the Plaintiffs are not seeking further interest on the judgment sum but their statutory right to interest on the judgment debt, which as a cause of action is a horse of totally different colour from the clarification sought on the judgment sum; borrowing the language and drawing inspiration from the Federal Court case in Othman & Anor v Mek [1972] 2 MLJ 158. After the Defendant’s appeal to the Federal Court had been dismissed the liability to pay post judgment interest to 55 the Plaintiffs crystallised following the stay of execution agreement and the Plaintiffs are seeking to enforce their right to post judgment interest. Pronouncement [128] For the reasons given above, I had allowed the appeal from the decision of the Sessions Court to strike out the Plaintiffs’ claim. As it is the Defendant also has a Counterclaim for a refund of the interest paid arising from the putting of the judgment debt into an interest earning account before the release to the Plaintiffs upon the Federal Court affirming the decision of the Court of Appeal in the appeal proper. [129] As that is going for trial since there is no application for summary judgment on that Counterclaim by the Defendant, the trial of the Plaintiffs’ action will involve the same issues and fact-finding exercise that would straddle both claim and counterclaim in that if there had been an agreement to forgo interest on post judgment by the Plaintiffs then correspondingly the interest paid erroneously has to be refunded. No further court’s time in that sense will be involved as the trial court would still have to hear the Defendant’s Counterclaim and also the application that the Plaintiffs be declared “vexatious litigants”. 56 [130] The same would apply if the stay of execution agreement and the Consent Stay Order was to preserve the rights of both parties to post judgment interest. [131] The order of the SCJ in Enclosure 9 was set aside with costs in the cause. For completeness the decision of the SCJ in dismissing the Plaintiffs’ summary judgment application in Enclosure 14 is affirmed. Dated: 27 July 2017. Sgd YA LEE SWEE SENG Construction Court High Court Kuala Lumpur For the Appellants/Plaintiffs : Mahendran Ponniah (Messrs R.R. Chelliah Brothers) For the Respondent/Defendant: Prem Ramachandran (Messrs Kumar Partnership) Dates of Decision: 20 April 2017

Tika 2.6.0

WA-22NCVC-680-11/2016

PLAINTIF Tradewinds Properties Sdn Bhd (No. Syarikat: 10912-V) DEFENDAN 1. Zulkiple Bin A.Bakar 2. Perunding ZNA (M) Sdn Bhd (No. Syarikat:361752-W) 3. Perunding ZNA (Asia) Sdn Bhd (No. Syarikat: 871000-H)

25/07/2017

YA DATUK S. NANTHA BALAN

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=12ac273d-04eb-417f-ae97-e3989748e7d9&Inline=true

IN‘H1l:'. H1611 cumu u1- k'U.\Lv\ Lumvuk (( VIL rm ‘ONJ .\N1AR\ TRADEWINDS PROPERTIES sun am) .PLAlNTlFF (No. Syankar: 1u=n2m D \N 1. ZIJLIGPLE BIN A.BAKAR 2. PERUNDING 2 A(M)SDNEHD ,\\') 3. PERUNDING ZNA (ASIA) SDN BHD (Na S1:nLax*R7l{K\O»H) ...nEFENn.\N'rs UN U13 and lrml) lmmducum. 1, These are my pound. of magma: «rm 2 run [ml Fssnnually, the plamuffdmxns lhur me deftndznn ma cngagtd m friudulenr mnducr m nrdcr m mm making paxjmenlx m m: pmnnn undcr 3 C0l\~L'T\\’ yudgmenr rhar us rczxmlcd m an cnrlu-r sun mum-n um plmnuff ml the fix n and snznnd defcndnntx um. um T1» plamuif had pxevxuualy ma me (us: dcicndam ("D1") and um mom defendant rnzw by way of Km Lumpur mgr. Conn Sim No. 5223372009 (“suit 93"). Sun 93 wns flltd on I6 Febmznj 2009. D1 15 me um .»|I:x:holder of D2 and 85% shznholder of me thud defennhnt (“nan DI xs 2 dxxector of D2 and D3. D2 was Incorporated an 2 October 1995 and D3 was xncoxpnmred nn 4 Stplcmber 2009 on 9 F:1:nmry 201 1. n cnnscm yudyncm wzz rccurdnd m sun 93 ("the cannon! judgment”) By an pn »m mu, uh: plmuzr is mxuug m cnforcc u. nghb and enudrxm-nL.« msmg out U: rh: consem ]udgmen( ngnmt an me defendant: 1.. pub and xubsuncc. an plzmufl comulds um D} was Ancorponred and has lxzn uscd us . corporate vehndz by D! an cucumvenr and mu: D2‘: obhgauons under an cunstnt judgment and m dcfnqud me phmuff who was mg yudgmcnt trrdvror o(D2 The Ram oinhe comm: yudyncnt m as follows: 3.1 m and I): shall pay the sum m‘RMl .1.‘ mm on m the plxunnff ("me scnlemm sum”), :5 (nu ma Liml wnltment oisun 93; 3 2 In Impact of an uudumnnr sum. 32: DI and n2 welt ymnflv and srvemlly mm: m pay me am RM5o0,m7o.oo Upon pzymrnl ohhe am RM5on,ono.oo, D1 shall hav: no further Uzbilily under the iudgmuu; and [cmplmns «am; mmm (C) pm r.» ..... .....»¢ all: x... ....r..n_v .1....ma Whll WIS .=.....m lay 5...; an to bu ........a by me ..:..n...r 1.. Mr mucly dam: humus; mu. knawlndge mm the w........y Wm nu. .. -an .3 ply Iuer .. .....,... «summer! .. aw. u... s..m..... rm. maxi. xcmvmng .. 2.... In pmven as well um =«:...m. L7(d mum; on .r.. V... uf Ih: nVV:n:d napclrluvr um xnch x.......... »... wnducud w... would ........... .. duhmu-sly wnmddwcvnd mm. urnumstu-was crush cm. a... a........my um ....... Ix .... m ..m uflhz .11.“: mm... Sm rclwed an IM danswwl .( Lard ....n...... in mg :1): ..m....L.:...:... Dam! .m.em...».......,, . .s~.»..v; and 0.. mm 2 acm no nhrrc .. wns hgld .>... ... wok"... 1... me ..e...=... al .1....o..=.y. .. can ... umblnhed by I-1km] mmconndevilmnlhs c.....=., .1... .c|.~.....m.........m. wm. rzspcl. we 2.. .. .g..¢...=... ....:. an lamest ...ag»‘s ....w.=........ .1. ;L«.uJu:A m rudrnu: a.. a... cam M41 shown Murly .u.._. cummxnnms .... Iii: pm .1 me xppallanl VJVPN ...a. =......... .. a.........;., .. r... ..... .... 5. ruddy ....a.....¢.. .. ».... w. cunnm xgvve w..». suhmwwu;-us .7, |=......a cuunytl mu Hus ma 5... . use ..r . men hut mm busmcss vemur: nix .........m.. zhnswu .nmn.= pm ..rg.»u.. IIK znd nf nu ninbnn .. ML. nwns m hum .. Wuhevcfarzxec .......¢... ... Inc mbmmmni .... .r... inn: e, .=.....a wnmwl r...-mg npvcmnl A.../4.. Me... Id: BM ., .\"m mm M) 54.. BM .3» A/wIAerAppu1[2U16] 2 CL] 363 CA'- ‘I41! In mu we arm-.-.142 sunzs.@h¢«,m-«arm mm 142 vu./;a,u..r.a.....c..... mallysuslrnghk nu: .,........n=. .,.p..m ... m....a.... m... ... =....n (-56 Iv um decmzd In) the Fodzrll c....u..... m mm ......c.pxes .. apply , Mm: .. was s..p..n...a u... .. lnw, mm me «My Iwu .....a.... ..r pmof, mmdy btynnd ruwmhlc am. for u........: an ...a u. me bum»: af ,.m.........s Ihu: .... ....m s.....m Thrwfvw. a. is up .. .2» paswdnny Na... Iflzr 1......“ ....x m... dam! the wmwce ma...» .5 Dan; .1... .. my my... cm! mu... .. fin! whemulhc .. am nvfwvulwns mama: m mmwnl “Mn 0! (hr nflcyuon of {mm ...a 0.: sunnludofploohequurdmne\evnu\m|h:de|vben1>ou mennlan (4) M2] .. mum be .....m u... mm. ......4.c......; xwch . s...W...: has ..a.....=a me imdud uf .=.....=e HF ........u.....=. dtspme um mfuxmn Mu cmmml enm... that In: more know: ma ...¢.._;...... uffmudmrhiwzrislhcdegvtcnllmwfibuisl1\|nmIxIlnng:vII\:« .5 .eq.....a ... . mmmI\ use 4S¢bTavrg Yak: Khzng .. Lu KVMMIKIIZUQSIS§LK(R)2§3ll27|V.'175’ |u| In: .;s....g. ~...... ....¢... In d:fraud' .5 m: ....... pvnwenulxc ¢......... alx Jm . rm gpuml ,..u.,.,...a.... {mm mg .:.......I am ..u.1..mn.... . flrma.umm[2\‘I|7!I cr. 552 .. n... Vnr hthnuuur ... an under 5 mm of the em»). Inmlvtncy Au mu. .: ...,.a~..........aw.... mar: am M¥hv mg: , Ihzle mun In ...g.....n-y ... me 1...... .ar...=.. 2; company Aehn hy .r...¢ ... ch: = mm. uflscr my knaw u... u.._. ms. nu: be mid ur um .; s..ns........ and Ilmusxmblc nsk than my WHI .... hc am.-..a, :n..4...u u uteplld munscl r... .r.. dvvclnfls xnbmmxon mu. mm .5 . ...:.......... mm... a rm... u. .. neuan ..... pm use In . dam: ... dunlges .g..... .r.< wmpany ...a we clnymg an ollke 9......» «rm. =......:...y wi ....=... .mr....a -* 0.... cm KW .. no... c.,m...... mu :4». am [2016] 5 cm 566 CA» an m lpplxmbk .....a.... ufpmufforn .......a., =. ... .....u. 3‘ ml .5 on . Mlanue nfpmhlbl .5. 11.: mm ‘r.. awuxs‘ .. «pm... .. mc p..y........ ..... mus dwly ...a..~...= uh: . luwu dzgru afymof .5 .:.;....a. n... VA-rwzrdeglae nfprm-I .5 .;.. . hnlwce Lvfpmludnlmcs (plus :7 may. a. The mmn zyunfl the defcndanu W» hen ultzn .. srvwaxe pmrztduvp .....z...s .: lhr mm ...«.¢a..... .....m .... sumpnny The mull .....:. lirsL mlkra n.......g Ignmsl flwtcnmpzny helm!‘ ..... nuke mg dve:\n1mr\ -min Ind allkv =.»..»...»n.... and!!! agwn the deflndmls s.m m: ,........w u. rrlymu a. nu: wcand .....n .;rLmg1_\,.:.= ,..m...m.a .5 me Lhzmmpany fnsl. sc-cur: judumml ... II: fsvnur w...=.. ruxdzmi .« m. mm ..v -c.us.m.» helm! m ,, .« wnld ........: ... .=..... ....a=.wL. mu: 0-u 15,41 1. on 9... xx will |21]n.= learned mgr. (‘mm Judy fmnd ma p:.u..m us: mm M . mu...“ alvmbabllmes. Iwmxnglm rm. dnfendanfs mnmm... mu . mm olheyond rusonlbb: am for . :19: gr fraud m mu proccedlnfis wax nqmmd .. was man by the fcdenl Cum ... mg m. V Hon Kglr am “,9, guns 3 gu 212 I11: Judxc um hmud nu In-Iy Ihc Ywmr dqru nf pmnlxx mauma m iraw rm Km; V m: M Eugxvrnnvrg awn»; 4 gm, mm} 4 MU 56V,1nd1o\luwtd in . xcllcx nfdacxsuons sud! u5Cyb<'r Vtllggz sg flflv maxim mm gn gm; 3 9': [Mu 4 cu m . [ma] MLIU mam .LmmtL&um. [man I ML! mm ' ‘arr mam” K... L0L12mzIJ.LA's.14.|2nv21 umuma llwulhccuun‘sv1v>«I?utllh|Iwn became; 1%: mm...“ Ihclums . . wnuu“ [z9| CaM<qImII¥y, ».z lyre mm m lurntd Hugh Counludr an IN: zpplwcdfle fixnd-rd nfpmaf m. . sluuwry c wlirrmb-c mu Not 50 much bzcmlxe um um: umdud wukr cm ma b1flb¢<nus:s\|br§.304 1 melts-els Ah: slmdud ufpmolmzl mum pg ml rm lam “yr m |wurs' ix depluyad u. M: pm ' ' n ma um nan, mdvcales um . luur dngzzmprovf laqulvm Thu! lwtwrr-lewn ulprunlis .... n h-Inns: Alfpmblhlllll n cnmvnl go my Vvwzrtmnllna cw burden alymof us] We .5.“ W. -1.: mum submlssmru aflrmned cnunszl lnr me p umm lhz mum: ngnmxl me dcfammu ..= in my cut, but ukm m npalzm promcduus mnud nf ... um um: pmwdml-I mm m: mm,” On . pncllnll nmqm; 3¥L~)_(|)nurMuu1lu be read Inn-Hy .5 lhccnufl mu! {in mm a findvn! Hgmml me mmpany mm a can mike mg daclnmmy urflnl and alhsr wusqurnlwnl man: ...;..u. u.. dulundznu, m Supyune Cam in nu pg Kgg &Anovv rm gum Wm; fuudglys) 1 cu Mn [23 cum; 3:: us 4.1-»: m4 mm whom ..n.1.m;.; :53 J; 0:: Cmnguniu Ac gamma ma=.m.......m by Wly m.m¢.m :~4id:n:: bmhy wm xnmw em, .m..m..my mm m h: Affaded ho ddmd-In m ‘an cvdcnu In mm Ihermelva mm ‘s best saved m an: procwmnn: mm: plwuifilus :1lJblm><d\LIe|1'n n ....1.... av Ihe onmpany Which u pwclsalylhe me have [u| mm; umnmed ourpvvvnsinn iery nrztully. and bunru m ......a the ma nqullemull um mat a mu bzforc . nghl cf mum “mm; 3 btuvvuy be invaknd, w: Ihrvefow Ina: mm m: mm H n Cmm Am: ‘.. um um, lhu me .a:e..am; da nu! nwd m be me in Ike tame M Ilka: . ....¢ Ihemmpany muamn mma. mm prmwdmg; M... .9 5: uk... Sun: the ,,:....m 5 mm. an the seomld limb nfmnflfln. the pI|m(|W ntosswn has .5 filb me complny Ins. xa:I(e1m1gmm| ... us fivauv which rendmx u u.. ,....., uI“cm‘Iunr‘ mm (hr pllmnll tan wmimazn mm unM [M]Th:rdm¢. an acmvn agmsl the ddzndlms manm mum... NSI he mnnnmnzd HY the urn: m M pmnerdungt m...:.: mm: I21: mmpmy -- [unphaxlx adrkd] 11, comm: an the gunman nhn xcllcd on Ih: mm: Conn’: daemon m Gwlmban Lrrgb Bzgawn Jug/I 990/! 1'. Vellumnq PImm:an_y o 0;»; 4a>p¢aLr [ms] 1 CL} 719 FC an an pmlclplzs on “Mung of uh: corporal: m1" um wag enunciated m ma: C: "In: n u mm law mu 0»: mm .1: bmnd m mar wndmy ma um: mm 1:! . sun mun c-mfin: In Ihc mamas. m Lmm _ m mmlrd ladzmdruuilnn lmmermalhns nolbcenpkuded. [96] Eur m (h: rvcnuhax WE. should. Wt nu oflhe vlrw Ital m is nnw . xeuhsd x.» ... Mn\ny;4a\M1lh: cmm mm mo llvtcurpmmc van] .1 . mrpm1|Inm ‘(mu :m|>m:lu>n win m up far Inuduknl pwpfiies, .7: mm in was csuhlnshed lo mm m txmmg obfimum or W. m lmrvcm mg MM»: of : m«..= kl pcrwvulm‘ my A5 m mu wnnnm51nuduYau pmpm n his but am.m 1‘ In mm. nunal I}-Ind .,. ma in mm”‘w.a {mm . :......, oacurred in‘ was Wm lhrlrlrc swgnxufiepamte pcnmmhllw of mmpunzs mu used In cmhle pagans m anal: mar wmntlull obhutnms ur dunu. lite calm uauld dmqnvd nu: manna! xgurn-1zn¢:5nIlh< cmnp.In1zs..., |9l] Qunz lecmlly Ihus mun an .mcm.1 an L1»: 15:»: oflvfimg . uupulnl: v:|V ... me:-gc a: wguum nma mu mum. A1 ...,......g.c, me mmug ........ .. ...a...:;. .r..am..... ul wrvomll |>fl!smam\ Th: gznzrul nfle .. .... .. mu-puny r... ... u........ «an wpuulr ...: mm mm .5 shuehaldui .. my rxprcssvun ... the .........v (is! .... ... SIlh]r((,.V0Irvmr1n . Axalnllon .4 co u.1ux97] ACIZ 1.... Haubury LC mm ...... ... .... ...... ...... m. owmumy .. mu, ...m............ a. ...... beaezlcd m..._. nlhnv .mq.=...1... pasonwlm ..s ..y..: .... u..a.x...u ...,....p..... ... Mn: ...»: .... .... ........c. 1-Hhvsz ».rm....x pan ... xv»: prulmliaru ... .... cnmplny ... ..;.x....,. .....;v.... ... dvscumng what lhnsc ...n.....¢ w.....:........ 1'». ma Chnnsdlnt hnwxvcrymvvdtd Io! ...... .. WMCM .... ..n nlvnmponum ......» had, He 5...: .1 mm W .... «....a and ... agency. ...: Nth: cnmpnny Mun mu .... ...a ...... (mum .... ...,.n., evuy out Mm: ........a. ...»... whnnh .. .. wufihl ... s...,,.... .n=....1g....... .; .:..,.....a ul The proposllmn when ...»«..a sun: that .(.r.e.. is c....a o. ... ...c...y .eu....-......» ... ...». am.-any .. . ...... .. r......., m: am... ofwvwuk versmmhly doa .... mum .... .n....m:a¢.. .......c.... r...... 5...... .......n.a.....<..y mu ...." m... ........e... .1 .... mu... ... m.p...... pevsmuhl) ...... r.....u m .».......r:-«...:/...... Vtmrhclydr lzsmmal cm... mu m no ...... .5 ...r..m-y I... .... pmw.....». ...... . ....,.... W... wk. (hr :....n‘. ......w....... .. pwzmc me m..»...= «.1 ...... ....m.s.. specv-1 ...c...........>.; ,».......... .n.. In: umpnny .. quzsflnu .. . ...... rm... wmnlmg .... .... «.... pm 11.: ...... '. ...... nus: =......n..g .... .... rum’ u... «...... ¢..........a by m: Supreme Cum ...... u......a x....,.1..... ... ...= (as: u1PrnI » PrvIIand0r}1rr<"" The Vendnnxfiadxmml «rm: «...... ...»: .....- u.. wmnlmmx ,.......,.k .. kyfly ...... ...: «.... ...: ......“ ptcvmr-3 .... (mpnnl: ...: .. ... u. .. ... .....m....... .r . cmnpam .. ......» srwnfl .a........... .. .5 to nrmccal Ah: .4......, M m .¢..: ..:..... mu .... dmcv ...: wan: 1...... idenlxfying ...=.... »s........g .... mu. ..:......y .5 Iuufly nelnvam ... ...... use: me ...... .5 not dvzrryrding mg 'rm.1:“ .... only Vrmkmg M...» .. ....1..m...».. r..=.. uhwch -1.. .........:.e ........... .5 ......-.n.... Th; ...“... yrmcxple .. .:.m..... vaxelsnvu The wimeuu u .5 mn the mm may dmcgud lhzcarwmlt ml «ma: .5. leyl mm ayim Ilxe pcwnn m wnlml n( it whudw ms»: Indcpzndzmlyullm tampon)‘; mwrmm, and mm,,..., vs unlmwmdsn Iiulme iepnnle :.g.: ..m...m, ullhecumpnny WV" dckll m: nghl nr mm ‘u mfwvuemml Many mm W!“ rm mm bum ulcfipvmi, mu m mm: ¢.mmuu.m the dnflemwz belwoen than: may he :1-Inca! nu; may hr mu M by :t{:ruw:1olhos: (nu ... which [M noun nu ban Ihnugu, nghuy or umngha m havz man In wyvwruht val‘ Then nu No. Wlmzu Name Dela-iplion wmm. Suxunznl 1. Mom] Nubsivi Ammm Mmagcr, um mm mm Snrmu-ddin Dqnnmtnl. Tmlewmda - Cnrpunnon Ecrlud, ‘ holding company of Tradewmds Fwpttuns Sdn ' ma. (H.,.u...n/.,/...uy.. mm 20:: and bu ‘ Lu-u/Mgr 0/I/It can H mm .. lb: mm u/I5! m..,,,,,,./ 2 z..n.ua,,1. an. A, Dncuor and xlmvimlder of mm mm Baku‘ 4“D1"y ‘D2 and D3 3 Rnymond 1-... Manager or m nw1 mm Vcw Aik 12 The folllvwing Isxucs wuc fmmed fur puxpuscs of the mnl: (I) Huw mud: mum due and owing to due bx‘ DZ the plnlnnffundcr am cnnscm iudgmcnl? to nu n M u <5) <4) (E) Wham: ch: mm (3) daemon‘ moluuun. of D2 {um -Jmud 25 Much 11111, 26 May 21711 and M May 20:1) Wm pustd by, A///Nu/M‘ D! m 4.- mg cnnuznr |udgmen{? Whuhu the busmtss of [)2 has been umzd on with inlenl to defraud in median, namely lh: pnmnm In all th( nrcurn5Kanc:s.Whell1cr m is personally responsible for the debt due and owing by In to an plamuffundzr (I1: cunscnx yudgzntm? Wlvcrlur D1. D2 ....1 D3 nu: m Lmlh md m rm nne .<m,;1; tommcnmil nmn M dxsunct rm. bung separalt 1:591 mama Whuhex D1 .5 ch: nhrr ego ind/or cunlzolhng mm mm And/or 93> In all the CIYCUYHSCIHCES‘ xuhclhez lhu Incvs uf zlns nu: |uxnfy the Mung of [he (nrpnxal: mu in mm m and/or D3 hablc to pa} [0 an plmnrr me debt due ma nwmg bv D2 m me plxnnuffumler zh: cnnscnt )udg;1\cnL7 Wlmzhu rh: plaunuff 1; cnudul m exumpxaq damagu agmm D1 and/or D37 vagenvuu Evidcncz I3. H. Axnrdtng In uh: pleaded case (pmgmph. I77 and 17.3 or am Statement of Churn], an ulcuxpnnlion of DJ on 4 Scpben-Abe! 2009 (mm: me rung ohm: '13; and me (post cons:n1yud.grnmz) nssxgnmmz of D2’. zczclvnbles to D2, demnnsxzaxed am at me um: tnwnng mm on consent ,u¢g.-mm, D1 me no mmmm of yudmg me cnune sum dun um: me wnsml yudgmtnt Essenmlly, u ‘s an plaunures use am me resoluuons by an duzzmxs D; D2 wtrz m|mt:d and rxcculnd bv D1. .5 a duccmr of D2 and um arm the rrzsstgument of pavrnen: of D2‘: rm (mm m consultancy pmyccls (0 me D3. D2 has purpanrdl; becnmt mncuvn, and xs nmv unable and/or Inupabl: nf plying the omctzu-‘ding xum nx anr pm mums m (lac p].uxmfl'T|Ic pmnurrmmemc mam um D3 rm mm and by m as ; vcmclg m enabl: D2 (0 made u. abhgnunnxt undcr K11: yudgxncnz. According 1:.) mg Lltfrndmu, m was mooxpumztd bv D1 (oguhnr mm my board of dubcmrs m (mm to mnnmin D1‘: tngxnecmug consultancy busmcss whurby mg professmnzl hcensc um Lnnsieund m D3Aocoz:lmg m D), mm were. cum mm. fin: ch: assxgmnm He smd am DTs clmnts had last confident: m D2. Thus, .1 W25 ntctsszry m r:—package the “ZN.\" lama ma maxkcl rm work .hm..,;r. D3. D1 also sud am n2 wax facing 1%: suns, 1.... he was unable In gw: any dmnls m am flspzct. rauuofli DI mu he wns Involved xmh nezhmcal zngmeezmg rnzurn and was no! m\'olvt<l ma rnavlagaxnent of D2. Dunng :ru.»s—cxaAmn.anon, .2 W put an D1 am he hm no mzmuun of paving me full yudpnmt sum under the comm: yudzment nnd am hr W15 only concerned mom rm mm pcrsoml lmlnlizv zhercundcr own denied the sugucsnon He said am \H\e ma ma. an Intcnnnn mm the plaintiff wnuld not have burn paid mvmsum 00. Analysis and conclusion 16 The 'rm1 Notes of Evldtncr shall be rsfcued (0 as “NOE” D1 .5 dcscnbgd as mm m the NOE um I shall mu (0 mm as “D1" Quin: obviously, an xssue which hrs at me hear: or am us: Is me consultzncy [us whmh are pmble m D2 by us clients, and which mm “ass1gned" to D3 puhunm m remluuons of D2 mm. WEKC all pmcurrd |n Mzv 201I, which was about 3 m(Int|1.< nftcr the cnnxrnr ]udgmA-nt \\i|§ cnmmd mm‘ The nnctssnrv qucstlnn am .5 wluezlucr uh: Imgnmcnl of mu-xvnblu: wax sinister r-r mu‘ u I benign busincn decision wilhnul my ullnriur mmiv: Io Jvnid plying um nmoum due under me come.-n Iudgmem? rm dn:n.L~ of mu fees payable by D2'.< climb are is follawsv 9) PLH-KH mm Sdn Bhd (“PLB~KH aim")- 1um,30u,noo UU(“Pwi:cl1"); »..= :9 M31 17. (M) Tc:h—Au Sdn Bhd (‘Tech-An") — xM314,oo7.uo ("Pmiccl 23, md (nu) PuLm|nyz Holdmgs Sdn Bhd (‘PuImi:ya Hold.ings")~R]\I711,289 37 (“Fmiecx 3') I: \I'm« u-uLyu.<1mJ during me um um D3 only n:cu\'ed . xum wuhng !U\l3b2,'l3fl.‘}0 from D2‘: clutnnt. PW/1 cunfizmtd that flu: lnsi pnvmenl mad: to m: plzmuffwns on 1 Fcbruary 21:13 (!¢¢ um 7 lo Z3p:g: xmosg. PW! confm-nzd am uh: plmnufi am not wnte [0 or subpuma any \x1n):<.s¢s mm Eh: mm dsems ofD2 m support/Icsflfy mat the D2 ma been 1.. mm,» of moms m excess nfwlur has hem pm to the p|mnu1T(s:<' page 20, line 20 In 34 NOE) Sxgnuficznflv. Pm confim-Atd am then As no dncummr m m: mal bundle nf dnzummts Whith show D23 chem; had paid a sum In excess ufwhat has been paid in the plmnnff. Nrvcnhzlcsx. P\\c'1 .«unc.< um rhc rcamgnmcnz nr mu (us ... D3 wzs done Wm, (H: aimslcr mmnuun to Ilcful lhc cumcm gunlgncm and to enable D2 to avoid paying mm mm mu owmg 10 lb: Flmnufl. In amphflmnon, 1>\x'1 sud m ms w-um slarerncut (pwm) mg: mg zezssxgnrmznz 0] D2‘: fees :0 D) was dun: um; mum m dam the consent yudgmmt and for D2 Iu mm pmng um sum: and awmg to I11: plamnfi. Fi[e2|luV3C 3.3 34 322 D2 was lmblc (0 pm‘ me bxlance sum of 1=..\msv,r)oo.0u. Th: serlhmenl sum man be pmd m an fn|1o\\1x\g Insrzllrnnnts: 3.3.1 An mm: msuumm. of RM230,0D0.DO smn be paid \vxI.h1n seven (7) dzys of the Judgntm; 3 3 2 A second nnmllmenk nf xMxon.mm.m .+.nu be pad on or befor: 15 Ftbruary 2011; 3.3 3 11.: xcmmndez of 1uvn;2u,ooo.oa gun he paid by monthly msullsnenrs on or beforc mg 7"‘ d1V of czch mumh m zcnmdancc \\1Lh me iullmnng payn-mm‘ xchcdule‘ um ‘ um: um! vzzmz xMm.am Fonz mmlha m mam uzmz-mm mm: kMv7.mnnnrnr\2m.umu Imznwm ‘ lzununnl 112014 xmlzmormlznmms mmom .1 Ion mm! I mzau xmzmm fm um... mmm AP.“ [mm thc payment schedul: «ma :bov:, D2 shall pay no uh: plamufl me tquzvnltnt of 12% can choquts and/or paymznls xecuved 1,, D2, and such paymenu mu be apphed :0 Ram ch: monthly mmlxmm. um mmmn uursundmg and shunun um pnymznr xchzdulei and variant :3. IV In lhxs regard, mm pnmu (0 am following ... suppon of £11: plamuffs mm’- (:1 D3 ms Incomonttd nfiu me 93 Sun was filcd and before me mus:-m )udg1nent was mama. (5) as wn: mmrpnxarcd (0 mm uvu D2’: prufzssionzl hcube m! no {active the rznxxgnmunr or D2’: cnnsuluncy pm,.m; (c) Nolwuhsmndmg th: above, Dl zntucd mm ma constm judgment on behalf or D2 ma, w|r.hm (hit: (3) month.» from m: wnscnl ,u.Lgn-.=m and passed um dui-(mm u-mlunons an mm; of m; and (a) Aim rhn xussngnmrnt, D2 is now unable m pm; me outslandmgsum at any pan (huvoi. Hence, PW] cuncludss that, based on Lh: enduwe, m causing me reassngament ofDZ's ices to D3, D1 ms comrmrted £m..a..::..: trading and should be mndc pclsonzlly mm; for D2‘: deb: under Rh: (anxenr judgment PW1 funhcr states that. based an em cvidence. D3 at a sham and . vchlcl: med 1» D1/D2 tn rvade UT: nhligsmons undcr me znnsent )udg-men! .-\c:m'dmg m Pwl. the reassignment of D2‘; Rs zn D3 shnrw tl-nut DI. D2 and D3 xx in reality :4 staple ccnxrnuxcul um: and mu scpnvalc cnuues vaunvu: 20. Havmg cumxdered mg mama and an rum: rmmx nxzndam upon um cvmts um Lunspned, 1 End that u .5 Ion Incrcdulous (0 suggest that am mcoryomuon of the D3 on 4 Scptunbel zoos ma. was about 17 mondus pun: m the mcordxng of mg mnsznt yudgment on 9 Febvmary 21:11. was don: war. a nmrr mom to zvmd paying me nnwums due under the mnsznt yudynrnt In rm. during ems.» exnmmannn. PW! mmally zgrud wuln the suggcshnn 1», znumcl for 2h: drfendanls man u mud be Imp sxblc for m m Inav: mcnrpoxzlcd D3, 17 months pun! :4» me Unix} of Lhc cnnscnl um: wnh ch: mlcnunn to rccuve (res m 2D! 1. Lara P\X'l sand 11:: was “not mg" v\wm trxdenccns a1p.3‘1-40 N013 and reads .5.» mm Nuhu caula : mm ,W m ,n.. w.m=.: sum”... an Qummn(I77 ubeg--.51: pig: :2 mm up 1.» pug: u hm um, ym to page I: M, Lard .x mm m) an page D I mu ,.m ma you mnmw ".4 n wfll mm M Io: dmurmm Ennk Nubxm mm ‘Th: :5: Drfzwldlnl rum... Iesnfiad um mg m Dtfcndlm was mwrp urd Io mm me 2"‘ Delcndmvfs pmfeukmnl {res (mm the :o.m.n.n;, rN..qs- Cnuld you mu .1 sum: 5 me xoc much an the mm Defiamxlu My Lonl wmu: V! lug: vs m 20‘ Spzmnully M: us. Wnuld ym 211»: mm me rm mm. llm mg mm Dr.-fen-lam wmch 1: rgxwomc zm (ASIA) sow ax-m was m cm .mwm.a Ipprnximnleh m ...a . hulfyms u v» bclrur We CDrIBI1lJIldgWKIIl\l415rh‘1!MedVI Febnmy mam A Ye; Q /um an mm we, I an n to ya: mu 1: wauld hnva 5.. mm: envuorl .5: main an ....... A: Vs. .>...n will In ms. lhe Fluid n<m.a.m wxs uwmmrnwd, WI haw estnbv-shzddum‘ on.- u A 0 On rmmm Llhe lioruenlJndgma1Iw:srwnmedl|ghl.wv rm .s..mm Ihnn mm A om Q A .n. wgxtsnng K In ylm mu Ih: Inwrpnnllnn cf In: ma Ddmdam premdedlhz mmnlmg of me am... m.:w..z. M lusllhllwuc-1 agn: wvm W n uni mm I11: wnmqwvrllw-1 of III: cmnpxny me mm D:fu|dunL n was beimv -A; Cnnsrm m.4....=m ofD°I12 ml :~ A \'m:. :2 Am: A Aglwd. Q nun.” .. xsmy mslmnuan mu .. wuuld b<Im|)1l§lhIk,I use a.. word impoulhln. Iar lb: m....:.m I me an mud Delndanlx rmu... you hut: .u.;u: mm In wan... in mnkrlm hveinmrymrulmnmmpum «mm Icnllnn -....=ammgmmm A' mm. 9 mm; you mm mm m ;.Wm.... -5 mm A, mu ...mn 0 ma Inn-Y A am um xnre. Dc V»-H Ivuwem M_\ mm mm luv: Hun hwxubmmhms" A: any mm. mm (nnfinned that (H: pumurr snll cnnnnued no man»: man .< tmnrdi payment as am nrnuunr rnmtindlng under me znnvsnt Judgnrnt well am uh: dwccmrs rnnluuum wrre pissed 111 M1; 2011 And rwn zvnlcncc .3 found .1 pig: 341...: 1? m 22 NOE and read: a.» to Can lukzyuunow .un=m|..nomg;a..amxmm plg:56‘|n As M, mm, m. an .3» mm.m..- al um Much -ml zm. MarchNH.dnynuh:v:(naxEn:mNubovn" A Ycs 22. o wnulnl munmw mlh mepllrelyml Vequcnum x....=..«= he mu unxwevepgnulln Mmn at mu, Inc v: n m.mn..a in mm mania Nam m. n.:..a.... 4..»..u. um I-.|r.u...=... om. Cnnxenl .VInfl;utn|’ vu > Du yau mmevsluul ..., qnn|H)w" Vrs Vuu m sum” vn lmulmu ' Ye: xbamn: mquawe m lmk" >4: >a )5 nm mum yw leucurul il pail March 11:: | v True - >4: [Egnphzals mud] In an; rqgnd, u .5 mpomm to read] am me I15: paymgmxm on 1 Fcbmary 2U13.And mnously, although u was zdmmcd m m: Smurmtm of Clan-n am (ha plunurrum in rccupt of KM6S4,0flD,D0 Whl(h ,5 m cxccss of ch: sum or RM362.930.90. whxch was rcczxvtd fmm D2‘: chcnts pursuant m ma dmm Iesulunnnx. PW! will demcd the Sam: (m pig: 1»: km 1 lo 4 NOE). Bcynnd chm. I’\3<'1 wax nm uh]: to show that D] zvccwed anything mot: than |{.M3(:Z,‘7RU 90 [mm 02:. chcnb 1.. am mgnul, n .3 ..-1mm u. num mm ow: had msuficd um according w Dy. nccmmung .m;..4.\, they onlr mcmd a sum {umhng RI\I3fi2,‘18fl9lJ I hav: no reason to doubt DW/Ts usuxnony m um reprd 11.. evxdznct on dus was: mm Mel m pangrnph 7 2 ol Du: mm Fuels. the 2..»: o=rm:....: Wm nvowl . mu! n1RM z,:zs.ass :7 far m. 3 Pmyents emu an the Rnmlulmvm Ihe camulumy fats m hcen Imyuml m we Jm nermmn; .... W wnfirm >...mm whellm m. m Defendlnl rm mm m nmmmu um m pinyiph 7 1 Mme mm ram» Flux: up! n Bud an me Mr! Dcfcndinfi .=m....u, mg m Ddcndam Lmly kmw mm 2 plymmls new md=4v.M:u,.ss7on.na xmuuooy and lhr cnlnv sum war was mm! (D 'I’rIdewAms' Iawyus Was: rdcrmp1g:|3!CBOD,cInw«|rIfwlml s Com whu wnnhe sum mm .n.¢ 1m Dzfmdlm renewed aw, Inwn nsrxn Bmaaud mu .» um ammm ml mfmvd ma Tm: ws m vdrvunez to mg m n=1¢..a...rs tnnk smelmm WVIISII mm Ihnl an am/zml‘ . sum 4»: m nA.an7nn was veczwcd Can yml mmm ms Calm Mm an the sum mu mg 3:»: Dzkrulum rwqvad. .r..y, rm mumw rm am Dcluwdnnx u sure there 3 no sum my-m fmm Tam-An ax .- W . pmblum ymp.-:1 since .+.y mu: "1: am Dcfmdnrl um -mm man Tm-—An WIS L73/mg m uke Idvnmlge Mme ;......m.. nuw um m: m mrgmm n.. ma: wcmmns mm was mw cnpykd humus: nllhe ‘frléawmdx lnw .... ... 2009 Wm: 2nd Delemhnl was alhvwed In um-me by Trudcwmds mym .s . ,.m.;q pm(us|ma\ mmpiny. n mm the nu uer...a.... would cvcn mm to :\|uw .mm..».; on pm lhmugh Jim fur .w<.vmg mm m ma. :1 61):: nu mun‘ excqa Ia mp and mdmduli Hus: lcfrlmyzgs Ms— m caoo, um you Infiwrmlhls cm um wal (Iv: mm mm Inc in! n.rma...x rwelved. u my. fmm Pmvxjxyz Hhldmp Ind whal .5 me dommevn mg rrkmd m7 m. .. .,. m.,m= m m. ltd rlgfmdun 1 mu m....... whvr.hshovwsur|2(l’1D'1flll :smvmfRM 43.31330 Aye ymx IWIII wmmrm. sm m¢..a.m his mid: any .mp.. m m...n m. ; cums m mm; of w..mu..=, fcrusllzd .7. vurlsmpfi 7 2 Agaad mm W: mud: my um In (heir Awmmls mum". hm «um Mm: tune. the my m alwlys Ixrn mg sine and m. av W!" W Whln [hue VS money 9. m m huokmg mm n vveamu m.mrm vs any inmrm Imm me gums to 9., u .u W: mu Imnkzbam m. ,,os;.m.-, .1 wing vueumu 23 and ma cmnullal mnny lnwycls hm w.n.m cannula evldenoeafsum mm; mun |:w):n -monk: owmnnwc Mm‘! 5,: my. ‘Hg w|o1lh\:. u. nddmau u would alsn be um nwd mm to am ma maney. mm .. . um p|\IIu>nphy ... mm, wm wrw the clxmlf lespons: when mg ;m n¢c=..a.m cmucled Ih:s.h:uI: (. ny)” A As nveniuned nhnne mmamg w ...: Amuunu 5m.m on ch 3 sommmzs «pupa ~ abusive Lsngmge "s\neAnng" ...»: 9.31: wry mm: «mm; uur suurhmsa w:c:lVed lfillntfl 20 o Apart fivm >1-wllzlmglhel-.h:nI§‘ u-amuanermm mu: my I1:-tnmdx nr III: any Emu agunn 11:: 3 mm; .5 mm won-pumenl oi the Lnvnxuhuncy rem um...‘ mm A Asmumnoned urlmnnclnl Dtkmtmmwd gn onmnlmuon hul wimmn mnumn tudmne to shun am am tin: and man: so W: :1: a sm pan} w m: c|||m. mu: lav/52:: mu not me the use as n dug: »« «rm wmnlhk Aym, m char m. Kins dehl would be mm; mm umed zwd mm) ... chute and meme! " In my vxcvmh: zpprnpnmc suning point m m; vcmlulion of am problem at hand x; m am denemum, am much. accnxdmg m the evldmcc, W xctened from an Ll-um: pmyccts pununnl m the am: nsnlununs? In um xegud, u 15 quiz: cum am only KM362,VEO,‘JU wa: “mm: by D3, wl-uch .5 clcnrly 16» than dun nrnounr winch WI: p...1 undur mu cunsmt ,...1gmm, Lhzz u, RM(:54,0U0.m.v. Wlm .5 sxgnlficanr about me paymrnrs um wm made to Lhe plmnnff .. (112: among). me Lhme xcsnlunons wcxc nssucd m 1*/Jay zuu. yusi mu: mm months mu Lhz consult mdgment was amend mm, m: plamuff xccuved payments as pa the schedule undcr mg mm cantamed |n ch: mnscnt mdgmgm and an 1.5: plymcnt (:5 pa mm‘: testimony) was on I my 2U13(s4<‘p.l7l1n:7—23 Nam. unmou- 24. 25. in mm‘ xx xmlugd am on lxablluy man mg consent mdgmmt wu only up (0 v.Msuu,oou.ou. Hmcz, no purpusr. .5 served .. far as D1 is comma to pay man. um msou,nvo.oo Accordmg m the cwdencc, nmlvu D1, tvzn after mg mmal damsl-mld amount of msoo.oou.ou was reached, :11: plamuff conunund .0 mm; a mum sum of R.\ns4.ooo no. And u-.= mm! paid vlns RM6S4.000 00. As ;. sn1rK\nz pow, u a» crystal clear am xh: p;\r\'y which xx m default un-in me terms of the =..mm yudgvnsm‘ IV nz D2‘: lubxllty m,;.,u me plalnuff IS zhc nllfiexcncn: bctwzcn lhc mu judgrncnl mm or ILM1,43U,UU0.00 and L11: nmounl pud,IL’\/l654,00U DU Ieavuig 2 slmrzfafl uERM776,00D.D0. And 50 m me cnnrext of me pxesmt Sm! zgalnxk 131,02 and D3 and an suggauon ma: D3 was incoqvomnxl m defraud mg plmuii. who was a yudgrnent zradllrn, me Lrnpemnvc pnrrmry question naw Is whuhtr n has bcen pmvcn on a 1mm ofpmbabvullnzs am D3 was Incorporated with ma Inlenlmn of dcfmudlng lh: plmnnfi m a ...r the comma! ,udg.-mu up whcthcr D2’; busmm wan turned on wnh the munrmn of dcfmudmg the plunufl. AW .. mun be recalled am sun 93 was mm an I6 F<bmu_\' 2009 whcrux D3 wns Incorporated on 4 Scpzembex 2009 um me cause!“ mgmn: was recorded on 9 February zuu Fim.Lly,1n mm ofevcnca, paynxnt were duly mm as per mg zen-ns of am tonamt )udg1nenI up [0 1 Ftbruary 2013, am: which D2 dcfmllud m me payment sducdxxle mums: 26 "1111 111111111; indupuubly d1s.clos:s 11111 1:: 1111111111 1 111.11 of RMJ6298030. ,1 sum of 11M314,11¢17.oo 11111 111111-111 11o11n11 1 111111: 2011 (mm 1>1_11—1<H 1511111 sd1-1 13111:1(;¢e p 1313 131111111: B1) and 2 111111 of RM4B,31300 was mcarvzd 1111111111 16 D1: 2011 from 1>111111111 Homes 5111 131111) 111.146 13111-1111: 1111 011111111 d-1: 11111, panics 11.11 refuted 111 1 111111111111 1111111111111 1111111 20 Srpmnbex 2011 (,1 111,144 111111111e B1):1.< .1111 111111: “a.~‘.<1gnment" of («S 12111 1111-11111111111114 :1 11: 1111111111111 1111111111. 1 and 11111 11111 1g1m1-11111 111:1 11111 11111111 1): 11 11 1-1 111 11 1-11111111111 1.11 1 “lcllcf 111 41111111111111-1-11" by 17111111111 Holdu-1g: Sdn mu] m P1:tun1J.11'1g ZN1\ (Co. Nu ‘)0‘1U3E—K) (1101 D2), 11111111 11 1 11111111111 1111111 1111111 1111 111111111 sounding 111111: of D2. 111111111 11 PeKund11'1g 2M 1111) 5111 Bhd (Co No.36l75Z—\\.’) A1 my 1111:. 111: 111111111111 11111 1 11111 1111 1511191111111 ofxecuvablcs, 11311111 11 was 2 1111-11p1:11 navafion of 111: bcncfits, Lnlzrcsu, obligation: and 111111111111. 'n111<, 1111 111111111: 111 11211;: s 111’ :11: 1-111111111111 :,;1¢=1-111111 (11 142 11111111: 131) 111 11=111111111111¢ 11111 1111111: had 1111111111111 “ass1g;1ed" 13221 1111111111; 111 D3 is 11111111111111 111111 lcplly 1111111111. 111 1111111 01111111111111, 1 51-111 11 11111 1111 11141111111 111 111g,,,1¢.«1 111.1 m 1-11.1 11111111111111111 .1 111111 of 1 111111-111 111111 111 11111114 1111 p1111111rr111111, 111 me 1111111111 .1111g111e111. 11 15 1111 pla1nuKTs cast; 11111 131 11111111 me z<ns<1g1|In:1-1: of D2’: frcs 10 D3 to tvide DZ's obhgmmns undel the 1111111111 111111111111. 11112:.“ zv Therefore, accuzdmg (0 (hr plalnufl. D1 ms commuted fmudulent Lmdxng and should be made pctsomlly liable for D2‘: debt under an consent judgmtnt. According m v\x'1_m .5 a sham ma 9: vehsclc me by D1 /02 m cud: D2’: ublxgunom under me consnnt ,..a,;m¢... xx .5 alleged um um reasslg-nmcut of D2‘: fees m D3 showy um DI, D2 and D3 m m real - 2 mgr: communal um! and not szpamln mum. However, :. xm nghdy .»ubm|ucL| |:y Counsel fox {I-ue dcfuudznls, me pmmrr,» complaint hay: is onJ\' wivh respect :0 mg nccuvzblzs fmrn me :r)nsulram:) pmeczs which wcxc assxgncd to D3 Than: 1: no vndu suggestion m mg pleadings wuh respecl m the man mcurnz of D} from me: sources such um D3 mus: M an zmounts due under due consent yudgrncnt xegndltss of when (hcy gct men mcome (mm. Th: 0.-.1,» mad. agmm D3 :5 the amck whxch 15 made \mdc1 Lhe rubnc of “hfnng of me corponrc veil".Fmrn thz Summary nf Fmanual Innmmum. [p.20 5) D3 1.: rwdcnrly 1 financially henlrhy cnmpanv wuh a revenue or RM4,32l.7b7 00 :s an 23 July 2016 Th: pexnnzul qunsnnn 1: whr wet: D2'mcm.bI.; zmgncd m D}? In thu regard u 1. mm.“ m mu m um qursuunfi postal ... Mcxsn. mm“ Smgh A‘ Ymhu letter dmd I6 January 2015 (130713; B) um um znxwexs givcn as pu Messrs Snndosh Amndznis lcncr and 2 Apnl 2015 Q).13¢ — 137 B). Th: reason} which wen amuulated m am new mm, min aha. D2 was m 1 runs.» bcmust of low sharks and cmdxtoxs landing Lo ph, 51:)! dxuupnon u[ 02:» buslnzss. »..m.m M). 31 1: was .150 munuonud am mm was oolluswn btzwecn plamuff and an office mnnzgcx or D2 1: .1» mm: um Lh: “asngrunent" xws beans: or “on»gomg" legal cases In ans regard, dunng cu:-ss— exammznun, [)1 could not point (0 am pzluculaz legal me And so, counsel fix: the plalnuff sumesned am the “ass1gnment" was done (0 mm paying an plmurr undtr an comm xudpnent. D1 acme mg mggeslltm am he W only mrereslvd m enxunng am he ‘A1! personally (hand nf lubnhly. Dl ml am if mm »m (h: cast, Khcn zhq wuuld nu! hm pm mom mm RMsou,ooooo \A'huu)K m on.- case. the plmnnll was pmd . xum of mu 654,000.00. For compluenrss, 1 should add um Mnux. Rnnylz smgh a non sent 2 mm mm: 2 jun: 2015 (p.149 . 150 B mi 2 hsrofqucsuons p. 131433 E) 1nd mg rcply by Messxs Sandosh Amndm I: as per letter dam w Angus: 2015 (.2 p 134 Bundle B), whexun may Immuy smned um D2 has no documents. or (nurxc. me nagging quemon IS whckhcr D1 mmcd mm-v.‘ than m:az,<2sa,ao rm. um um consultancy pm,ms> 1.. m far as eh: cm bcforc me .5 canon-niul. um qummun xemzms zl Inge as mm .s nu c\'IAenoc um D3 zucuvrd mm: mm m3s2,-130.90 rm. me three cunsulmnty projects. or course, Information could hm been elicited rmm D2‘: chcnls vn subpuerm oz d1sc:)\'-try agzlnst me chem as “Lhud p.uues"undex an Ozdcr 24 me xx Rules of com 2012 lo deltrrmnc whethu the monies due [0 D2 were or wtze not fully «aka by mm mm vagesomu 3.5 In the even: D1 mud/or D2 dzfnulz on any of the mm or uh: yudgmenl, Including Ll): turns of pmnmz nfchc settlement sum. the plmnnimull hr znntled to cxcrut: me yudg-mrnl an the sum of mm,45u,uoo,oo (‘me mu iudgmnnl sum") together wm; mtexcsl at the ml: of 3% per ammm fmm due am of default um mg am of run ruhsnnun, mums an sum already Paul by on and/or D2 under uh: Judgmuu Eufurc mg plamuif may exzculz |h< judjcrnent for m: sumx due and owing. the plnmuffmusk Em issue a noun: ta D1 Ind/or D2 (whnchevcx Is applicable) giving . fiv: (5) month pencd lo rcrnzdy me default as supulzlsd under me mm ("5-MonLh Notice") If D1 nnd/ur D2 full 2:. xcmcdy aw dnfanll, the plunnfi bc 1: lxbmy to cxccutr me iudgment mzhmn funhu reference to D1 ma/.7. DZ. Pursuant (0 an runsznr judgmtnl, a sum onu»ms4.ooo,ou was pnd (0 mg plnnuff over a pcuod of am: Howevrr. an lsalancc of I11: msmllmzms whzch wezc due and pnynble mu sh: consent ,ua,;mm: wzr: not paid me the Ian payment that W15 made was on 1 Ftbxuary 2013 As per rh: Iznns of (h: ctmsmr yudgmznt, by mm nun: d:A'ault in pmmm. uh: plmnnff wn cnIALl:d m cnfiuu: agzmxl DZ. am full judgment ~um of nM1,4so.uoaoo rmnu: um sum cf I11»/1034.000 on, which mu dmzdy um. pmd,lclvn1.g n sluuniall uf RM79§,u00.00 v...-mu 32. 33. In Llux mgnrd, ma plzunnff could hm, hm for lawn: winch presently eludc mg chose not Lu make an appummn for an order to compel D2’: chnnm m dasclosc whahu mamas are due and owmg In D2 and Wham funhzrpnylnenls luv: been made by um um znnucs beyond me sum of mvz3nz,9so.9o. Then: .a of (nun: Ihc suggtxurm um ma fucs due from uh: pm}c(l cnnsultzncy WCYC iwgncd no DJ m order am D\ rmy In gm" 55% shims In DJ. Despltr some muul obmcaml answtn. dunng cxnxsr ualnuuuun, m e\'enlua.l.ly accepted um ht was 1 xhuzhuldcr of D) from ma sun and um 1.: wns 33% shnzdaolder u|'D3. Bu: I doubt it me masngnmcnt of xtcnvablcs ms Lhe wnsxdenuon for gun: of Ih: 35% shares In D3 and (van xhl-us xms pm offlle annngemcm. x am unable Io conclude am this is 2 mznlfiskznon of an mtcnuon to defraud ma plaaamr and dtpnre them of the Runs of the consent gudgrnmt, lxcauxe rhc plamnff vms In fact pmd nms-4,000 00. In my vmw. Ifrhe Inlennon was samam, then n x.« amour ma. the deftndzmx had ensured ma: ma plalnllff wzx pmd RM65A,000 on well «her «he flcs Wu: anlgficd 1; the purpnsc waa merel} In mxulaw and cap D1‘: habmry up to RM5ou,ouaou, mm At a xulzvznl In nsk why use dafcndmu wuuld mzkr payment to 111:: plamnrr bcvond I1M5U0,flOD0O. DI said am rhu: urns every anmuion to pig: Lhn plunnff Eur (ha funds were not Iorlhconung {mm m Lhme mums. ragezlnul And DW2 ma explmnzd nu. ma: wns msupembln: dlfflculnzs m gzumg pmngm fxcm DZ‘; dmm, DWZ smd am they wok legal zdnc: and were and um may would face dxfficulnes m Lrymg to sue mg um cnuncs for me amounts um W: flu: and owmg. or toms: on D23 Md: than semis tn he no ducumuus mh regards an effort (0 claim me monies {mm me am mums. From D3 Gd: alxn (her: mm m be no paper man] of efforts In am. (hr mnmes from me (hxcc enmzcs. But mm dun nnl mun chm D2‘~ clients had .a.m..a mung me zmounu am mm mm m 1,: du: mu! mung .... D2 and/or am Lhry lml prud nl x-nurucs to D3 (ovcr and zbuvc um sum ul R.MJ62,‘73U 90) puxsuam to Lhe muluuum nur.h<)nz\ng the pnymenzs am: m D3, ms brings rm to the qutulon, ya Igmn 7 ma me due: mnues pay anything mm: mm lUVB6Z,980.')0 [0 by Pmscml). Lhue .5 no cvxdmcc Lhar D3 reczwad anything man than maezysu 90. Indzed, n has not nvan bccn pleaded m (h: Skatanlcnt of Clmm um D3 (waved more ram RM362.9S47 90 {Ram D2‘: clsmls. In In). event, it 15 adrmntd may (H: plilnnff was pmd 2 mm of mvmsamo no htrwccn March 2011 and F=brunn' 2013 and (BK .< more than the mm mm wax me-v=d by D3 rmm D2‘: clmnls And clcaxlyklu-I: m no ducumzntx m show that D2’: dmms had pmd mania m D3 m cxcu: of RM t:54,00000 and ma: thus: monks was not pan! !OLh\: p|aAnmTUlnrn~nc|y, uh: mdmul posmon um ubmns ‘S Lhn mm 1:: yuslnn rvxdencz mu DJ xzccwed any mom: beyond the zen] sum of muszvsu 90 mm D2’: chem. van :2 cl)! 35 Thu: .5 uf (ourac no basis [or any suggcstmn um D3 mould pay out of am. own pockzns .9 mm me debts of D2 undtr an cmsent yudynmt. The zmounu which are mgma ax: om, the mnmcs mm m ma :9 be due ma psyxble from .11: mm enuucs to D2 whuzh were assigned to D3 or count me asslgnmcnt ofkceivablcs 11: May 201:, 1: on (ha zsfiumpuon mm the arnonms am truly due and nwmg by D2‘: cllzutx. There i< no evldnncc m» H, ‘mm .5 am mind nr pnslnnn nf uh: three ermues as In men purpnncd luabmq to pay D: And so, due m «ha pauclry us m.1m=, u .5 W, much sptculnuvc m 5.,» am .11: mm enuuzs at: m rm Indcbzud zu D2 mu u it further sptculzuvc to conclude um they pull mum mm 1u\ua2,9so9u.Iz .. therefor: mm surmise and runyrcmlt u. xuggeix um D3 mm; have xeoewcd mot: um. Iu\I3cz‘18o9u Sunnis: and speculauon om; adds :0 suspicion but u is Amt proof or coufiz, (ha Iru: posmon "mm ma um mum could hnve bean dezen-mned by an appmprut: ipphcnuon for discovery by an plnnnff against me rhwe enuuzs and .5 Ch: a:c¢..am.« had ulnecltd m =uch . discovery application, am. 1 mm have entertained who suggesttnn am the acrma..m hm mmnung :0 mag and 1 would hm‘: rezdxly ;;rnw1mt=d :0 (hi: mnklng cf an zdvusz Infuuncc against {ht del':nad)\nu.In [hr cmcmmuncm. I Impelled to :1“ vlcw um um cvnknce 0! DWI and Dwz nppnr m have ,1 mg cf uunh .110.“ u, nllxxl. um um W1: no prupu pipzl rnzl on mutual zspccn of mm zsszmons muamu Lookmg at the ovnzll urcumsmnces m .11: round, I have no reason m v.L\sbel1<v: DWI’: evxdnnot um. cm: was even Amcnnnn m pay m halanc: sum which was ontsmndxng undu me comm }udgmen( or couzsc. 1 do not blame me plmnuffs for |uI'npmg (0 me ocnclusxon am the d1r:z(on' xcsolunicns in May 2011 appemd sn-nster. n W a reasnnlblr conclusion m make since mg uming of 0.. rrsnlullnns gm {he appczmunc: mu D21: reccxvablcs wu: being dwencd m m m Urdu In mm: thn thus: mums: .1: bvroml Lhc mm uf the plzmnlf Bu: eh: Fncx um p.,m..m uue made m the plzmuffiram March zon unul Fcbnnry 2013 zmuunnng Io RM654,flfl0.00 and lb: nbsence of any cvulencc m «how mu D3 «caved anylhnng mot: (hnn r.M3a2,9s0,90 from D2’: dnenu, ulu the puvbabdxues nu away Exam any conclusion or anrmm am an msohluons m M.y 2011 WCIC s|n|5b:rUf uourse, going fonva1<L if .: Innsplrzs that momcs are an md mung by my of (he vhree chcms of I12 that steps would have m be ukcn m xeuovcx (hes: monies but am may w=].I be mkcn by the hquldnror of D2, M at all u is wound up du: m m mabil RM796,0D(l.D0m an plnntlffundu uh: consem yudgncnr - in pay In in rm as me pmm. suit n mmma. based on me evxdence am W pnsenlcd In nus Cmm. my Knnclunanx nn me .m.=s an: .5 follows.’ (1!) On the am tum an In how much mmm am and owing ro—du< bv DZ m the plmnnff under uh: consent iudgrntnl, u u my conclusion am 2 sum of mvn9e,ooo.oo mmsns unpaid: man man (b) As my whether me mm (3) d.\r:\:mrs' usoluuons of D2 (..c. and 25 Much 201:, 2:. Maw zou mu 2a Wm‘ 2011) war: pnsud 11,, min um, D1 m mm the cnmcnl }udg-mom, m my vxtw. cm rvxdm-1:: am no! suppon the suggtstion um (hue was such an mrzntlwn In Lh|s regard. :2 .5 n:(<sszry to tmphasxu ma: the paymens to the plaunuffvxre made afmx mg rcsuluuons mm passcd. And me pzymmu cxcczded the nusonmo no zhmahnld‘ 1-ms demonstrates that rhc payment "1 me sum of nM5s4.nou ooms not designed m msulzlc Dl from pasonz] lxabdlty: (c) Th: um Lxxuc .5 wlxethcr me busum of D2 has bun cnmud on wnh |1-nun: la dzfuud nu ueduur, namzly the plamnffand m this regard. I am of the \'1:\\' mm .11: pzymenl of RM654,000.|JO Io me plamuff negues the existence of 1.. Incenuon to deinud :11: plmnriff qudgment cudxlvr). Thus, Lin: pmnurrs clan-n which .5 pxzdxulcd on section 304 (1) Cnmpnmcx Act was hu not been zsuhlishul nn a balance nfpmbnbxlxutti (Ln Th: nzxr issue ,5 whethez m all the drmmsuntcs, D1 h puwmu, responsible for me am due and owmg by DZ m du: plamnff under me ocnscnl judgment In rim ncgud, u n my mndunnn mm or. hzhdxrg hax bean dmchauged ax mom am RMS00.(K10.I)O wns pmd m the pmnufr: (r) Th: mm lemnmng Lssuts are:— maasuua 321. (9 Whtzlux D1, D2 ma D) m m mm and m an un: smgln: cummcxcml mm as mum from mug xeparxuc legal mum. ma (u) xwmm D1 .3 me am ego Ind/0k conuolhng rmnd ofD2 and/or D3; and (1) wrxmhu m .u {ht urcuinuances, me facts of ms (as: yusnfy uh: hiung of I11: oorpuulc van to mu. D1 and/or D3 liable to pay m ()1: plamuff lh( dzht due ma mung by D2 m me plamuff under me comm: wdgrnent. In so rm .. um.» xssucs zrc cunmmunL my conclusion x.» um um farms] main): and me conduct or me pnmcs, slgruficzndy wnh ztfuenbe (0 d1: payment ox u.\1(.54,ooooo to me pmnurr (the 1:5: pnymant of wl-uch was on 1 Fcbrmry 2013), does not supprm the suggunon Lhal Lhcx: wzs fraud such as tn |usnfy due xmmg of me corponne vul FunlI:1,l find um um l.~ nu evidence on“ “mum to defraud Ih: plmnuff (iudgxncm Uednor) and D3 was nm used as a sham cox-punk vd-nd: m avoid paying D2’sl\al>|1\:-; under m. cnmxenr mdynznl bccauvz wcll allex mg mrmlex Wu: assigned to D3.[1:3-menls wgn mad: m me plunnffrigl-n up tn 1 F.b.....y 2013 )9. Lastly. mm 5 no evidence mm any of rhe um ennncs who allegedly owe ice.» to D2 have made m pzyrnznt (0 D3 beyond um sum of maswao -)0. In .0 far as the am for txcmplan darmges Against [:1 and/or m 1: concemcd. 1 End no 1.,;a1 ban: and mdccd no endcna; m suppon 2 claim rm zxtnlplary dnrnages. Onlcarne 40. For um mm. as was above, 1: .; mv conclusion um die plmnuff am not prnvcn m cast an 2 balance or probabilncs and as M». an.- plamurrs dam is dlsmxmzd mm costs at 1u13s,wu,o:» (wbyzct (D 4% allocntor) than accordmglr. Ds1te:25]\Ily2m7 s. Namlu Bnlan / Iudgv High Court 7 ' Km: Lumpur p... 31 M3: Cmmsnlz Emk Rzzlnn Hadn. Mr jeffzny Lgg, Ms mm Shznkar (Mum Rail/Itimglx ¢- Yeah) rm lhu pmnusr. M: Sandosh Amndm (Mum .YanJmbAnandm:) for the dgfzndanus Slnzmgs: Szcnnn 304 Companies Act was (An :25) Order 24 Rulc 7l\ Rulcx of Coukt 2012 Urdu 48 of 111: Rules ofCourl Zflll. Cases: LMW Eleczmmr Pt: Uri u Aug Chung [ugly ar 4 Or! [201 01 1 ML} 135; rzoun 7 AMR 25301014 0.; mo HC 167 lam/nd n. .‘/lwmzrnjv rmmu ¢- Orr m/1.9:.» Appcul [2015] 3 CL) 592 CA /mu AV]:/or 54» BM .7 Sm mm (M; M an @‘AIa1/xr Appeal [znm] 2 cu 563 CA cm CI»: Kmug y. '1'.;z..g Caqwmlmv M m an pom] o 0.; can CA Curbxbaa my Bagmua/I Imgb c- On p. mmuw Pmrmmrgv ¢- 02;», Appeak [Z015j1CLj719 rc vapesunul By vmun: of puzgraph 3.21 shove, D1 was fully dxschmged .5 me parrnenz of RM654.DDO0Q ma ustezded the dwmshold of msoaoouou. Eu: m rhe pmme sun. Lhc plan-mfi sreks rn ruover the sum of m79.s,oou.m plus Anmesr rhercon and exemplary dnmngcs against D1, D2 and D3, 11.: gm mm ]1|:inIIff'.< complaint m ma present suit is amps wns m(<u11onl:d ma rm hem uscd by m as : c(u'p0nIe vehxde .0 man: D2 in evade us .;m.g.u'.m.< undcx (hr cm1scnryudgmcn{.T|-Ac p1.murr nllcgcn um D2 ma D3 are m truth and m rm nn: slnglt mrnmexul mm 2» distinct (mm lasing yrpum: legal mung: and that D1 111:4 camul on the business of D1 mm (In: mtcnuun ofdeflmunhng the plmnuil, .3 DZ’: crrdnoz The mnow gluund on which me plu or {mud Agmnxt Ihr. nlefcndmrs .5 pmnlltnrtd 15 um soon after .11: constnr pdgnem was recorded, D1 pxocurcd ammn resoluuum m b: pzstd m me: um D2‘: rucuvnbles m um form or pzuyecr consultancy fees from am of its tl1:n(s,:rr.“ass1gn:d" to D3. As such, Lhe plnmuffxs seeking for me rdxcfs as sand |n paragraph 22 of us snmnent of claim which am. im arm. briefly: as ramm- 7.! A declznnun that D1 ms camrd rm the buslnuw cf D2 wuh mmnmun to defraud the plam-iffi a.« D2‘: manor. vznesnln An order am 131 he pcmonnlly Luble [0 pay to me plamufl‘ ma mm ..r KM796,DODDfl Ioguhu wu.h unmm rhucnn nf 5% pt! anuum fmm 3 Much 2013 unul run nrzlizmon (“m|rnand.ing sum". bemg the am awed by DZ m me plamnff undcr me judgnenu 7 3 Allcrnauvclv, an umu dun D1 Ind D3 be }u|rILly and szvemlh mm: m pay «a zh: plmmff llm nutstnnding sum; and 7,4 Exunplzry damages ngamst m and/or D} A: mua carlmr. 21 mm nERM654.00(7.00 wu pild m the p|.I|nn|T The 1m paymcnf nm was made m (hr: plmnnfi was 1 Fcbmuy zou‘ 1-mmrm, m new of n2'.- default 1:: mcuung nu nblxgauuns :2 pa)’ ma consunl )udg-rncnl, um plmnuffpruceedcd by my nfyudgnicnt dam cxzrmnzuon and ubmnnl an mac. [0 mmm mg officcxs a[ D2, mcludmg D1, under me pzovxsluns of Order 48 of an Rulzs ol Court 2012 (uh: JDE") Followmg from Lhe JDE, an plzmnff discovered, inrm/ya, ch: foJ.low|ng:— 2.1 D2 had bean appointed hy mm (3) cmnpanles m pmnde consulunq s:mc:s m respect of um (3) scpxmtc pxayccts, pamculzrs of whuch an as follow): an I PLBVKH Em: San Bhd (“PLB-KH Bins") . “Cadzugan Skxm Penn-nzhrm Dy Ams box vaxrsvfll um dan Stbahagian Lm mu & mos, Sc-knycn 4, jnhn Chan Ferry, mmm mmcmnnh. scbmng um" (wmjm 1"). 3.1.2 Tt(hn\xl’ $1111 Bhd ("I':ch-An") — “Czdangnn Munbxm dan Mtnylapknn Makmb Rmdzh Salns mm (zvuum Tnnsknan, m Am L0: 615 hxnggz 42:, scbahzgun 622, 3740-17“. 3746, 3747 dnn 3749. Muku-n 9. Datum Qelaczang Pen: 5e1al7m. Pulzu Pmang" (”Fu7iecI2"). 313 P\.nn}nva Holvlmg: san Bhd (“Pulmiaya Holdings") — “The Pmpoxcd Conurucuun Ind Campluuon of spmc mud SR 1, Abzmdnmd Mam Drain mm and Canal Dr Sxlnng wmk; at I-mm I7. Puuaynya. vrumh Pcrszkuruan" (“Fmjecl 3'3 ; (collecuvcly mrmeu to 2.. “consu.lm.m:y pl-oi2I:t1") s.2 By reason of mg work am m (1.: consultancy pmm, D2 was owed pxofessxonzl consultancy rm bv PLB—KH Bum. T¢(l1»An ma Punmzya Holdings, as EoI.Iows.— IPLBVKH am k.m,.mn,mn on l_'r«h,An RM314,6(:7 0 V P tram: H01 gs _ 7 Told RM2,325,9§6.37 mum: 3.3 ‘lhz following events took plno: arm me conscnt yudgrncnl wns m-.m1u1;~ 331 I22 pasud . Dmczm-s Rgsnluunn clued 25 March 2011 auxhonslng PLB—KH Bma to (assign the pzofesxlonzl consulmncy fees, due [0 D2 {or Prmca 1, to be paid duecdy to D3. 93.: D2 paucd n Dm:cIv;r's Rumlumn mm: 26 May 1011 aulhm-mng Tczhdn m rznssxgn me pmfessmmx consultancy fies, due (0 D2 fm Pm]=ct 2, m 1;: paid duecm; to D3: 3.: 3 D2 passed a Direcwfs Rcaulumm ama 26 May 2011 nuxhnnsmg 1=..m.,a,. Holdings to (assign the pnvfcsqnnn] cnnullumcy rm. due :0 n2 fov Pxoyect 3, to be pm dnrtfly (0 1:3. and (collccuvely, “Lhc usolulions") 3.4 The .=~..1..m.« afnrcmld were executcd by nu. M adueclor ofD2. The plnnuff allcgts mm the deftndznts are guilty offrsuduknt Riding and in am mpm. the plamnffrelled on semen 304 "mm Comynmcs A(r1?(v5 (Act 125) whxcl-A mad: vanelofiu um xuw.-......., 1... ......:..u... Ir-«fin: 1.; u m [hr cows: ml Ihe wmdmg up ..r .. :......;w .. ... my puma ..,....<. 3 =....,,,.., 1 Ippun .-.. -y .. ... at .... m......., has bu: ¢....m .... with uni in defnlm ma...... 0! In mnpuly ..r ....m..... ..r ...y ...s..- ,...... ..r for my ll-nudulem 9...”... ma Cmm an the Ippllcnlnn .,r (Iv: .......a........ ....,. undue!nr»:unIr|IMnrvcHlve-mhmny.nvu;«,1F\l thinks pmpel 3. ... m. declare man my [mien Whfl Mai lmomngly a puny lo we ....m on mac 9......“ m .1... manncv mu bc pEN4I1fl“_\VE$vvV1Slhk.Wl|’VDuIiWy‘ImWll0II ollubxhly. Farah or W ..r Ih: am. a. me. habulmes m m wmpany .3. Ike (‘nun divem." 1o. 1.. unphfitzuun of 1...: arg\m\mts, m.....«a fnr an plzmuff mm 0.. th: pnnuples that W: dhnlled from [hr r..um....,; care: on nm.duI..-m Iradlngy (.1) may £p,......... P1: 14.1 . A... 0...“; fun)‘ c~ 4 0/: [zone] 1 ML] ms; [mo] 7 AME 25; [21:10] 4 cu aw HC:— mu Th: uwr: hrfnrc lhe awn mu .....n .».= ......,.=.......... cf: 191!)-‘d “mm. ...: hcxs 0. Inn (45: ms . hm Ih: nvcamnp .. .>.... .....m. .. n.. Vabffllnfl nl the wcclum .. mm clear 1. u only .u..ry m ..=........ m. ...m ..... ... ......... ... deli-Ind. {he ......a.... Q. pm... .w.....a .5 . Irma am.» qr pm... hy Ieasmw .4 nu: umds -.1 .. .m.¢..=-~ ... 3 _3g1_y n .5 Ihgnmrz Au4[>:i¢n| an... .... evndmm ...r.m me hill’! .. -vlkin .p... m: busmess of mm nu rm. mu-inched Mm am... in .m....am.u...n m— 1.. .., lI"l:1fflIA‘llIE1I|Hf|III!' um um xoamd um: .. ... .x...m....¢.a .. uhulhet n..- ....,...=.. ..r Insm ms mm camad an‘\-/uh ....a.. .. drlnud cnxhlun ., or for my ¢m..a.......,..p.,,.‘-......... the ........n. on zoom ~ M... a. y... ....=... ... .:..»...n n a. . .... ... dept“: endnars. .. sum: cmiimls. al‘-n ernlm K ..:»......m ... mum ..p.... nm... ,.....e .=.........a¢ ha (Cukmxn V In: Queen mm : ACLC we. M... .,«....m1................m...a»... mun vuesonl ul 1.. n |- flap:-Ilenl ...,u.. m .m.....u.m. ul nth pulneuhr mi: 5 ma by lhe Fcdcm (mm m my Dglmw «M sgn_uM& 1; 1 I/ xa.y_m; .9131 5,»; [man MU no up Aflln . .» c: (Mama) m mu-w Ihtn mpmmp us }cTu»m.1 y. Munrundy Nmiman o Orr .4m1'/lnnlivzr Ap;>m1[2016] 3 CL] .592 CA um ‘oclum mum aHheCA vtqmuv! pnmllhu mm... penal! mm be shown In bnuvmmbh no new busmtss ullheumpwy m M. . ...m... 547 u 1.» mm lh: cvedilms arm mmplny. Mm, dam] busvntss mm knmflcdfir mm m. c4vmpnn_\ wxll nol a: nu: lopay mans IN)! par scsuffiuenl In Lnggcrlhr subsnrl .. mu nun! be llrnun n-well Oh: s|nm:n.I_ul.d.~h|£w v-- In: purl al the .n...a Wm-..m whn such hvnnnux m m...nm.a m evldcnw m mm unl rm yhvwn deuly M, mmumslames an am pan of s.)..,.x where man gnmm af Alisha-Icny an nu pm an be an , nmbulcd .. hm: (pants so a :27’ |s1]w: now mu m hm mg mm um Judge rm mu mu. m¢....xm..rmm¢. ,5, my §!§A W:foum1hnrv:IAmgul Ih:mb»: m -.7 5 304 ufCIuI pan 42 m hrr grmnds or mgmnn luud . an n. daltvmmmg mu." mun hm hm“ mom, : scum, wuh mm. mm |Ia1Tm.In‘5 dcfimllmw wave and a4.m....= mm W; mus! he . qusmm 0| fvcr m be mu .4 imm :1 «mar.-.|..... ..r (h: ermmy ..r 0.. uvkvunl clmnmilancns Th: ma: fan afdueaovs um/nu: NI hlumen mm. um, knnu nun .. VS flfi prnsq-euoflhe cwdmvls bung mad Illarfvrz dues nm. :2! mm. wamm . finding Man .m.u..m w dcfnud gum [in mm mi; lbw: mm mm he ..mn....¢ mnrc The rm nl mmgxy Hiding while msulvem filth mu m: dwrmlms zre lwu: um u.= mam: mu nu! Ivtplnistvuupled mm . sunlumxx mlpmpntly m the mound ufvh: buslnss ......w...g lo dnhnnul mm M VA“ be «..:m.:... .0 mos: mg mmnma Ieqmrrmmlsoflhii semen In: In mu

Pytesseract-0.3.10

B52NCC-17-01/2017

PLAINTIF OCBC BANK (MALAYSIA) BERHAD DEFENDAN LAI CHOY THAI

25/07/2017

DATO' ISHAK BAKRI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=6c3d993a-b8fe-406b-b48b-9dc2878bd1e0&Inline=true

DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL KHUSUS SAMAN NO: BA-B52NCC-17-01/2017 ANTARA OCBC BANK (MALAYSIA) BERHAD ....PLAINTIF DAN LAI CHOY THAI ….DEFENDAN ALASAN KEPUTUSAN Pendahuluan [1] Ini adalah permohonan plaintif untuk merekodkan penghakiman ingkar kehadiran untuk satu jumlah yang melebihi daripada jumlah yang dinyatakan dalam pernyataan tuntutan plaintif. [2] Pada mulanya permohonan plaintif untuk memasukkan penghakiman ingkar kehadiran untuk satu jumlah yang melebihi daripada jumlah yang dinyatakan dalam pernyataan tuntutan telah dipohon di hadapan Penolong Kanan Pendaftar Puan Solehah Noratikah Ismail. Penolong Kanan Pendaftar Puan Solehah Noratikah Ismail tidak memberikan sebarang perintah terhadap permohonan plaintif atas alasan jumlah penghakiman yang dipohon melebihi daripada jumlah yang dinyatakan dalam pernyataan tuntutan plaintif. [3] Permohonan plaintif kemudiannya dipindahkan ke Mahkamah Sesyen di mana plaintif memohon perkara yang sama , antaranya, memohon penghakiman ingkar kehadiran direkodkan untuk satu jumlah yang melebihi daripada jumlah yang dinyatakan dalam pernyataan tuntutan plaintif. [4] Setelah meneliti dan mempertimbangkan permohonan plaintif, mahkamah memutuskan membenarkan penghakiman ingkar kehadiran direkodkan untuk jumlah yang kurang daripada jumlah yang dinyatakan dalam pernyataan tuntutan plaintif. Mahkamah juga turut menolak permohonan plaintif untuk merekodkan penghakiman ingkar kehadiran untuk jumlah yang melebihi daripada jumlah yang dinyatakan dalam pernyataan tuntutan plaintif. [5] Plaintif tidak berpuashati dengan sebahagian keputusan mahkamah dan memfailkan rayuan ke Mahkamah Tinggi Shah Alam. Berikut adalah alasan-alasan kepada keputusan mahkamah yang menolak permohonan plaintif. FAKTA KES [6] Fakta ringkas kes adalah seperti berikut. Plaintif telah memfailkan saman dan pernyataan tuntutan terhadap defendan untuk jumlah yang terhutang sepertimana yang dinyatakan dalam pernyataan tuntutan plaintif. [7] Setakat 29.3.2017 peguamcara plaintif memaklumkan kepada Penolong Kanan Pendaftar bahawa jumlah yang dituntut telah berubah kerana defendan telah membuat pembayaran untuk 4 facilities tersebut: (i)RM135,838.03 (menurun) (ii)RM212,848.17(meningkat) (iii)RM58,784.57 (menurun) (iv)RM307,080.80 (meningkat) [8] Penolong Kanan Pendaftar kemudiannya mengarahkan peguamcara plaintif membuat pindaan kepada pernyataan tuntutan plaintif sekiranya plaintif memohon untuk merekodkan jumlah penghakiman ingkar yang jumlahnya melebihi daripada jumlah yang dinyatakan dalam pernyataan tuntutan plaintif. Ini adalah perlu untuk mencerminkan jumlah sebenar yang dituntut oleh plaintif. [9] Pada 19.4.2017 ketika hadir semula di hadapan Penolong Kanan Pendaftar, peguamcara plaintif memohon penghakiman ingkar kehadiran direkodkan termasuk untuk jumlah yang melebihi daripada jumlah yang dinyatakan dalam pernyataan tuntutan plaintif dan enggan mematuhi arahan Penolong Kanan Pendaftar yang diberikan sebelum ini. [10] Memandangkan plaintif enggan mematuhi arahan Penolong Kanan Pendaftar, kes ini dipindahkan ke mahkamah sesyen untuk didengar pada 17.5.2017. KEPUTUSAN MAHKAMAH [11] Mahkamah memutuskan menolak permohonan plaintif kerana kaedah menyatakan jumlah yang dinyatakan dalam penghakiman ingkar hendaklah tidak melebihi daripada jumlah yang diplid dalam pernyataan tuntutan. [12] Order 13 rule 1 secara ringkas menyatakan jumlah dalam penghakiman ingkar hendaklah tidak melebihi jumlah yang diplid dalam pernyataan tuntutan. [13] Penghakiman ingkar yang direkodkan untuk jumlah yang melebihi daripada jumlah dalam pernyataan tuntutan seharusnya diketepikan (Rujuk kes Mahkamah Rayuan Wooley Development Sdn Bhd v Stadco Sdn Bhd ) 6 MLJ 111 [14] Seterusnya if the terms of the default judgment are different from the prayers in statement of claim and the damages obtained are more than the amounts prayed for, the default judgment is irregular and can be set aside (Cheow Chew Khoon v Abdul Johari Abdul Rahman) 1 MLJ 457. [15] Seterusnya A JID entered for interest more than the rate provided under O 42 f 12 can also be set aside (Development & Commercial Bank v Aspatra Corporation & Anor) 1 CLJ 141 FC) except for interest agreed by parties in contractual basis. [16] Oleh itu permohonan plaintif ditolak. Mahkamah berpendapat plaintif hendaklah meminda pernyataan tuntutan plaintif sekiranya plaintif ingin merekodkan jumlah yang lebih tinggi dari jumlah yang dinyatakan dalam pernyataan tuntutan plaintif. Bertarikh pada 25 haribulan Julai, 2017 tt (ISHAK BAKRI) Hakim Mahkamah Sesyen Shah Alam Selangor 5

Tika 2.6.0

B52NCC-17-01/2017

PLAINTIF OCBC BANK (MALAYSIA) BERHAD DEFENDAN LAI CHOY THAI

25/07/2017

DATO' ISHAK BAKRI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=6c3d993a-b8fe-406b-b48b-9dc2878bd1e0&Inline=true

DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL KHUSUS SAMAN NO: BA-B52NCC-17-01/2017 ANTARA OCBC BANK (MALAYSIA) BERHAD ....PLAINTIF DAN LAI CHOY THAI ….DEFENDAN ALASAN KEPUTUSAN Pendahuluan [1] Ini adalah permohonan plaintif untuk merekodkan penghakiman ingkar kehadiran untuk satu jumlah yang melebihi daripada jumlah yang dinyatakan dalam pernyataan tuntutan plaintif. [2] Pada mulanya permohonan plaintif untuk memasukkan penghakiman ingkar kehadiran untuk satu jumlah yang melebihi daripada jumlah yang dinyatakan dalam pernyataan tuntutan telah dipohon di hadapan Penolong Kanan Pendaftar Puan Solehah Noratikah Ismail. Penolong Kanan Pendaftar Puan Solehah Noratikah Ismail tidak memberikan sebarang perintah terhadap permohonan plaintif atas alasan jumlah penghakiman yang dipohon melebihi daripada jumlah yang dinyatakan dalam pernyataan tuntutan plaintif. [3] Permohonan plaintif kemudiannya dipindahkan ke Mahkamah Sesyen di mana plaintif memohon perkara yang sama , antaranya, memohon penghakiman ingkar kehadiran direkodkan untuk satu jumlah yang melebihi daripada jumlah yang dinyatakan dalam pernyataan tuntutan plaintif. [4] Setelah meneliti dan mempertimbangkan permohonan plaintif, mahkamah memutuskan membenarkan penghakiman ingkar kehadiran direkodkan untuk jumlah yang kurang daripada jumlah yang dinyatakan dalam pernyataan tuntutan plaintif. Mahkamah juga turut menolak permohonan plaintif untuk merekodkan penghakiman ingkar kehadiran untuk jumlah yang melebihi daripada jumlah yang dinyatakan dalam pernyataan tuntutan plaintif. [5] Plaintif tidak berpuashati dengan sebahagian keputusan mahkamah dan memfailkan rayuan ke Mahkamah Tinggi Shah Alam. Berikut adalah alasan-alasan kepada keputusan mahkamah yang menolak permohonan plaintif. FAKTA KES [6] Fakta ringkas kes adalah seperti berikut. Plaintif telah memfailkan saman dan pernyataan tuntutan terhadap defendan untuk jumlah yang terhutang sepertimana yang dinyatakan dalam pernyataan tuntutan plaintif. [7] Setakat 29.3.2017 peguamcara plaintif memaklumkan kepada Penolong Kanan Pendaftar bahawa jumlah yang dituntut telah berubah kerana defendan telah membuat pembayaran untuk 4 facilities tersebut: (i)RM135,838.03 (menurun) (ii)RM212,848.17(meningkat) (iii)RM58,784.57 (menurun) (iv)RM307,080.80 (meningkat) [8] Penolong Kanan Pendaftar kemudiannya mengarahkan peguamcara plaintif membuat pindaan kepada pernyataan tuntutan plaintif sekiranya plaintif memohon untuk merekodkan jumlah penghakiman ingkar yang jumlahnya melebihi daripada jumlah yang dinyatakan dalam pernyataan tuntutan plaintif. Ini adalah perlu untuk mencerminkan jumlah sebenar yang dituntut oleh plaintif. [9] Pada 19.4.2017 ketika hadir semula di hadapan Penolong Kanan Pendaftar, peguamcara plaintif memohon penghakiman ingkar kehadiran direkodkan termasuk untuk jumlah yang melebihi daripada jumlah yang dinyatakan dalam pernyataan tuntutan plaintif dan enggan mematuhi arahan Penolong Kanan Pendaftar yang diberikan sebelum ini. [10] Memandangkan plaintif enggan mematuhi arahan Penolong Kanan Pendaftar, kes ini dipindahkan ke mahkamah sesyen untuk didengar pada 17.5.2017. KEPUTUSAN MAHKAMAH [11] Mahkamah memutuskan menolak permohonan plaintif kerana kaedah menyatakan jumlah yang dinyatakan dalam penghakiman ingkar hendaklah tidak melebihi daripada jumlah yang diplid dalam pernyataan tuntutan. [12] Order 13 rule 1 secara ringkas menyatakan jumlah dalam penghakiman ingkar hendaklah tidak melebihi jumlah yang diplid dalam pernyataan tuntutan. [13] Penghakiman ingkar yang direkodkan untuk jumlah yang melebihi daripada jumlah dalam pernyataan tuntutan seharusnya diketepikan (Rujuk kes Mahkamah Rayuan Wooley Development Sdn Bhd v Stadco Sdn Bhd ) 6 MLJ 111 [14] Seterusnya if the terms of the default judgment are different from the prayers in statement of claim and the damages obtained are more than the amounts prayed for, the default judgment is irregular and can be set aside (Cheow Chew Khoon v Abdul Johari Abdul Rahman) 1 MLJ 457. [15] Seterusnya A JID entered for interest more than the rate provided under O 42 f 12 can also be set aside (Development & Commercial Bank v Aspatra Corporation & Anor) 1 CLJ 141 FC) except for interest agreed by parties in contractual basis. [16] Oleh itu permohonan plaintif ditolak. Mahkamah berpendapat plaintif hendaklah meminda pernyataan tuntutan plaintif sekiranya plaintif ingin merekodkan jumlah yang lebih tinggi dari jumlah yang dinyatakan dalam pernyataan tuntutan plaintif. Bertarikh pada 25 haribulan Julai, 2017 tt (ISHAK BAKRI) Hakim Mahkamah Sesyen Shah Alam Selangor 5

Tika 2.6.0

12ANCVC-94-11/2016

PERAYU BANDAR SUBANG SDN. BHD. (NO. SYARIKAT: 114944-K) …. PERAYU RESPONDEN LIM EU CHING (NO. K/P: 651030-01-6169) …. RESPONDEN

24/07/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

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DALAM MAHKAMAH TINGGI DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA RAYUAN SIVIL NO: 12ANCVC-94-11/2016 ANTARA BANDAR SUBANG SDN. BHD. (NO. SYARIKAT: 114944-K) …. PERAYU DAN LIM EU CHING (NO. K/P: 651030-01-6169) …. RESPONDEN [Dalam Perkara Mengenai Mahkamah Sesyen di Shah Alam Di Negeri Selangor Darul Ehsan Guaman No.: BA-B52NCVC-276-08/2016] ANTARA LIM EU CHING (NO. K/P: 651030-01-6169) .…PLAINTIF DAN BANDAR SUBANG SDN. BHD. (NO. SYARIKAT: 114944-K) ….DEFENDAN GROUNDS OF JUDGMENT Introduction [1] This is an appeal by the Appellant who was the Defendant, on the decision of the Sessions Court in allowing for the summary judgment under Order 14 of the Rules of Court 2012 against the Appellant by the Respondent, who was the Plaintiff. The Sessions Court found for the Plaintiff, that there was no triable issue on the part of the Appellant’s Defence. [2] Both parties, in this judgment, will be known as they were in the Sessions Court. Factual Background [3] The Plaintiff’s claim against the Defendant is for liquidated damages of the sum RM348,003.94 due to the Defendant’s delay of 3107 days in delivering vacant possession of a double storey semi-detached house held under the title H.S.(D) 177895, P.T. 4922 Mukim Bukit Raja, District of Petaling, State of Selangor Darul Ehsan with a postal address of No.3, Jalan Pulau Indanh U10/58, Seksyen U10, 40170 Shah Alam, Selangor Darul Ehsan (the said Property). [4] The Plaintiff is a Malaysian citizen of full age having his residential address at No.7, Jalan SL 7/5, Bandar Sungai Long, 43000 Kajang, Selangor Darul Ehsan whereas the Defendant is a private limited company duly incorporated in Malaysia with its registered address at No. 1, Lintang Angsana, Bandar Baru Ayer Itam, 11500 Pulau Pinang and its business address at No. 2-8, Bangunan Farlim, Jalan PJS 10/32, Bandar Sri Subang, 46000 Petaling Jaya, Selangor Darul Ehsan. [5] The Defendant is primarily involved in the business of property development wherein the Defendant’s projects include but not limited to a housing development known as the ‘Subang Impian, Shah Alam, Phase 2’ project (the said Development). [6] It was claimed that on or about 11.11.2005, the Plaintiff had entered into a Sale and Purchase Agreement dated 11.11.2005 with the Defendant (the SPA) (can be found at pages 99 – 124 of the Appeal Record) for the sale of the said Property within the said Development wherein the said Property was sold by the Defendant, being the Vendor, to the Plaintiff, being the Purchaser, for a total purchase price of RM409,135.00 (the Purchase Price). [7] The Plaintiff claimed that there are express terms and conditions of the said SPA on delivery of vacant possession which bind both the Plaintiff and Defendant, as follows: “Clause 23(1) Vacant possession of the said Building shall be delivered to the Purchaser in the manner stipulated in Clause 24 herein within twenty-four (24) calendar months from the date of this Agreement;” “Clause 23(2) If the Vendor fails to deliver vacant possession of the said Building in manner stipulated in Clause 24 herein within the time stipulated in sub-clause (1), the Vendor shall be liable to pay the Purchaser liquidated damages calculated from day to day at the rate of ten per centum (10%) per annum of the purchase price from the expiry of the delivery of vacant possession in sub-clause (1) until the date the Purchaser takes vacant possession of the said Building. Such liquidated damages shall be paid by the Vendor to the Purchaser immediately upon the date of Purchaser takes vacant possession of the said Building.” “Clause 23(3) For the avoidance of doubt, any cause of action to claim liquidated damages by the Purchaser under this clause shall accrue on the date the Purchaser takes vacant possession of the said Building.” [8] The Defendant alleged that there was no consideration given by the Plaintiff to the Defendant in relation to the purchase of the said Property as there was no payment made in accordance with clause 4.1 of the said SPA. The Plaintiff argued that Defendant’s allegation was wholly inaccurate as the said SPA and transfer of property had taken place due to reasons that the Defendant was indebted to Yap Grouting & Drilling Services Sdn. Bhd. (“Yap Grouting”) who was at that material time the main contractor for the said Development. [9] The Plaintiff claimed that the Defendant had offered the said Property to Yap Grouting to set-off the debts due and owing by Defendant to Yap Grouting and Yap Grouting who was also indebted to the Plaintiff, had in turn offered the said Property to the Plaintiff as a set-off against the debts due and owing by Yap Grouting to the Plaintiff. [10] The Plaintiff filed a Writ in the Shah Alam Sessions Court claiming against the Defendant for liquidated damages in the sum of RM348,003.94 for the delay in delivery of vacant possession of the said Property. On 25.10.2016, the Sessions Court allowed the Plaintiff’s application for summary judgment against the Defendant through the Notice of Application dated 23.8.2016, with the following orders granted: (a) the Defendant to pay the Plaintiff the total sum of RM348,003.94 being the Outstanding Sum; (b) the Defendant to pay to the Plaintiff interest on the total Outstanding Sum at the rate of 5% per annum from the date of the action until the date of judgment; and (c) the costs of the Plaintiff’s Application to be forthwith paid by the Defendant to the Plaintiff. The Cause Papers [11] The cause papers which are all filed in the Defendant’s Record of Appeal: “(a) Respondent’s Writ dated 10.08.2016 (“Writ”) [see: pages 10 to 20 ROA]; (b) Respondent’s Statement of Claim dated 10.08.2016 (“Statement of Claim”) [see: pages 21 to 36 ROA]; (c) Appellant’s Defence dated 07.09.2016 (“Defence”) [see: pages 37 to 45 ROA]; (d) Respondent’s Reply to Defence dated 22.09.2016 (“Reply to Defence”) [see: pages 46 to 73 ROA]; (e) Respondent’s Notice of Application for Summary Judgment dated 23.08.2016 (“Application”) [see: pages 1 to 9 ROA]; (f) Respondent’s Affidavit in Support affirmed on 25.08.2016 (“Respondent’s Affidavit in Support”) [see: pages 74 to 129 ROA]; (g) Appellant’s Affidavit in Reply affirmed on 23.09.2016 (“Appellant’s Affidavit in Reply”) [see: pages 130 to 145 ROA]; (h) Respondent’s Affidavit in Reply affirmed on 06.10.2016 (“Respondent’s Affidavit in Reply”) [see: page 146 to 218 ROA]; (i) Respondent’s Affidavit in Reply (II) affirmed on 10.10.2016 (“Respondent’s Second Affidavit in Reply”) [see: pages 219 to 238 ROA]; (j) Respondent’s Written Submissions dated 18.10.2016 [see: pages 1 to 33 of the Additional Record of Appeal (“AROA”); (k) Appellant’s Written Submissions dated 21.10.2016 [see: pages 34 to 45 AROA]; (l) Respondent’s Written Submissions in Reply dated 22.10.2016 [see: pages 46 to 53 AROA]; and (m) Grounds of Judgment dated 07.12.2016 [see: pages 54 to 68 AROA].” Defendant’s Submission [12] The learned counsel for the Defendant advanced several grounds in arguing that there are triable issues on this matter. This Court will zoom into the main grounds based on the Defendant’s counsel’s written submission and partly from oral submission. The written submission which are reproduced in parts are as follows: “6.1 The Respondent/Plaintiff had failed to disclose truthfully and fully in the Statement of Claim the circumstances under which the Sale and Purchase Agreement was signed. It is submitted that the Sale and Purchase Agreement was not a simple case of the Respondent as an ordinary purchaser was enticed to purchase the said property from the Appellant as developer and hence requires the court’s protection. 6.2 The Appellant did not offer or advertised to offer to sell the said property to the Respondent. The Respondent was aware that the Appellant signed the Sale and Purchase Agreement with the Respondent in respect of the said property and the transfer of the said property to the Respondent as the result of a commercial debt settlement by the Appellant with Yap Grouting. At all material time, the Respondent entered into the Sale and Purchase Agreement with the Appellant at the direction or instruction of Yap Grouting as a result of a commercial transaction of settlement of debt between the Respondent and Yap Grouting 6.3 It is submitted that the Sale and Purchase Agreement is a business arrangement in the guise of a statutory Sale and Purchase Agreement for the purchase of the said property by a normal purchaser. As the Respondent claimed that Yap Grouting was indebted to him, the Respondent had signed the Sale and Purchase as part of a commercial debt settlement with Yap Grouting. As such the Respondent is not an ordinary purchaser. 6.4 There was no consideration for the Sale and Purchase Agreement. No monies were paid for the purchase price by the Respondent to the Appellant. Yap Grouting only “authorised” Respondent to be the “purchaser” which are the words used in Yap Grouting’s letter dated 14.10.2005 as exhibited in the Respondent’s Affidavit in Reply (II) as “YYL-1” (“Yap Grouting Letter”) (pages 237 – 238 Appeal Record). There was no reason given for authorization by Yap Grouting to “authorize” the Respondent to sign the Sale and Purchase Agreement. In the ordinary meaning of the word “authorised” as found in the English Oxford Dictionary, it means to give permission. As such there was no consideration for the purchase of the said property from the Respondent. 6.5 The Respondent is not entitled to the benefit of clause 23 of the Sale and Purchase Agreement without satisfaction of the proof of the Respondent’s burden of paying the purchase price to the Appellant under clauses 3 and 4 of the Sale and Purchase Agreement. The Respondent cannot be entitled to take advantage of the Sale and Purchase Agreement by insisting on his rights under clause 23 while ignoring the provisions of clauses 3 and 4 which expressly states that the purchase price shall be paid to the Appellant as vendor. Clause 3 provides that the purchase price “shall be payable in the manner hereinafter provided”. Clause 4 provides that the purchase price “shall be paid by the Purchaser to the Vendor”. 6.6 ……… 6.7 ………. 6.8 ……… 6.9 The Respondent’s allegation that Yap Grouting offered the said property to the Respondent as debt settlement is adding facts which are not supported by the documents. The Yap Grouting letter did not state that there was a debt contra arrangement between Yap Grouting and the Respondent. The only thing that the Appellant agreed was the commercial debt contra arrangement between the Appellant and Yap Grouting as stated in the Appellant’s letter dated 29.10.2005 (“appellant’s Letter’) that had been exhibited as “IAW-1” in the Appellant’s Affidavit in Reply (pages 136-137 Appeal Record). The Appellant submits that the Respondent or Yap Grouting cannot add words orally or by way of affidavits to amend, vary, contradict or insert terms that were never in the Yap Grouting Letter or the Sale and Purchase Agreement. There is nothing in the Appellant’s letter or Yap Grouting’s Letter to support the Respondent’s allegations. Yap Grouting cannot add additional evidence by Affidavit to expand or to explain the contents of its letter to the Appellant. In the circumstances, Section 91 to 94 of the Evidence Act 1950 are applicable which disallows the Respondent to give parol or affidavit evidence to add, subtract, vary or contradict the Yap Grouting Letter or to remedy the defects in the Yap Grouting Letter or to use it in respect of the Sale and Purchase Agreement. As for the Appellant’s Letter, the Respondent is not a party to the said Letter. The following are the authorities referred:- (a) Citibank Bhd v Pembangunan Cahaya Tulis Sdn Bhd (receivers and managers appointed) & Ors and other suits [2012] 9 MLJ 181; (b) Datuk Tan Leng Teck v Sarjana Sdn Bhd & Ors [1997] 4 MLJ 329; (c) Tindok Besar Estate Sdn Bhd v Tinjar Co [1979] 2 MLJ 229; (d) Encony Development Sdn Bhd v Robert Geoffrey Gooch & Anor [2016] 3 MLJ 400. [13] The Defendant’s counsel submits that the Sessions Court had erred in deciding that the purchase price can be settled by a set-off agreement between a third party and the Plaintiff. The Defendant submits that the set-off and facts on consideration were never pleaded in the Statement of Claim. As such the facts pertaining to a set-off agreement cannot be considered by the Court. [14] In addition, counsel for the Defendant submits that the Plaintiff should have amended the Statement of Claim and cannot simply add facts by incorporating it in the Affidavit In Reply. Counsel also added that the Affidavit of Yap Grouting was not the one whom instructed for the contra debt arrangement and the said Affidavit was 14 days late. [15] The counsel for the Defendant also submitted that although the SPA is a statutory agreement, the terms must be enforced fairly without undue preference to one party. The Defendant’s counsel submitted that it would not be fair to the Defendant where the court construed the LAD terms in the SPA in favour of the Plaintiff while ignoring the pre-conditions and the Plaintiff’s obligations for claiming LAD. It is also not fair to the Defendant to ignore or overlook the terms of SPA in favour of the Plaintiff or not to enforce the terms of SPA in favour of the Defendant. [16] It is submitted that the Court must give effect to the intention of the parties notwithstanding it is an agreement made pursuant to the Housing Development (Control and Licensing) Act 1966. The Defendant’s counsel referred to the authority in the case of Foong Seong Equipment Sdn Bhd (Receivers and Mangers appointed) v Keris Properties (PK) Sdn Bhd and another appeal [2013] 2 MLJ 361 as a general principle of the interpretation of contracts. [17] In relation to the loan, the Defendant submitted that the Court should not condone the Plaintiff in misleading the Bank when the Plaintiff took the monies for purchase financing for his own use when the loan monies should have been paid to the Defendant to pay the purchase price. This is because the purpose of the loan was for purchase financing as stated in the Facility Agreement and also the Letter of Offer. Thus, it is submitted that Plaintiff failed to use the loan as to the purpose of the loan itself (which was for the said Property purchase financing) since he had used the loan for his own purposes and enjoyed the benefit of the loan. As such it is not right for the Defendant to pay LAD to the Plaintiff when he has obtained benefits under the SPA without having to fulfill his obligations to pay the purchase price from the loan under clause 5(2) of the SPA. [18] In addition, the Defendant submits that the Plaintiff committed a fundamental breach of the SPA by using the said Property to obtain loan financing and without utilizing the loan to pay the Defendant, the Plaintiff is estopped from claiming for LAD and relied on the authority Ching Yik Development Sdn Bhd v Setapak Heights Development Sdn Bhd [1996] 3 MLJ 675. [19] The Defendant’s counsel submitted that Plaintiff is not allowed to raise an allegation of fact in his affidavits which is not pleaded and which is inconsistent with the Statement of Claim in order to improve his claim. In addition, he argued that the Defendant’s Defence need only show a triable issue for a full trial under Order 14 Application for a Summary Judgment and that the Defendant need not show a complete defence. [20] On that point, the counsel for the Defendant referred to the following authorities, the case of BANK NEGARA MALAYSIA V MOHD ISMAIL & ORS [1992] 1 MLJ 400 (Pages 255 to 270 Appellant Bundle of Authorities) and the case of Eng Say Kuang v Hong Leong Bank Bhd [2008] MLJU 38 (pages 271 to 276 Appellant Bundle of Authorities). [21] The Court heard the submission by the Defendant’s counsel that the late delivery of physical possession was about after 10 years, due to beyond circumstances of control as there was a stop work order issued by the local authorities where additional conditions were imposed after the completion and the Certificate of Fitness was issued later. The Defendant claimed that frustration of contract occurred. [22] On the issue of limitation, the counsel submitted that the SPA was signed on 11.11.2005 and the 6 years limitation started on 1.1.2007 until year 2013 which would mean the claim by the Plaintiff filed in 2016 would be time barred and added that this was not pleaded by the Plaintiff. Plaintiff’s Submission [23] The Plaintiff’s counsel assertion is that there was a SPA signed and the Plaintiff is entitled to invoke LAD when there is a delay in the delivery of vacant possession of the said Property. [24] The Plaintiff’s counsel argued that there was an arrangement where the Defendant will transfer the said Property to Plaintiff instead as the 3rd party whom owed to Plaintiff and the Defendant’s allegation is wholly inaccurate, misconceived and baseless. The counsel submitted as in its written submission: “17.1 prior to executing the said SPA, the Appellant was indebted to Yap Grouting & Drilling Services Sdn. Bhd. (hereinafter referred to as “Yap Grouting”), who was at the material time the main contractor for the said Development; 17.2 this circumstances had then caused the Appellant to offer the said Property to Yap Grouting in order to set-off the debts due and owing by the Appellant to Yap Grouting. This fact had been duly admitted by the Appellant in its pleadings [see: paragraph 4.3 Appellant’s Defence at page 38 ROA and paragraph 6.2 Appellant’s Affidavit in Reply at page 132 ROA]; 17.3 however, at the same time, Yap Grouting was also indebted to the Respondent and therefore Yap Grouting had in turn, offered the said Property to the Respondent as a set-off against the debts due and owing by Yap Grouting to the Respondent. This fact had been duly confirmed by Yap Yoon Loong, the director of yap Grouting in the Respondent’s Second Affidavit in Reply affirmed by yap Yoon Loong himself [see: paragraph 6.3 Respondent’s Second Affidavit in Reply at page 222 ROA]; 17.4 subsequent to the Respondent’s acceptance of the offer by Yap Grouting, all parties, including the appellant, had agreed and/or consented for the said Property to be transferred directly to the Respondent (hereinafter referred to as the “Contra Agreement’). 18. The existence of the Contra Arrangement was at all material times never disputed by the Defendant and is clearly shown in a letter of settlement dated 29.10.2005 between Yap Grouting and the Appellant [see: Exhibit IAW-1 Appellant’s Affidavit in Reply at page 137 ROA] as well as the letter dated 14.10.2005 from Yap Grouting to the Appellant [see: Exhibit YYL-1 Respondent’s Second Affidavit in Reply at page 238] of which the consideration value of the Contra Arrangement was notably the Purchase Price as stipulated under Clause 3 the said SPA. 19. Following the above, it is pertinent to note that a valuable consideration for a promise may consist in some benefit conferred on the promisor, or detriment suffered by the promise, or both as defined under Section 2(d) Contracts Act 1950 [SEE: Tab 1 Respondent’s Bundle of Authorities (“RBOA”)], which states that:- “When, at the desire of the promisor, the promise or any other person has done or abstained from doing, or does or abstains from doing, or promises to do or to abstain from doing, something, such act or abstinence or promise is called a consideration for the promise.” [25] The counsel for the Plaintiff relied on the case of Korakyat Plantations Sdn Bhd (in liquidation) v Tan Siew Ee & Ors [2006] 1 MLJ 274 where 10% of the purchase price for each property were made and that the letter of undertaking unconditionally agreed to transfer the said property unit to the respondent free from encumbrances as a total set-off against loans taken by the appellant from the respondents and this was considered to be a valuable consideration. [26] The Plaintiff’s counsel conceded that there was a valuable consideration based on the alternative mode of payment by setting-off via the contra arrangement which consist the said Property to be transferred by the Defendant to the Plaintiff, coupled with the act of executing the memorandum of transfer by the Defendant of the said Property to the Plaintiff is an admission of receiving a valuable consideration from the Plaintiff. In view of receiving the valuable consideration from the Plaintiff, Plaintiff’s counsel submits that it is for the Plaintiff to invoke clause 11(2) of the SPA. [27] About the loan facility, counsel also submitted that this is irrelevant and Plaintiff had suffered loss and could not utilize the said Property for the last 10 years as could not take loan and suffered cash flow which resulted the said Property to be mortgaged with RHB Bank. [28] In terms of the delay in delivering vacant possession due to the stop work order argument, counsel for the Plaintiff asserted that based on Regulation 11 of the Contract of Sale of Housing Development (Control & Licensing) Act, there is a provision on special circumstance where the clause on vacant possession may be waived or modify the due date of delivery of vacant possession. The Plaintiff’s counsel argued that the Defendant should have applied for waiver or modification under the said regulation 11 and relied on the authorities of Tan Sri G. Darshan Singh v. Loke Kee Deve. [2010] 7 MLJ and Ng Hean Ying & Ors v. Ken Property Sdn Bhd [2013] MLRH and therefore the Defendant is estopped to raise the stop work order defence. [29] On the issue of limitation, Plaintiff’s counsel argued that the cause of action was done within time based on Clause 23(3) of SPA where Plaintiff is entitled to claim for LAD. In reply to the contra debt arrangement alleged by Defendant that it was not pleaded, the counsel for the Plaintiff submits that that statement is not true as additional facts had been given in response to Defendant’s defence under the issue of consideration. Sessions Court’s Decision [30] The Sessions Court had considered all the issues submitted and had decided as follows, which parts of the judgement is reproduced here: “Dakwaan tiada balasan dan perjanjian jualbeli tidak menunjukkan niat sebenar pihak-pihak kerana harga belian tidak dibayar 5. Defendan menimbulkan isu bahawa tiada balasan atas pembelian ini kerana plaintif tidak membayar jumlah RM409,135.00 seperti yang dinyatakan dalam klausa 4.1 perjanjian. Bagaimanapun Mahkamah berpendapat fakta berkenaan set-off tidak boleh diabaikan kerana ia menjadi asas kepada persetujuan pihak-pihak untuk memasuki perjanjian jualbeli. Untuk isu ini, Mahkamah merujuk keputusan Mahkamah Rayuan kes Korakyat Plantiations Sdn Bhd v. Tan Siew Ee & Ors [2005] 2 CLJ 578 dimana Mohd Ghazli Yusoff JCA memutuskan seperti berikut: “…….. The said ‘letters of undertaking’ issued by the appellant in respect of the lots identified therein clearly spelt out that the appellant unconditionally gre that it “will transfer/assign the above units of property free of any and whatsoever encumbrances/ or claim by us as a total set off against the loan take from you”. We would agree with the contention of counsel that this is tantamount to an admission by the appellant that they had received valuable consideration from the respondents concerned.” 6. Walaupun fakta kes adalah berlainan namun prinsipnya adalah sama dimana sebarang hutang boleh di set-off atau ditolak dengan persetujuan pihak-pihak selepas valuable consideration diterima. Dalam kes ini, defendan berstuju nilai keberhutangan defendan sebanyak RM409,135.00 yang dibuat secara set-off adalah nilai harga belian. 7. Klausa 11(2) memperuntukkan berikut: “……..subject to the payment of the purchase price by the Purchaser to the Vendor ……the Vendor shall, within twenty one (21) days, execute a valid and registrable memorandum of transfer of the said property to the Purchaser.” Walaupun tiada bayaran dibuat, defendan masih melaksanakan borang pindahmilik sehingga geran hakmilik di atas nama plaintif dikeluarkan seperti yang ditunjukkan di exh. “LEC-1” (L.5). Ini disebabkan oleh persetujuan defendan untuk menolak hutangnya secara set-off dengan hartanah berkenaan. Defendan adalah terikat dengan surat persetujuan yang dicapai dengan Yap Grouting. 8. Mahkamah berpendapat siapa yang hendak dinamakan oleh Yap Grouting sebagai pembeli/pemilik hartanah dalam perjanjian jualbeli adalah hak Yap Grouting. Oleh itu plaitif yang dinamakan dalam perjanjian tidak sepatunya dijadikan isu kerana defendan telah memberikan persetujuan mereka untuk menamakan plaintif sebagai pembeli. Mahkamah berpendapat jika defendan mendakwa bayaran tidak dibuat dan tiada persetujuan berkenaan set-off serta nama plaintif sebagai pembeli dipertikaikan maka tidak mungkin defendan menandatangani perjanjian jualbeli dengan plaintif. Jika defendan masih mendakwa harga belian mesti dibayar dan set-off dipertikaikan maka defendan secara jelas telah melanggar surat persetujuan yang dicapai di atas 9. Berdasarkan alasan-alasan yagn dinyatakan, Mahkamah berpendapat perkara ini tidak lagi menjadi isu apabila defendan sendiri telah bertindak melaksanakan dokumen pindahmilik sehingga hartanah berjaya didaftarkan atas nama plaintif seperti yang ditunjukkan di exh. “LEC-1”. 10. Mahkamah berpendapat melalui perbuatan dan tindakan defendan, defendan telah diestop daripada menimbulkan isu-isu ini terutama apabila defendan tidak pernah pada bila-bila masa membangkitkan bahawa tiada bayaran dibuat oleh plaintif. Exh. “LEC-1” jelas menunjukkan bahawa plaintif adalah pemilik rumah tersebut. Oleh itu juga, plaintif sebagai pemilik berdaftar adalah bebas untuk berurusan dengan hartanah tersebut seperti menggadaikannya kepada RHB Bank untuk pinjaman yang diambil. Priviti kontrak dan isu Iocus standi 11. Defendan membangkitkan isu bahwa tiada privit kontrak diantara plaintif dengan defendan kerana surat persetujuan adalah diantara defendan dengan Yap Grouting. Atas sebab ini maka defendan mendakwa plaintif hanya bertindak sebagai ejen kepada Yap Grouting dan dengan itu plaintif tiada locus standi untuk memulakan tindakan bagi menuntut gantirugi LAD terhadap defendan. 12. Untuk isu ini, Yap Grouting telah mengesahkan bahawa hartanah telah diberikan kepada plaintif. Defendan telah menandatangani perjanjian jualbeli dengan plaintif dan bukan dengan Yap Grouting. Tiada dimana-mana dalam perjanjian jualbeli yang menyatakan bahawa plaintif bertindak sebagai ejen kepada Yap Grouting. Mukasurat hadapan perjanjian jualbeli di exh. “LES-2” (L.5) jelas menunjukkan bahawa plaintif adalah pembeli tanpa sebarang syarat. Oleh kerana plaintif adalah pembeli yagn dinamakan dan plaintif telah diisukan dengan geran hakmilik sebagai pemilik berdaftar maka Mahkamah berpendapat plaintif mempunyai locus standi untuk membawa tindakan ini terhadap defendan. Berdasarkan alasan ini maka Mahkamah berpendapat isu ini juga bukan isu untuk dibicarakan. Kelewatan menyerahkan milikan kosong hartanah 13. Berdasarkan perjanjian jualbeli, defendan dikehendaki menyerahkan milikan kosong dalam masa 24 bulan dari tarikh perjanjian (11.11.2005) dimana milikan kosong patut diberikan pada 11.11.2007. Namun tarikh penyerahan sebenar dibuat pada 13.5.2016 – exh. “LEC-3” (L.5). Fakta jelas menunjukkan berlaku kelewatan selama 9 tahun 6 bulan. 14. Defendan mendakwa kelewatan adalah disebabkan oleh Perintah Berhenti Kerja (stop work order) dan Yap Grouting mempunyak pengetahuan mengenainya. Defendan juga mendakwa disebabkan Yap Grouting mempunyai pengetahuan maka plaintif diestop daripada menuntut gantirugi LAD. Mahkamah berpendapat samada Yap Grouting atau plaintif mempunyai pengetahuan, pengetahuan tersebut tidak boleh di infer terhadap plaintif. Plaintif tidak diestop daripada menuntut gantirugi LAD kerana pihak-pihak adalah terikat dengan terma-terma di dalam perjanjian. 15. Perintah Berhenti Kerja bukan suatu halangan kepada plaintif untuk melaksanakan haknya dalam menuntut LAD. Perjanjian jualbeli adalah tertakluk kepada peruntukan statutory yang mengawal aktiviti defendan sebagai pemaju. Peraturan 11(1) Housing Development (Control & Licensing) Regulations 1989 telah memperuntukkan berikut: “11. Contract of sale (1) Every contract of sale for the sale and purchase of a housing accommodation together with the subdivisional portion of land appurtenant thereto shall be in the form prescribed in Schedule G and where the contract of sale is for the sale and purchase of a housing accommodation in a subdivided building in the form of a parcel of a building or land intended for subdivision into parcels, as the case may be, it shall be in the form prescribed in Schedule H.” 16. Berdasarkan Jadual G maka klausa berkenaan penyerahan milikan kosong telah dimasukkan ke dalam perjanjian jualbeli (klausa 23(1), (2) & (3)) sebagai peruntukan statutori untuk melindungi pembeli daripada pemaju. 17. Berikutan wujudnya tempoh penyerahan milikan kosong dalam perjanjian sebagaimana Jadual G maka Peraturan 11(3) terpakai kepada defendan jika milikan kosong tidak dapat diberikan dalam tempoh yang ditetapkan. Peraturan 11(3) memperuntukkan berikut: “(3) Where the Controller is satisfied that owing to special circumstances or hardship or necessity compliance with any of the provisions in the contract of sale is impracticable or unnecessary, he, may, by a certificate in writing, waive or modify such provisions: Provided that no such waiver or modification shall be approved if such application is made after the expiry of the time stipulated for the handing over of vacant possession under the contract of sale or after the validity of any extension of time, if any, granted by the Controller.” 18. Peruntukan berkenaan penyerahan milikan kosong adalah peruntukan statutori yang menyebabkan klausa berkenaannya telah dimasukkan ke dalam perjanjian jualbeli dan mestilah dipatuhi oleh defendan. Dalam keadaan dimana defendan mempunyai masalah untuk menyerahkan milikan kosong disebabkan oleh Perintah Berhenti Kerja, maka adalah menjadi tanggungjawab defendan sepenuhnya untuk memohon perlanjutan masa kepada Pengawal Perumahan (Controller of Housing). Dalam hal ini, defendan gagal berbuat demikian dimana tiada kebenaran bertulis oleh Pengawal diberikan kepada defendan untuk melanjutkan masa menyerahkan milikan kosong melebihi tempoh 24 bulan sebagaimana yang ditetapkan dalam kalusa 23(1) perjanjian. 19. ……… 20. ……… 21. ……… 22. ……… 23. Berdasarkan otoriti-otoriti di atas, defendan sekarang diestop daripada membangkitkan isu Perintah Berhenti Kerja oleh pihak berkuasa kerana defendan sendiri telah gagal melaksanakan tanggungjawab statutori mereka untuk memohon kepada Pengawal Perumahan bagi perlanjutan masa. Isu had masa 24. Mahkamah berpendapat isu had masa tidak terpakai kepada plaintif kerana undang-undang berkaitan had masa adalah jelas. Pihak-pihak juga terikat dengan perjanjian jualbeli. Walaupun perjanjian ditandatangi pada 11.11.2005, kausa tindakan hanya bermula dari tarikh penyerahan milikan kosong sebenar diberikan sebagaimana klausa 23 perjanjian dan bukan 6 tahun dari tarikh perjanjian ditandatangani. 25. ………. 26. ………. 27. Fakta jelas menunjukkan bahawa milikan kosong diserahkan pada 13.5.2016. Gantirugi LAD hanya dapat dikria selepas plaintif mengambilkira milikan kosong dan bukan sebelumnya. Di atas alasan-alasan yang dinyatakan, Mahkamah berpendapat tiada isu yang perlu dibicarakan dan dengan itu permohonan plaintif untuk memasukkan penghakiman muktamad terhadap defendan di bawah A.14 KKM 102 telah dibenarkan dengan kos.” THE COURT’S FINDING [31] This is an appeal on summary judgment application made by the Plaintiff which was allowed against the Defendant. Matters pertaining to summary judgment under Order 14 of the ROC 2012 had been decided in a plethora of cases. It is a principle, which remains good and trite law that the plaintiff is to establish a prima facie case. This would mean that when there is no dispute as to the fact and law, the plaintiff can dispose an action where the defendant’s defence is clearly unsustainable in law or on the facts without the need for a full trial. [32] A number of cases supporting the principle under summary judgment can be referred from some of the authorities attributed by both counsels, the case of Bank Negara Malaysia v Mohd Ismail Ali Johor & Ors [1992] 1 CLJ (Rep) 14, a Supreme Court decision, the case of Eng Seng Kuang v Hong Leong Bank Bhd [2008] MLJU 38; Malayan Insurance (M) Sdn Bhd v Asia Hotel Sdn Bhd [1986] 1 MLRA 269 and National Company for Foreign Trade v Kayu Raya Sdn Bhd [1984] 1 MLRA 190. [33] In order to show whether there ought to be tried, the elements required can be found in the case of Shell Malaysia Trading Sdn Bhd v Filotek Trading Sdn Bhd [1999] 8 CLJ 592, where the High Court Penang which made reference to the Federal Court case of Fira Development Sdn Bhd v Goldwin Sdn Bhd. [1989] 1 CLJ 34 had this to say, “On the hearing of such an application, the court may give such judgment for the plaintiff against that defendant, “unless the court dismisses the application or the defendant satisfies the court with respect to the claim or to the part the claim to which the application relates that there is an issue or question in dispute which ought to be tried or that there ought for some other reason to be a trial of that claim or part” (Ord. 14 rule 3). A defendant may show cause against a plaintiff’s application (i) by a preliminary or technical objection, or (ii) on the merits, eg. That he has a good defence to the claim on the merits or that a difficult point of law is involved, or a dispute as to the facts which ought to be tried, or a real dispute as to the amount due which requires the taking of an account to determine, or any other circumstances showing reasonable grounds of a bona fide defence (The English Supreme Court Practice 1997 vol. 1 para 14/3 – 4/3). What is a defence on the merits? The Supreme Court, in Fira Development Sdn Bhd v Goldwin Sdn Bhd [1989] 1 CLJ 34 per Lee Hun Hoe CJ (Borneo), imparted that “a defence on the merits means merely raising only an arguable or triable issue.” [34] Therefore in determining a prima facie case, the facts and evidence on Plaintiffs claim must be proven on the balance of probabilities and whether the Defendant has a triable issue. The crux of the matter is whether the Plaintiff is entitled to invoke liquidated ascertained damages (LAD) under the SPA to which the Defendant contended that no consideration had been passed between the Defendant and the Plaintiff in purchasing the said Property. [35] The learned counsel for the Plaintiff submitted that there was an arrangement made where three parties agreed to a contra debt or set-off method of payment. The subject-matter of the set-off is the said Property which is to be transferred to the Plaintiff. The Plaintiff pleaded for the LAD in his Statement of Claim by referring to some of the provisions of the SPA. The Plaintiff had pleaded that the full terms and conditions of the SPA “and the effects thereof would be referred to and relied upon during the trial itself.” (at page 33 of the Appeal Record). [36] Upon careful perusal of the pleadings, how the issue of consideration came about can be found in Defendant’s Defence (at paragraph 4.2 and 4.3, page 43 of the Appeal Record) stating that the Plaintiff was not entitled to claim for LAD under the clause 23(2) of the SPA as Plaintiff did not comply with clause 4(1) of the SPA and the Settlement Letter of 29.10.05 was between the Defendant and Yap Grouting who had agreed to accept the said Property as a full set off against the outstanding account of RM409,135.00 due from the Defendant to Yap Grouting. [37] The Plaintiff in reply to the defence made by the Defendant stated (at paragraphs 6, 6.1 and 6.2, at page 66 of the Appeal Record) that Yap Grouting agreed to accept the said Property as a full set-off against the outstanding amount due owing by the Defendant and Yap Grouting subsequently offered the said Property to the Plaintiff as a set-off against the debts due and owing by Yap Grouting to the Plaintiff. Plaintiff averred that there was consideration passed and that Plaintiff signed the SPA and said Property was registered under Plaintiff’s name (paragraphs 6.1 – 6.6, at pages 66-67 of the Appeal Record). [38] The preliminary requirements for an Order 14 application have been set out by Sean FJ (as he then was) in the case of National Company For Foreign Trade v Kayu Raya Sdn Bhd [1984] 2 CLJ 220 and there his Lordship itemized the following requirements: “(1) that the defendant must have entered an appearance; (2) that the statement of claim must have been served onto the defendant; and (3) that the affidavit in support of the application must have complied with the requirements of O. 14 r.2 of the RHC.” [39] Based on the Plaintiff’s Statement of Claim, the cause of action pleaded is for the LAD as provided under the SPA as supported by his affidavit. Therefore the issue of entitlement to LAD under the SPA led to the issue of consideration raised as a defence by the Defendant. In addition, the Defendant also claimed that the Plaintiff acted as an agent of Yap Grouting which was denied by the Plaintiff by submitting further material facts. I have to agree with the counsel for the Plaintiff that the Plaintiff’s Statement of Claim had stated the material facts for the Plaintiff to plead its cause of action against the Defendant and had in reply to the Defendant’s Defence, given more material facts by stating the background to his claim. This is in reliance of the authority attributed by the counsel for the Plaintiff in the case of Bruce v Odhams Press, Limited [1936] 1 All ER 287, see page 294. The word “material” means, “necessary for the purpose of formulating a complete cause of action; and if any one “material” statement is omitted, the statement of claim is bad…” [40] The Plaintiff claimed that all parties including the Defendant consented for the said Property to be transferred directly to the Plaintiff and this contra debt agreement was never disputed by the Defendant as reflected in their reply to the letter of 29.10.2005 (as exhibit “IAW-1” attached to Defendant’s Affidavit in Reply, at page 137 of the Appeal Record). The contra debt arrangement evidence adduced is further corroborated by Yap Grouting’s Affidavit In Reply (II) (at pages 219 – 226 and 229 – 236 of the Appeal Record) to support the fact that the Plaintiff is the registered owner of the said Property and was never an agent of Yap Grouting. [41] Triable issues must relate to the relevant issues or matter pleaded by the Defendant in his statement of defence. The defence raised by the Defendant that there was no privity of contract as no consideration moved from Plaintiff to Defendant could not hold water. The defence that the Plaintiff was acting as an agent for Yap Grouting is denied by Yap Grouting. In its plain meaning and obvious case, the contract made by Yap Grouting to Defendant was for himself as well as for the Plaintiff to set-off the debt between Yap Grouting and Defendant which this consideration supports such a contract. In the case of McEvoy v Belfast Bunking Co Ltd [1935] AC 24, is a case where a father who had Sterling Pounds of 10,000 on deposit with the Belfast Bank, transferred it to a deposit account in the names of himself and of his infant son. Soon after, he died. The executors were allowed by the bank to withdraw the money and put it into an account in their own names. The money was in fact lost in attempts to keep the family business alive and the son sued the bank. One of the arguments by the Bank was that no rights accrued to the son over the deposit account because he had furnished no consideration. The argument was however rejected by the English Court. [42] The counsel for the Plaintiff contended that there is indeed a valuable consideration provided by the Plaintiff vis-à-vis the said Property and the SPA and relied on a number of authorities, among others: section 2 (d) Contracts Act 1950; Guthrie Waugh Bhd v Malaippan Muthucumaru [1970] 1 MLRH 432 and Korakyat Plantations Sdn Bhd (in liquidation) v Tan Siew Ee & Ors [2006] 1 MLJ 274. The counsel for the Plaintiff also relied on a recent case, NV Bina Sdn Bhd v Magna Park Sdn Bhd [2016] 9 MLJ 313 where the Court had held, borrowing Plaintiff’s counsel’s quote from the written submission, “On the second point, the fact that no consideration flowed from the promise is immaterial. The position in Malaysia under the Contracts Act 1950 – distinct from the common law position – is that consideration need not flow from the promise; it suffices that any one party provides the consideration for there to be a valid contract: see the decision of the Judicial Committee of the Privy Council in Kepong Prospecting Ltd & Ors v Schmidt [1968] 1 MLJ 170. The promise by the defendant to make direct payments, and the benefit conferred on Bina BMK by reason of being relieved of the obligation to make the same payments, should very clearly provide the requisite consideration.” (emphasis added) [43] On the face of it, there was a valuable consideration and the agreement was properly executed. The title of ownership of the said Property is held by the Plaintiff, the Defendant could not object to Plaintiff’s ownership and the contractual arrangements that existed between them. There is a clear contractual arrangement in the instant case. Unlike in the case of Tan Eng Choong v Foo Kai Yuen [1988] 1 MLJ 531 where the application for a summary judgment was dismissed as the status of the parties and their contractual arrangements were far from clear. In that case, the plaintiff was of the impression that he was a partner to the legal firm with the defendant whereas the defendant consented on a different arrangement. The High Court held that for the Court to allow for a summary order under Order 43 r.1(i) of the Rules of the High Court 1980 would be a misconceived and the order of the Senior Assistant Registrar which allowed the plaintiff’s application was set aside. [44] It is this Court’s finding that Yap Grouting’s said letter was attached to the Defendant’s Affidavit which clearly proves that the Defendant never objected to Plaintiff as part of the contra debt arrangement and thus as authorized registered owner of the said Property. Therefore the defence raised by the Defendant did not defeat the Plaintiff’s claims, neither did it support the Defendant’s defence. As remarked by Ramli Ali JCA (now FCJ) in the case of Carta Bintang Sdn Bhd v RHB Capital Berhad [2009] MLJU 360, “…An issue may be relevant, but if the determination can be done by way of affidavit evidence (as in Order 14 application) then such an issue is not “triable issue”, and therefore cannot be used to frustrate for summary judgment.” [45] On the issue of LAD under the SPA (at pages 176 – 218 of the Apepal Record), the Plaintiff has the right to invoke clause 23(1), (2) and (3) of the SPA. Clause 23 (1) clearly spelt out on the LAD provision whereas clause 23 (2) and (3) provides in the event clause 23(1) is not fulfilled which will trigger clause 23(2) of the SPA. The words are clear that the vendor will be liable to pay from the expiry of the delivery of vacant possession in clause 23(1) until the date the purchaser takes vacant possession of the said Property. Therefore where the terms of the contract in relation to delivery of vacant possession had been reduced to writing, that is the SPA and the language is very clear and unambiguous, it is not open for the judge to improve on it as it would be adding new terms into the agreement: Tindok Besar Estate Sdn Bhd v Tinjar Co [1979] 2 MLJ 229. [46] In relation to the stop work order defence by the Defendant, the SPA had conformed to the statutory requirement of attaching Schedule G to the SPA following Regulation 11(1) Housing Development (Control & Licensing) Regulations 1989. Form G on vacant possession had been included in the SPA. Therefore the argument that there was a stop work order to justify the delay is not a defence as it the Defendant who is responsible to apply for an extension of time for delivery of vacant possession. Failure to do so by the Defendant would be a clear breach of the SPA. It would also be illogical for developer or vendor not to apply for an extension of time which is allowed under the law. Based on the SPA, it is clear that the LAD can be invoked when there is a delay on delivering the vacant possession of the said Property and therefore failure to do so by the Defendant does not absolve the Defendant of his liability to pay LAD based on the case attributed by counsel for the Plaintiff in Tan Sri G darshan Singh v Loke Kee Development Sdn Bhd and Anor [2009] 7 MLJ 157. [47] On the issue of utilizing the said Property by Plaintiff to facilitate a loan, this was the Defendant’s contention which I do not see the importance of this issue as a triable issue as there was no evidence alluded by the Defendant. Based on the Appeal Record, the Agreement for Banking Facility between RHB Bank and the Plaintiff can be found at pages 176 – 218 of the Appeal Record. The date of the offer for the facility was 27.10.2005 and the date of agreement of the Banking Facility was 24.3.2006 where the period of the facility was for 180 months for the amount of RM335,000.00. The facility period would have surpassed by now and pertinent to note that where loan facility had been taken by the owners of any property, they are still required to repay the loan facility. In this case, the Plaintiff is unable to rent out the said Property nor could benefit from it as the vacant possession was given only after 10 years. It can be surmised that the Defendant was merely asserting its case on bare allegations. This Court finds that it is the Defendant instead whom benefitted from the contra debt arrangement as he is uplifted from the burden of the purported debt of Yap Grouting. [48] On the issue of limitation, I will not delve much on this aspect simply because the action accrued for the Plaintiff was when the Defendant failed to adhere to clause 23(2) and (3) of the SPA. Briefly, based on the letter of demand of 18.7.2016 (at page 128 – 129 of the Appeal Record), it was stated the Defendant had given the Plaintiff vacant possession on 13.5.2016 and claimed for the delay of the 24 months that is from 11.11.2007 until 11.11.2009 as well as the delay until the vacant possession of the said Property was given to Plaintiff, that is from 11.11.2009 until 13.5.2016. The Plaintiff demanded for the LAD through its solicitors on 18.7.2016. Clause 23(2) and (3) of the SPA clearly spelt out the delay to include until the vacant possession is delivered to the Plaintiff and I cannot see any other way in interpreting the unambiguous words of clause 23 (2) and (3) of the SPA that the LAD is claimable until vacant possession of the said Property is delivered to the Plaintiff. Therefore Plaintiff’s claim or demand made is not time barred. [49] This appeal arises from a summary judgment under Order 14 of the ROC 2012. It is incumbent upon the Court to have the overall view to ascertain whether the Defendant has a real or bona fide defence. I wish to rely on the case of Eng Say Kuang v Hong Leong Bank Bhd [2008] MLJU 38, “It is trite law that in such an application the onus on the defendant to be entitled to defend the action in a full trial, is to satisfy the court that "there is an issue or question in dispute which ought to be tried or that there ought for some other reason to be a trial..." [50] In light of the above reasons, this Defendant could not satisfy this Court nor am I convinced that there is an issue or question in dispute which ought to be tried. I find that the Defendant’s grounds for appeal did not give rise to any bona fide triable issue. In view thereof, the Plaintiff, based on the balance of probabilities, has a prima facie case for summary judgment to be entered against the Defendant. I therefore dismiss the appeal with cost. Dated: 24 July 2017 (DATIN ZALITA BINTI DATO’ ZAIDAN) Judicial Commissioner Shah Alam High Court, Selangor SOLICITORS: APPELLANT : CHAN WENG KHAI Tetuan Chang Weng Khai & Company No. 48-M, Jalan SS21/58 Damansara Utama 47400, Petaling Jaya Selangor Darul Ehsan [CWK/BSSB/16/LIT/493416] Tel : 03-7728 9633 Fax : 03-7728 9133 RESPONDENT : RANDY CHEW Tetuan Terrence & Randy Sutite D1-U6-16, Tingkat U6 Blok D1, Jalan Dutamas 1 50480 Kuala Lumpur [Ruj: L00012/16/TL/RC] Tel : 03-6205 3655 Fax : 03-6211 5997 49

Tika 2.6.0

12ANCVC-94-11/2016

PERAYU BANDAR SUBANG SDN. BHD. (NO. SYARIKAT: 114944-K) …. PERAYU RESPONDEN LIM EU CHING (NO. K/P: 651030-01-6169) …. RESPONDEN

24/07/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=81b89e50-7a63-4f46-bfaa-3ac0f6ed3e32&Inline=true

DALAM MAHKAMAH TINGGI DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA RAYUAN SIVIL NO: 12ANCVC-94-11/2016 ANTARA BANDAR SUBANG SDN. BHD. (NO. SYARIKAT: 114944-K) …. PERAYU DAN LIM EU CHING (NO. K/P: 651030-01-6169) …. RESPONDEN [Dalam Perkara Mengenai Mahkamah Sesyen di Shah Alam Di Negeri Selangor Darul Ehsan Guaman No.: BA-B52NCVC-276-08/2016] ANTARA LIM EU CHING (NO. K/P: 651030-01-6169) .…PLAINTIF DAN BANDAR SUBANG SDN. BHD. (NO. SYARIKAT: 114944-K) ….DEFENDAN GROUNDS OF JUDGMENT Introduction [1] This is an appeal by the Appellant who was the Defendant, on the decision of the Sessions Court in allowing for the summary judgment under Order 14 of the Rules of Court 2012 against the Appellant by the Respondent, who was the Plaintiff. The Sessions Court found for the Plaintiff, that there was no triable issue on the part of the Appellant’s Defence. [2] Both parties, in this judgment, will be known as they were in the Sessions Court. Factual Background [3] The Plaintiff’s claim against the Defendant is for liquidated damages of the sum RM348,003.94 due to the Defendant’s delay of 3107 days in delivering vacant possession of a double storey semi-detached house held under the title H.S.(D) 177895, P.T. 4922 Mukim Bukit Raja, District of Petaling, State of Selangor Darul Ehsan with a postal address of No.3, Jalan Pulau Indanh U10/58, Seksyen U10, 40170 Shah Alam, Selangor Darul Ehsan (the said Property). [4] The Plaintiff is a Malaysian citizen of full age having his residential address at No.7, Jalan SL 7/5, Bandar Sungai Long, 43000 Kajang, Selangor Darul Ehsan whereas the Defendant is a private limited company duly incorporated in Malaysia with its registered address at No. 1, Lintang Angsana, Bandar Baru Ayer Itam, 11500 Pulau Pinang and its business address at No. 2-8, Bangunan Farlim, Jalan PJS 10/32, Bandar Sri Subang, 46000 Petaling Jaya, Selangor Darul Ehsan. [5] The Defendant is primarily involved in the business of property development wherein the Defendant’s projects include but not limited to a housing development known as the ‘Subang Impian, Shah Alam, Phase 2’ project (the said Development). [6] It was claimed that on or about 11.11.2005, the Plaintiff had entered into a Sale and Purchase Agreement dated 11.11.2005 with the Defendant (the SPA) (can be found at pages 99 – 124 of the Appeal Record) for the sale of the said Property within the said Development wherein the said Property was sold by the Defendant, being the Vendor, to the Plaintiff, being the Purchaser, for a total purchase price of RM409,135.00 (the Purchase Price). [7] The Plaintiff claimed that there are express terms and conditions of the said SPA on delivery of vacant possession which bind both the Plaintiff and Defendant, as follows: “Clause 23(1) Vacant possession of the said Building shall be delivered to the Purchaser in the manner stipulated in Clause 24 herein within twenty-four (24) calendar months from the date of this Agreement;” “Clause 23(2) If the Vendor fails to deliver vacant possession of the said Building in manner stipulated in Clause 24 herein within the time stipulated in sub-clause (1), the Vendor shall be liable to pay the Purchaser liquidated damages calculated from day to day at the rate of ten per centum (10%) per annum of the purchase price from the expiry of the delivery of vacant possession in sub-clause (1) until the date the Purchaser takes vacant possession of the said Building. Such liquidated damages shall be paid by the Vendor to the Purchaser immediately upon the date of Purchaser takes vacant possession of the said Building.” “Clause 23(3) For the avoidance of doubt, any cause of action to claim liquidated damages by the Purchaser under this clause shall accrue on the date the Purchaser takes vacant possession of the said Building.” [8] The Defendant alleged that there was no consideration given by the Plaintiff to the Defendant in relation to the purchase of the said Property as there was no payment made in accordance with clause 4.1 of the said SPA. The Plaintiff argued that Defendant’s allegation was wholly inaccurate as the said SPA and transfer of property had taken place due to reasons that the Defendant was indebted to Yap Grouting & Drilling Services Sdn. Bhd. (“Yap Grouting”) who was at that material time the main contractor for the said Development. [9] The Plaintiff claimed that the Defendant had offered the said Property to Yap Grouting to set-off the debts due and owing by Defendant to Yap Grouting and Yap Grouting who was also indebted to the Plaintiff, had in turn offered the said Property to the Plaintiff as a set-off against the debts due and owing by Yap Grouting to the Plaintiff. [10] The Plaintiff filed a Writ in the Shah Alam Sessions Court claiming against the Defendant for liquidated damages in the sum of RM348,003.94 for the delay in delivery of vacant possession of the said Property. On 25.10.2016, the Sessions Court allowed the Plaintiff’s application for summary judgment against the Defendant through the Notice of Application dated 23.8.2016, with the following orders granted: (a) the Defendant to pay the Plaintiff the total sum of RM348,003.94 being the Outstanding Sum; (b) the Defendant to pay to the Plaintiff interest on the total Outstanding Sum at the rate of 5% per annum from the date of the action until the date of judgment; and (c) the costs of the Plaintiff’s Application to be forthwith paid by the Defendant to the Plaintiff. The Cause Papers [11] The cause papers which are all filed in the Defendant’s Record of Appeal: “(a) Respondent’s Writ dated 10.08.2016 (“Writ”) [see: pages 10 to 20 ROA]; (b) Respondent’s Statement of Claim dated 10.08.2016 (“Statement of Claim”) [see: pages 21 to 36 ROA]; (c) Appellant’s Defence dated 07.09.2016 (“Defence”) [see: pages 37 to 45 ROA]; (d) Respondent’s Reply to Defence dated 22.09.2016 (“Reply to Defence”) [see: pages 46 to 73 ROA]; (e) Respondent’s Notice of Application for Summary Judgment dated 23.08.2016 (“Application”) [see: pages 1 to 9 ROA]; (f) Respondent’s Affidavit in Support affirmed on 25.08.2016 (“Respondent’s Affidavit in Support”) [see: pages 74 to 129 ROA]; (g) Appellant’s Affidavit in Reply affirmed on 23.09.2016 (“Appellant’s Affidavit in Reply”) [see: pages 130 to 145 ROA]; (h) Respondent’s Affidavit in Reply affirmed on 06.10.2016 (“Respondent’s Affidavit in Reply”) [see: page 146 to 218 ROA]; (i) Respondent’s Affidavit in Reply (II) affirmed on 10.10.2016 (“Respondent’s Second Affidavit in Reply”) [see: pages 219 to 238 ROA]; (j) Respondent’s Written Submissions dated 18.10.2016 [see: pages 1 to 33 of the Additional Record of Appeal (“AROA”); (k) Appellant’s Written Submissions dated 21.10.2016 [see: pages 34 to 45 AROA]; (l) Respondent’s Written Submissions in Reply dated 22.10.2016 [see: pages 46 to 53 AROA]; and (m) Grounds of Judgment dated 07.12.2016 [see: pages 54 to 68 AROA].” Defendant’s Submission [12] The learned counsel for the Defendant advanced several grounds in arguing that there are triable issues on this matter. This Court will zoom into the main grounds based on the Defendant’s counsel’s written submission and partly from oral submission. The written submission which are reproduced in parts are as follows: “6.1 The Respondent/Plaintiff had failed to disclose truthfully and fully in the Statement of Claim the circumstances under which the Sale and Purchase Agreement was signed. It is submitted that the Sale and Purchase Agreement was not a simple case of the Respondent as an ordinary purchaser was enticed to purchase the said property from the Appellant as developer and hence requires the court’s protection. 6.2 The Appellant did not offer or advertised to offer to sell the said property to the Respondent. The Respondent was aware that the Appellant signed the Sale and Purchase Agreement with the Respondent in respect of the said property and the transfer of the said property to the Respondent as the result of a commercial debt settlement by the Appellant with Yap Grouting. At all material time, the Respondent entered into the Sale and Purchase Agreement with the Appellant at the direction or instruction of Yap Grouting as a result of a commercial transaction of settlement of debt between the Respondent and Yap Grouting 6.3 It is submitted that the Sale and Purchase Agreement is a business arrangement in the guise of a statutory Sale and Purchase Agreement for the purchase of the said property by a normal purchaser. As the Respondent claimed that Yap Grouting was indebted to him, the Respondent had signed the Sale and Purchase as part of a commercial debt settlement with Yap Grouting. As such the Respondent is not an ordinary purchaser. 6.4 There was no consideration for the Sale and Purchase Agreement. No monies were paid for the purchase price by the Respondent to the Appellant. Yap Grouting only “authorised” Respondent to be the “purchaser” which are the words used in Yap Grouting’s letter dated 14.10.2005 as exhibited in the Respondent’s Affidavit in Reply (II) as “YYL-1” (“Yap Grouting Letter”) (pages 237 – 238 Appeal Record). There was no reason given for authorization by Yap Grouting to “authorize” the Respondent to sign the Sale and Purchase Agreement. In the ordinary meaning of the word “authorised” as found in the English Oxford Dictionary, it means to give permission. As such there was no consideration for the purchase of the said property from the Respondent. 6.5 The Respondent is not entitled to the benefit of clause 23 of the Sale and Purchase Agreement without satisfaction of the proof of the Respondent’s burden of paying the purchase price to the Appellant under clauses 3 and 4 of the Sale and Purchase Agreement. The Respondent cannot be entitled to take advantage of the Sale and Purchase Agreement by insisting on his rights under clause 23 while ignoring the provisions of clauses 3 and 4 which expressly states that the purchase price shall be paid to the Appellant as vendor. Clause 3 provides that the purchase price “shall be payable in the manner hereinafter provided”. Clause 4 provides that the purchase price “shall be paid by the Purchaser to the Vendor”. 6.6 ……… 6.7 ………. 6.8 ……… 6.9 The Respondent’s allegation that Yap Grouting offered the said property to the Respondent as debt settlement is adding facts which are not supported by the documents. The Yap Grouting letter did not state that there was a debt contra arrangement between Yap Grouting and the Respondent. The only thing that the Appellant agreed was the commercial debt contra arrangement between the Appellant and Yap Grouting as stated in the Appellant’s letter dated 29.10.2005 (“appellant’s Letter’) that had been exhibited as “IAW-1” in the Appellant’s Affidavit in Reply (pages 136-137 Appeal Record). The Appellant submits that the Respondent or Yap Grouting cannot add words orally or by way of affidavits to amend, vary, contradict or insert terms that were never in the Yap Grouting Letter or the Sale and Purchase Agreement. There is nothing in the Appellant’s letter or Yap Grouting’s Letter to support the Respondent’s allegations. Yap Grouting cannot add additional evidence by Affidavit to expand or to explain the contents of its letter to the Appellant. In the circumstances, Section 91 to 94 of the Evidence Act 1950 are applicable which disallows the Respondent to give parol or affidavit evidence to add, subtract, vary or contradict the Yap Grouting Letter or to remedy the defects in the Yap Grouting Letter or to use it in respect of the Sale and Purchase Agreement. As for the Appellant’s Letter, the Respondent is not a party to the said Letter. The following are the authorities referred:- (a) Citibank Bhd v Pembangunan Cahaya Tulis Sdn Bhd (receivers and managers appointed) & Ors and other suits [2012] 9 MLJ 181; (b) Datuk Tan Leng Teck v Sarjana Sdn Bhd & Ors [1997] 4 MLJ 329; (c) Tindok Besar Estate Sdn Bhd v Tinjar Co [1979] 2 MLJ 229; (d) Encony Development Sdn Bhd v Robert Geoffrey Gooch & Anor [2016] 3 MLJ 400. [13] The Defendant’s counsel submits that the Sessions Court had erred in deciding that the purchase price can be settled by a set-off agreement between a third party and the Plaintiff. The Defendant submits that the set-off and facts on consideration were never pleaded in the Statement of Claim. As such the facts pertaining to a set-off agreement cannot be considered by the Court. [14] In addition, counsel for the Defendant submits that the Plaintiff should have amended the Statement of Claim and cannot simply add facts by incorporating it in the Affidavit In Reply. Counsel also added that the Affidavit of Yap Grouting was not the one whom instructed for the contra debt arrangement and the said Affidavit was 14 days late. [15] The counsel for the Defendant also submitted that although the SPA is a statutory agreement, the terms must be enforced fairly without undue preference to one party. The Defendant’s counsel submitted that it would not be fair to the Defendant where the court construed the LAD terms in the SPA in favour of the Plaintiff while ignoring the pre-conditions and the Plaintiff’s obligations for claiming LAD. It is also not fair to the Defendant to ignore or overlook the terms of SPA in favour of the Plaintiff or not to enforce the terms of SPA in favour of the Defendant. [16] It is submitted that the Court must give effect to the intention of the parties notwithstanding it is an agreement made pursuant to the Housing Development (Control and Licensing) Act 1966. The Defendant’s counsel referred to the authority in the case of Foong Seong Equipment Sdn Bhd (Receivers and Mangers appointed) v Keris Properties (PK) Sdn Bhd and another appeal [2013] 2 MLJ 361 as a general principle of the interpretation of contracts. [17] In relation to the loan, the Defendant submitted that the Court should not condone the Plaintiff in misleading the Bank when the Plaintiff took the monies for purchase financing for his own use when the loan monies should have been paid to the Defendant to pay the purchase price. This is because the purpose of the loan was for purchase financing as stated in the Facility Agreement and also the Letter of Offer. Thus, it is submitted that Plaintiff failed to use the loan as to the purpose of the loan itself (which was for the said Property purchase financing) since he had used the loan for his own purposes and enjoyed the benefit of the loan. As such it is not right for the Defendant to pay LAD to the Plaintiff when he has obtained benefits under the SPA without having to fulfill his obligations to pay the purchase price from the loan under clause 5(2) of the SPA. [18] In addition, the Defendant submits that the Plaintiff committed a fundamental breach of the SPA by using the said Property to obtain loan financing and without utilizing the loan to pay the Defendant, the Plaintiff is estopped from claiming for LAD and relied on the authority Ching Yik Development Sdn Bhd v Setapak Heights Development Sdn Bhd [1996] 3 MLJ 675. [19] The Defendant’s counsel submitted that Plaintiff is not allowed to raise an allegation of fact in his affidavits which is not pleaded and which is inconsistent with the Statement of Claim in order to improve his claim. In addition, he argued that the Defendant’s Defence need only show a triable issue for a full trial under Order 14 Application for a Summary Judgment and that the Defendant need not show a complete defence. [20] On that point, the counsel for the Defendant referred to the following authorities, the case of BANK NEGARA MALAYSIA V MOHD ISMAIL & ORS [1992] 1 MLJ 400 (Pages 255 to 270 Appellant Bundle of Authorities) and the case of Eng Say Kuang v Hong Leong Bank Bhd [2008] MLJU 38 (pages 271 to 276 Appellant Bundle of Authorities). [21] The Court heard the submission by the Defendant’s counsel that the late delivery of physical possession was about after 10 years, due to beyond circumstances of control as there was a stop work order issued by the local authorities where additional conditions were imposed after the completion and the Certificate of Fitness was issued later. The Defendant claimed that frustration of contract occurred. [22] On the issue of limitation, the counsel submitted that the SPA was signed on 11.11.2005 and the 6 years limitation started on 1.1.2007 until year 2013 which would mean the claim by the Plaintiff filed in 2016 would be time barred and added that this was not pleaded by the Plaintiff. Plaintiff’s Submission [23] The Plaintiff’s counsel assertion is that there was a SPA signed and the Plaintiff is entitled to invoke LAD when there is a delay in the delivery of vacant possession of the said Property. [24] The Plaintiff’s counsel argued that there was an arrangement where the Defendant will transfer the said Property to Plaintiff instead as the 3rd party whom owed to Plaintiff and the Defendant’s allegation is wholly inaccurate, misconceived and baseless. The counsel submitted as in its written submission: “17.1 prior to executing the said SPA, the Appellant was indebted to Yap Grouting & Drilling Services Sdn. Bhd. (hereinafter referred to as “Yap Grouting”), who was at the material time the main contractor for the said Development; 17.2 this circumstances had then caused the Appellant to offer the said Property to Yap Grouting in order to set-off the debts due and owing by the Appellant to Yap Grouting. This fact had been duly admitted by the Appellant in its pleadings [see: paragraph 4.3 Appellant’s Defence at page 38 ROA and paragraph 6.2 Appellant’s Affidavit in Reply at page 132 ROA]; 17.3 however, at the same time, Yap Grouting was also indebted to the Respondent and therefore Yap Grouting had in turn, offered the said Property to the Respondent as a set-off against the debts due and owing by Yap Grouting to the Respondent. This fact had been duly confirmed by Yap Yoon Loong, the director of yap Grouting in the Respondent’s Second Affidavit in Reply affirmed by yap Yoon Loong himself [see: paragraph 6.3 Respondent’s Second Affidavit in Reply at page 222 ROA]; 17.4 subsequent to the Respondent’s acceptance of the offer by Yap Grouting, all parties, including the appellant, had agreed and/or consented for the said Property to be transferred directly to the Respondent (hereinafter referred to as the “Contra Agreement’). 18. The existence of the Contra Arrangement was at all material times never disputed by the Defendant and is clearly shown in a letter of settlement dated 29.10.2005 between Yap Grouting and the Appellant [see: Exhibit IAW-1 Appellant’s Affidavit in Reply at page 137 ROA] as well as the letter dated 14.10.2005 from Yap Grouting to the Appellant [see: Exhibit YYL-1 Respondent’s Second Affidavit in Reply at page 238] of which the consideration value of the Contra Arrangement was notably the Purchase Price as stipulated under Clause 3 the said SPA. 19. Following the above, it is pertinent to note that a valuable consideration for a promise may consist in some benefit conferred on the promisor, or detriment suffered by the promise, or both as defined under Section 2(d) Contracts Act 1950 [SEE: Tab 1 Respondent’s Bundle of Authorities (“RBOA”)], which states that:- “When, at the desire of the promisor, the promise or any other person has done or abstained from doing, or does or abstains from doing, or promises to do or to abstain from doing, something, such act or abstinence or promise is called a consideration for the promise.” [25] The counsel for the Plaintiff relied on the case of Korakyat Plantations Sdn Bhd (in liquidation) v Tan Siew Ee & Ors [2006] 1 MLJ 274 where 10% of the purchase price for each property were made and that the letter of undertaking unconditionally agreed to transfer the said property unit to the respondent free from encumbrances as a total set-off against loans taken by the appellant from the respondents and this was considered to be a valuable consideration. [26] The Plaintiff’s counsel conceded that there was a valuable consideration based on the alternative mode of payment by setting-off via the contra arrangement which consist the said Property to be transferred by the Defendant to the Plaintiff, coupled with the act of executing the memorandum of transfer by the Defendant of the said Property to the Plaintiff is an admission of receiving a valuable consideration from the Plaintiff. In view of receiving the valuable consideration from the Plaintiff, Plaintiff’s counsel submits that it is for the Plaintiff to invoke clause 11(2) of the SPA. [27] About the loan facility, counsel also submitted that this is irrelevant and Plaintiff had suffered loss and could not utilize the said Property for the last 10 years as could not take loan and suffered cash flow which resulted the said Property to be mortgaged with RHB Bank. [28] In terms of the delay in delivering vacant possession due to the stop work order argument, counsel for the Plaintiff asserted that based on Regulation 11 of the Contract of Sale of Housing Development (Control & Licensing) Act, there is a provision on special circumstance where the clause on vacant possession may be waived or modify the due date of delivery of vacant possession. The Plaintiff’s counsel argued that the Defendant should have applied for waiver or modification under the said regulation 11 and relied on the authorities of Tan Sri G. Darshan Singh v. Loke Kee Deve. [2010] 7 MLJ and Ng Hean Ying & Ors v. Ken Property Sdn Bhd [2013] MLRH and therefore the Defendant is estopped to raise the stop work order defence. [29] On the issue of limitation, Plaintiff’s counsel argued that the cause of action was done within time based on Clause 23(3) of SPA where Plaintiff is entitled to claim for LAD. In reply to the contra debt arrangement alleged by Defendant that it was not pleaded, the counsel for the Plaintiff submits that that statement is not true as additional facts had been given in response to Defendant’s defence under the issue of consideration. Sessions Court’s Decision [30] The Sessions Court had considered all the issues submitted and had decided as follows, which parts of the judgement is reproduced here: “Dakwaan tiada balasan dan perjanjian jualbeli tidak menunjukkan niat sebenar pihak-pihak kerana harga belian tidak dibayar 5. Defendan menimbulkan isu bahawa tiada balasan atas pembelian ini kerana plaintif tidak membayar jumlah RM409,135.00 seperti yang dinyatakan dalam klausa 4.1 perjanjian. Bagaimanapun Mahkamah berpendapat fakta berkenaan set-off tidak boleh diabaikan kerana ia menjadi asas kepada persetujuan pihak-pihak untuk memasuki perjanjian jualbeli. Untuk isu ini, Mahkamah merujuk keputusan Mahkamah Rayuan kes Korakyat Plantiations Sdn Bhd v. Tan Siew Ee & Ors [2005] 2 CLJ 578 dimana Mohd Ghazli Yusoff JCA memutuskan seperti berikut: “…….. The said ‘letters of undertaking’ issued by the appellant in respect of the lots identified therein clearly spelt out that the appellant unconditionally gre that it “will transfer/assign the above units of property free of any and whatsoever encumbrances/ or claim by us as a total set off against the loan take from you”. We would agree with the contention of counsel that this is tantamount to an admission by the appellant that they had received valuable consideration from the respondents concerned.” 6. Walaupun fakta kes adalah berlainan namun prinsipnya adalah sama dimana sebarang hutang boleh di set-off atau ditolak dengan persetujuan pihak-pihak selepas valuable consideration diterima. Dalam kes ini, defendan berstuju nilai keberhutangan defendan sebanyak RM409,135.00 yang dibuat secara set-off adalah nilai harga belian. 7. Klausa 11(2) memperuntukkan berikut: “……..subject to the payment of the purchase price by the Purchaser to the Vendor ……the Vendor shall, within twenty one (21) days, execute a valid and registrable memorandum of transfer of the said property to the Purchaser.” Walaupun tiada bayaran dibuat, defendan masih melaksanakan borang pindahmilik sehingga geran hakmilik di atas nama plaintif dikeluarkan seperti yang ditunjukkan di exh. “LEC-1” (L.5). Ini disebabkan oleh persetujuan defendan untuk menolak hutangnya secara set-off dengan hartanah berkenaan. Defendan adalah terikat dengan surat persetujuan yang dicapai dengan Yap Grouting. 8. Mahkamah berpendapat siapa yang hendak dinamakan oleh Yap Grouting sebagai pembeli/pemilik hartanah dalam perjanjian jualbeli adalah hak Yap Grouting. Oleh itu plaitif yang dinamakan dalam perjanjian tidak sepatunya dijadikan isu kerana defendan telah memberikan persetujuan mereka untuk menamakan plaintif sebagai pembeli. Mahkamah berpendapat jika defendan mendakwa bayaran tidak dibuat dan tiada persetujuan berkenaan set-off serta nama plaintif sebagai pembeli dipertikaikan maka tidak mungkin defendan menandatangani perjanjian jualbeli dengan plaintif. Jika defendan masih mendakwa harga belian mesti dibayar dan set-off dipertikaikan maka defendan secara jelas telah melanggar surat persetujuan yang dicapai di atas 9. Berdasarkan alasan-alasan yagn dinyatakan, Mahkamah berpendapat perkara ini tidak lagi menjadi isu apabila defendan sendiri telah bertindak melaksanakan dokumen pindahmilik sehingga hartanah berjaya didaftarkan atas nama plaintif seperti yang ditunjukkan di exh. “LEC-1”. 10. Mahkamah berpendapat melalui perbuatan dan tindakan defendan, defendan telah diestop daripada menimbulkan isu-isu ini terutama apabila defendan tidak pernah pada bila-bila masa membangkitkan bahawa tiada bayaran dibuat oleh plaintif. Exh. “LEC-1” jelas menunjukkan bahawa plaintif adalah pemilik rumah tersebut. Oleh itu juga, plaintif sebagai pemilik berdaftar adalah bebas untuk berurusan dengan hartanah tersebut seperti menggadaikannya kepada RHB Bank untuk pinjaman yang diambil. Priviti kontrak dan isu Iocus standi 11. Defendan membangkitkan isu bahwa tiada privit kontrak diantara plaintif dengan defendan kerana surat persetujuan adalah diantara defendan dengan Yap Grouting. Atas sebab ini maka defendan mendakwa plaintif hanya bertindak sebagai ejen kepada Yap Grouting dan dengan itu plaintif tiada locus standi untuk memulakan tindakan bagi menuntut gantirugi LAD terhadap defendan. 12. Untuk isu ini, Yap Grouting telah mengesahkan bahawa hartanah telah diberikan kepada plaintif. Defendan telah menandatangani perjanjian jualbeli dengan plaintif dan bukan dengan Yap Grouting. Tiada dimana-mana dalam perjanjian jualbeli yang menyatakan bahawa plaintif bertindak sebagai ejen kepada Yap Grouting. Mukasurat hadapan perjanjian jualbeli di exh. “LES-2” (L.5) jelas menunjukkan bahawa plaintif adalah pembeli tanpa sebarang syarat. Oleh kerana plaintif adalah pembeli yagn dinamakan dan plaintif telah diisukan dengan geran hakmilik sebagai pemilik berdaftar maka Mahkamah berpendapat plaintif mempunyai locus standi untuk membawa tindakan ini terhadap defendan. Berdasarkan alasan ini maka Mahkamah berpendapat isu ini juga bukan isu untuk dibicarakan. Kelewatan menyerahkan milikan kosong hartanah 13. Berdasarkan perjanjian jualbeli, defendan dikehendaki menyerahkan milikan kosong dalam masa 24 bulan dari tarikh perjanjian (11.11.2005) dimana milikan kosong patut diberikan pada 11.11.2007. Namun tarikh penyerahan sebenar dibuat pada 13.5.2016 – exh. “LEC-3” (L.5). Fakta jelas menunjukkan berlaku kelewatan selama 9 tahun 6 bulan. 14. Defendan mendakwa kelewatan adalah disebabkan oleh Perintah Berhenti Kerja (stop work order) dan Yap Grouting mempunyak pengetahuan mengenainya. Defendan juga mendakwa disebabkan Yap Grouting mempunyai pengetahuan maka plaintif diestop daripada menuntut gantirugi LAD. Mahkamah berpendapat samada Yap Grouting atau plaintif mempunyai pengetahuan, pengetahuan tersebut tidak boleh di infer terhadap plaintif. Plaintif tidak diestop daripada menuntut gantirugi LAD kerana pihak-pihak adalah terikat dengan terma-terma di dalam perjanjian. 15. Perintah Berhenti Kerja bukan suatu halangan kepada plaintif untuk melaksanakan haknya dalam menuntut LAD. Perjanjian jualbeli adalah tertakluk kepada peruntukan statutory yang mengawal aktiviti defendan sebagai pemaju. Peraturan 11(1) Housing Development (Control & Licensing) Regulations 1989 telah memperuntukkan berikut: “11. Contract of sale (1) Every contract of sale for the sale and purchase of a housing accommodation together with the subdivisional portion of land appurtenant thereto shall be in the form prescribed in Schedule G and where the contract of sale is for the sale and purchase of a housing accommodation in a subdivided building in the form of a parcel of a building or land intended for subdivision into parcels, as the case may be, it shall be in the form prescribed in Schedule H.” 16. Berdasarkan Jadual G maka klausa berkenaan penyerahan milikan kosong telah dimasukkan ke dalam perjanjian jualbeli (klausa 23(1), (2) & (3)) sebagai peruntukan statutori untuk melindungi pembeli daripada pemaju. 17. Berikutan wujudnya tempoh penyerahan milikan kosong dalam perjanjian sebagaimana Jadual G maka Peraturan 11(3) terpakai kepada defendan jika milikan kosong tidak dapat diberikan dalam tempoh yang ditetapkan. Peraturan 11(3) memperuntukkan berikut: “(3) Where the Controller is satisfied that owing to special circumstances or hardship or necessity compliance with any of the provisions in the contract of sale is impracticable or unnecessary, he, may, by a certificate in writing, waive or modify such provisions: Provided that no such waiver or modification shall be approved if such application is made after the expiry of the time stipulated for the handing over of vacant possession under the contract of sale or after the validity of any extension of time, if any, granted by the Controller.” 18. Peruntukan berkenaan penyerahan milikan kosong adalah peruntukan statutori yang menyebabkan klausa berkenaannya telah dimasukkan ke dalam perjanjian jualbeli dan mestilah dipatuhi oleh defendan. Dalam keadaan dimana defendan mempunyai masalah untuk menyerahkan milikan kosong disebabkan oleh Perintah Berhenti Kerja, maka adalah menjadi tanggungjawab defendan sepenuhnya untuk memohon perlanjutan masa kepada Pengawal Perumahan (Controller of Housing). Dalam hal ini, defendan gagal berbuat demikian dimana tiada kebenaran bertulis oleh Pengawal diberikan kepada defendan untuk melanjutkan masa menyerahkan milikan kosong melebihi tempoh 24 bulan sebagaimana yang ditetapkan dalam kalusa 23(1) perjanjian. 19. ……… 20. ……… 21. ……… 22. ……… 23. Berdasarkan otoriti-otoriti di atas, defendan sekarang diestop daripada membangkitkan isu Perintah Berhenti Kerja oleh pihak berkuasa kerana defendan sendiri telah gagal melaksanakan tanggungjawab statutori mereka untuk memohon kepada Pengawal Perumahan bagi perlanjutan masa. Isu had masa 24. Mahkamah berpendapat isu had masa tidak terpakai kepada plaintif kerana undang-undang berkaitan had masa adalah jelas. Pihak-pihak juga terikat dengan perjanjian jualbeli. Walaupun perjanjian ditandatangi pada 11.11.2005, kausa tindakan hanya bermula dari tarikh penyerahan milikan kosong sebenar diberikan sebagaimana klausa 23 perjanjian dan bukan 6 tahun dari tarikh perjanjian ditandatangani. 25. ………. 26. ………. 27. Fakta jelas menunjukkan bahawa milikan kosong diserahkan pada 13.5.2016. Gantirugi LAD hanya dapat dikria selepas plaintif mengambilkira milikan kosong dan bukan sebelumnya. Di atas alasan-alasan yang dinyatakan, Mahkamah berpendapat tiada isu yang perlu dibicarakan dan dengan itu permohonan plaintif untuk memasukkan penghakiman muktamad terhadap defendan di bawah A.14 KKM 102 telah dibenarkan dengan kos.” THE COURT’S FINDING [31] This is an appeal on summary judgment application made by the Plaintiff which was allowed against the Defendant. Matters pertaining to summary judgment under Order 14 of the ROC 2012 had been decided in a plethora of cases. It is a principle, which remains good and trite law that the plaintiff is to establish a prima facie case. This would mean that when there is no dispute as to the fact and law, the plaintiff can dispose an action where the defendant’s defence is clearly unsustainable in law or on the facts without the need for a full trial. [32] A number of cases supporting the principle under summary judgment can be referred from some of the authorities attributed by both counsels, the case of Bank Negara Malaysia v Mohd Ismail Ali Johor & Ors [1992] 1 CLJ (Rep) 14, a Supreme Court decision, the case of Eng Seng Kuang v Hong Leong Bank Bhd [2008] MLJU 38; Malayan Insurance (M) Sdn Bhd v Asia Hotel Sdn Bhd [1986] 1 MLRA 269 and National Company for Foreign Trade v Kayu Raya Sdn Bhd [1984] 1 MLRA 190. [33] In order to show whether there ought to be tried, the elements required can be found in the case of Shell Malaysia Trading Sdn Bhd v Filotek Trading Sdn Bhd [1999] 8 CLJ 592, where the High Court Penang which made reference to the Federal Court case of Fira Development Sdn Bhd v Goldwin Sdn Bhd. [1989] 1 CLJ 34 had this to say, “On the hearing of such an application, the court may give such judgment for the plaintiff against that defendant, “unless the court dismisses the application or the defendant satisfies the court with respect to the claim or to the part the claim to which the application relates that there is an issue or question in dispute which ought to be tried or that there ought for some other reason to be a trial of that claim or part” (Ord. 14 rule 3). A defendant may show cause against a plaintiff’s application (i) by a preliminary or technical objection, or (ii) on the merits, eg. That he has a good defence to the claim on the merits or that a difficult point of law is involved, or a dispute as to the facts which ought to be tried, or a real dispute as to the amount due which requires the taking of an account to determine, or any other circumstances showing reasonable grounds of a bona fide defence (The English Supreme Court Practice 1997 vol. 1 para 14/3 – 4/3). What is a defence on the merits? The Supreme Court, in Fira Development Sdn Bhd v Goldwin Sdn Bhd [1989] 1 CLJ 34 per Lee Hun Hoe CJ (Borneo), imparted that “a defence on the merits means merely raising only an arguable or triable issue.” [34] Therefore in determining a prima facie case, the facts and evidence on Plaintiffs claim must be proven on the balance of probabilities and whether the Defendant has a triable issue. The crux of the matter is whether the Plaintiff is entitled to invoke liquidated ascertained damages (LAD) under the SPA to which the Defendant contended that no consideration had been passed between the Defendant and the Plaintiff in purchasing the said Property. [35] The learned counsel for the Plaintiff submitted that there was an arrangement made where three parties agreed to a contra debt or set-off method of payment. The subject-matter of the set-off is the said Property which is to be transferred to the Plaintiff. The Plaintiff pleaded for the LAD in his Statement of Claim by referring to some of the provisions of the SPA. The Plaintiff had pleaded that the full terms and conditions of the SPA “and the effects thereof would be referred to and relied upon during the trial itself.” (at page 33 of the Appeal Record). [36] Upon careful perusal of the pleadings, how the issue of consideration came about can be found in Defendant’s Defence (at paragraph 4.2 and 4.3, page 43 of the Appeal Record) stating that the Plaintiff was not entitled to claim for LAD under the clause 23(2) of the SPA as Plaintiff did not comply with clause 4(1) of the SPA and the Settlement Letter of 29.10.05 was between the Defendant and Yap Grouting who had agreed to accept the said Property as a full set off against the outstanding account of RM409,135.00 due from the Defendant to Yap Grouting. [37] The Plaintiff in reply to the defence made by the Defendant stated (at paragraphs 6, 6.1 and 6.2, at page 66 of the Appeal Record) that Yap Grouting agreed to accept the said Property as a full set-off against the outstanding amount due owing by the Defendant and Yap Grouting subsequently offered the said Property to the Plaintiff as a set-off against the debts due and owing by Yap Grouting to the Plaintiff. Plaintiff averred that there was consideration passed and that Plaintiff signed the SPA and said Property was registered under Plaintiff’s name (paragraphs 6.1 – 6.6, at pages 66-67 of the Appeal Record). [38] The preliminary requirements for an Order 14 application have been set out by Sean FJ (as he then was) in the case of National Company For Foreign Trade v Kayu Raya Sdn Bhd [1984] 2 CLJ 220 and there his Lordship itemized the following requirements: “(1) that the defendant must have entered an appearance; (2) that the statement of claim must have been served onto the defendant; and (3) that the affidavit in support of the application must have complied with the requirements of O. 14 r.2 of the RHC.” [39] Based on the Plaintiff’s Statement of Claim, the cause of action pleaded is for the LAD as provided under the SPA as supported by his affidavit. Therefore the issue of entitlement to LAD under the SPA led to the issue of consideration raised as a defence by the Defendant. In addition, the Defendant also claimed that the Plaintiff acted as an agent of Yap Grouting which was denied by the Plaintiff by submitting further material facts. I have to agree with the counsel for the Plaintiff that the Plaintiff’s Statement of Claim had stated the material facts for the Plaintiff to plead its cause of action against the Defendant and had in reply to the Defendant’s Defence, given more material facts by stating the background to his claim. This is in reliance of the authority attributed by the counsel for the Plaintiff in the case of Bruce v Odhams Press, Limited [1936] 1 All ER 287, see page 294. The word “material” means, “necessary for the purpose of formulating a complete cause of action; and if any one “material” statement is omitted, the statement of claim is bad…” [40] The Plaintiff claimed that all parties including the Defendant consented for the said Property to be transferred directly to the Plaintiff and this contra debt agreement was never disputed by the Defendant as reflected in their reply to the letter of 29.10.2005 (as exhibit “IAW-1” attached to Defendant’s Affidavit in Reply, at page 137 of the Appeal Record). The contra debt arrangement evidence adduced is further corroborated by Yap Grouting’s Affidavit In Reply (II) (at pages 219 – 226 and 229 – 236 of the Appeal Record) to support the fact that the Plaintiff is the registered owner of the said Property and was never an agent of Yap Grouting. [41] Triable issues must relate to the relevant issues or matter pleaded by the Defendant in his statement of defence. The defence raised by the Defendant that there was no privity of contract as no consideration moved from Plaintiff to Defendant could not hold water. The defence that the Plaintiff was acting as an agent for Yap Grouting is denied by Yap Grouting. In its plain meaning and obvious case, the contract made by Yap Grouting to Defendant was for himself as well as for the Plaintiff to set-off the debt between Yap Grouting and Defendant which this consideration supports such a contract. In the case of McEvoy v Belfast Bunking Co Ltd [1935] AC 24, is a case where a father who had Sterling Pounds of 10,000 on deposit with the Belfast Bank, transferred it to a deposit account in the names of himself and of his infant son. Soon after, he died. The executors were allowed by the bank to withdraw the money and put it into an account in their own names. The money was in fact lost in attempts to keep the family business alive and the son sued the bank. One of the arguments by the Bank was that no rights accrued to the son over the deposit account because he had furnished no consideration. The argument was however rejected by the English Court. [42] The counsel for the Plaintiff contended that there is indeed a valuable consideration provided by the Plaintiff vis-à-vis the said Property and the SPA and relied on a number of authorities, among others: section 2 (d) Contracts Act 1950; Guthrie Waugh Bhd v Malaippan Muthucumaru [1970] 1 MLRH 432 and Korakyat Plantations Sdn Bhd (in liquidation) v Tan Siew Ee & Ors [2006] 1 MLJ 274. The counsel for the Plaintiff also relied on a recent case, NV Bina Sdn Bhd v Magna Park Sdn Bhd [2016] 9 MLJ 313 where the Court had held, borrowing Plaintiff’s counsel’s quote from the written submission, “On the second point, the fact that no consideration flowed from the promise is immaterial. The position in Malaysia under the Contracts Act 1950 – distinct from the common law position – is that consideration need not flow from the promise; it suffices that any one party provides the consideration for there to be a valid contract: see the decision of the Judicial Committee of the Privy Council in Kepong Prospecting Ltd & Ors v Schmidt [1968] 1 MLJ 170. The promise by the defendant to make direct payments, and the benefit conferred on Bina BMK by reason of being relieved of the obligation to make the same payments, should very clearly provide the requisite consideration.” (emphasis added) [43] On the face of it, there was a valuable consideration and the agreement was properly executed. The title of ownership of the said Property is held by the Plaintiff, the Defendant could not object to Plaintiff’s ownership and the contractual arrangements that existed between them. There is a clear contractual arrangement in the instant case. Unlike in the case of Tan Eng Choong v Foo Kai Yuen [1988] 1 MLJ 531 where the application for a summary judgment was dismissed as the status of the parties and their contractual arrangements were far from clear. In that case, the plaintiff was of the impression that he was a partner to the legal firm with the defendant whereas the defendant consented on a different arrangement. The High Court held that for the Court to allow for a summary order under Order 43 r.1(i) of the Rules of the High Court 1980 would be a misconceived and the order of the Senior Assistant Registrar which allowed the plaintiff’s application was set aside. [44] It is this Court’s finding that Yap Grouting’s said letter was attached to the Defendant’s Affidavit which clearly proves that the Defendant never objected to Plaintiff as part of the contra debt arrangement and thus as authorized registered owner of the said Property. Therefore the defence raised by the Defendant did not defeat the Plaintiff’s claims, neither did it support the Defendant’s defence. As remarked by Ramli Ali JCA (now FCJ) in the case of Carta Bintang Sdn Bhd v RHB Capital Berhad [2009] MLJU 360, “…An issue may be relevant, but if the determination can be done by way of affidavit evidence (as in Order 14 application) then such an issue is not “triable issue”, and therefore cannot be used to frustrate for summary judgment.” [45] On the issue of LAD under the SPA (at pages 176 – 218 of the Apepal Record), the Plaintiff has the right to invoke clause 23(1), (2) and (3) of the SPA. Clause 23 (1) clearly spelt out on the LAD provision whereas clause 23 (2) and (3) provides in the event clause 23(1) is not fulfilled which will trigger clause 23(2) of the SPA. The words are clear that the vendor will be liable to pay from the expiry of the delivery of vacant possession in clause 23(1) until the date the purchaser takes vacant possession of the said Property. Therefore where the terms of the contract in relation to delivery of vacant possession had been reduced to writing, that is the SPA and the language is very clear and unambiguous, it is not open for the judge to improve on it as it would be adding new terms into the agreement: Tindok Besar Estate Sdn Bhd v Tinjar Co [1979] 2 MLJ 229. [46] In relation to the stop work order defence by the Defendant, the SPA had conformed to the statutory requirement of attaching Schedule G to the SPA following Regulation 11(1) Housing Development (Control & Licensing) Regulations 1989. Form G on vacant possession had been included in the SPA. Therefore the argument that there was a stop work order to justify the delay is not a defence as it the Defendant who is responsible to apply for an extension of time for delivery of vacant possession. Failure to do so by the Defendant would be a clear breach of the SPA. It would also be illogical for developer or vendor not to apply for an extension of time which is allowed under the law. Based on the SPA, it is clear that the LAD can be invoked when there is a delay on delivering the vacant possession of the said Property and therefore failure to do so by the Defendant does not absolve the Defendant of his liability to pay LAD based on the case attributed by counsel for the Plaintiff in Tan Sri G darshan Singh v Loke Kee Development Sdn Bhd and Anor [2009] 7 MLJ 157. [47] On the issue of utilizing the said Property by Plaintiff to facilitate a loan, this was the Defendant’s contention which I do not see the importance of this issue as a triable issue as there was no evidence alluded by the Defendant. Based on the Appeal Record, the Agreement for Banking Facility between RHB Bank and the Plaintiff can be found at pages 176 – 218 of the Appeal Record. The date of the offer for the facility was 27.10.2005 and the date of agreement of the Banking Facility was 24.3.2006 where the period of the facility was for 180 months for the amount of RM335,000.00. The facility period would have surpassed by now and pertinent to note that where loan facility had been taken by the owners of any property, they are still required to repay the loan facility. In this case, the Plaintiff is unable to rent out the said Property nor could benefit from it as the vacant possession was given only after 10 years. It can be surmised that the Defendant was merely asserting its case on bare allegations. This Court finds that it is the Defendant instead whom benefitted from the contra debt arrangement as he is uplifted from the burden of the purported debt of Yap Grouting. [48] On the issue of limitation, I will not delve much on this aspect simply because the action accrued for the Plaintiff was when the Defendant failed to adhere to clause 23(2) and (3) of the SPA. Briefly, based on the letter of demand of 18.7.2016 (at page 128 – 129 of the Appeal Record), it was stated the Defendant had given the Plaintiff vacant possession on 13.5.2016 and claimed for the delay of the 24 months that is from 11.11.2007 until 11.11.2009 as well as the delay until the vacant possession of the said Property was given to Plaintiff, that is from 11.11.2009 until 13.5.2016. The Plaintiff demanded for the LAD through its solicitors on 18.7.2016. Clause 23(2) and (3) of the SPA clearly spelt out the delay to include until the vacant possession is delivered to the Plaintiff and I cannot see any other way in interpreting the unambiguous words of clause 23 (2) and (3) of the SPA that the LAD is claimable until vacant possession of the said Property is delivered to the Plaintiff. Therefore Plaintiff’s claim or demand made is not time barred. [49] This appeal arises from a summary judgment under Order 14 of the ROC 2012. It is incumbent upon the Court to have the overall view to ascertain whether the Defendant has a real or bona fide defence. I wish to rely on the case of Eng Say Kuang v Hong Leong Bank Bhd [2008] MLJU 38, “It is trite law that in such an application the onus on the defendant to be entitled to defend the action in a full trial, is to satisfy the court that "there is an issue or question in dispute which ought to be tried or that there ought for some other reason to be a trial..." [50] In light of the above reasons, this Defendant could not satisfy this Court nor am I convinced that there is an issue or question in dispute which ought to be tried. I find that the Defendant’s grounds for appeal did not give rise to any bona fide triable issue. In view thereof, the Plaintiff, based on the balance of probabilities, has a prima facie case for summary judgment to be entered against the Defendant. I therefore dismiss the appeal with cost. Dated: 24 July 2017 (DATIN ZALITA BINTI DATO’ ZAIDAN) Judicial Commissioner Shah Alam High Court, Selangor SOLICITORS: APPELLANT : CHAN WENG KHAI Tetuan Chang Weng Khai & Company No. 48-M, Jalan SS21/58 Damansara Utama 47400, Petaling Jaya Selangor Darul Ehsan [CWK/BSSB/16/LIT/493416] Tel : 03-7728 9633 Fax : 03-7728 9133 RESPONDENT : RANDY CHEW Tetuan Terrence & Randy Sutite D1-U6-16, Tingkat U6 Blok D1, Jalan Dutamas 1 50480 Kuala Lumpur [Ruj: L00012/16/TL/RC] Tel : 03-6205 3655 Fax : 03-6211 5997 49

Tika 2.6.0

W-02(A)1792-09/2016

PERAYU S.P. VELOO & CO. [SUED AS A LAW FIRM] RESPONDEN AFFIN BANK BERHAD ... RESPONDEN T

Taxation — Bill of costs — Contentious Matter — Whether bill of costs has been delivered according to law — Whether steps taken to comply with the procedure to tax bill of costs through court process within stipulated time frame — Limitation — Whether time-barred — Legal Profession Act 1976 [Act 166], ss 116, 121,124,126, 128,130, 132; Rules of Courts 2012 [ (P.U. (A) 205/2012), Order 59

21/07/2017

YA DATUK DR HAJI HAMID SULTAN BIN ABU BACKERKorumYAA TAN SRI DATUK SERI PANGLIMA DAVID WONG DAK WAHYA DATUK DR HAJI HAMID SULTAN BIN ABU BACKERYA DATO' UMI KALTHUM BINTI ABDUL MAJID

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=222e8d48-c23a-45b1-abb5-dac82f8835d2&Inline=true

1 THE COURT OF APPEAL OF MALAYSIA (APPELLATE JURISDICTION) CIVIL APPEAL NO. W-02(A)1792-09/2016 BETWEEN S.P. VELOO & CO. ... APPELLANT [SUED AS A LAW FIRM] AND AFFIN BANK BERHAD ... RESPONDENT [COMPANY NO.: 25046-T] [Dalam Perkara Mengenai Mahkamah Tinggi Malaya di Kuala Lumpur] Saman Pemula No. WA-17D-14-04/2016 Dalam Perkara Seksyen 130,132 dan 126 Akta Profesyen Undang-Undang 1976; Dan Dalam Perkara mengenai fee guaman dan taksiran antara Affin Bank Berhad dengan Tetuan S.P. Veloo & Co.; Dan Dalam Perkara Aturan 59, Kaedah-Kaedah Mahkamah 2012 dan/atau Kaedah-Kaedah Mahkamah Tinggi 1980. 2 ANTARA AFFIN BANK BERHAD … PLAINTIF [NO. SYARIKAT: 25046-T] DAN S.P. VELOO & CO. … DEFENDAN [DISAMAN SEBAGAI SEBUAH FIRMA GUAMAN] Coram: David Wong Dak Wah, JCA Hamid Sultan bin Abu Backer, JCA Umi Kalthum binti Abdul Majid, JCA Hamid Sultan Bin Abu Backer, JCA (Delivering Judgment of The Court) GROUNDS OF JUDGMENT [1] The appellant’s/solicitor’s appeal is against the decision of the learned High Court judge who had allowed the respondent’s/client’s application to get the Bill taxed relating to contentious business notwithstanding the limitation of one year to do so has set in pursuant to the Legal Profession Act 1976 (LPA 1976). The respondent’s prayers before the High Court read as follows: “(i) to deliver the Plaintiff the detailed solicitors' bills of costs within 14 days after the order is made; 3 (ii) the said detailed solicitors' bills of costs then fixed for taxation at this Honorable Court; and (iii) to deliver all cause papers, documents, correspondences, files and all other matters relating to the works done by the Defendant to the Plaintiff within 14 days after the order is made.” [2] The central allegation of the respondent before the High Court was that the solicitor’s bill was not an itemised bill as per the requirement of Order 59 of the Rules of High Court 1980 (RHC). [Now Rules of Court 2012 (RC 2012)]. In addition, it was also the contention that the sum claimed by the solicitor for work done was not reasonable. The learned judge’s reasons as summarised by the respondent read as follows: “(a) the Appellant had only delivered gross sum bills to the Respondent. Although the Invoices set out "all the works done", they "did not itemise the costs of each items to show the legal fees were arrived." (b) the Respondent did not agree with the legal fees charged under the Invoices. The fees charged were "not reasonable." (c) the Appellant did not have a "signed written agreement" with the Respondent on the Legal Works.” [3] We wish to make it clear that (i) LPA 1976 allows a solicitor to present to a client a bill for contentious matter; (ii) if the client is not happy with the bill, he has two options (a) he can request the bill to be taxed and that has to be done within a year subject to conditions; (b) if the bill was not taxed and if he finds the sum as exorbitant, unreasonable or excessive, etc. the client can challenge the bill when the solicitors bring an action for recovery. The LPA 1976 does not prohibit the court 4 from revisiting an exorbitant or unreasonable bill at the time of recovery proceedings. Only in exceptional circumstance that such a challenge may be successful; (iii) if the bill was not taxed within a year, it may be possible to seek extension of time to tax the bill pursuant to Additional Powers in Courts of Judicature Act 1964 (CJA 1964). This possibility was discussed at length in relation to a different Act by Justice Nantha Balan in the recent case of Perbadanan Pengurusan Anjung Hijau v Pesuruhjaya Bangunan [2017] MLJU 679. As the parties had not raised the issue of extension and additional powers of CJA 1964, we will not deliberate on the matter though there may not be any prohibition for making such application if prima facie they can demonstrate the bill was not consented or exorbitant in a case where there was no prior agreement to the said sum and there was legitimate expectation from the client that the solicitor will only present a bill for a reasonable sum as per the market practice. [4] The Court of Appeal decision of Tan Tek Sin & Anor v Nora Hayati & Associates [2015] 2 MLJ 1 presided by Raus Sharif PCA (as His Lordship then was), Azahar Mohamed JCA (as His Lordship then was) and Lim Yee Lan JCA supports the proposition that the court has inherent jurisdiction to intervene when a solicitor’s bill is grossly excessive and may grant extension of time to get the solicitor’s bill taxed. The Court of Appeal inter alia held: “(3) The plaintiffs had engaged the defendant to obtain a relatively uncomplicated court order for the letters of administration. The defendant had set-out the particulars of the legal work done without any sum being shown against each item. The bill only just showed a lump sum of RM600,000 representing the costs of all the items. This was in itself a special circumstance, which was a ground for the court to exercise its inherent 5 jurisdiction to allow the plaintiffs' extension of time and to refer the bill for taxation and determination (see paras 32–33). (4) The fee of RM600,000 was arguably grossly excessive and did not commensurate with the legal work done. This, prima facie, was a special circumstance that warranted the High Court to exercise its inherent jurisdiction by granting an order for taxation. There was never any averment made by the defendant in their affidavit to challenge the plaintiffs' contention in the affidavit in support that the sum of RM631,141.20 was astronomical. The defendant in opposing the application did not explain or clarify the exorbitant fee of RM600,000 (see paras 34–35).” [5] The solicitor’s bill in the instant case for contentious business can be summarised as follows: No. Nature of Instruction Fees 1. Amended invoice no. 1 Removal of caveat Government tax of 6% Disbursement Total RM 115,000.00 RM 6,900.00 RM 2,566.00 RM 124,466.00 2. Amended invoice no. 2 Defending the setting aside of order application Government tax of 6% Disbursement Total RM 145,000.00 RM 8,700.00 RM 3,628.00 RM 157,328.00 3. Invoice no. 3 Defending the stay application Government tax of 6% Disbursement Total RM 55,000.00 RM 3,300.00 RM 1,212.40 RM 59,512.40 4. Invoice no. 4 Defending the appeal Government tax of 6% Disbursement Total RM 150,000.00 RM 9,000.00 RM 1,073.80 RM 160,073.80 Total sum: RM501,380.20 6 [6] Looking at the fees structure above for ordinary day to day business of the court, we reserve our comment on the issue of ‘unreasonable fee’. In the instant case, there was no expert evidence of members of the profession on this issue. [See Ngan Siong Hing v RHB Bank [2014] 2 MLJ 449; Pang Yeow Chow v Advanced Specialist Treatment Engineering Sdn Bhd [2014] 8 CLJ 188]. This was also a case where there was no prior agreement of fees and any reasonable client would expect the fees to be reasonable as the legal profession is duty bound to abide by ethics. Professional ethics in respect of lawyers is the set of moral principles which lays down certain duties for the observance of its members which they owe to the society, to the court, to the profession, to the public, to his client, etc. befitting professional standards of conduct. In Re GH Conaghan [1961] MLJ 81 it was stated that the legal profession occupies by law a privileged position. The continued existence of that position can only be justified if every individual member of the profession conforms to certain standards. Sending a purportedly an unreasonable bill to a client for a contentious business, that too without prior agreement, where in the ordinary course of business could have been done would attract professional misconduct and would also be a grave breach of ethical standards of the legal profession. If the bill is found to be reasonable then there can be no reason for the client to complain. Brief Facts [7] The brief facts and law related to the case has been set out by the learned judge. This judgment must be read together with the judgment of the learned judge to appreciate our grounds in the right perspective. 7 We do not wish to repeat what was said in the judgment save to summarise the facts in our own words as follows: (a) The solicitor did contentious litigation matter for the client without any prior agreement as to fees. (b) The solicitor sent a bill for work done. (c) The client found the bill to be excessive and sought a discount. (d) Revised bills were sent. (e) After 1 year the bill was presented, the client requested for detailed bill of costs for purpose of taxation. (f) The solicitor did not respond and the client filed an originating summons purportedly in reliance of sections 130, 132 and 126 of LPA 1976 as well as Order 59 of RC 2012. The prayer as summarised by the learned judge reads as follows: “(i) to deliver the Plaintiff the detailed solicitors' bills of costs within 14 days after the order is made; (ii) the said detailed solicitors' bills of costs then fixed for taxation at this Honorable Court; and (iii) to deliver all cause papers, documents, correspondences, file and all others matters relating to the works done by the Defendant.” [8] The grounds of the Originating Summons inter alia are stated as follows: “(a) pihak-pihak tidak dapat mencapai sebarang persetujuan atas yuran yang kena dibayar oleh Plaintif kepada Defendan di mana yuran-yuran yang dikenakan adalah tidak munasabah. 8 (b) invois-invois yang telah dihantar oleh Defendan kepada Plaintif hanya merupakan bil-bil jumlah kasar dan bukannya bil-bil kos yang terperinci dan sedia dicukaikan. (c) Plaintif adalah berhak untuk diserahkan dengan bil-bil kos terperinci dan sedia ditaksirkan untuk meneruskan dengan taksiran/percukaian oleh Mahkamah yang Mulia ini; (d) Plaintif pada semua masa material sedia dan mampu untuk menjelaskan yuran-yuran yang dikenakan oleh Defendan asalkan ia adalah munasabah dan berpatutan. Plaintif bersedia untuk membuat pembayaran kepada Defendan selepas taksiran atas bil-bil kos dijalankan oleh Mahkamah.” [9] The Memorandum of Appeal of the solicitors inter alia reads as follows: “1. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to take into account that section 121 of the Legal Profession Act 1976 (hereinafter referred to as "the LPA") provides the Appellant, as an advocate and solicitor, with the option of presenting either a gross sum bill or a detailed bill. 2. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to take into account and/or appreciate section 121 of the LPA, when she held that a solicitor's bill of cost must be presented in the form of a bill of cost ready for taxation as prescribed by section 132 of the LPA. 3. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to appreciate and/or take into account that there is no legal requirement for the Appellant, as an advocate and 9 solicitor, to present a bill cost ready for taxation when rendering the Appellant's Invoices at the first instance. 4. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to take into account that it is the duty of the Respondent to, within the period prescribed under the LPA, to request for a bill of cost ready for taxation, if the Respondent required a bill of cost in that form. 5. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to appreciate and/or take into account that in the absence of a request by the Respondent for a bill of cost ready for taxation within the period prescribed in the LPA, the Respondent is not entitled to the delivery of a bill of costs ready for taxation. 6. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to take into account the fact that Respondent had never asked the Appellant to present a bill of cost ready for taxation within the period of 1 year from the date of delivery of the Appellant's Invoices. 7. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to appreciate the difference between:- (i) gross sum bill; (ii) detailed bill; and (iii) a bill of cost ready for taxation. 8. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to take into account that that all the Appellant's Invoices contained precise and sufficient details of all the work carried out by the Appellant pursuant to the Respondent's instructions, so as to enable the Respondent to assess and/or understand and/or appreciate the extent and the nature of the work 10 carried out by the Appellant and as to how the fee stipulated in the Appellant's Invoices were arrived at. 9. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to take into account that all material times the Respondent had in their possession all the relevant documents and/or information to enable them to assess and/or understand and/or appreciate the extent and the nature of the work carried out by the Appellant and as to how the fee stipulated in the Appellant's Invoices were arrived at. 10. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to appreciate and/or take into account that the Appellant's Invoices are in fact detailed bill of cost and not a gross sum bill. 11. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to take into account that the Respondent's application for an order for taxation (hereinafter referred to as "the said application") is statute barred by virtue of section 128(2) of the LPA. 12. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to take into account that a period of more than one (1) year had lapsed from the date of the delivery of the Appellant's Invoices to the date of the said application. 13. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to take into account that section 128(2) of the LPA creates an absolute bar to making of an order for taxation after the lapse of a period of more than one (1) year from the date of delivery of the Appellant's Invoices. 11 14. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to take into account that the Court, by virtue of section 128(2) of the LPA was not vested with any inherent jurisdiction to extend time to allow said application beyond the period of one (1) year from the date of delivery of the Appellant's Invoices. 15. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to take into account that section 128(2) is a negative enactment which effectively excludes the Court's inherent jurisdiction to extend time beyond the period of one (1) year from the date of delivery of the Appellant's Invoices so as to allow the said application. 16. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to appreciate and/or take into account the principles of statutory interpretation and/or rules of construction of statute. 17. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to take into account that the Respondent in the said application did not pray for an extension of time to make the said application. 18. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to take into account that the affidavit in support of the said application did not fulfil the necessary requirements prescribed by section 126(1) of the LPA so as to enable the Court to exercise its discretion to extend time beyond the period of 6 months from the date of delivery of the Appellant's Invoices, let alone extend time beyond the period of one (1) year to allow the said application. 19. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to appreciate and/or take into account that section 130 of the LPA has no application in the present instance. 12 20. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to appreciate and/or take into account the fact that the Respondent had never asked the Appellant to present a bill of cost ready for taxation within the period prescribed in the LPA, and as such the Respondent is not entitled to rely on section 130 of the LPA. 21. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to appreciate and/or take into account that section 132 of the LPA has no application in the present instance. 22. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to appreciate and/or take into account the unrebutted affidavit evidence of the Appellant that there had been assurance from the Respondent that the Appellant's 1st and 2nd Invoices will be paid and as such the Respondent is estopped from disputing the said Invoices. 23. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to appreciate and/or take into account that the 3rd and 4th Invoices of the Appellant were in fact agreed fees and as such the Respondent is estopped from disputing the said Invoices. 24. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to appreciate and/or take into account that the 3rd and 4th Invoices of the Appellant were in fact agreed fees and as such an order for taxation with regards to the said Invoices ought not have been made. 25. The Learned Judge had erred in law and/or fact in arriving at her decision, where she held that in that she failed to appreciate and/or take into account that the agreement as to fees with regards to the 3rd and 4th Invoices as reached between the Appellant and the Respondent 13 is valid despite the absence of a written agreement in the form as prescribed by section 116 of the LPA. 26. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to appreciate and/or take into account section 124 of the LPA where after a lapse of 6 months from date of presentation of the Appellant's Invoices to the Respondent, the said Invoices are presumed to be bona fide until the contrary is shown by the Respondent, and the fact that the Respondent had not shown anything to the contrary within the prescribed period under the LPA. 27. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to appreciate and/or take into account that the case of TAN TEIK SIN v NORA HAYATI & ASSOCIATES [2015] 1 CLJ 89 (hereinafter referred to as "Tan Tiek Sin's case") was wrongly decided. 28. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to distinguish the facts of Tan Tiek Sin's case from the facts of the said application, and she failed to appreciate and/or take into account that in such circumstances Tan Tiek Sin's case has no application in the present instance. 29. The Learned Judge had erred in law and/or fact in arriving at her decision, in that she failed to appreciate and/or take into account the actual facts and the legal principles enunciated in Tan Tiek Sin's case.” Jurisprudence Relating to Bill of Costs, Taxation and LPA 1976 for Contentious Matter [10] If there is no agreement for fees the LPA 1976 envisages at least three types of bill for purpose of costs between the solicitor and client. They are as follows: 14 (a) gross bill (s.121 LPA 1976) (b) detailed bill (s.121 LPA 1976) (c) itemise bill of costs for taxation (s.132 LPA 1976). [11] It must be noted that a solicitor’s bill can be a gross bill or detailed bill. A detailed bill mentioned in section 121(1) of LPA 1976 has nothing to do with a bill of costs for purpose of taxation under RHC 1980 or RC 2012. Courts in their decisions have often created confusion by asserting a detailed bill must be in the form of bill of taxation as set out in RHC 1980 and that too when dealing with section 121 of LPA where RHC 1980 or RC 2012 does not come into operation at all. Section 121 is independent of section 132 of LPA 1976. RHC 1980 or RC 2012 only comes into operation when it relates section 132 of LPA. [12] There is also a difference in phrase in the use of bill of costs in section 121 and section 128. Section 121(1) refers to solicitor’s bill of costs. Section 128 refers to an order for taxation of costs. The distinction is not one of an apple and an orange but one of a marble and pumpkin. This distinction is further emphasised by section 126(1) which states ‘an order for taxation of bill of costs’. The bill referred to here is the bill presented by the solicitor under section 121 and not the bill of costs related to taxation mentioned in RHC 1980 or RC 2012. Even section 130 refers to delivery of solicitor’s bill of costs and that bill can be a subject matter of taxation of bill of costs. If the court orders taxation of solicitor’s bill of costs, the taxation of the bill must follow the procedure set out for taxation of bill of costs under RHC 1980 and now under RC 2012. [Emphasis added]. 15 [13] The taxation of bill of costs of a solicitor’s bill was provided for in detail in RHC 1980. However, in RC 2012 the details required of a ‘taxation of bill of costs of solicitors’ have been dropped leaving only Form 117 which relates to Order 59 rule 7 and not really Order 59 rule 17 of RC 2012. We will not dwell on the RC 2012 for the purpose of this appeal, save to say that the phrase “itemised bills of costs” is no more found in RC 2012 and the words bill of costs also do not appear except in Form 117 which reads as follows: No. 117 BILL OF COSTS (O.59, r. 7) No. Particulars Amount (RM) 1. Getting Up (A) (1) Taking instructions from client for the hearing (2) Considering the facts and law (3) Attending and corresponding with client (4) Interviewing and corresponding with witnesses and potential witnesses and taking proofs of their evidence (5) Perusing pleadings, affidavits and other relevant documents (6) General care and conduct of the proceedings Total of Items 2. Out of Pocket Expenses (B) Filing Fees Attestation Transport Accommodation for Counsel and witnesses Witnesses allowances Expert fees and disbursements “Transcribing Court proceedings” Translation services Printing and/or Binding Photocopy 16 Miscellaneous (Particularize) TOTAL COSTS CLAIMED (RM TOTAL COSTS ALLOWED BY COURT (RM) “ALLOCATUR” DETERMINED BY THE REGISTRAR [14] It must also be noted that the previous Order 59 of RHC 1980 also mentioned that solicitor’s bill of costs and subsequent taxation procedure is referred to as taxation of bill of costs and also reference such as solicitor’s bill. [See for example RHC Order 59 rule 26(2); 28(1), etc.]. [15] Section 121 of LPA 1976 relates to “Where remuneration of advocate and solicitor not subject of agreement” reads as follows: “(1) Where the remuneration of an advocate and solicitor in respect of contentious business done by him is not the subject of an agreement made pursuant to section 116, the solicitor's bill of costs may at the option of the advocate and solicitor either contain detailed items or be for a gross sum: Provided that - (a) at any time before service upon him of a writ or other originating process for the recovery of costs included in a gross sum bill and before the expiration of three months from the date of the delivery to him of the bill, the party chargeable therewith may require the advocate and solicitor to deliver to him in lieu of the cost a bill containing detailed items, and the gross sum bill shall thereupon be of no effect; 17 (b) where an action is commenced on a gross sum bill, the Court shall, if so requested by the party chargeable therewith before the expiration of one month from the service on that party of the writ or other originating process, order that the bill shall be taxed; (c) if a gross sum bill is referred to taxation, whether under this section or otherwise, nothing in this section shall prejudice any rules of court with respect to taxation and the advocate and solicitor shall furnish the taxing officer with such details of any of the costs covered by the bill as the taxing officer may require. (2) Subsection (1) shall not apply to fees paid to an advocate and solicitor who is briefed as a senior counsel.” [16] Section 121 clearly talks about a solicitor’s bill of costs. It has nothing to do with “taxation of bill of costs”. Solicitor’s bill is a bill for services rendered by the solicitor. The bill can set out detailed items or for gross sum. This bill and the manner it is prepared is at the option of the solicitor. There is no provision in law for the court to dictate how the solicitor’s bill should be. Cases which have not made out the distinction must be corrected by due process of law. In addition, section 121(1) proviso (c) itself makes it clear if the matter is referred to taxation the solicitor must issue a bill as required by the taxing officer. Section 121(1) proviso (a) gives the client the right to demand from the solicitor a bill containing detailed item if the solicitor has served a gross bill. This request is only for the client to be informed of, of the breakdown of the gross bill and not a bill for taxation. A bill for purpose of taxation can only come after the court has ordered the matter to be referred to taxation. Section 121(1) proviso (b) also makes it clear even if a gross bill is submitted an order can be obtained for it to be taxed. 18 [17] Section 126 of LPA 1976 which relates to an order for taxation of costs to be made within 6 months of delivery of bill of costs reads as follows: “(1) An order for the taxation of a bill of costs delivered by any advocate and solicitor may be obtained by a petition as a matter of course by the party chargeable therewith, or by any person liable to pay the cost either to the party chargeable or to the advocate and solicitor, at any time within six months from the delivery of the bill, or, by the advocate and solicitor after the expiration of one calendar month, and within a year from, the delivery. (2) The order shall contain such directions and conditions as the court thinks proper, and any party aggrieved by any order of Court may apply by summons in chambers that the same may be amended or varied or set aside. (3) In any case where an advocate and solicitor and his client consent to taxation of a solicitor's bill the Registrar may proceed to tax the bill notwithstanding that there is no order therefor.” [18] Section 126 must be read with section 121. Section 126 simply sets out the step to be taken if the client is not satisfied with the solicitor’s bill of costs, be it gross or itemised bill. The time period of one month, six months and a year stated in the section is important. [19] Section 128 of LPA 1976 which relates to order for taxation of advocate and solicitor's bill on notice given reads as follows: “(1) After the expiration of six months from the delivery of a bill of costs, or after payment of the bill of costs, no order shall be made for taxation of a solicitor's bill of costs, except upon notice to the advocates and solicitors and under special circumstances to be proved to the satisfaction of the Court. 19 (2) No such order for taxation shall in any event be made after the expiry of one year from the delivery of the bill of costs.” [20] Section 128 must be read together with sections 121 and 126 for purpose of clarity. The law gives a right to a client to get the solicitor’s bill of costs taxed. The application must be made within six months and that can be done as of right. However, the application can also be made after the 6th month and within a year upon special circumstances been proved to the satisfaction of the court. The threshold test here is very high. [21] What is important to note is that if section 128 timeline is not adhered to by the client, he will not have the privilege to get the solicitor’s bill of costs to be taxed through the court process. What will be left to address his grievance will only be related to a common law right to dispute the claim. It is very unlikely for the courts to entertain a complaint on the solicitor’s bill of costs when the statutory mechanism was not adhered. Only in very rare and exceptional circumstances will the court want to reopen the issue of bill of costs. In Templer Park Golf & Resort Bhd & Anor v Tetuan George Varughese [2010] 8 CLJ 754, the Court went on to say: “When the dispute is to solicitor's bill, different jurisprudence applies as solicitors are a protected species, subject to the scrutiny by solicitors disciplinary board and/or the court in relation to bills for work done as provided for in LPA 1976. Dispute as to solicitor's bills must be challenged according to law and the mere assertion that the bills are bona fide disputed and the plaintiffs being ready and willing to deposit the sum claimed cannot be a ground to grant a "fortuna injunction".” javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1976_166&SearchId=1hakim33','_DisplayAct','');DispAct.focus() 20 The facts of the Templer Park’s case as summarised in CLJ read as follows: “This was the plaintiff's application to restrain the defendant (solicitor) from presenting a winding up petition relating to non-payment of solicitors bill. The defendant had issued a total of 20 separate s. 218 notices to the plaintiffs relating to non-payment of their itemized solicitor's bill issued in essence pursuant to Solicitor's Remuneration Order 1980. The plaintiffs submitted, inter alia, that (i) the quantum was excessive; (ii) the defendant had failed to comply with ss. 126 and 128 of Legal Profession Act 1976; (iii) the plaintiffs were willing to deposit the monies claimed pending the invoices being taxed and the company was solvent. The defendant argued (i) it was an undisputed fact that the defendant had acted for the plaintiffs, for both contentious and non-contentious works and bills have been issued; (ii) at all material time the plaintiffs have not questioned, challenged or disputed the bills and (iii) the bills were all itemized bills giving full details of the nature of professional services rendered by the defendant.” The court in dismissing the clients’ application had held inter alia as follows: “(1) The contents of the solicitor's bill were presumed by law to be bona fide and the necessity to prove the contents of the bill and to tax the bill on the facts of this case did not arise due to several provisions of the LPA 1976. Under s. 124(2) once the bill had been delivered in compliance with sub-s. (1) it shall not be necessary in the first instance for the advocate and solicitor to prove the contents of the bill and it shall be presumed until the contrary was shown to be a bill bona fide complying with this Act. Further, the bills issued pursuant to Solicitors Remuneration Order was never resisted from the first instance and now one year had lapsed (Vije & Co v. Co-operative Central Bank Ltd ). [Emphasis added]. javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1976_166&ActSectionNo=218.&SearchId=1hakim33','_DisplayAct','');DispAct.focus() javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1976_166&ActSectionNo=126.&SearchId=1hakim33','_DisplayAct','');DispAct.focus() javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1976_166&ActSectionNo=128.&SearchId=1hakim33','_DisplayAct','');DispAct.focus() javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1976_166&SearchId=1hakim33','_DisplayAct','');DispAct.focus() javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1976_166&ActSectionNo=124.&SearchId=1hakim33','_DisplayAct','');DispAct.focus() 21 (2) The plaintiffs' argument that they were commercially solvent could not on its own be a ground for preventing a petitioner (defendant) from presenting a petition on an undisputed debt (Savant-Asia Sdn Bhd v. Sunway PMI-Pile Construction Sdn Bhd ). An irreparable harm that may be caused to the debtor company could not be seen as a cure for not honouring the commitment to the creditors. (3) The defendant's claim stood in law to be bona fide and the plaintiffs' claim that the sum claimed was bona fide disputed was not supported with contemporary objections against the bills and the line of arguments raised by the plaintiffs militated against the relevant provisions of LPA 1976. And in consequence, the plaintiffs' application must be dismissed with direction as they had stated that they were in a position to settle the bills.” [22] As we have stated earlier that a solicitor’s bill of costs has special protection by statute and section 124 gives the protection. It does not require the solicitor to prove the contents and it shall be presumed until the contrary is shown a bill bona fide complying with this Act. The emphasis is ‘bona fide’. If the bill is established to be not bona fide then the court’s role to intervene is not ousted. There appears to be no cases directly on point related to the factual matrix of this case so far on the meaning of ‘bona fide’. A grossly unconscionable or unreasonable bill may attract the jurisprudence of bona fide. In cases where it can be shown that the solicitor had done contentious work without fees agreement and the charges are excessive or exorbitant sum for the work a case can be made out provided there is evidence given by senior litigation solicitors on that issue, etc. and there can also be a subsequent complaint for misconduct before the Disciplinary Board. That is to say, though the LPA 1976 gives protection to solicitors in respect of bills unlike other profession, misconduct on issues of excessive or exorbitant bill can be a subject matter of complaint sufficient to protect the client. javascript:DispAct=window.open('/Members/DisplayAct.aspx?CaseActCode=MY_FS_ACT_1976_166&SearchId=1hakim33','_DisplayAct','');DispAct.focus() 22 Thus, the LPA 1976 on the issue of bills protect the lawyers and has also a mechanism to protect the clients. This may not be the case in other professions. [23] Section 124 of LPA 1976 which entitles ‘No advocate and solicitor to sue for costs until delivery of bill of cost’ reads as follows: “(1) Except as authorized by this Act, no advocate and solicitor shall without the leave of the court commence or maintain any action for the recovery of any costs due for any business done by him until the expiration of one month after he has delivered to the party to be charged therewith, or sent by post to. or left with him at, his office or place of business, dwelling house or last known place of abode, a bill of costs, which bill shall be signed either by the advocate and solicitor, or in the case of a partnership, by any of the partners, either with his own name or with the name or style of the partnership, or by another advocate and solicitor employed by the first-named advocate and solicitor or the partnership, or be enclosed in or accompanied by a letter, signed in the like manner, referring to the bill. (2) Where a bill is proved to have been delivered in compliance with subsection (1) it shall not be necessary in the first instance for the advocate and solicitor to prove the contents of the bill and it shall be presumed until the contrary is shown to be a bill bona fide complying with this Act.” [24] Section 130 of the LPA 1976 also relates to a right to get the solicitor’s bill to be taxed and in that process also for delivery of any deeds, documents or other papers subject to lien, etc. The difference between sections 126 and 130 is inter alia that under section 126 the presumption is that a solicitor’s bill of costs has been delivered. Section 130 deals in a case where a solicitor’s bill of costs is not delivered and the clients want to pay the bill upon taxation and also collect the documents. The said section 130 of LPA 1976 states as follows: 23 “Order for delivery of solicitor's bill of costs by way of petition 130.(1) An order for the delivery of a solicitor's bill of costs, and for delivery up of any deeds, documents or other papers in the possession of the advocate and solicitor may, subject to any lien which such advocate and solicitor may have, and for the taxation of the bill when delivered, be obtained on a petition of course. (2) Upon the petition being filed, the Registrar shall mark the order thereon forthwith, and draw up the order if necessary. (3) Subject to this section, the Court shall have the like jurisdiction as the High Court in England to make an order under subsection (1).” [25] Section 132 of LPA 1976 makes the clear distinction to say when the bill of costs for taxation is made it must follow the Rules of Court. That is to say, a solicitor’s bill of costs need not follow the RC 2012 but a bill of costs for taxation must follow the RC 2012. [26] We are grateful to the learned counsel for a number of courts decision in this area of law. We have looked into it and take the view that the LPA 1976 has provided a clear guideline on the issue of solicitor’s bill of costs and the steps to be taken within the time frame to be taxed through the court’s process and also wide powers of the court set out in CJA 1964 Schedule relating to Additional Powers of Courts as well as case laws on inherent jurisdiction to extend time which makes our legal framework different from England and for that reason English case laws must be read with caution. A client can be deprived to get the solicitors bill taxed if the procedures in the LPA 1976 are not followed. However, the LPA 1976 per se does not prohibit the court from 24 reopening the issue of fees if prima facie it can be shown that the bill is not bona fide, etc. The distinction is this, the right to be taxed which means that the client must pay the taxed bill and the amount cannot be challenged. If the bill was never taxed, there may be a small window to challenge it seeking extension of time to set it to be taxed or otherwise. It all depends on the facts and circumstances and the seriousness of the complaint. [27] We do not think it is necessary to go through the cases, save to set out some of the cases cited before us. [See Re A Solicitor [1961] 2 ALL ER 321; Storer & Co v Johnson and Weatherall [1890] 15 App Cas 203; Phuah Choon Hwang & Anor v Hassan & Kong Yeam [1987] 1 MLJ 156; Harry Lee Wee v Haw Par Brothers International Ltd [1980] MLJ 228; Harrison and Others v Tew [1990] ALL ER 865 (CA); Harrison and Others v Tew [1990] ALL ER 321; Chia Ah Sim v Ronny Chong & Co [1993] 2 SLR 564; Vije & Co v Co-Operative Central Bank Ltd [1991] 3 MLJ 432; Tan Tek Sin & Anor v Tetuan Nora Hayati & Associates (Sued as a Firm) [2015] 2 MLJ 1]. [28] We have read the appeal record and able submissions of the parties. After giving much consideration to the submission of the learned counsel for the respondent/client, we take the view that the appeal must be allowed. Our reasons inter alia are as follows: (a) in the instant case, a solicitor’s bill of costs has been delivered according to law; (b) the client did not take steps to comply with the procedure to get it taxed through the court process within the time frame; 25 The right to get the solicitor’s bill of costs taxed as of right has become time-barred. For that reason we are inclined to allow the appeal. That does not mean that the bill cannot be challenged at all for reasons we have stated earlier and/or an application cannot be made to the court for extension of time to get the bill taxed. [29] For reasons state above, the appeal is allowed with costs of RM5,000.00 subject to allocatur. Deposit is to be refunded. We hereby order so. Dated: 21 July 2017 sgd (DATUK DR. HAJI HAMID SULTAN BIN ABU BACKER) Judge Court of Appeal Malaysia. Note: Grounds of judgment subject to correction of error and editorial adjustment etc. Counsel for Appellant: Mr. K. Selva Kumaran [with Mr. Ahmad Saiful Bahari] Messrs. Rose Hussin Advocates & Solicitors Suite 2-6-5 & 2-6-6, Wisma Manjalara Jalan 7A/62A, Bandar Manjalara 52200 Kuala Lumpur. [Ref: L0671/16/RH/SK] 26 Counsel for Respondent : Mr. Andrew Chiew Ean Vooi [with Ms Nurul Syafiqah bt Nawi @ Sahwi] Messrs Lee Hishammuddin Allen & Gledhill Advocates & Solicitors Level 6, Menara 1 Dutamas Solaris Dutamas No. 1, Jalan Dutamas1 50480 Kuala Lumpur. [Ref: NSN/AC/50236]

Tika 2.6.0

BA-12NCC-6-07/2016

PERAYU 1. WONG MAY LENG (NO. K/P: 650630-10-7246) 2. WONG CHOW SHANG (NO. K/P: 631114-07-5483) RESPONDEN 1. THOMAS PATRICK FRANCIS FERNANDES (NO. PASPOT INDIA: H 1078515) 2. WONG LAY SHAN (NO. K/P: 880218-10-5162

19/07/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=fa847bc6-950d-4c11-a4d0-077cab2cbd76&Inline=true

DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA RAYUAN SIVIL NO: BA-12NCC-6-07/2016 ANTARA 1. WONG MAY LENG (NO. K/P: 650630-10-7246) 2. WONG CHOW SHANG (NO. K/P: 631114-07-5483) ….. PERAYU- PERAYU DAN 1. THOMAS PATRICK FRANCIS FERNANDES (NO. PASPOT INDIA: H 1078515) 2. WONG LAY SHAN (NO. K/P: 880218-10-5162 …..RESPONDEN- RESPONDEN [Dalam perkara mengenai Mahkamah Sesyen di Shah Alam Guaman No: B52NCC-37-04/2015 Bicara Penuh (B) ANTARA 1. THOMAS PATRICK FRANCIS FERNANDES (NO. PASPOT INDIA: H 1078515) 2. WONG LAY SHAN (NO. K/P: 880218-10-5162 ….. PLAINTIF- PLAINTIF DAN 3. WONG MAY LENG (NO. K/P: 650630-10-7246) 4. WONG CHOW SHANG (NO. K/P: 631114-07-5483) …..DEFENDAN- DEFENDAN GROUNDS OF JUDGMENT Introduction [1] This is an appeal by the Appellants who were the 1st and 2nd Defendants, against the decision of the learned Session Judge of 17.6.2016 that allowed the Respondents, the 1st and 2nd Plaintiffs’ claim of RM340,000.00. [2] The parties, in this judgment, will be known as they were in the Sessions Court. The terms ‘1st and 2nd Defendant’ and ‘the Defendants’ and ‘1st and 2nd Plaintiffs’ and ‘the Plaintiffs’ may be used interchangeably. Facts [3] The dispute before me is about a sale of business restaurant by way of sale and purchase of shares agreement known as the Restaurant Sale Private Contract dated 2.11.2013. The background facts can be briefly referred to as follows: (a) The Defendants were the main shareholders of the company First Food Connection Sdn Bhd (“FFCSB”) carrying a restaurant business in the name Wai Kei (the Restaurant); (b) On or around 27.9.2013, the 1st Defendant had contacted the 1st Plaintiff to sell the Restaurant business to the Plaintiffs. There was a discussion between the 1st Plaintiff and the 1st Defendant where the Defendants had made representation that lunch delivery will be at 300 packs per day and net profit will be at RM500 per day where the gross income daily is between RM2,500 to RM3,000 and net profit monthly at RM18,000.00. (c) The assertion by the Plaintiffs is that based on the representation made by the Defendants, the Plaintiffs agreed to purchase the Restaurant business. (d) Both Plaintiffs and Defendants entered into the Restaurant Sale Private Contract (“the Contract”) dated 2.11.2013 through the purchase of shares of the Defendants in FFCSB. (e) The Plaintiffs paid the Defendants RM271,000.00 and the Defendants by the name Choy Yin Moi had transferred the security dated 1.11.2013 for the 100% transfer of shares in FFCSB to the Plaintiffs. (f) The Plaintiffs took over the Restaurant on 4.11.2013 and claimed that many problems occurred and sought assistance through emails and telephone calls from the Defendants since 12.11.2013 but to no avail. (g) The Plaintiffs through their Solicitors informed the Defendants that there was a breach of contract by the Defendants and terminated the Contract on 20.1.2014. The Plaintiffs also demanded for the return of the sale purchase money of RM250,000.00 from the Defendants. (h) The Plaintiffs claimed that they had incurred losses ever since they took over the Restaurant’s business and the Plaintiffs finally stopped the business on 21.3.2014. (i) The Plaintiffs claimed that the Plaintiffs had adhered to the Contract particularly clause 6 on contract termination, sale reversal and refund. The Plaintiffs claimed that the Defendants had failed to return the sale and purchase of the shares money to the Plaintiffs and failed to adhere to clause 6 of the Contract that is, failure to refund the entire paid amount purchased within 7 days of termination. (j) The Plaintiff did not deny that they had to continue with the Restaurant business until 24.3.2014 even after the Contract was terminated on 20.1.2014 in order to mitigate the losses (see page 302-303 of the Appeal Record Jilid I) as the Plaintiffs had to generate income before terminating the Restaurant business. (k) The Plaintiffs also claimed that they had emailed on 2.2.2014 to the 1st Defendant asking for help to sell off the Restaurant (at page 469-470 Appeal Record Jilid I). (l) After a full trial of three days and four witnesses where two were Plaintiffs’ and the other two were Defendants’, the Sessions Court had on 17.6.2016 allowed the Plaintiffs’ claim for RM340,000.00, being RM250,000.00 for the return of the purchased shares price and RM90,000.00 for the loss of profit as promised by the Defendants. Defendants’ Submission [4] The learned counsel for the Defendants submitted several grounds as in the amended Memorandum of Appeal dated 19.9.2016 (at pages 1-3, paragraphs (1) – (8) of the ‘Rekod Rayuan Tambahan (Jilid III)). Mainly the arguments put forward is that the Session Judge had erred on facts and law without considering or failing to consider: (i) that the Plaintiffs failed to adhere to the terms of the Contract in particular clause 6 of the Contract; (ii) that the Plaintiffs continued with the Restaurant business after terminating the Contract; (iii) that the Plaintiffs had waived their rights and/or estopped to sue the Defendants when Plaintiffs continued with the Restaurant business after it being terminated; and (iv) that the Plaintiffs acquiesced to continue with the Contract based on Section 40 of the Contracts Act 1950. [5] The counsel for the Defendants argued at length on clause 6(a) of the Contract and the issue of consequential order. The Court heard the importance of clause 6 of the Contract and the reason that a consequential order should had been made, claimed to have been overlooked by the Session Judge which resulted the Defendants suffered losses in terms of: · loss of the restaurant; · loss of the company First Food; were ordered to pay back the sale purchase of RM250,000.00 to the Plaintiff; and · to pay the loss of profit of RM90,000 to the Plaintiff. [6] On the Plaintiffs’ argument that the Restaurant’s business cannot be returned as it ended on 21.3.2014, the counsel for the Defendants submitted although the Plaintiffs terminated the contract on 20.1.2014, they had however continued with the Restaurant business until 21.3.2014 and thus the mitigation plead should fail. The counsel relied on the Federal Court case Edmund Chan Kai Khoon v. Abrizah Abdullah & Ors (2010) 6 CLJ 249 that the Restaurant business can and should be returned to the Defendants. [7] It was contended that the Session Court did not consider section 40 of the Contract Act 1950 and counsel relied on the case of Dr. Shanmuganathan v. Perisamy s/o Sithambaram Pillai (1997) 3 MLJ 61, Federal Court decision where the trial judge had overlooked in making a consequential order. [8] On the loss of profit of RM90,000.00, the counsel for the Defendants submitted that the 1st Plaintiff failed to prove and that the Contract did not provide for loss of profit. In addition, to strengthen its argument on loss of profit, section 75 Contract Act 1950 was referred that there must be prove for the losses or for the reasonable compensation. Plaintiffs’ Submission [9] The learned counsel for the Plaintiffs argued before the Court mainly on 3 grounds, firstly in relation to the consequential order to return the Restaurant business and sell off the shares, the learned counsel for the Plaintiff submitted that this was never pleaded by the Defendants. It was conceded by the Plaintiffs that the Defendants only pleaded that the Plaintiffs had continued with the Restaurant business after the Contract was terminated under the business name of Wai Kei and nowhere stated that the Restaurant business be returned and that the shares be transferred upon return of the Restaurant business. On this aspect, Plaintiffs’ counsel submitted that no evidence was adduced from both counsels at the trial. [10] The Plaintiffs’ counsel agreed that such consequential order should had been made and referred to the case of Edmund Chan Kai Khoon v. Abrizah Abdullah & Ors (2010) 6 CLJ 249. However, the Plaintiffs’ counsel argued that returning of the Restaurant business and the purchased shares following clause 6 of the Contract would be impossible to comply as clause 6 of the Contract provides for the return of business in full whereas the Restaurant business suffered major losses and that Defendants never revealed their intention to return the purchased shares in exchange for the Restaurant business to be returned. [11] The Plaintiffs’ counsel submitted that the Plaintiffs continued with the Restaurant business after the Contract was terminated to mitigate losses and highlighted this Court the evidence in support at pages 302-303 (Jilid 1) and pages 479-480 (Jilid II) of the Record of Appeal. The Plaintiffs’ counsel pointed that the Defendants knew that the Plaintiffs were seeking their help to sell off the Restaurant business based on the oral evidence of the 1st Defendant (at pages 396-397 of Appeal Record (Jilid II)) and Plaintiffs’ email of 2.2.2014 (at page 469 of the Appeal Record (Jilid II), cross refer with pages 479-480 of the same). [12] The counsel for the Plaintiffs made a distinction on the return of the shares proviso of the contract as referred by the Defendants in the case of Wong Leng Hung v Krishnamurthy Nagaratnam [2005] 8 CLJ 745 and the present case. It was submitted that in Wong Leng Hung (supra) case at pages 746 and 748, clause 4 of the contract mentioned the return of monies first be made to invoke the termination of the contract whereas under clause 6 of the Contract, the Contract is terminated due to breach of contract, “sale will be reversed, Business will be returned to Seller in full and Seller will refund the entire paid amount to Purchaser within 7 days of termination”. [13] In relation to the second argument that Plaintiffs failed to prove for the loss of profit RM 90,000.00, the Plaintiffs assert that the loss was proven by highlighting clause 2.6 of the Contract (at page 559 (Jilid II) of the Apepal Record where the Net profit of Business stated that “Seller will make sure business produces its minimum net profit of RM18,000 per month and produce the same for 3 consecutive months after completion of sale”. It was argued that this was a guarantee given by the Defendants in the Contract of net profit RM18,000 per month, as pleaded by the Plaintiffs and added that the Defendants never challenged on Plaintiffs’ losses for the said period of Restaurant business run by the Plaintiffs, at the trial. [14] On the third ground that the law under Section 40 of the Contracts Act 1950, Plaintiffs’ counsel made reference to the oral evidence of the 1st Plaintiff and the email sent to show that he was in a desperate situation to recover his losses and to sell the Restaurant and by making alternative proposal to the Defendants as the latter did not respond to Plaintiffs help and was not to expand the business (at page 259 (Jilid 1) of the Appeal Record). [15] The Plaintiffs’ counsel argued that the Defendants’ counsel argument that the Plaintiffs should have moved out from the Restaurant premise is unreasonable as the premise is rented by the Plaintiffs on a monthly tenancy for RM7,400 and if the tenancy agreement is to be terminated, Plaintiffs will suffer additional loss of RM21,000. [16] The counsel for the Plaintiffs submitted based on its written submission, the Plaintiffs had successfully proven: “D. Kesimpulan (iv) Dengan hujahan-hujahan di atas, Responden-Respondne telah berjaya membuktikan bahawa:- (d) Terdapat satu kontrak yang sah di antara Responden-Responden dan Perayu-Perayu dan pihak-pihak adalah terikat dengan terma-terma dan syarat-syarat dalam perjanjian tersebut. (e) Perayu-Perayu telah membuat representasi kepada Responden-Responden seperti yang diplidkan dalam perenggan 7 Pernyataan Tuntutan dan representasi tersebut adalah representasi salah seperti yang diplidkan dalam perenggan 18 Pernyataan Tuntutan. (f) Perayu-Perayu telah memecah terma-terma dan syarat-syarat Perjanjian tersebut seperti yang diplidkan dalam perenggan 19 Pernyataan Tuntutan. (g) Responden-Responden berhak membatalkan Perjanjian tersebut dan menuntut pemulangan bayaran harga jualan sebanyak RM250,000.00 serta kerugian keuntungan sebanyak RM90,000.00.” THE COURT’S FINDING: [17] The heart of the matter is in relation to the termination of the Restaurant business and its consequences. The whole of clause 6(a) of the Contract is reproduced here for convenience, as follows: “Clause 6. Contract termination, sale reversal and refund: The Parties hold the right to terminate this contract 90 days upon completion of sale subject to breach of this contract as described below: a. Breach of this Contract by Seller in terms of non-fulfillment of Value Deliverables as listed in section 2, inaccurate disclosure of information related to the Business such as sales revenue, net profit, liabilities and encumbrances, etc. thus resulting in financial losses or other damages and inconveniences to Purchaser. In the event of Contract termination by Purchaser as a result of breach of Contract by Seller, sale will be reversed, Business will be returned to Seller in full, and Seller will refund the entire paid amount Purchaser within 7 days of termination.” [18] On the issue of the validity of termination, this requires the construction of Clause 6(a) of the Contract. It provides the termination stating that it becomes a breach of contract when there is non-fulfillment of section 2 of the Contract, inaccurate disclosure of information related to the Business which includes sales revenue, net profit and even liabilities. The second paragraph of clause 6(a) stated the consequences of the termination. Again, it relates to the breach caused by the Defendants and stated that the “sale will be reversed, Business will be returned to Seller in full, and Seller will refund the entire paid amount to Purchaser within 7 days of termination.” [19] The counsel for the Plaintiffs made two primary arguments on this issue that there was termination and that the business continued for a while after termination to mitigate losses as there was no reply from the Defendants on the termination notice. The counsel for the Defendants on the other hand generally stated the termination is invalid because of non-compliance of clause 6(a) by the Plaintiffs by continuing with the Restaurant business after termination. [20] Reverting back to the facts and evidence before this Court, there is a history behind the sale and purchase of the Restaurant business. The Plaintiffs relied heavily on the Defendants information and track record which is based on the information only given by the Defendants themselves. The Plaintiffs had through his email of 27.9.2013 had asked for a detailed information of the Restaurant potential income generator. This was agreed by the Defendants’ witness, the 1st Defendant (DW1) herself whom testified during the cross examination (at page 368 of the Appeal Record (Jilid 1)), “S: Miss Wong, sila rujuk kepada Q&A, ms 10, dalam jawapan 17 ini, awak mengatakan bahawa Plaintif telah membuat siasatan yang terperinci, thorough investigation mengenai perniagaan restaurant tersebut dan telah bersetuju untuk mengikatnya saya cadangkan kepada awak bahawa siasatan yang terperinci atau thourough investigation, merujuk kepada soalan dan jawapan, melalui email-email dan juga meeting-meeting diantara plaintif-plaintif dan defendan-defendan, setuju? J: Setuju.” [21] The Plaintiff’s statement based on the record explained that the due diligence carried out on the business were done through emails, discussion and meeting with the Defendants. The Defendants had made representation that lunch delivery will be at 300 packs per day and net profit will be at RM500 per day where the gross income daily is between RM2,500 to RM3,000 and net profit monthly at RM18,000.00. Based on this representation by the Defendants, the Plaintiffs agreed to purchase the Restaurant. [22] The Defendants had replied to the Plaintiffs’ email on 27.9.2013 (at pages 459 and 460 (Jilid II) of the Appeal Record) that the cash collection daily is between RM2,500 to RM3,000 daily and the operational cost is low at under 30%. The following email on 29.9.2013 where Plaintiff was asked by Defendant to consider the food cost of 30%-35% before calculating on the profit. On this basis, Plaintiff relied on the purportedly “exact figure” to calculate the net profit and for cash flow investment (at page 461 (Jilid II of the Appeal Record). The Defendants however did not reply to Plaintiffs’ email and never denied on Plaintiff’s calculation and total of profit. [23] Interestingly, the Plaintiffs were promised of the guaranteed profit from the Restaurant business which became one of the salient points embedded into the Contract. Upon careful reading of the Contract, the purported profit making Restaurant clearly stated in the preamble where the Defendants “declared to be true” that the Restaurant generates a gross revenue of not less than RM80,000.00 per month with a net profit of not less than RM18,000 per month. [24] The agreed “Value Deliverables” are as stated in clause 2 of the Contract where among others are the ‘Business as an on-going concern’ and ‘Net Profit of Business’. The ‘Net Profit Business’ I would say, clearly mentioned the guaranteed net profit of RM18,000 per month: “2.6 Net Profit of Business: Seller will make sure the Business produces its minimum net profit of RM18,000 per month and produce the same for 3 consecutive months after completion of sale.” [25] The Plaintiffs claimed that after taking over the Restaurant business, the Plaintiffs found that the Defendants had breached the Contract by not providing an experience cook and the kitchen crew are not efficient as represented by the Defendants. The Restaurant business started facing problems and the Restaurant failed to generate the net profit of RM18,000 per month as guaranteed in the Contract. Plaintiffs claimed that they had issued complaints but no changes were made until Plaintiffs terminated the Contract on 20.1.2014. [26] Combing through the facts and evidence, this Court finds that the Contract was a valid Contract and all the representation made by the Defendants including the misrepresentation and losses occurred are pleaded in the Plaintiffs’ Statement of Claim (at pages 12 – 23 of the (Jilid 1) of the Appeal Record). The Court also referred to the oral evidence of the 1st witness for the Plaintiffs whom worked with the Defendants as well as the Plaintiffs until the Restaurant business was closed down (at pages 47 – 50 (Jilid I) of the Appeal Record). In my mind, in any food restaurant business it would be a reasonable inference that the cook or chef partly if not wholly, contribute to the success of the food restaurant business and this fact was misrepresented by the Defendants. [27] The facts and evidence gathered proved to show that there was misrepresentation, that the information given was not accurate for clause 6(a) of the Contract to be invoked. Clause 6(a) of the Contract provides that upon discovery of the inaccurate disclosure of information of the Restaurant business by the purchaser who is the Plaintiffs here, the sale of the Restaurant business will be reversed where the business is to be returned to the seller in full and seller will return the entire paid amount purchased within 7 days. [28] In order to appreciate the meaning of the Contract which must be ascertained from the words which the parties have agreed upon, the Contract must be read in the context of the circumstances in which they are executed. This Court wish to refer to the case of Tindok Besar Estate Sdn Bhd v Tinjar Co [1979] 2 MLJ 229 FC Kota Kinabalu where Chang Min Tat Ming, Federal Court Judge observed in relation to the terms agreed by Parties in the context of sections 91 and 92 of the Evidence Act 1950: “…where the terms of a contract have been reduced to writing, as in this particular agreement they had been, the contract could only be proved by the document itself, and it is not open to the respondent to seek to introduce and the judge to admit evidence that would inter alia, add new terms to it. [29] It is quite clear to me from a reading of Clause 6(a) that the Plaintiffs have the right to terminate the Contract. The Plaintiffs had offered the Defendants time to remedy the breach (email of 4.1.2014 at page 50 of (Jilid II) of the Appeal Record) before terminating on 20.1.2014 which was communicated to the Defendants (oral evidence at page 257 – 258 (Jilid I) of the Appeal Record). The consequences of the termination as provided in clause 6(a) is that the sale will be reversed where the Business will be returned to the Defendants in full and the Defendants will refund the entire paid amount to the Plaintiffs within 7 days of termination. [30] However, there was no reply by the Defendants on the offer to remedy nor did they reply within the 7 days of termination. The termination was valid as there was a breach of contract due to inaccurate information which allows the innocent party, in this case the Plaintiffs, to invoke the termination clause relying on the authority attributed by the Plaintiffs’ counsel in the case of Sim Thong Realty Sdn Bhd v Teh Kim Dar [2003] 3 CLJ 227 (Plaintiffs written submission for Sessions Court, at page 575 (Jilid II) of the Appeal Record). [31] If the construction of the Contract is crystal clear, the Court cannot improve on the contract and should be construed objectively: Attorney General of Belize & Ors v Belize Telecom Ltd [2009] Privy Council UKPC 10 where Lord Hoffman delivering the decision had said, “This court has no power to improve upon the instrument which it is called upon to construe, whether it be a contract, a statute or articles of association. It cannot introduce terms to make it fairer or more reasonable. It is concerned only to discover what the instrument means. However, that meaning is not necessarily or always what the authors or parties to the document would have intended. It is the meaning which the instrument would convey to a reasonable person having all the background knowledge which would reasonable be available to the audience to whom the instrument is addressed. ….. It is this objective meaning which is conventionally called the intention of the parties, or the intention of Parliament, or the intention of whatever person or body was or is deemed to have been the author of the instrument” [32] As the Defendants failed to reply to the termination notice, it proves to show that no refund of purchased shares as provided in clause 6(a) of the Contract is complied with and thus the business of the Restaurant could not be assumed to be automatically be returned to the Defendants. In addition, it would be a reasonable inference that the Plaintiffs cannot be waiting for the Defendants to refund and neither could they sell the Restaurant business immediately to recover the loss and expenses incurred and the option left to mitigate the losses is by continuing with the business of lunch delivery under a different management and later under a new name at the same premise (page 259 (Jilid 1) of the Appeal Record) as the tenancy agreement has not been terminated. [33] The basis relied by the Defendants that the Plaintiffs were still interested to run the Business is an afterthought and does not hold water as the Contract had clearly provide for the consequences of termination. In addition, this fact is corroborated by the email from the Plaintiffs in responding to the Defendants failure to refund where the Plaintiffs sought help to sell off the Restaurant business even after invoking clause 6 of the Contract the oral evidence given by the Defendants (at pages 396 and 397 (Jilid II) of the Appeal Record): “S: Merujuk di ms 56? J: Okay, ini adalah plaintif menghantar email kepada kami meminta pertolongan kami sama ada untuk menjual restoran itu dan melalui telefon dia juga pernah memanggil kami menolongnya, bagaimana ……” “Saksi SD1: Ya, masih menghubungi saya dengan meminta pertolongan, then lagi dia telah meminta saya menjual restoran tersebut dan ……..” On 2.2.2014, the Plaintiffs again emailed to the Defendant stating that, “If you’re able to help me sell the restaurant, I will just let this go and not want to fight with you in court.” [34] In relation to the argument for a consequential order, I have reservation as to the submission made by the Defendants that it could be granted following section 40 of the Contract Act 1950 and Plaintiffs’ counsel submission that this Court can still make the consequential order following the case Edmund Chan Kai Khoon v Abrizah Abdullah (supra). Firstly, after careful perusal of Defendants’ pleadings, I cannot seemed to find the claim for the return of the Business by the Defendants (amended Defence at pages 24-39 (Jilid 1) of the Appeal Record). The Defendants had claimed basically that the Contract was not valid, that the Plaintiffs had acquiesced the Restaurant business and the closing down of the Restaurant business is the risk to be accepted by the Plaintiffs. The fact remains that the return of the purchased price of shares to the Plaintiffs were not agreeable or denied by the Defendants. Based on the termination clause of 6(a) of the Contract, the return of the purchased shares price goes hand in hand with the return of the Business. [35] Secondly, I am bound by the principle on pleadings that is, to make a finding on the basis that it was not pleaded in the pleading or argued at the court below, would be dangerous. I rely on the Federal Court case of Pacific Forest Industries Sdn Bhd & Anor v Lin Wen-Chih & Anor [2009] 6 MLJ 293 where Tun Zaki Azmi Chief Justice (as he then was) remarked, “[15] The facts pleaded will inadvertently be related to the legal principles that the party will be relying upon. It is not for the court to decide on what principle a party should plead. It should be left to the parties to identify it themselves. ….. [16] ….. It is therefore dangerous and totally unadvisable, for the court, on its own accord, to consider any point without reliance on any pleadings or submission by counsel appearing before them. ….” [36] In addition, I viewed that in making a consequential order for the return of the Restaurant business simply because section 40 of the Contract Act 1950 was referred to by the Defendants, I turn to the decision in Sambaga Valli A/P K.R. Ponnusamy v Datuk Bandar Kuala Lumpur and Others Civil Appeal No.: W-01-(W)-55-02/ 2016 where the Court of Appeal made the distinction between a case of raising additional grounds based on pleadings and a case of taking a new plea not borne out of the pleadings. I viewed that making a finding or an order for the return of the Restaurant business that was not pleaded by the Defendants tantamount to a miscarriage of justice. [37] I agree with the counsel for the Plaintiffs’ argument that the case of Wong Leng Hung v Krishnamurthy (supra) should be distinguished from this case as the facts on termination was on the premise that the monies paid to be refunded first before invoking termination of the agreement. [38] In relation to the contention that the Plaintiffs failed to prove loss of profit amounting to RM90,000.00, the evidence had been submitted in the Sessions Court where it was one of the elements amounting to a breach of contract and the evidence of Plaintiffs offering Defendants to remedy the breach of the contract proves to show that the Plaintiffs suffered the loss of profit as claimed and does not require appellate intervention. [39] The argument by the counsel for the Defendants that the Plaintiffs have no locus standi or the capacity to sue the Defendants as the Defendants never entered into a contract with one Thomas Patrick Francis Fernandes, although this is a minor issue, the Court’s answer is that the Contract was valid as the issue raised is the name rather than the identity where in the latter, it refers to the same person, one of the parties to the Contract. [40] In light of the above reasons, I find that the Plaintiffs had proven his case on the balance of probabilities and dismiss the appeal with cost. Dated: 19 July 2017 (DATIN ZALITA BINTI DATO’ ZAIDAN) Judicial Commissioner Shah Alam High Court Selangor Darul Ehsan SOLICITORS: APPELLANT : BALVINDER SINGH EDWIN TAN Tetuan Shahrul Balvinder & Co No. 31, Room A 3rd Floor Jalan Barat Off Jalan Imbi 55100 Kuala Lumpur [Ref: BS/WML&WCS/lit/2015] Tel : 03-2144 4299 Fax : 03-2145 4616 RESPONDENT : S.H. CHAN Tetuan SH Chan Suite 1208, Level 12, Amcorp Tower Amcorp Trade Centre No. 18, Persiaran Barat 46050 Petaling Jaya Selangor Darul Ehsan [Ref: CSH/THOMAS/14001] Tel : 012-611 4922 Fax : 03-9057 6924 27

Tika 2.6.0

BA-12NCC-6-07/2016

PERAYU 1. WONG MAY LENG (NO. K/P: 650630-10-7246) 2. WONG CHOW SHANG (NO. K/P: 631114-07-5483) RESPONDEN 1. THOMAS PATRICK FRANCIS FERNANDES (NO. PASPOT INDIA: H 1078515) 2. WONG LAY SHAN (NO. K/P: 880218-10-5162

19/07/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=fa847bc6-950d-4c11-a4d0-077cab2cbd76&Inline=true

DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA RAYUAN SIVIL NO: BA-12NCC-6-07/2016 ANTARA 1. WONG MAY LENG (NO. K/P: 650630-10-7246) 2. WONG CHOW SHANG (NO. K/P: 631114-07-5483) ….. PERAYU- PERAYU DAN 1. THOMAS PATRICK FRANCIS FERNANDES (NO. PASPOT INDIA: H 1078515) 2. WONG LAY SHAN (NO. K/P: 880218-10-5162 …..RESPONDEN- RESPONDEN [Dalam perkara mengenai Mahkamah Sesyen di Shah Alam Guaman No: B52NCC-37-04/2015 Bicara Penuh (B) ANTARA 1. THOMAS PATRICK FRANCIS FERNANDES (NO. PASPOT INDIA: H 1078515) 2. WONG LAY SHAN (NO. K/P: 880218-10-5162 ….. PLAINTIF- PLAINTIF DAN 3. WONG MAY LENG (NO. K/P: 650630-10-7246) 4. WONG CHOW SHANG (NO. K/P: 631114-07-5483) …..DEFENDAN- DEFENDAN GROUNDS OF JUDGMENT Introduction [1] This is an appeal by the Appellants who were the 1st and 2nd Defendants, against the decision of the learned Session Judge of 17.6.2016 that allowed the Respondents, the 1st and 2nd Plaintiffs’ claim of RM340,000.00. [2] The parties, in this judgment, will be known as they were in the Sessions Court. The terms ‘1st and 2nd Defendant’ and ‘the Defendants’ and ‘1st and 2nd Plaintiffs’ and ‘the Plaintiffs’ may be used interchangeably. Facts [3] The dispute before me is about a sale of business restaurant by way of sale and purchase of shares agreement known as the Restaurant Sale Private Contract dated 2.11.2013. The background facts can be briefly referred to as follows: (a) The Defendants were the main shareholders of the company First Food Connection Sdn Bhd (“FFCSB”) carrying a restaurant business in the name Wai Kei (the Restaurant); (b) On or around 27.9.2013, the 1st Defendant had contacted the 1st Plaintiff to sell the Restaurant business to the Plaintiffs. There was a discussion between the 1st Plaintiff and the 1st Defendant where the Defendants had made representation that lunch delivery will be at 300 packs per day and net profit will be at RM500 per day where the gross income daily is between RM2,500 to RM3,000 and net profit monthly at RM18,000.00. (c) The assertion by the Plaintiffs is that based on the representation made by the Defendants, the Plaintiffs agreed to purchase the Restaurant business. (d) Both Plaintiffs and Defendants entered into the Restaurant Sale Private Contract (“the Contract”) dated 2.11.2013 through the purchase of shares of the Defendants in FFCSB. (e) The Plaintiffs paid the Defendants RM271,000.00 and the Defendants by the name Choy Yin Moi had transferred the security dated 1.11.2013 for the 100% transfer of shares in FFCSB to the Plaintiffs. (f) The Plaintiffs took over the Restaurant on 4.11.2013 and claimed that many problems occurred and sought assistance through emails and telephone calls from the Defendants since 12.11.2013 but to no avail. (g) The Plaintiffs through their Solicitors informed the Defendants that there was a breach of contract by the Defendants and terminated the Contract on 20.1.2014. The Plaintiffs also demanded for the return of the sale purchase money of RM250,000.00 from the Defendants. (h) The Plaintiffs claimed that they had incurred losses ever since they took over the Restaurant’s business and the Plaintiffs finally stopped the business on 21.3.2014. (i) The Plaintiffs claimed that the Plaintiffs had adhered to the Contract particularly clause 6 on contract termination, sale reversal and refund. The Plaintiffs claimed that the Defendants had failed to return the sale and purchase of the shares money to the Plaintiffs and failed to adhere to clause 6 of the Contract that is, failure to refund the entire paid amount purchased within 7 days of termination. (j) The Plaintiff did not deny that they had to continue with the Restaurant business until 24.3.2014 even after the Contract was terminated on 20.1.2014 in order to mitigate the losses (see page 302-303 of the Appeal Record Jilid I) as the Plaintiffs had to generate income before terminating the Restaurant business. (k) The Plaintiffs also claimed that they had emailed on 2.2.2014 to the 1st Defendant asking for help to sell off the Restaurant (at page 469-470 Appeal Record Jilid I). (l) After a full trial of three days and four witnesses where two were Plaintiffs’ and the other two were Defendants’, the Sessions Court had on 17.6.2016 allowed the Plaintiffs’ claim for RM340,000.00, being RM250,000.00 for the return of the purchased shares price and RM90,000.00 for the loss of profit as promised by the Defendants. Defendants’ Submission [4] The learned counsel for the Defendants submitted several grounds as in the amended Memorandum of Appeal dated 19.9.2016 (at pages 1-3, paragraphs (1) – (8) of the ‘Rekod Rayuan Tambahan (Jilid III)). Mainly the arguments put forward is that the Session Judge had erred on facts and law without considering or failing to consider: (i) that the Plaintiffs failed to adhere to the terms of the Contract in particular clause 6 of the Contract; (ii) that the Plaintiffs continued with the Restaurant business after terminating the Contract; (iii) that the Plaintiffs had waived their rights and/or estopped to sue the Defendants when Plaintiffs continued with the Restaurant business after it being terminated; and (iv) that the Plaintiffs acquiesced to continue with the Contract based on Section 40 of the Contracts Act 1950. [5] The counsel for the Defendants argued at length on clause 6(a) of the Contract and the issue of consequential order. The Court heard the importance of clause 6 of the Contract and the reason that a consequential order should had been made, claimed to have been overlooked by the Session Judge which resulted the Defendants suffered losses in terms of: · loss of the restaurant; · loss of the company First Food; were ordered to pay back the sale purchase of RM250,000.00 to the Plaintiff; and · to pay the loss of profit of RM90,000 to the Plaintiff. [6] On the Plaintiffs’ argument that the Restaurant’s business cannot be returned as it ended on 21.3.2014, the counsel for the Defendants submitted although the Plaintiffs terminated the contract on 20.1.2014, they had however continued with the Restaurant business until 21.3.2014 and thus the mitigation plead should fail. The counsel relied on the Federal Court case Edmund Chan Kai Khoon v. Abrizah Abdullah & Ors (2010) 6 CLJ 249 that the Restaurant business can and should be returned to the Defendants. [7] It was contended that the Session Court did not consider section 40 of the Contract Act 1950 and counsel relied on the case of Dr. Shanmuganathan v. Perisamy s/o Sithambaram Pillai (1997) 3 MLJ 61, Federal Court decision where the trial judge had overlooked in making a consequential order. [8] On the loss of profit of RM90,000.00, the counsel for the Defendants submitted that the 1st Plaintiff failed to prove and that the Contract did not provide for loss of profit. In addition, to strengthen its argument on loss of profit, section 75 Contract Act 1950 was referred that there must be prove for the losses or for the reasonable compensation. Plaintiffs’ Submission [9] The learned counsel for the Plaintiffs argued before the Court mainly on 3 grounds, firstly in relation to the consequential order to return the Restaurant business and sell off the shares, the learned counsel for the Plaintiff submitted that this was never pleaded by the Defendants. It was conceded by the Plaintiffs that the Defendants only pleaded that the Plaintiffs had continued with the Restaurant business after the Contract was terminated under the business name of Wai Kei and nowhere stated that the Restaurant business be returned and that the shares be transferred upon return of the Restaurant business. On this aspect, Plaintiffs’ counsel submitted that no evidence was adduced from both counsels at the trial. [10] The Plaintiffs’ counsel agreed that such consequential order should had been made and referred to the case of Edmund Chan Kai Khoon v. Abrizah Abdullah & Ors (2010) 6 CLJ 249. However, the Plaintiffs’ counsel argued that returning of the Restaurant business and the purchased shares following clause 6 of the Contract would be impossible to comply as clause 6 of the Contract provides for the return of business in full whereas the Restaurant business suffered major losses and that Defendants never revealed their intention to return the purchased shares in exchange for the Restaurant business to be returned. [11] The Plaintiffs’ counsel submitted that the Plaintiffs continued with the Restaurant business after the Contract was terminated to mitigate losses and highlighted this Court the evidence in support at pages 302-303 (Jilid 1) and pages 479-480 (Jilid II) of the Record of Appeal. The Plaintiffs’ counsel pointed that the Defendants knew that the Plaintiffs were seeking their help to sell off the Restaurant business based on the oral evidence of the 1st Defendant (at pages 396-397 of Appeal Record (Jilid II)) and Plaintiffs’ email of 2.2.2014 (at page 469 of the Appeal Record (Jilid II), cross refer with pages 479-480 of the same). [12] The counsel for the Plaintiffs made a distinction on the return of the shares proviso of the contract as referred by the Defendants in the case of Wong Leng Hung v Krishnamurthy Nagaratnam [2005] 8 CLJ 745 and the present case. It was submitted that in Wong Leng Hung (supra) case at pages 746 and 748, clause 4 of the contract mentioned the return of monies first be made to invoke the termination of the contract whereas under clause 6 of the Contract, the Contract is terminated due to breach of contract, “sale will be reversed, Business will be returned to Seller in full and Seller will refund the entire paid amount to Purchaser within 7 days of termination”. [13] In relation to the second argument that Plaintiffs failed to prove for the loss of profit RM 90,000.00, the Plaintiffs assert that the loss was proven by highlighting clause 2.6 of the Contract (at page 559 (Jilid II) of the Apepal Record where the Net profit of Business stated that “Seller will make sure business produces its minimum net profit of RM18,000 per month and produce the same for 3 consecutive months after completion of sale”. It was argued that this was a guarantee given by the Defendants in the Contract of net profit RM18,000 per month, as pleaded by the Plaintiffs and added that the Defendants never challenged on Plaintiffs’ losses for the said period of Restaurant business run by the Plaintiffs, at the trial. [14] On the third ground that the law under Section 40 of the Contracts Act 1950, Plaintiffs’ counsel made reference to the oral evidence of the 1st Plaintiff and the email sent to show that he was in a desperate situation to recover his losses and to sell the Restaurant and by making alternative proposal to the Defendants as the latter did not respond to Plaintiffs help and was not to expand the business (at page 259 (Jilid 1) of the Appeal Record). [15] The Plaintiffs’ counsel argued that the Defendants’ counsel argument that the Plaintiffs should have moved out from the Restaurant premise is unreasonable as the premise is rented by the Plaintiffs on a monthly tenancy for RM7,400 and if the tenancy agreement is to be terminated, Plaintiffs will suffer additional loss of RM21,000. [16] The counsel for the Plaintiffs submitted based on its written submission, the Plaintiffs had successfully proven: “D. Kesimpulan (iv) Dengan hujahan-hujahan di atas, Responden-Respondne telah berjaya membuktikan bahawa:- (d) Terdapat satu kontrak yang sah di antara Responden-Responden dan Perayu-Perayu dan pihak-pihak adalah terikat dengan terma-terma dan syarat-syarat dalam perjanjian tersebut. (e) Perayu-Perayu telah membuat representasi kepada Responden-Responden seperti yang diplidkan dalam perenggan 7 Pernyataan Tuntutan dan representasi tersebut adalah representasi salah seperti yang diplidkan dalam perenggan 18 Pernyataan Tuntutan. (f) Perayu-Perayu telah memecah terma-terma dan syarat-syarat Perjanjian tersebut seperti yang diplidkan dalam perenggan 19 Pernyataan Tuntutan. (g) Responden-Responden berhak membatalkan Perjanjian tersebut dan menuntut pemulangan bayaran harga jualan sebanyak RM250,000.00 serta kerugian keuntungan sebanyak RM90,000.00.” THE COURT’S FINDING: [17] The heart of the matter is in relation to the termination of the Restaurant business and its consequences. The whole of clause 6(a) of the Contract is reproduced here for convenience, as follows: “Clause 6. Contract termination, sale reversal and refund: The Parties hold the right to terminate this contract 90 days upon completion of sale subject to breach of this contract as described below: a. Breach of this Contract by Seller in terms of non-fulfillment of Value Deliverables as listed in section 2, inaccurate disclosure of information related to the Business such as sales revenue, net profit, liabilities and encumbrances, etc. thus resulting in financial losses or other damages and inconveniences to Purchaser. In the event of Contract termination by Purchaser as a result of breach of Contract by Seller, sale will be reversed, Business will be returned to Seller in full, and Seller will refund the entire paid amount Purchaser within 7 days of termination.” [18] On the issue of the validity of termination, this requires the construction of Clause 6(a) of the Contract. It provides the termination stating that it becomes a breach of contract when there is non-fulfillment of section 2 of the Contract, inaccurate disclosure of information related to the Business which includes sales revenue, net profit and even liabilities. The second paragraph of clause 6(a) stated the consequences of the termination. Again, it relates to the breach caused by the Defendants and stated that the “sale will be reversed, Business will be returned to Seller in full, and Seller will refund the entire paid amount to Purchaser within 7 days of termination.” [19] The counsel for the Plaintiffs made two primary arguments on this issue that there was termination and that the business continued for a while after termination to mitigate losses as there was no reply from the Defendants on the termination notice. The counsel for the Defendants on the other hand generally stated the termination is invalid because of non-compliance of clause 6(a) by the Plaintiffs by continuing with the Restaurant business after termination. [20] Reverting back to the facts and evidence before this Court, there is a history behind the sale and purchase of the Restaurant business. The Plaintiffs relied heavily on the Defendants information and track record which is based on the information only given by the Defendants themselves. The Plaintiffs had through his email of 27.9.2013 had asked for a detailed information of the Restaurant potential income generator. This was agreed by the Defendants’ witness, the 1st Defendant (DW1) herself whom testified during the cross examination (at page 368 of the Appeal Record (Jilid 1)), “S: Miss Wong, sila rujuk kepada Q&A, ms 10, dalam jawapan 17 ini, awak mengatakan bahawa Plaintif telah membuat siasatan yang terperinci, thorough investigation mengenai perniagaan restaurant tersebut dan telah bersetuju untuk mengikatnya saya cadangkan kepada awak bahawa siasatan yang terperinci atau thourough investigation, merujuk kepada soalan dan jawapan, melalui email-email dan juga meeting-meeting diantara plaintif-plaintif dan defendan-defendan, setuju? J: Setuju.” [21] The Plaintiff’s statement based on the record explained that the due diligence carried out on the business were done through emails, discussion and meeting with the Defendants. The Defendants had made representation that lunch delivery will be at 300 packs per day and net profit will be at RM500 per day where the gross income daily is between RM2,500 to RM3,000 and net profit monthly at RM18,000.00. Based on this representation by the Defendants, the Plaintiffs agreed to purchase the Restaurant. [22] The Defendants had replied to the Plaintiffs’ email on 27.9.2013 (at pages 459 and 460 (Jilid II) of the Appeal Record) that the cash collection daily is between RM2,500 to RM3,000 daily and the operational cost is low at under 30%. The following email on 29.9.2013 where Plaintiff was asked by Defendant to consider the food cost of 30%-35% before calculating on the profit. On this basis, Plaintiff relied on the purportedly “exact figure” to calculate the net profit and for cash flow investment (at page 461 (Jilid II of the Appeal Record). The Defendants however did not reply to Plaintiffs’ email and never denied on Plaintiff’s calculation and total of profit. [23] Interestingly, the Plaintiffs were promised of the guaranteed profit from the Restaurant business which became one of the salient points embedded into the Contract. Upon careful reading of the Contract, the purported profit making Restaurant clearly stated in the preamble where the Defendants “declared to be true” that the Restaurant generates a gross revenue of not less than RM80,000.00 per month with a net profit of not less than RM18,000 per month. [24] The agreed “Value Deliverables” are as stated in clause 2 of the Contract where among others are the ‘Business as an on-going concern’ and ‘Net Profit of Business’. The ‘Net Profit Business’ I would say, clearly mentioned the guaranteed net profit of RM18,000 per month: “2.6 Net Profit of Business: Seller will make sure the Business produces its minimum net profit of RM18,000 per month and produce the same for 3 consecutive months after completion of sale.” [25] The Plaintiffs claimed that after taking over the Restaurant business, the Plaintiffs found that the Defendants had breached the Contract by not providing an experience cook and the kitchen crew are not efficient as represented by the Defendants. The Restaurant business started facing problems and the Restaurant failed to generate the net profit of RM18,000 per month as guaranteed in the Contract. Plaintiffs claimed that they had issued complaints but no changes were made until Plaintiffs terminated the Contract on 20.1.2014. [26] Combing through the facts and evidence, this Court finds that the Contract was a valid Contract and all the representation made by the Defendants including the misrepresentation and losses occurred are pleaded in the Plaintiffs’ Statement of Claim (at pages 12 – 23 of the (Jilid 1) of the Appeal Record). The Court also referred to the oral evidence of the 1st witness for the Plaintiffs whom worked with the Defendants as well as the Plaintiffs until the Restaurant business was closed down (at pages 47 – 50 (Jilid I) of the Appeal Record). In my mind, in any food restaurant business it would be a reasonable inference that the cook or chef partly if not wholly, contribute to the success of the food restaurant business and this fact was misrepresented by the Defendants. [27] The facts and evidence gathered proved to show that there was misrepresentation, that the information given was not accurate for clause 6(a) of the Contract to be invoked. Clause 6(a) of the Contract provides that upon discovery of the inaccurate disclosure of information of the Restaurant business by the purchaser who is the Plaintiffs here, the sale of the Restaurant business will be reversed where the business is to be returned to the seller in full and seller will return the entire paid amount purchased within 7 days. [28] In order to appreciate the meaning of the Contract which must be ascertained from the words which the parties have agreed upon, the Contract must be read in the context of the circumstances in which they are executed. This Court wish to refer to the case of Tindok Besar Estate Sdn Bhd v Tinjar Co [1979] 2 MLJ 229 FC Kota Kinabalu where Chang Min Tat Ming, Federal Court Judge observed in relation to the terms agreed by Parties in the context of sections 91 and 92 of the Evidence Act 1950: “…where the terms of a contract have been reduced to writing, as in this particular agreement they had been, the contract could only be proved by the document itself, and it is not open to the respondent to seek to introduce and the judge to admit evidence that would inter alia, add new terms to it. [29] It is quite clear to me from a reading of Clause 6(a) that the Plaintiffs have the right to terminate the Contract. The Plaintiffs had offered the Defendants time to remedy the breach (email of 4.1.2014 at page 50 of (Jilid II) of the Appeal Record) before terminating on 20.1.2014 which was communicated to the Defendants (oral evidence at page 257 – 258 (Jilid I) of the Appeal Record). The consequences of the termination as provided in clause 6(a) is that the sale will be reversed where the Business will be returned to the Defendants in full and the Defendants will refund the entire paid amount to the Plaintiffs within 7 days of termination. [30] However, there was no reply by the Defendants on the offer to remedy nor did they reply within the 7 days of termination. The termination was valid as there was a breach of contract due to inaccurate information which allows the innocent party, in this case the Plaintiffs, to invoke the termination clause relying on the authority attributed by the Plaintiffs’ counsel in the case of Sim Thong Realty Sdn Bhd v Teh Kim Dar [2003] 3 CLJ 227 (Plaintiffs written submission for Sessions Court, at page 575 (Jilid II) of the Appeal Record). [31] If the construction of the Contract is crystal clear, the Court cannot improve on the contract and should be construed objectively: Attorney General of Belize & Ors v Belize Telecom Ltd [2009] Privy Council UKPC 10 where Lord Hoffman delivering the decision had said, “This court has no power to improve upon the instrument which it is called upon to construe, whether it be a contract, a statute or articles of association. It cannot introduce terms to make it fairer or more reasonable. It is concerned only to discover what the instrument means. However, that meaning is not necessarily or always what the authors or parties to the document would have intended. It is the meaning which the instrument would convey to a reasonable person having all the background knowledge which would reasonable be available to the audience to whom the instrument is addressed. ….. It is this objective meaning which is conventionally called the intention of the parties, or the intention of Parliament, or the intention of whatever person or body was or is deemed to have been the author of the instrument” [32] As the Defendants failed to reply to the termination notice, it proves to show that no refund of purchased shares as provided in clause 6(a) of the Contract is complied with and thus the business of the Restaurant could not be assumed to be automatically be returned to the Defendants. In addition, it would be a reasonable inference that the Plaintiffs cannot be waiting for the Defendants to refund and neither could they sell the Restaurant business immediately to recover the loss and expenses incurred and the option left to mitigate the losses is by continuing with the business of lunch delivery under a different management and later under a new name at the same premise (page 259 (Jilid 1) of the Appeal Record) as the tenancy agreement has not been terminated. [33] The basis relied by the Defendants that the Plaintiffs were still interested to run the Business is an afterthought and does not hold water as the Contract had clearly provide for the consequences of termination. In addition, this fact is corroborated by the email from the Plaintiffs in responding to the Defendants failure to refund where the Plaintiffs sought help to sell off the Restaurant business even after invoking clause 6 of the Contract the oral evidence given by the Defendants (at pages 396 and 397 (Jilid II) of the Appeal Record): “S: Merujuk di ms 56? J: Okay, ini adalah plaintif menghantar email kepada kami meminta pertolongan kami sama ada untuk menjual restoran itu dan melalui telefon dia juga pernah memanggil kami menolongnya, bagaimana ……” “Saksi SD1: Ya, masih menghubungi saya dengan meminta pertolongan, then lagi dia telah meminta saya menjual restoran tersebut dan ……..” On 2.2.2014, the Plaintiffs again emailed to the Defendant stating that, “If you’re able to help me sell the restaurant, I will just let this go and not want to fight with you in court.” [34] In relation to the argument for a consequential order, I have reservation as to the submission made by the Defendants that it could be granted following section 40 of the Contract Act 1950 and Plaintiffs’ counsel submission that this Court can still make the consequential order following the case Edmund Chan Kai Khoon v Abrizah Abdullah (supra). Firstly, after careful perusal of Defendants’ pleadings, I cannot seemed to find the claim for the return of the Business by the Defendants (amended Defence at pages 24-39 (Jilid 1) of the Appeal Record). The Defendants had claimed basically that the Contract was not valid, that the Plaintiffs had acquiesced the Restaurant business and the closing down of the Restaurant business is the risk to be accepted by the Plaintiffs. The fact remains that the return of the purchased price of shares to the Plaintiffs were not agreeable or denied by the Defendants. Based on the termination clause of 6(a) of the Contract, the return of the purchased shares price goes hand in hand with the return of the Business. [35] Secondly, I am bound by the principle on pleadings that is, to make a finding on the basis that it was not pleaded in the pleading or argued at the court below, would be dangerous. I rely on the Federal Court case of Pacific Forest Industries Sdn Bhd & Anor v Lin Wen-Chih & Anor [2009] 6 MLJ 293 where Tun Zaki Azmi Chief Justice (as he then was) remarked, “[15] The facts pleaded will inadvertently be related to the legal principles that the party will be relying upon. It is not for the court to decide on what principle a party should plead. It should be left to the parties to identify it themselves. ….. [16] ….. It is therefore dangerous and totally unadvisable, for the court, on its own accord, to consider any point without reliance on any pleadings or submission by counsel appearing before them. ….” [36] In addition, I viewed that in making a consequential order for the return of the Restaurant business simply because section 40 of the Contract Act 1950 was referred to by the Defendants, I turn to the decision in Sambaga Valli A/P K.R. Ponnusamy v Datuk Bandar Kuala Lumpur and Others Civil Appeal No.: W-01-(W)-55-02/ 2016 where the Court of Appeal made the distinction between a case of raising additional grounds based on pleadings and a case of taking a new plea not borne out of the pleadings. I viewed that making a finding or an order for the return of the Restaurant business that was not pleaded by the Defendants tantamount to a miscarriage of justice. [37] I agree with the counsel for the Plaintiffs’ argument that the case of Wong Leng Hung v Krishnamurthy (supra) should be distinguished from this case as the facts on termination was on the premise that the monies paid to be refunded first before invoking termination of the agreement. [38] In relation to the contention that the Plaintiffs failed to prove loss of profit amounting to RM90,000.00, the evidence had been submitted in the Sessions Court where it was one of the elements amounting to a breach of contract and the evidence of Plaintiffs offering Defendants to remedy the breach of the contract proves to show that the Plaintiffs suffered the loss of profit as claimed and does not require appellate intervention. [39] The argument by the counsel for the Defendants that the Plaintiffs have no locus standi or the capacity to sue the Defendants as the Defendants never entered into a contract with one Thomas Patrick Francis Fernandes, although this is a minor issue, the Court’s answer is that the Contract was valid as the issue raised is the name rather than the identity where in the latter, it refers to the same person, one of the parties to the Contract. [40] In light of the above reasons, I find that the Plaintiffs had proven his case on the balance of probabilities and dismiss the appeal with cost. Dated: 19 July 2017 (DATIN ZALITA BINTI DATO’ ZAIDAN) Judicial Commissioner Shah Alam High Court Selangor Darul Ehsan SOLICITORS: APPELLANT : BALVINDER SINGH EDWIN TAN Tetuan Shahrul Balvinder & Co No. 31, Room A 3rd Floor Jalan Barat Off Jalan Imbi 55100 Kuala Lumpur [Ref: BS/WML&WCS/lit/2015] Tel : 03-2144 4299 Fax : 03-2145 4616 RESPONDENT : S.H. CHAN Tetuan SH Chan Suite 1208, Level 12, Amcorp Tower Amcorp Trade Centre No. 18, Persiaran Barat 46050 Petaling Jaya Selangor Darul Ehsan [Ref: CSH/THOMAS/14001] Tel : 012-611 4922 Fax : 03-9057 6924 27

Tika 2.6.0

BA-24FC-705-05/2016

PLAINTIF MYSTIQUE BAY SDN BHD DEFENDAN SUZIANA BINTI ABD SAMAT (NO. K/P: 650131-10-5668)

19/07/2017

YA DATUK AZIMAH BINTI OMAR

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1 DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN SAMAN PEMULA NO: BA-24FC-705-05/2016 Dalam Perkara mengenai Seksyen 256, 257 dan 271 Kanun Tanah Negara 1965; Dan Dalam Perkara Gadaian yang didaftarkan di bawah Perserahan No. 107922/2015 ke atas tanah yang dipegang di bawah Hakmilik Sementara H.S (D) 119836, PT 31771, Pekan Baru Sungai Buloh, Daerah Petaling, Negeri Selangor Darul Ehsan; Dan 2 Dalam perkara mengenai Aturan 83 Kaedah-Kaedah Mahkamah 2012. ANTARA MYSTIQUE BAY SDN BHD …PLAINTIF DAN SUZIANA BINTI ABD SAMAT (NO. K/P: 650131-10-5668) …DEFENDAN ALASAN PENGHAKIMAN (Notis Permohonan – Kandungan 7) A. PENDAHULUAN [1] Plaintif (Mystique Bay Sdn Bhd) adalah sebuah syarikat kewangan yang berdaftar di Malaysia yang beralamat di Tingkat 23, Plaza See Hoy Chan, Jalan Raja Chulan, 50200 Kuala Lumpur. Manakala Defendan (Suziana Binti Abd Samat) pada masa perjanjian fasiliti 3 ditandatangani pada 15.9.1997 adalah merupakan pelanggan Standard Chartered Bank Malaysia Berhad (Bank Standard Chartered). [2] Atas permintaan pihak Defendan, Bank Standard Chartered telah meluluskan satu kemudahan Pinjaman Berjangka sebanyak RM169,150.00 dan kemudahan Pinjaman Overdraf sebanyak RM169,150.00. Berikutan daripada kelulusan kemudahan perbankan tersebut, pada 15.9.1997, Defendan telah menandatangani suatu perjanjian pinjaman fasiliti (“pinjaman fasiliti tersebut”) dengan Bank Standard Chartered di atas terma-terma dan syarat-syarat yang terkandung di dalam pinjaman fasiliti tersebut. [3] Sebagai jaminan kepada pinjaman fasiliti tersebut, Defendan telah bersetuju untuk menggadai sekeping tanah kepunyaannya yang dipegang di bawah Hakmilik Sementara H.S (D) 119836, PT 31771, Pekan Baru Sungai Buloh, Daerah Petaling, Negeri Selangor Darul Ehsan (hartanah tersebut) bagi faedah Bank Standard Chartered. Untuk itu, Defendan telah menandatangani satu Surat Kuasa Wakil bertarikh 15.9.2017 yang mana Defendan telah memberikan kuasa 4 kepada Bank Standard Chartered untuk menyempurnakan sebarang dokumen bagi pihak Defendan termasuklah penyempurnaan Gadaian jika hakmilik individu/berasingan telah dikeluarkan bagi hartanah tersebut. [4] Melalui satu Perintah Letak Hak bertarikh 20.11.2007 yang diperolehi di Mahkamah Tinggi Kuala Lumpur melalui Saman Pemula No. D4- 24-323-2007, Plaintif telah mengambil alih hak, kuasa dan liabiliti tanggungan Standard Chartered Bank Malaysia Berhad yang termasuk kemudahan Pembiayaan/Akaun Cagaran Penyerahakan yang telah diberikan kepada pihak Defendan di dalam tindakan ini. [5] Plaintif kemudiannya telah menggunakan kuasa dan haknya di bawah Surat Ikatan Penyerahakkan dan Surat Kuasa Wakil tersebut untuk menyempurnakan gadaian bagi menjamin pinjaman-pinjaman tersebut yang mana telah didaftarkan pada 15.10.2015 melalui Perserahan No.107922/2015 (gadaian tersebut). [6] Defendan telah memungkiri syarat dan terma-terma pinjaman- pinjaman tersebut apabila gagal untuk membayar ansuran bulanan 5 seperti yang ditetapkan dan oleh itu Plaintif melalui peguamcaranya telah menghantar surat bertarikh 8.4.2016 berserta Notis Kemungkiran Mengenai Suatu Gadaian (Borang 16D) bertarikh 8.4.2016 kepada Defendan untuk menuntut wang terhutang berjumlah RM867,938.78 setakat 8.4.2016 bagi Pinjaman Berjangka dengan faedah pada kadar 9.25% setahun dan RM413,419.61 setakat 8.4.2016 bagi Pinjaman Overdraft yang terhutang di bawah pinjaman-pinjaman tersebut. [7] Defendan walau bagaimanapun telah gagal mematuhi notis Borang 16D tersebut dan justeru itu Plaintif telah memfailkan Saman Pemula (Kandungan 1) untuk mendapatkan satu perintah untuk menjual hartanah tersebut melalui lelongan awam. [8] Defendan telah tidak memasuki kehadirannya atas saman pemula ini walaupun kertas-kertas kausa telahpun diserahkan kepadanya. Pada 16.8.2016, Mahkamah ini telah membenarkan Kandungan 1 Plaintif dan mengeluarkan satu perintah untuk menjual hartanah tersebut melalui lelongan awam. Tarikh lelongan awam bagi hartanah tersebut telah ditetapkan pada 8.12.2016. 6 B. KANDUNGAN 7 [9] Pada 23.1.2017, Defendan pada telah memfailkan permohonan di Kandungan 7 yang antara lain memohon perintah-perintah berikut: (a) Perintah Jualan (Order For Sale) yang diberikan oleh Mahkamah ini berkenaan Hakmilik Sementara H.S (D) 119836, PT 31771, Pekan Baru Sungai Buloh, Daerah Petaling, Negeri Selangor Darul Ehsan pada 16.8.2016 (hartanah tersebut) diketepikan. (b) Suatu pengisytiharan bahawa Gadaian yang didaftarkan di bawah Perserahan No. 107922/2015 adalah batal dan tidak sah. [10] Permohonan Defendan di dalam Kandungan 7 telah disokong oleh afidavit-afidavit berikut: i. Afidavit Sokongan Defendan bertarikh 23.1.2017 (Kandungan 8) ii. Afidavit Balasan Defendan bertarikh 24.3.2017 (Kandungan 10) 7 [11] Di dalam percubaan Defendan untuk mendapatkan perintah-perintah yang dipohon di Kandungan 7, Defendan telah bersandarkan kepada alasan-alasan berikut: (i) Plaintif tidak berhak untuk mendapatkan perintah jualan tersebut kerana tidak ada gadaian yang sah menurut undang-undang telah didaftarkan di pejabat tanah atas hartanah tersebut. (ii) Defendan tidak pernah menandatangani apa-apa dokumen gadaian terhadap hartanah tersebut dan jika wujud gadaian sekalipun, pinjaman-pinjaman tersebut adalah diantara Defendan dan Standard Chartered Bank Malaysia Berhad. (iii) Defendan tidak mengetahui kewujudan saman pemula dan tidak pernah menerima sebarang kertas kausa. (iv) Tindakan Plaintif disini adalah terhalang oleh had masa. [12] Permohonan Defendan ini telah ditentang oleh Plaintif dan adalah menjadi tegasan Plaintif bahawa alasan-alasan yang dibangkitkan oleh Defendan adalah alasan-alasan yang tidak berasas dan langsung tidak membangkitkan atau mewujudkan kausa yang 8 bertentangan (cause to contrary) yang membolehkan Plaintif dinafikan kepada satu perintah jualan oleh Mahkamah ini bagi menjual hartanah tersebut melalui lelongan awam. Kausa yang bertentangan [13] Undang-undang adalah jelas dan jitu bahawa di dalam sesuatu prosiding halang tebus, bagi penguatkuasaan hak atau remedi statutori yang ada kepada pemegang gadaian (chargee), Mahkamah akan hanya mengeluarkan satu perintah menjual sesuatu hartanah yang digadai oleh pemberi gadaian (chargor) melalui lelongan awam sekiranya mahkamah berpuas hati bahawa tidak wujud suatu kausa yang bertentangan. [14] Seksyen 256 (3) Kanun Tanah Negara (KTN) telah memperuntukkan berikut: “(3) On any such application, the Court shall order the sale of the land or lease to which the charge relates unless it is satisfied of the existence of cause to the contrary”. 9 [15] Di dalam pentakrifan frasa kausa yang bertentangan, Mahkamah ingin merujuk kepada kes Low Lee Lian v. Ban Hin Lee Bank Berhad [1997] 1 MLJ 77. Di dalam kes Low Lee Lian ini, di muka surat 82 Mahkamah Persekutuan telah menerangkan tiga kategori kes yang mewujudkan kausa yang bertentangan menurut seksyen 256(3) KTN seperti berikut: “In our judgment, 'cause to the contrary' within s 256(3) may be established only in three categories of cases. First, it may be taken as settled that a chargor who is able to bring his case within any of the exceptions to the indefeasibility doctrine housed in s 340 of the Code establishes cause to the contrary. That section provides as follows: 340(1) The title or interest of any person or body for the time being registered as proprietor of any land, or in whose name any lease, charge or easement is for the time being registered, shall, subject to the following provisions of this section, be indefeasible. (2) The title or interest of any such person or body shall not be indefeasible – (a) in any case of fraud or misrepresentation to which the person or body, or any agent of the person or body, was a party or privy; or (b) where registration was obtained by forgery, or by means of an insufficient or void instrument; or (c) where the title or interest was unlawfully acquired by the person or body in the purported exercise of any power or authority conferred by any written law. 10 (3) Where the title or interest of any person or body is defeasible by reason of any of the circumstances specified in sub-s (2) – (a) it shall be liable to be set aside in the hands of any person or body to whom it may subsequently be transferred; and (b) any interest subsequently granted thereout shall be liable to be set aside in the hands of any person or body in whom it is for the time being vested: Provided that nothing in this subsection shall affect any title or interest acquired by any purchaser in good faith and for valuable consideration, or by any person or body claiming through or under such a purchaser. (4) Nothing in this section shall prejudice or prevent – (a) the exercise in respect of any land or interest of any power of forfeiture or sale conferred by this Act or any other written law for the time being in force, or any power of avoidance conferred by any such law; or (b) the determination of any title or interest by operation of law. In other words, a chargor who is able to demonstrate that the charge, the enforcement of which is sought, is defeasible upon one or more of the grounds specified under sub-ss (2) and (4)(b) above will be held to have established cause to the contrary under s 256(3). The decision of Smith J in Subchent Kaur v Chai Sau Kian [1958] MLJ 32, of the former Federal Court inPhuman Singh v Kho Kwang Choon [1965] 2 MLJ 189, of Raja Azlan Shah J (as he then was) in Overseas Union Finance Ltd v Lim Joo Chong [1971] 2 MLJ 124 and that of Edgar Joseph Jr J (as he then was) in United Malayan Banking Corp Bhd v Syarikat Perumahan Luas Sdn Bhd (No 2) [1988] 3 MLJ 352 (affirmed on appeal) sufficiently illustrate the proposition now under discussion. http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.8728547800246143&bct=A&service=citation&risb=21_T26657263987&langcountry=MY&linkInfo=F%23MY%23MLJ%23sel1%251958%25page%2532%25year%251958%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.05483784016566984&bct=A&service=citation&risb=21_T26657263987&langcountry=MY&linkInfo=F%23MY%23MLJ%23vol%252%25sel1%251965%25page%25189%25year%251965%25sel2%252%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.2933549850111363&bct=A&service=citation&risb=21_T26657263987&langcountry=MY&linkInfo=F%23MY%23MLJ%23vol%252%25sel1%251971%25page%25124%25year%251971%25sel2%252%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.41983896810888066&bct=A&service=citation&risb=21_T26657263987&langcountry=MY&linkInfo=F%23MY%23MLJ%23vol%253%25sel1%251988%25page%25352%25year%251988%25sel2%253%25 11 Secondly, a chargor may show cause to the contrary within s 256(3) of the Code by demonstrating that the chargee has failed to meet the conditions precedent for the making of an application for an order for sale. For example, failure on the part of the chargee to prove the making of a demand or service upon the chargor of a notice in Form 16D would constitute cause to the contrary. So too, where the notice demands sums not lawfully due from the chargee. See Co-operative Central Bank Ltd v Meng Kuang Properties Bhd [1991] 2 MLJ 283. However, in such a case, it would be open to the chargee to subsequently serve a notice or a proper notice (as the case may be) before commencing proceedings afresh as the cause shown to the contrary does not in substance affect the chargee's right to apply for an order for sale. Thirdly, a chargor may defeat an application for an order for sale by demonstrating that its grant would be contrary to some rule of law or equity. This principle finds its origins in the judgment of Aitken J in Murugappa Chettiar v Letchumanan Chettiar [1939] MLJ 296 at p 298 where he said: I agree that equitable principles should not be invoked too freely for the purpose of construing our Land Code, but surely a chargor, who shows that there would be no need to sell his land if the chargee paid up in full what is due from himself in another capacity, has shown good and sufficient cause why the land should not be sold. Section 149 of the Land Code obviously contemplates that there may be cases in which charged land should not be sold, even though there has been a default in payment of the principal sum or interest thereon secured by the charge; and it seems to me that a chargor may 'shew cause' either in law or equity against an application for an order for sale, and that the courts should refuse to make an order in every case where it would be unjust to do so. By 'unjust' I mean contrary http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.9641194943869744&bct=A&service=citation&risb=21_T26657263987&langcountry=MY&linkInfo=F%23MY%23MLJ%23vol%252%25sel1%251991%25page%25283%25year%251991%25sel2%252%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.3004786877978387&bct=A&service=citation&risb=21_T26657263987&langcountry=MY&linkInfo=F%23MY%23MLJ%23sel1%251939%25page%25296%25year%251939%25tpage%25298%25 12 to those rules of the common law and equity which are in force in the Federated Malay States. (Penekanan oleh Mahkamah ini) [16] Di dalam mencapai pendekatan terhad dengan memberikan tiga kategori kausa yang bertentangan ini, Mahkamah Persekutuan telah memberikan alasan-alasannya dengan berkata di muka surat 87 begini: “As earlier observed, unless a chargor can bring himself within one of the three categories of cases set out earlier in this judgment, no cause to the contrary would be shown and the court will be obliged to make an order for sale. It would not be sufficient, as was done in the instant case, to allege mere breaches by the chargee of the loan agreement between the chargee and the borrower or even of the terms of the annexure to the charge in order to resist an application under Section 256(3) of the Code. An allegation that the chargee acted in breach of contract, while it may give rise to an independent action in personam, is insufficient per se to defeat the ad rem rights of a chargee under his registered charge to an order for sale. We are conscious that the approach we have adopted results in a very narrow and restrictive interpretation of s 256(3) of the code. But there are 13 good reasons of policy for such an interpretation. It must not be forgotten that in the ordinary way, banks and other financial institutions loan moneys deposited with them by their customers to a borrower on the faith of the security of a charge created over the landed property of the borrower, or as here, of a third party. In the event of a default by the borrower, the lending institution normally looks to early recovery of all or a substantial part of the money due to them from a sale of a security. If the courts of this country interpret the phrase ‘cause to the contrary’ appearing in s 256(3) of the Code liberally, then, institutional lenders would loose confidence in their right to realize their security through an order for sale. Financial institutions would then become reluctant to lend money to bonafide entrepreneurs. Commerce would come to a standstill and the development of land and industries in this country which are largely dependent upon loans from banks would cease. No judgment of this court will be designed to produce such a consequence.” Alasan (i): Plaintif tidak berhak untuk mendapatkan perintah jualan tersebut kerana tidak ada gadaian yang sah menurut undang-undang telah didaftarkan di pejabat tanah atas hartanah tersebut. Alasan (ii): Defendan tidak pernah menandatangani apa-apa dokumen gadaian terhadap hartanah tersebut dan jika wujud gadaian sekalipun, 14 pinjaman-pinjaman tersebut adalah di antara Defendan dan Standard Chartered Bank Malaysia Berhad. {Alasan (i) dan Alasan (ii) akan ditentukan bersekali} [17] Adalah telah dihujahkan bagi pihak Defendan bahawa Plaintif tidak berhak untuk mendapatkan perintah jualan tersebut kerana tidak ada gadaian yang sah menurut undang-undang telah didaftarkan di pejabat tanah atas hartanah tersebut. Menurut Defendan lagi, gadaian yang didaftarkan di bawah No. Perserahan 107922/2015 pada 15.10.2015 tersebut adalah suatu gadaian yang tidak sah kerana beliau tidak pada bila-bila masapun ada menandatanganai apa-apa dokumen gadaian berkenaan hartanah tersebut. [18] Defendan juga telah cuba mempertikaikan dokumen gadaian di No. Perserahan 107922/2015 bertarikh 15.10.2016 dengan mengatakan bahawa gadaian tersebut adalah satu gadaian yang tak sah kerana di dalam Borang 16A (GADAIAN) perenggan (a) dan (b) di muka surat pertama gadaian tersebut telah dipotong dan telah meninggalkan catatan di perenggan (c) sahaja. Menurut Defendan pemotongan perenggan (a) dan (b) telah menjadikan gadaian 15 Defendan sebagai gadaian pihak ketiga (third party charge) dan bukannya gadaian pihak pertama (first party charge). [19] Penelitian Mahkamah ini ke atas Borang 16A di Eksibit HR-5, Kandungan 2 (Afidavit Sokongan Plaintif) menunjukkan bahawa Borang 16A telahpun didaftarkan oleh Plaintif dengan Pendaftar Hakmilik Selangor pada jam 12.57 pada 15.10.2015. Di Borang 16 A tersebut jelas menunjukkan bahawa Defendan sebagai tuanpunya hartanah tersebut telah menggadai hartanah tersebut bagi maksud menjamin pembayaran pinjaman yang telah diberikan oleh pemegang gadaian (Plaintif) kepadanya. Di muka surat 1, Borang 16A yang telah didaftarkan oleh Plaintif jelas menunjukkan bahawa Defendan sebagai tuanpunya berdaftar hartanah tersebut sememangnya telah bersetuju bahawa hartanah tersebut digadai kepada Plaintif sebagai jaminan pembayaran pinjaman yang telah diperolehinya. Pengakuan Defendan di muka surat 1, Borang 16A diperturunkan di bawah ini: “Saya, SUZIANA BINTI ABD SAMAT (NO. K/P: 650131-10-5668) seorang warganegara Malaysia yang cukup umur dan beralamat di b1-11, pj Industrial Park, Jalan Kemajuan, 46200 Petaling Jaya, Selangor 16 ……………………………………………………………………………………………. *tuanpunya tanah/bahagian yang tidak dipecahkan atas tanah yang tersebut dalam jadual di bawah ini; *pemajak/pemajak kecil dalam pajakan/pajakan kecil yang tersebut dalam jadual di bawah ini bagi tanah yang tersebut itu; Bagi maksud menjamin- *(a) pembayaran balik pinjaman sebanyak RM yang dengan ini saya telah mengaku telah terima, kepada pemegang gadaian yang tersebut namanya di bawah ini, beserta faedah; *(b) pembayaran wang sebanyak RM kepada pemegang gadaian yang tersebut namanya di bawah ini, beserta faedah dan sebagai balasan; _____________________________________________________ _____________________________________________________ ____________________________________________________ *(c) pembayaran kepada pemegang gadaian yang tersebut namanya di bawah ini, beserta faedah, wang yang dari semasa ke semasa kena dibayar kepadanya daripada *akaun semasa saya/akaun yang berikut yang disimpan di antara kami ”. (Penekanan oleh Mahkamah ini) 17 [20] Defendan di dalam kes ini telahpun menandatangani suatu Surat Kuasa Wakil bertarikh 15.9.1997 di mana Defendan telah memberikan kuasa kepada Bank Standard Chartered untuk menyempurnakan suatu gadaian ke atas hartanah tersebut serta menyempurnakan segala dokumen-dokumen berkaitan yang lain sekiranya hakmilik berasingan telah dikeluarkan bagi hartanah tersebut. [21] Plaintif melalui Perintah Letakhak Mahkamah (Vesting Order) bertarikh 20.11.2007 telahpun mengambil alih hak serta kuasa yang berkaitan dengan perjanjian pinjaman tersebut termasuk segala hak yang termaktub di dalam Surat Kuasa Wakil tersebut dari Bank Standard Chartered. [22] Mahkamah ini juga perlu merujuk kepada Surat Kuasa Wakil bertarikh 15.9.1997 {Eksibit HR-B, Kandungan 9 (Afidavit Jawapan Plaintif)} yang jelas menyatakan seperti berikut: “NOW THIS INSTRUMENT WITNESSETH that in consideration of the Bank agreeing to grant or to continue to grant from time to time the Facilities to 18 the Borrower, the Assignor hereby by way of security irrevocably appoints the Bank to be general attorney of the Assignor on behalf of the Assignor and in the name of the Assignor or otherwise, and with full power of substitution:- (b) to execute, deliver and otherwise complete and perfect charge(s) under the provision of the National Land Code in form and substance satisfactory to the Bank in favour of the Bank as the legal charge (the Charge) of the Said Property and to register the Charge with the appropriate authority;” [23] Defendan semestinya terikat dengan Surat Kuasa Wakil bertarikh 15.9.1997 (SKW 1997) tersebut yang telah dilaksanakannya sendiri. SKW 1997 tersebut adalah dokumen yang masih sah kuatkuasanya di mana ianya tidak pernah dibatalkan oleh mana-mana pihak ataupun Defendan. Atas SKW 1997 ini, Plaintif telahpun melaksanakan suatu gadaian ke atas hartanah tersebut. [24] Mahkamah ini merujuk kepada seksyen 243 KTN yang memperuntukkan seperti berikut: 19 “Every charge created under this Act shall take effect upon registration so as to render the land or lease in question liable as security in accordance with the provisions thereof, express or implied” [25] Mahkamah ini juga merujuk kepada seksyen 253 KTN yang memperuntukkan bahawa: “(1) The provisions of this chapter shall have effect for the purpose of enabling any chargee to obtain the sale of the land or lease to which his charge relates in the event of a breach by the chargor of any of the agreements on his part expressed or implied therein.” [26] Atas dakwaan Defendan berhubung pemotongan perenggan (a) dan (b) di Borang 16A tersebut, Mahkamah ini hanya perlu merujuk kepada kes Malaysia Building Society Berhad v. KCSB Konsortium Sdn Bhd [2017] 4 CLJ 24 di mana Mahkamah Persekutuan telah memutuskan seperti berikut: “(19) In the present case paras (b) and (c) of the charge instrument were deleted hence making it into a first party instead of a third party charge as intended by the parties. Apart from that error the instrument does not suffer from any other efficiency. Form 16A was sealed with the seal of the 20 Respondent’s company and attested to by directors of the company or a director together with the secretary of the company. For those reasons we find that Form 16A filed in the present case is not an ‘insufficient instrument’ as envisaged by s. 340(2)(b) of the NLC which renders the charge created pursuant thereto defeasible. (34) For those reasons alluded to above, we hold that the impugned charge is a valid charge and accordingly the order of the High Court as affirmed by the Court of Appeal is set aside. Further, in exercise of the power under s. 417 of the NLC, we direct the Registrar to review the file relating to the said charge and cause the rectification of the charge as a third party charge”. [27] Mahkamah Persekutuan di dalam kes Malaysia Building Society Berhad ini telahpun memutuskan bahawa kesilapan pemotongan perenggan-perenggan dalam Borang 16A (Gadaian) adalah hanya satu kesilapan semata-mata dan kesilapan tersebut tidak mempunyai kesan mengubah gadaian kepada pindah hak milik atau apa-apa urusan instrumen lain. [28] Adalah menjadi dapatan Mahkamah ini bahawa dakwaan Defendan bahawa pemotongan perenggan (a) dan (b) di dalam Borang 16A telah menjadikan gadaian yang didaftarkan oleh Plaintif terhadap hartanah tersebut sebagai gadaian pihak ketiga bukannya gadaian 21 pihak pertama, lantas menjadikan gadaian tersebut menjadi defektif adalah satu dakwaan yang tidak bermerit. Di dalam Borang 16A tersebut adalah jelas menunujukkan bahawa hartanah tersebut telahpun digadaikan oleh Defendan kepada pemegang gadaian iaitu Plaintif bagi menjamin pembayaran balik segala wang beserta faedah, dari semasa ke semasa kena dibayar oleh Defendan kepada Plaintif daripada akaun semasa Defendan/ akaun yang lain yang disimpan di antara Plaintif dan Defendan. Defendan sememangnya terikat dengan gadaian yang telah didaftarkan ke atas hartanah tersebut. Defendan tidak langsung diprejudiskan ataupun terkeliru atas kesilapan pemotongan perenggan-perenggan (a) dan (b) tersebut. [29] Adalah menjadi dapatan Mahkamah ini juga bahawa gadaian di Eksibit HR-5 tersebut adalah merupakan satu gadaian yang sah di mana keesahannya tidak pernah dicabar, ditarik balik atau dibatalkan oleh mana-mana pihak termasuklah Defendan. Defendan tidak boleh kini mempertikaikan gadaian tersebut dan cuba mengelakkan diri daripada terikat dengan gadaian yang telah didaftarkan dengan sahnya oleh Plaintif. 22 [30] Adalah menjadi dapatan Mahkamah ini, alasan-alasan di atas yang dibangkitkan oleh Defendan adalah alasan-alasan yang tidak berasas dan tidak bermerit dan tidak langsung membangkitkan atau terjumlah kepada satu kausa yang bertentangan sepertimana yang telah digariskan di dalam kes Low Lee Lian. Alasan iii: Defendan tidak mengetahui kewujudan saman pemula dan tidak pernah menerima sebarang kertas kausa. [31] Defendan telah mendakwa bahawa kertas-kertas kausa bagi saman pemula Plaintif ini telah tidak diserahkan dan disampaikan kepadanya secara teratur kerana ianya tidak diserahkan kepada alamat terkini Defendan iaitu di No. 36, Jalan 5, Taman Ampang Jaya, 68000 Ampang, Selangor Darul Ehsan. Defendan telah mengatakan bahawa kertas kausa-kertas kausa saman pemula Plaintif telah di sampaikan ke alamat lamanya iaitu Golden Cape (M) Sdn Bhd, B1-11, PJ Industrial Park, Jalan Kemajuan, 46200 Petaling Jaya, Selangor Darul Ehsan {Golden Cape (M)}. Defendan telah 23 mendakwa bahawa alamat {Golden Cape (M)} tidak lagi digunakan oleh beliau. [32] Di dalam perkara penyampaian kertas kausa ini juga, Defendan seterusnya menyatakan bahawa Plaintif telahpun mempunyai pengetahuan berkenaan alamat terkini Defendan sejak tahun 2008 lagi apabila Plaintif telah menulis surat kepada Defendan menggunakan alamat terkini Defendan di No. 36, Jalan 5, Taman Ampang Jaya, 68000 Ampang Selangor {Eksibitkan S-6, Kandungan 8 (Afidavit sokongan Defendan)}. [33] Penelitian Mahkamah ini kepada Kandungan 4 (Afidavit Penyampaian oleh Hasrizal bin Ahmad) sememangnya menunjukkan bahawa penyampaian dan pengeposan kertas kausa saman pemula kepada Defendan adalah kepada alamat terakhir Defendan iaitu Golden Cape (M) Sdn Bhd, B1-11, PJ Industrial Park, Jalan Kemajuan, 46200 Petaling Jaya, Selangor Darul Ehsan. Alamat ini adalah merupakan alamat Defendan yang terdapat di dalam dokumen gadaian. 24 [34] Berhubung dengan perkara penyampaian dan penyerahan kertas- kertas kausa kepada Defendan, Mahkamah ini merujuk kepada klausa 16.1 dokumen gadaian yang telah memperuntukkan bahawa: “16. SERVICE OF NOTICES AND PROCESS 16.1 Every notice, demand or other communication under this Charge shall be in writing and may dispatched as follows:- (a) if to the Bank, by registered letter sent to its address specified at the head of this Charge; (b) if the borrower it may, at the option of the Bank, be delivered personally or by prepaid letter, and be sent to his address specified in Section 1 of the schedule hereto OR his usual OR last known place of residence”. [35] Manakala klausa 16.4 dokumen gadaian seterusnya memperuntukkan bahawa: “16.4 In addition to and not in derogation of any mode of service that may be permitted or prescribed by any wrotten law, in the event legal proceedings are instituted by the Bank against the Borrower the originating process shall be deemed to have been duly served on the Borrower:- 25 (a) if the originating process is sent by hand, at the time a copy of the originating process is left at the address of the Borrower stated herein; (b) if the originating process is sent by registered post, on 7th day (including the of posting) from the date the originating process is put into post addressed to the Borrower at the address of the Borrower herein stated”. [36] Manakala Aturan 10 Kaedah 3 Kaedah-Kaedah Mahkamah 2012 (KKM 2012) pula memperuntukkan seperti berikut: “(1) Where- (a) a contract contains a term to the effect that the Court shall have jurisdiction to hear and determine any action in respect of a contract or, apart from any such term, the Court has jurisdiction to hear and determine any such action; and (b) the contract provides that, in the event of any action in respect of the contract being begun, the process by which it is begun may be served on the defendant, or on such other person on his behalf as may be specified in the contract, in such manner or at such place (whether within or out of the jurisdiction) as may be so specified, 26 then, if an action in respect of the contract is begun in the Court and the writ by which it is begun is served in accordance with the contract, the writ shall, subject to paragraph (2), be deemed to have been duly served on the defendant”. [37] Di dalam kes ini, adalah menjadi dapatan Mahkamah ini bahawa Plaintif telahpun menyampaikan kertas kausa saman pemula kepada Defendan dengan sempurna di mana Plaintif mempunyai pilihan untuk menyerahkan kertas kausa saman pemula kepada Defendan berpandukan mod penyampaian di dalam dokumen gadaian tersebut yang jelas menyatakan “be sent to his address specified in Section 1 of the schedule hereto OR his usual OR last known place of residence”. [38] Di dalam perkara ini, Mahkamah ini merujuk kepada kes Hong Leong Bank Bhd v. HGM Machinery Sdn Bhd (formerly known as Handee Engineering & Consultancy Services Sdn Bhd) & Ors [2013] 9 MLJ 412 yang telah memutuskan antara lain bahawa: “The plaintiff were justified and entitled to issue or send the said notices of demand to the address as stated in the guarantee 27 notwithstanding the said letter of 5 January 1999 stating the purported ‘new address’ of the fifth defendant given that under cl 21 of the said guarantee, the plaintiff were entitled to issue the said notices of demand EITHER to the last known address of the fifth defendant or the address as stated in the said guarantee (see para 150)”. [39] Di dalam kes Bank Pertanian Malaysia Bhd v. Rinta ak Dali (A) Chayar ak Dali (F) & Anor [2014] 9 MLJ 263, Mahkamah telah menggariskan seperti berikut: “From the letters of demand sent to the defendants, the plaintiff was obviously aware of other addresses used by the defendants. Although the plaintiff had served the letters of demand at these other addresses, it did not mean that all cause papers or proceedings must be served on the defendants at all these addresses. There was no requirement and no necessity to include these other addresses in the proceedings and to serve all cause papers and proceedings at all these other addresses”. 28 [40] Adalah menjadi dapatan Mahkamah ini bahawa walaupun Plaintif di dalam kes ini mempunyai pengetahuan berkenaan alamat Defendan selain daripada yang tercatat di dokumen gadaian tersebut, namun Plaintif adalah tidak bertanggungan atau tidak bertanggungjawab untuk menyerahkan kertas kausa saman pemula kepada alamat Defendan yang baru kerana dokumen-dokumen gadaian/ Surat Tawaran/ perjanjian pinjaman tidak memperuntukkan bahawa Plaintif dikehendaki berbuat demikian. Apa yang jelas di sini adalah; kertas kausa saman pemula telahpun diserahkan kepada alamat di Golden Cape (M) yang merupakan alamat Defendan yang telah dinyatakan secara spesifik di Seksyen 1, Jadual Pertama dokumen gadaian. [41] Di samping itu, Mahkamah ini perlu juga menekankan di sini bahawa sebelum pemfailan tindakan saman pemula ini di Mahkamah, Plaintif telah terlebih dahulu menyampaikan kepada Defendan Surat Tuntutan dan Penamatan bertarikh 12.2.2016 serta surat bertarikh 8.4.2016 bersama Borang 16D ke alamat Defendan yang sama seperti dicatatkan di dalam dokumen gadaian tersebut iaitu alamat di Golden Cape (M). Bukti pengeposan juga telah disertakan sebagaimana di dalam Eksibit HR-6 dan HR-7, Kandungan 2. Di 29 dalam perkara penyampaian Surat Tuntutan dan Penamatan bertarikh 12.2.2016 serta surat bertarikh 8.4.2016 bersama Borang 16D, Defendan sama sekali tidak pernah dan tidak pula menafikan bahawa beliau tidak menerima Surat Tuntutan dan Penamatan serta Borang 16D tersebut. [42] Berpandukan kepada kes-kes yang telah diputuskan serta berdasarkan alasan-alasan di atas, adalah menjadi dapatan Mahkamah ini bahawa dakwaan Defendan yang beliau tidak mengetahui kewujudan saman pemula dan tidak menerima sebarang kertas kausa adalah suatu penafian kosong semata-mata, serta merupakan penafian yang tidak bermerit dan tidak berasas. Alasan iv: Tindakan Plaintif disini adalah terhalang oleh had masa [43] Adalah menjadi dakwaan Defendan bahawa tindakan Plaintif terhadapnya adalah satu tindakan yang lapuk yang dihalang oleh had masa menurut seksyen-seksyen 6, 9, dan 21 Akta Had Masa 1953 (AHM 1953). 30 [44] Defendan di dalam kes ini telah cuba menghujahkan bahawa kausa tindakan Plaintif seharusnya dianggap bermula pada 1.10.1998 apabila Bank Standard Chartered melalui peguamcaranya menamatkan perjanjian-perjanjian pinjaman tersebut melalui surat tuntutan mereka bertarikh 1.10.1998. [45] Pertama, Mahkamah ini perlu menekankan bahawa peruntukan peruntukan seksyen 6 dan seksyen 9 AHM 1953 adalah tidak terpakai di dalam prosiding halang tebus yang telah dimulakan oleh Plaintif ini. [46] Benarkah dakwaan Defendan bahawa tindakan Plaintif adalah dihalang oleh tempoh had masa yang diperuntukan di bawah seksyen 21 AHM 1953? [47] Seksyen 21 AHM 1953 memperuntukkan berikut: Section 21. Limitation of actions to recover money secured by a mortgage of charge or to recover proceeds of the sale of land. 31 (1) No action shall be brought to recover any principal sum of money secured by a mortgage or other charge on land or personal property or to enforce such mortgage or other charge on land or personal property or to enforce such mortgage or charge, or to recover proceeds of the sale of land or personal property after the expiration of twelve years from the date when the right to receive the money accrued. (2) No foreclosure action in respect of mortgaged personal property shall be brought after the expiration of twelve years from the date on which the right to foreclose accrued. Provided that if, after that date the mortgagee was in possession of the mortgaged property, the right to foreclose on the property which was in his possession shall not, for the purposes of this subsection, be deemed to have accrued until the date on which his possession discontinued. (3) The right to receive any principal sum of money secured by a mortgage or ther charge and the right to foreclose on the property subject to the mortgage or charge shall not be deemed to accrue so long as that property comprises any future interests or any life insurance policy which has not matured or been determined. 32 (4) Nothing in the preceding subsections of this section shall apply to a foreclosure action in respect of mortgaged land but the provisions of this Act relating to actions to recover land shall apply to such an action. (5) No action to recover arrears of interest payable in respect of any sum of money secured by a mortgage or other charge or payable in respect of proceeds of the sale of land, or to recover damages in respect of such arrears shall be brought after the expiration of six years from the date on which the interest became due. Provided that – (a) Where a prior mortgagee or other incumbrancer has been in possession of the property mortgaged or charged, and an action is brought within one year of the discontinuance of such possession by the subsequent incumbrancer, he may recover by that action all the arrears of interest which fell due during the period of possession by the prior incumbrancer or damages in respect thereof, notwithstanding that the period exceeded six years. (b) Where the property subject to the mortgage or charge comprises any future interest or life insurance policy and it is term of the mortgage or charge that arrears of interest shall be treated as part of the principal 33 sub of money secured by the mortgage or charge, interest shall not be deemed to become due before the right to receive the principal sum of money has accrued or is deemed to have accrued. (6) This section shall not apply to any mortgage or charge of a ship. [48] Berhubung dengan tempoh masa 12 tahun menurut seksyen 21 (2) AHM 1953 ini, molek sekiranya Mahkamah ini merujuk kepada keputusan Mahkamah Rayuan di dalam kes Peh Lai Huat v. MBF Finance Bhd [2009] CLJ 69. Mahkamah Rayuan di dalam kes Peh Lai Huat ini telah memutuskan antara lain bahawa: “…Similarly, S 21(2) of the Limitation Act which reads:- (2) No foreclosure action in respect of mortgaged personal property shall be brought after the expiration of twelve years from the date on which the right to foreclose accrued: Provided that if after that date the mortgagee was in possession of the mortgaged property, right to foreclose on the property which was in his possession shall not, for the purposes of this subsection, be deemed to have accrued until the date on which his possession discontinued. 34 Also has no application to this case. That is because the cause of action here, that is to say, the right to exercise the statutory remedy of an Order for Sale did not arise until after the Appellate had failed to remedy the default specified in the Form 16D notice…” [49] Mahkamah ini juga merujuk kepada kes Jigarlal K. Doshi @ Jigarlal A/L Kantilal Doshi v. Resolution Alliance Sdn Bhd [2013] 3 MLJ 61 di mana Mahkamah Rayuan juga telah memutuskan antara lain seperti berikut: “The law is clear that the cause of action by a chargor does not accrue from the date of default of repayment of the loan but instead from the time the chargor fails to remedy the default as specified in the Form 16D Notice”. [50] Di dalam kes di hadapan Mahkamah ini, Plaintif melalui peguamcaranya telah mengeluarkan Borang 16D bertarikh 8.4.2016 terhadap Defendan dan Borang 16D tersebut telahpun disampaikan kepada Defendan untuk memberikan notis kepada Defendan supaya meremedikan kemungkirannya terhadap pinjaman-pinjaman tersebut. Defendan telah tidak mematuhi notis tersebut dan gagal 35 meremedikan kemungkirannya. Justeru itu, saman pemula di Kandungan 1 difailkan. Di dalam hal, adalah jelas di sini bahawa tindakan saman pemula Plaintif adalah tidak dihalang langsung oleh had masa. Pengiraan Faedah [51] Defendan telah juga mendakwa pengiraan faedah yang dibuat oleh Plaintif ke atas hutang tertunggak sepanjang tempoh kebankrapan beliau daripada 18.4.2007 sehingga 29.4.2014 adalah sesuatu yang salah. Adalah menjadi hujahan Defendan bahawa sepanjang tempoh beliau berstatus bankrap, Plaintif tidaklah boleh membuat pengiraan faedah ke atas hutang tertunggaknya. Di dalam ertikata lain, menurut Defendan apabila beliau diisytiharkan sebagai seorang bankrap pada 18.4.2007, maka pengiraan faedah atas jumlah hutang tertunggaknya sepatutnya terhenti. [52] Di dalam perkara ini, pertamanya Mahkamah ini merujuk kepada klausa 5 dokumen gadaian yang memperuntukkan berikut: “CAPITALISATION OF INTEREST 36 5.1 The interest on any moneys for the time being hereby secured including capitalized interest shall on the date of the same becoming due and at the end of every rest period thereafter be capitalized and added for all purposes to the principal sum then owing and shall thenceforth bear interest at the Prevailing Interest Rate or as the case may be and be secured and payable accordingly and all covenants and conditions contained in or impliedly by these presents and all powers and remedies conferred by law or these presents and all rules of law or equity in relation to the said principal sum and interest shall equally apply to such capitalized arrears of interest an to interest on such arrears. It is also hereby expressly agreed that nothwithstanding any provisions to the contrary, the decision of the Bank as to what is the rate of interest chargeable at any time shall be final and conclusive and shall not be questioned on any account whatsoever”. [53] Kedua, Mahkamah ini merujuk kepada apa yang telah diputuskan oleh Mahkamah Rayuan di dalam kes Jigarlal K. Doshi @ Jigarlal A/L Kantilal Doshi berhubung isu pengiraan faedah. Mahkamah Rayuan telah menjelaskan seperti berikut: “The mere fact that the respondent had filed the foreclosure proceedings some 15 years after the appellant had defaulted in the repayment of the loans in March 1996, does not mean that the respondent had deliberately delayed the commencement of proceedings to exploit the circumstances of 37 default and unjustly obtain huge snow balling interest claims against the appellant as contended by counsel for the appellant. There was nothing to prevent or restrain the appellant from repaying the whole or any part of the loans at any time to avoid the accumulation of the “snow balling interest”. The accumulation of interest was well within the knowledge of the appellant and cannot lie in the mouth of the appellant to now complain that the respondent was exploiting the situation or delaying by design to earn interest from the appellant. It is not wrong for banks to claim for interest when it is their business to do so. Equity has no bearing in a case of foreclosure and thus it cannot be said by the appellant that the orders of sale were contrary to “the rule of law and equity”. [54] Ketiga, Defendan telahpun dilepaskan dari status bankrap pada 29.4.2014 (Eksibit S-5, Kandungan 8). Untuk itu, Mahkamah ini perlu merujuk kepada keputusan Mahkamah Persekutuan di dalam kes Kwong Yik Bank v Hah Chiew Yin Yin [1985] 2 MLJ 452 yang telah memutuskan bahawa: “It is pertinent to observe that the bankrupt was not applying for an order of discharge but was applying for an order annulling her adjudication. The effect of this is to wipe out the bankruptcy altogether and put the bankrupt in the same position as there had been no adjudication order”. 38 [55] Defendan di dalam kes ini telahpun dilepaskan dari status bankrap pada 29.4.2014. Apabila prosiding halang tebus ini dimulakan oleh Plaintif pada 19.5.2016, Defendan bukanlah seorang bankrap. Memandangkan Defendan bukan seorang bankrap, maka Plaintif adalah berhak menguatkuasakan hak statutorinya dalam pengiraan faedah sepertimana tertakluk dalam syarat dan terma pinjaman- pinjaman serta gadaian tersebut ke atas Defendan. [56] Berdasarkan alasan-alasan di atas Mahkamah bersetuju dengan hujahan peguam Plaintif bahawa walaupun tindakan halang tebus bagi kes di hadapan Mahkamah telah dimulakan setelah kemungkiran telah lama berlaku, Plaintif masih tetap berhak ke atas jumlah serta faedah tertunggak di bawah kemudahan pinjaman- pinjaman tersebut dan Plaintif tidaklah boleh dianggap dengan sengaja mengumpul faedah yang tidak adil ke atas Defendan. Keputusan Mahkamah [57] Berdasarkan alasan-alasan yang telah dinyatakan di atas, adalah menjadi dapatan Mahkamah ini bahawa alasan-alasan yang ditimbulkan Defendan tidak langsung membangkitkan / mewujudkan 39 kausa yang bertentangan bagi mengetepikan suatu perintah penjualan melalui lelongan awam yang telah diperolehi Plaintif. [58] Adalah menjadi dapatan Mahkamah ini juga bahawa perintah jualan hartanah yang telah dikeluarkan pada 12.8.2016 telahpun dikeluarkan dengan teratur dan selaras dengan peruntukan undang- undang. [59] Berdasarkan alasan-alasan di atas, notis permohonan Defendan di dalam Kandungan 7 adalah dengan ini adalah ditolak dengan kos. Mahkamah ini juga memerintahkan supaya Defendan membayar kos sebanyak RM8000.00 kepada Plaintif. t.t. ..................................................... (DATUK AZIMAH BINTI OMAR) Hakim Mahkamah Tinggi Shah Alam (Saman Pemula) Selangor Darul Ehsan Bertarikh 19hb Julai 2017 40 Peguam Plaintif - Tetuan Sidek Teoh Wong & Dennis Puan Jagjit Kaur Peguam Defendan - Tetuan Arman-Yunos Encik Azhar Arman Ali

Tika 2.6.0

NO. S-05(M)-233-06/2016

PERAYU CHENG JINHUI (Passport No: E 32084481) RESPONDEN PUBLIC PROSECUTOR

Dangerous Drugs — Appeal against conviction and sentence — Appellant convicted and sentenced for trafficking in Methamphetamine weighing 1397.1 grams — Drugs found hidden inside a customized secret compartment structure underneath a hard layered pink plastic material liken to P-14 body material; wrapped in a silver package — Whether trial judge properly considered defence of innocent carrier — Whether defence cast reasonable doubt — Whether appellant’s conduct indicative of innocence — Whether charge proved beyond reasonable doubt — Dangerous Drugs Act 1952 [Act 234], ss 2, 37(da) & 39B(1)(a) & (2)

18/07/2017

YA PUAN SRI DATO' ZALEHA BINTI YUSOFKorumYA DATUK LIM YEE LANYA DATO' ABDUL RAHMAN BIN SEBLIYA PUAN SRI DATO' ZALEHA BINTI YUSOF

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=d6b3ff0d-ccf7-44c3-8aef-c1ccacb5300b&Inline=true

1 IN THE COURT OF APPEAL OF MALAYSIA APPELLATE JURISDICTION CRIMINAL APPEAL NO. S-05(M)-233-06/2016 BETWEEN CHENG JINHUI … APPELLANT (Passport No: E 32084481) AND PUBLIC PROSECUTOR …RESPONDENT [In the High Court of Sabah and Sarawak Sitting at Kota Kinabalu, Sabah Criminal Trial No. BKI – 45A-7/10-2014) Between Public Prosecutor And Cheng Jinhui CORAM: Y.A Datuk Lim Yee Lan, HMR Y.A Dato’ Abdul Rahman bin Sebli, HMR Y.A Puan Sri Dato’ Zaleha binti Yusof, HMR 2 JUDGMENT [1] The appelant in this case was found guilty and convicted by the High Court at Kota Kinabalu on 9.6.2016 under Section 39B(1)(a) of the Dangerous Drugs Act 1952 (DDA). She was sentenced to death by hanging under Section 39B(2) of the DDA. Aggrieved, she filed the instant appeal. The Charge [2] “ Bahawa kamu pada 6.7.2014, lebih kurang jam 11.25 malam di Cawangan Pemeriksaan Penumpang, Balai Ketibaan, Terminal 2 Lapangan Terbang Antarabangsa Kota Kinabalu, di dalam daerah Kota Kinabalu dalan Negeri Sabah, telah didapati mengedar dadah berbahaya iaitu Methamphetamine seberat 1397.1 gram, dan dengan itu kamu telah melakukan suatu kesalahan dibawah seksyen 39B(1)(a) Akta Dadah Berbahaya 1952 yang boleh dihukum di bawah seksyen 39B(2) Akta yang sama.” Background [3] The appellant arrived at Kota Kinabalu International Airport Terminal 2 (KKIA) on 6.7.2014 at about 11.25 pm, from Hong Kong International Airport with a one pink coloured trolley bag (exhibit P.14) as her checked- in luggage and another black coloured sling handbag. On arrival at KKIA, and after claiming P-14 from the designated carousel, as practiced by all 3 overseas passengers, the appellant placed P-14 under the scanner machine. [4] Upon scanning P-14, the customs officer, PW3 found the scanner to display a suspicious brownish orange image in P-14. P-14 was later re- scanned and went through examinations by various custom officers of the KKIA. The drug was eventually found hidden inside a customized secret compartment structure underneath a hard layered pink plastic material liken to P-14 body material; wrapped in a silver package [P5(4)]. [5] The learned trial judge in her grounds of judgment found that the appellant’s defence was that a year prior to her arrest, she had been on the payroll of one Gomez, who is of Negro descendant, to make overseas trips to send clothes samples to designated clients. These overseas trips took her to Hong Kong, Thailand, Philippines, and Laos and thrice to Malaysia, including this very trip. Previously, on each returned trip Gomez spent RMB6,000.00 which was inclusive of travel and accommodation expenses on her. On 5.7.2014, Gomez called to ask her to deliver clothes samples to Malaysia and told her to go to Guangzhou the next day (6.7.2014) where she was to meet his Negro friend, Ahtung at McDonald near a train station. At the meeting place, Ahtung gave her a luggage and her passport together with the air tickets and money for travelling 4 expenses. Ahtung told her the luggage contained ladies clothing samples and told her to place her own small plastic bag [P-14(A1) inside the luggage which she did. She saw the luggage was packed with ladies clothes. She then left by a taxi to China Hotel and from there she took a bus to Shenzhen, proceeded to Hong Kong International Airport and flew to Malaysia. She explained that when she was apprehended by the custom officers and saw a package retrieved from the luggage, she felt afraid and surprised because drugs were harmful to humans. She said Gomez told her that he was in the boutique business of supplying ladies clothes and never told her there were drugs inside the luggage. Issues [6] Before us, the appellant had raised three main grounds of appeal namely: (a) The learned High Court Judge did not adequately consider the defence of innocent carrier; (b) The element of knowledge was not proven and the surrounding facts and circumstances do not give rise to inferences that the appellant had knowledge of the drugs; and 5 (c) The appellant is not guilty of wilful blindness. Submission [7] Learned counsel for the appellant submitted that there was truth in the appellant’s defence. He submitted that 2 weeks before the appellant was arrested, another young woman from China named Yu Jing was also arrested at KKIA. He contended that Yu Jing case gave credence to the appellant’s story as there were stunning similarities between the two cases, namely: (i) The time period between the two arrests was very near to each other. The appellant in this case was arrested on 6th July 2014 while Yujing on 22nd June 2014. (ii) Both were arrested at KLIA Terminal 2. (iii) The luggage involved was the same American Tourister brand and size and the same pink colour. 6 (iv) In both cases, the secret compartment was the same i.e. one had to take out a fabric lining, metal handle bar and a plastic layer to get to the secret compartment. (v) Same Air Asia flight AK238 from Hong Kong to Kota Kinabalu (vi) Both had same itineraries in Malaysia i.e. they travelled from Guangzhou to Hong Kong Airport, flew to Sabah from Hong Kong, stayed overnight at Kota Kinabalu, travelled to Kuala Lumpur the next day and they returned to Hong Kong from Kuala Lumpur. (vii) The flight tickets for both were booked by the same person Jing Chen. (viii) Both tickets were purchased using the same credit card under the name of Chen Qiang. (ix) Both of their stories were strikingly similar. The appellant had told her version of the story to the immigration officers in two cautioned statements exhibit D1 and exhibit D2. 7 (x) Both were given a bag by a Negro person to travel to Malaysia to send clothes sample. (xi) Both luggages contained various brands of new clothes or clothes sample. (xii) All the similarities were agreed by PW6 who was the Investigating Officer (IO) for both cases. [8] Learned counsel for the appellant further submitted that the facts above gave an inference that a drug syndicate used drug mules to send drugs from China to Malaysia. The appellant’s defence of innocent carrier was not an afterthought as she told her story to the prosecution as early as at the investigation stage. Further, he submitted, “Gomez” was not a fictitious character as his number was given to the prosecution and saved in the appellant’s hand phone. The failure of the IO to investigate the number, in learned counsel for the appellant’s submission, rendered the appellant’s conviction unsafe. 8 [9] On the issue of knowledge, it was submitted on behalf of the appellant that the appellant did not display any conduct by which an inference could be drawn that the appellant had knowledge of the drugs inside exhibit P-14. The signs of “terkejut” of being “startled” and “worried” are a matter of perception. It can equally be the conduct of an innocent man who finds an incriminating thing in his bag. Further, it was argued, that the conduct of travelling alone did not infer knowledge on the appellant. The surrounding facts and circumstances when considered together with the defence of the appellant showed that she had no knowledge of the drugs. [10] It was also submitted that the appellant was not guilty of wilful blindness as she did ask Ahtung the contents of P-14 and inspected it and found it to contain ladies clothing. Further the hidden compartment could not be detected by the naked eye. Hence, considering the evidence in totality, learned counsel for the appellant submitted that the appellant could not be said to be guilty of wilful blindness. [11] On the part of the prosecution it was argued that the appellant was not an innocent carrier but she had elected to shut her eyes and carried the drug for whatever reason she knew better. Whether she was an 9 innocent carrier can be inferred from the facts of the case. Here the appellant had the opportunity to check the bag but had not done so. Her conduct showed the appellant knew the drug was there as she appeared startled when it was found. Learned Deputy Public Prosecutor (DPP) cited the case of PP v. Abdul Rahman bin Akif [2007] 4 CLJ 337; [2007] 5 MLJ 1, wherein his Lordship Arifin Zakaria FCJ (as he then was) adopted the reasoning of Lord Morris in the case of Warner v. Metropolitan Police Commissioner [1968] 2 All ER 356:- “ If there is assent to the control of a thing, either after having the means of knowledge of what the thing is or contains or being unmindful whether there are means of knowledge or not, then ordinarily there will be possession. If there is some momentary custody of a thing without any knowledge or means of knowledge of what the thing is or contains then ordinarily, I would suppose that there would not be possession. If, however , someone deliberately assumes control of some package or container, then I would think that he is in possession of it. If he deliberately so assumes control knowing that it has contents, he would also be in possession of the contents. I cannot think that it would be rational to hold that someone who is in possession of a box which he knows to have things in it is in possession of the box but not in possession of the things in it. If he had been misinformed or misled of the nature of the contents, or if he had made a wrong surmise as to them, it seems to me that he would nevertheless be in possession of them ”. 10 [12] Learned DPP also pointed out to us that “Yu Jing” had been convicted by the High Court and the conviction was affirmed by the Court of Appeal last year. [13] As to “Gomez” is hand phone number, learned DPP argued that PW6 had already given satisfactory explanation as to why she did not call the number as the number was not a local number and not registered in Malaysia. Her explanation was accepted as reasonable by the learned High Court Judge. Findings [14] We had considered the submissions made by learned counsel for the appellant and the learned DPP, respectively, oral as well as written. We also scrutinized the grounds of judgment of the learned High Court Judge. [15] On the issues raised, by the appellant, we shall deal with them together as these issues are inter-related. An apt description of “innocent carrier” as it co-relates with knowledge and wilful blindness is found in the Federal Court case of Munuswamy Sunder Raj v Public Prosecutor [2015] 6 MLJ 219, wherein Suriyadi FCJ at page 219-220 had stated as follows: 11 (a) The defence of innocent carrier is a valid defence that could be alluded to by an accused person, and in this case the appellant. A plethora of cases sprinkles the legal journals in Malaysia and suffice if we merely refer to a chosen few to clarify this defence without the need for comprehensive judicial activism. The Court of Appeal in Venkatesan Chinnasami v Public Prosecutor [2011] 1 LNS 1736 put it aptly in the following terms: ….A defence of innocent carrier refers to a state of affairs where an accused person acknowledges carrying, for example a bag or a box, as in the case before us, containing the dangerous drugs but disputes having knowledge of the drugs. Whether it will succeed or not would very much depend on the facts of each case. (b) As said above it is imperative that the success of the defence of innocent carrier depends very much on the facts of each case, a matter that falls within the realm of the trial judge. Ignorance simpliciter is not sufficient to let an accused person off the hook as otherwise every other accused person will allude to that defence. It needs more than that. Without any reason for suspicion, or there is no right or opportunity of examination, ignorance may be a good defence. A hypothetical scenario could be when an accused person receives a package which contains illicit drugs from say, England when not a shred of evidence could establish him having been aware of the circumstances of the drugs being sent to him or having any nexus to him. Prior to the parcel appearing at his door step he would not have had any reason for suspicion or the opportunity to inspect the parcel bearing in mind that the package was beyond his reach until it reached his hands. The rider is that everything depends on the facts. 12 (c) Let us now peruse briefly at the relevant parts of the evidence regarding the current case where every opportunity was made available to the appellant to inspect the bag. It was noticeable that there was no suggestion by the defence that the appellant had enquired from the person who handed the two boxes to him or such a suggestion was made to any of the prosecution’s witnesses of the contents. He was in a position to examine the contents of the bag entrusted by that Faruk before it was checked in but failed to do so. He was clearly guilty of wilful blindness (see Hoh Bon Tong v Public Prosecutor [2010] 5 CLJ 240 (CA) and Public Prosecutor v Amil bin Akmad [2007] 5 MLJ 561 (CA). In Hoh Bon Tong v Public Prosecutor when discussing this defence held that: The defence of innocent carrier must necessarily bring into the picture the concept of wilful blindness. And according to Yong Pung How CJ (Singapore) in Public Prosecutor v Hla Win [1995] 2 SLR 424 (at p 438), ‘the concept of wilful blindness qualifies the requirement of knowledge’. And His Lordship continued further by saying (at the same page): As Professor Glanville Williams aptly remarked in this Texbook on Criminal Law, at p 125: ….. the strict requirement of knowledge is qualified by the doctrine of wilful blindness. This is meant to deal with those whose philosophy is: ‘Where ignorance is bliss, ‘tis folly to be wise’. To argue away inconvenient truth is a human failing. If a person deliberately ‘shuts his eyes’ to the obvious, because he ‘doesn’t want to know, he is taken to know’. 13 Continuing at the same page, His Lordship said: In Ubaka v PP [1995] 1 SLR 267, the principles laid down in Warner v Metropolitan Police Commissioner [1968] 2 All ER 356; [1968] 2 WLR 1303 and modified in Tan Ah Tee v PP [1980] 1 MLJ 49 were applied by the trial judge. In its grounds of judgment, this court quoted the following passage by the trial judge: Ignorance is a defence when there is no reason for suspicion and no right and opportunity of examination, and ignorance simpliciter is not enough. [16] Such is the position in law of what “innocent carrier” is. With due respect, contrary to the submission of learned counsel for the appellant, that the learned High Court Judge had failed to adequately consider the defence of innocent carrier, we found that her ladyship had indeed considered substantially such defence at pages 29 - 30 and 32 to 34 of her grounds of judgment when she narrated the appellant’s defence. At pages 32 to 34 her ladyship stated the following: “ In essence, the defence of the accused was that she was an innocent carrier. She had no knowledge of the subject drugs found inside exhibit P-14 in question. She was informed by Gomez as well as Ahtung that inside the bag were only clothes samples and lady’s accessories. She only knew the presence of the subject drugs when the authorities opened and found a concealed compartment inside 14 exhibit-14 and told her that the silver package placed hidden inside the sealed compartment was filled with dangerous drugs and she agreed that she reacted surprised because Gomez or Ahtung never told her about the presence of drugs inside the luggage and felt afraid because she knew that drugs are harmful to humans. In her defence, the accused said Gomez is in the boutique business as well as cloth supplier. She had known and worked with Gomez for a year as a courier to deliver a luggage with clothes samples and lady’s accessories to designated clients of Gomez around Asia. For this simple errand the accused was paid handsomely with all expenses covered for the entire trip in total for the sum of RMB6,000 which is in RM3,814.01. This job entails considerable travelling to most of the Asian region in so far, since working with Gomez she had travelled twice to Hong Kong, Thailand, Philippines, once to Laos and inclusive of this trip to Malaysia for the third time. Essentially, her task is only to bring a luggage of cloth sampling to each designated destination instructed by Gomez (or Ahtung in cases of where Gomez is away from Malaysia i.e. Africa). This luggage upon arrival at each designated country will be handed over to the informed client of Gomez who would come to pick of the luggage at the hotel. The hotel she stayed at had earlier been booked by Gomez but will only be known to her upon her arrival acknowledgment via mobile call to Gomez at the designated city. Gomez will then inform his client to pick the luggage at the choiced hotel for the accused to stay. 15 The client will come to pick the luggage from the accused and leaves the hotel. The accused alluded to the series of steps taken in each of the designated destination she undertook. In this trip she was asked to stay overnight in Kota Kinabalu before flying the next day to Kuala Lumpur. She said her flight ticket to Kuala Lumpur is yet to be purchased and upon arrival at Kuala Lumpur, she is to contact Ahtung whereby she will be informed of which hotel to stay hence the client will collect the luggage thereto”. [17] Having done so, she gave her analytical view: “ Firstly, this was against the normal cost for carrying out such simple task, unless it was for something unlawful. An express service the likes of DHL or services equalvalent in China, would have done the job far cheaper, better and speedier. Secondly, the accused agreed that the samples of clothes that she brought are not exclusive, in fact from the exhibits tendered they look most ordinary. Therefore, one would very well ask oneself if these samples of clothes are not exclusive or valuable or expensive that requires extra care to handle, why the need for personal courier unless something unlawful. Thirdly, measured tread taken by Gomez just to hand over a luggage supposedly only to contain clothes sampling to his client appears over- board unless something unlawful. The clandestine meetings at McDonald nearby train station to collect a luggage instead of in Gomez office as she testified earlier which is also nearby the train station shows something unlawful. 16 The background of the accused revealed that she was quite capable of taking care of herself. She had High School education, understands and speaks simple English, Since working with Gomez for one year she had travelled extensively and also did modelling as part time; she was hardly a naïve or a gullible person. In view of her background and experience, her claim to have reposed such a high degree of trust in Gomez, not to mention Ahtung was implausible. There was little reason for her to blindly believe Gomez or much less Ahtung. The former she had known only one year and the latter she was in contact with was only when the former was indisposed and the latter took over. She agreed that she does not know Ahtung very well but yet because she and Gomez were friends therefore she trust Ahtung. There was nothing in her evidence to show that both she and Gomez were close friends except that she had been working for him for a year, In fact, she neither knew Gomez’s company’s name nor ever been to Gomez’s office”. [18] Her ladyship even bore in mind Yu Jing’s case: “Given that there is similar facts evidence with another case i.e BKI- 45A-8/10-2014 PP vs. YU JING with similar modus operandi, which I am mindful of; however looking into all the surrounding circumstances of both facts being presented respectively, I am of the view that the inferences taken would be in favour to the prosecution than the defence i.e. the probability of the accused deliberately ‘shuts her eyes’ to the obvious, because she doesn’t want to know, of the apparent drug syndicate because the pay and perks inclusive of the chance to travel to the cities of Asia were good. The time was flexible that she could increase her earning by doing part time job. In the court’s finding, the conduct of the accused as narrated by her evidence displayed nothing shot of wilful blindness towards the 17 contents inside the bag, exhibit P-14. The court referred to the case of PP v HLa Win [1995] 2SLR, Yong Peng How CJ stated as follows:- “ The concept of wilful blindness qualifies the requirement of knowledge….. [19] On the failure of the IO, PW6, to carry out proper investigation on “Gomez” is hand phone number, the following was her ladyship’s finding. “ PW6 gave reasons that the accused told her that Gomez was presently in Africa. The explanation given by the IO that she could not do further investigation in respect of the phone number due to it being an oversea number, therefore the problems and constraints of logistics information added with only the given name ‘Gomez’ on its own, without his full name and address would not be able to assist her investigation. In this matter if this court was to accede to counsel’s contention it would mean that every time an accused drops names without any sufficient particulars e.g. the accused’s full name and either his residence or office address will only lead to the edge of the world on a wild goose chase. That will not be to carry out investigation with a view to prove the case beyond reasonable doubt but to prove the case beyond a shadow of a doubt. (See Ali Hosseinzadeh Bashir v PP (Criminal Appeal No: B-05-36-211) ”. [20] Having perused the evidence and the grounds of judgment of the learned High Court Judge, we found there was no basis for the submission made by learned counsel for the appellant that her ladyship had failed to consider the defence of innocent carrier by the appellant. In fact as shown 18 earlier her ladyship had been very detail in her narration. Her ladyship had considered every step or action taken by the appellant in carrying out her “job” for Gomez. We also opined that the case of P.P v Yu Jing [2015] MLJU 2080 did not help the appellant’s case as she was convicted by the High Court. On appeal, the Court of Appellant had affirmed the conviction and sentence by the High Court against Yu Jing as reported in Yu Jing v P.P [2017] MLJU 324. The appellant here is not an illiterate person. As expressed by this court in Yu Jing’s case, supra “any reasonable person of average intelligence and honesty ought to have been suspicious about the nature of the delivery and the things that were to be carried and delivered across international border under the instructions of 2 negro men not known to her”. Although the appellant claimed that she knew Gomez and Gomez was her friend, but the evidence showed that she had known him for only one year, and she did not even know his full name, his office or his company’s name! [21] We also found no reason to disagree with the learned High Court Judge on the issue of knowledge and wilful blindness. The appellant in our view had ample times and opportunities to check P-14 thoroughly, but she chose not to. No doubt that the drugs were well hidden from view but that does not mean the appellant had no knowledge. In fact we noted that has been the normal defence made by drug mules to escape conviction. 19 Germane to this point was the decision of this court in Ali Hosseinzadeh Bashir v PP[2015] 1 CLJ 918 as cited by the learned DPP : “ [40] The argument is that since the drugs were hidden from view the appellant could not have known of their presence. The answer to this contention is the familiar decision of the Singapore Court of Appeal in Zulfikar Mustaffah v. PP [2001] 1 SLR 633 which the Federal Court cited with approval in PP v. Abdul Rahman Akif [2007] 4 CLJ 337. We are quite surprised that counsel had pursued this line of argument. We reproduce below what the Court of Appeal said at p.639: “ For the element of ‘possession’ (within the meaning of the Misuse of Drugs Act) to be established, it must not only be shown that the accused had physical control of the drugs at the relevant time; the prosecution must also prove that the accused possessed the requisite knowledge as to the contents of what he was carrying: see Warner v. Metropolitan Police Commissioner [1969] 2 AC 256; Tan Ah Tee & Anor v. PP [1978] 1 LNS 193; [1978 – 79] SLR 211; [1980] 1 MLJ 49. In the course of the appeal before us, counsel for the appellant relied heavily on the fact that the contents of the bundles were securely wrapped in newspapers and could not be identified. We were accordingly invited to draw the inference that the appellant had no knowledge of the contents of the bundles. We were unable to accede to this request. While the fact that the contents of the bundles were hidden from view may have been relevant in determining whether the requisite knowledge was absent, this factor should still not be given too much weight. Otherwise, drug peddlers could escape liability simply by ensuring that any drugs coming into their possession are firstly securely sealed in opaque wrappings. Rather the court must appraise the entire facts of the case 20 to see if the accused’s claim to ignorance is credible. As Yong Pung How CJ remarked in PP v. Hla Win [1995] 2 SLR 424 (at p.438): In the end, the finding of the mental state of knowledge, or the rebuttal of it, is an inference to be drawn by a trial judge from all the facts and circumstances of the particular case, giving due weight to the credibility of the witnesses”. [22] We could not agree more with Ali Hosseinzadeh’s case, supra. Conclusion [23] For the reasons stated above, we found no reason to disagree with the learned High Court Judge. There was no merit in the issues raised and we found that the conviction was safe. We therefore dismissed the appeal and affirmed the conviction and sentence. Dated: 18 Julai 2017 (ZALEHA BINTI YUSOF) Judge Court of Appeal Malaysia Counsels/Solicitors: RIZWANDEAN BIN M BORHAN ( Yusri & Rizwan ) Lot 16, 2nd Floor, Block B, Asia City Phase 1, Kota Kinabalu, SABAH. For the Respondent: AHMAD SAZILEE BIN ABDUL KHAIRI No. 45, Persiaran Perdana, Precinct 4, 62100 PUTRAJAYA.

Tika 2.6.0

JA-12B-30-05/2016

PERAYU Kong Hui Fong (No. K/P: 620428-01-5316) ...Perayu/Defendan RESPONDEN Pahlawan Sendirian Berhad (No. Syarikat: 014650-W) ...Responden/Plaintif

17/07/2017

YA DATO' DR. CHOO KAH SING

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Page 1 of 11 DALAM MAHKAMAH TINGGI DI JOHOR BAHRU RAYUAN SIVIL NO: JA-12B-30-05/2016 ANTARA KONG HUI FONG (NO. K/P 620428-01-5316) PERAYU DAN PAHLAWAN SENDIRIAN BERHAD (NO. SYARIKAT: 014650-W) RESPONDEN (Di Dalam Perkara Mahkamah Sesyen Johor Bahru Guaman No. B52-4-04/2014) ANTARA PAHLAWAN SENDIRIAN BERHAD (NO. SYARIKAT: 014650-W) PLAINTIF DAN KONG HUI FONG (NO. K/P: 620428-01-5316) DEFENDAN JUDGMENT CHOO KAH SING Judicial Commissioner High Court Johor Bahru Date: 17.7.2017 Page 2 of 11 Introduction [1] The appellant, Kong Hui Fong, being the defendant in the lower court, was not satisfied with the decision of the Sessions Court Judge (SCJ), Johor Bahru, who allowed the plaintiff‟s claim (respondent‟s claim) and recorded that a judgment sum of RM703,588.70 be entered against the defendant after a full trial. The parties hereinafter will be referred to according to their original status in the lower court. [2] On 31.5.2017, this Court, after hearing the appeal, set-aside the SCJ‟s decision in part and allowed a lesser judgment sum, i.e. a sum of RM46,153.00 to be entered against the defendant. The plaintiff is not satisfied with the decision of this Court and has filed an appeal to the Court of Appeal. This judgment serves as the reasons for this Court‟s decision. The reasons are set down as below. Background Facts [3] The plaintiff, being a company, filed a claim against the defendant for breach of trust in that the defendant had dishonestly and without authority misappropriated the plaintiff company‟s fund amounting to RM703,588.70 during the period between April 2009 and March 2013. [4] The defendant was an employee of the plaintiff company between the period 1.1.2011 and 30.4.2013. The defendant was previously employed by a company known as Narcissus Development Sdn. Bhd. (Narcissus) for approximately 26 years. The defendant was also previously employed by Messrs. Kong Yeam & Chui Sieng. One thing in common about the defendant‟s history of employment is that she was Page 3 of 11 working for and assisting the same proprietor, Dato Ng Kong Yeam (Dato Ng), who was the de facto owner of all the companies whom employed the defendant. [5] At the material time while the defendant was under the employ of companies owned by Dato Ng, the defendant was charged with the task of managing the financial affairs and accounts of Dato Ng‟s companies, including the plaintiff company. Occasionally, the defendant had to run Dato Ng‟s personal errands, such as, to pay his household utility bills. The defendant also took care of the Dato Ng‟s personal household expenses in that she had to withdraw money from the plaintiff company to pay Dato Ng‟s lawful wife, Datin Ling Chooi Sieng (DW4), the household expenses every month. [6] The defendant was at all material times entrusted with the safe keeping of the plaintiff company‟s cheque books. It is not in dispute that the authorized signatories of the plaintiff company‟s cheques were Dato Ng and his lawful wife (either one to sign). It was in evidence that all the cheques in the cheque books were pre-signed by Dato Ng. [7] During the period between April 2009 and March 2013, the defendant had issued a total of 51 cheques from the plaintiff company. The total amount of all those cheques was RM703,588.70 which is the judgment sum entered against her at the lower court. The plaintiff alleged the defendant had dishonestly and without authorization issued these cheques, and as a result, the plaintiff company suffered losses. [8] Those 51 cheques could be categorized into two groups. The first group of cheques amounting to 38 cheques in which the total sum was Page 4 of 11 RM572,588.70. The payee for the first group of cheques was the defendant herself. The second group of cheques amounting to 13 cheques which the total sum was RM131,000.00. The payee of 12 out of these 13 cheques was „Narcissus Develoment Sdn Bhd‟; and one cheque was made payable to „Funridge Development Sdn. Bhd.‟ [9] Sometime in May 2012, Dato Ng‟s health was deteriorating, and he was diagnosed with frontal-temporal dementia and was unable to handle his daily affairs, including the management of his companies‟ affairs. Dato Ng was taken care of by a lady by the name of Kay Swee Pin (PW1) who claimed to have shared a spousal relationship with him in Singapore. They had been living together from 1955 until mid-2013 in Singapore. Kay Swee Pin had borne Dato Ng a child who lived together with the couple. [10] Kay Swee Pin later became a director of the plaintiff company in early 2013. When she took over the control of the plaintiff company, she went through the books and accounts of the plaintiff company. She found that the defendant had made many payments using the pre-signed cheques to pay herself and others in the past, and that there were no supporting documents and/or proper records in reference to those payments. [11] On February 2013, Kay Swee Pin wrote an email (see pg. 1037 Rekod Rayuan Bhg C (Jilid 3) – D5) to the defendant giving strict instruction to her to stop issuing any payment using the pre-signed cheques. Kay Swee Pin then filed a civil suit against the defendant for those 51 unauthorized cheques at the lower court in 2014. Page 5 of 11 The Finding of this Court [12] It is trite that the appellate court will not interfere with the decision of the lower court if the trial court has not committed any error of law in coming to its decision. However, in this appeal, this Court finds there were several errors of law committed by the trial court. [13] Firstly, it was the plaintiff‟s pleaded case that the defendant had dishonestly and without prior permission paid out all those payment using the pre-signed cheques to herself and others. The burden then lies with the plaintiff to first prove that the defendant was not authorised to issue those cheques. The plaintiff did not adduce any evidence to prove that the defendant was not authorised to issue and make payment using those cheques (except three cheques which will be explained later). The SCJ took into account the fact that the defendant was entrusted with those pre-signed cheques, therefore, the defendant had to justify as to why she made those payments and to justify by supporting documents as to why the payments were made. [14] This Court could not agree with the approach taken by the SCJ in that the burden was on the defendant to justify as to why she issued those payments. This Court is of the considered view that the plaintiff must first prove that the defendant was not authorised to issue payments to herself and others. In order to do so, only the authorised signatories at that time could verify whether the defendant had dishonestly and without permission issued those cheques. At the time of the trial, Dato Ng, the signatory of those cheques, was not fit to give evidence in court. The next best person that could verify whether those payments were authorised or otherwise would be the other authorised signatory, namely, Page 6 of 11 Dato Ng‟s lawful wife. She gave evidence for the defendant. She acknowledged receipt of payments from the defendant every month for her household expenses. She did not give evidence to suggest the defendant had dishonestly or without permission issued those cheques. [15] There is nothing in fact to suggest the defendant had misused the pre-signed cheques. When one is entrusted with pre-signed cheques, it in fact implies that the person holding those pre-signed cheques is authorised to make payments at the holder‟s discretion, unless specific instruction is given to whom those pre-signed cheques are supposed to be paid to. [16] From the evidence of this case, the defendant had been issuing cheques since April 2009 to herself until end of 2012, and yet, there was no complaint by Dato Ng concerning the conduct of the defendant. The defendant‟s evidence was that she took the money to pay various expenses, including management fees, cleaning fees, utility bills, petrol expenses, et cetera. There was a consistent pattern of payments made out by the defendant every month. Some of these payments were made payable to one Sumardi (DW2) as cleaning fees, who gave evidence that he received payments from the defendant every month for his services. The defendant‟s repeated actions were not questioned by Dato Ng when he was in control of the plaintiff company. The defendant had been carrying out her responsibility as “the manager” of the finances of the plaintiff company all these years without interference from Dato Ng. The defendant‟s actions were questioned only when the lady Kay Swee Pin came into the picture to purportedly take over the management of the plaintiff company. Page 7 of 11 [17] From the evidence of the plaintiff‟s case, the plaintiff could only establish that some of the payments were not properly accounted for, in that no proper payment vouchers were made out or recorded. The SCJ took into account these facts as well as the relationship between PW1 and Dato Ng, and also particularly Dato Ng‟s health condition, and concluded that the defendant was dishonest and had without proper permission issued payments of those cheques. This approach, in the opinion of this Court, is an error of law in that the SCJ had shifted the burden of proof to the defendant to prove she was not dishonest and had issued the cheques with authorization. [18] What is material is that PW1 admitted that the cheques that were pre-signed by Dato Ng were left by Dato Ng entirely to the defendant as to whom she intended to pay out to (see pg. 545 Rekod Rayuan Bhg B (Jilid 3)) . This confirms that there was implied authority given to the defendant to use those pre-signed cheques to whom she intended to pay out to. On a balance of probabilities, the defendant has explained to whom she had paid out the money to for those cheques. Further, some of the recipients of the money gave evidence for the defendant admitting that they had received the money from the defendant for various reasons. This evidence shows that the defendant did not misuse the pre-signed cheques. The defendant had genuinely used those pre- signed cheques to pay expenses for the plaintiff company. The trial court seems to have ignored and failed to appreciate this part of the defendant‟s evidence. The trial court made a sweeping finding that the defendant was in breach of trust in that she had misused the pre-signed cheques and issued the same without authority. Page 8 of 11 [19] After having scrutinized the trial court evidence and the decision of the SCJ, this Court was satisfied that the trial court had made an error of law in the finding of facts and evidence in coming to its decision. [20] Secondly, it is the considered view of this Court that the defendant was able to establish that payments were in fact made for utility bills, postage expenses and petty expenses for the plaintiff company. These payments prove, on a balance of probabilities, that she had indeed made payments not for her benefit, but for the monthly expenses of the plaintiff company so as to keep the plaintiff company running. It is incomprehensible as to why the trial court could find the defendant is liable for those expenses, and that the defendant has to now pay back such sums to the plaintiff company. [21] The trial court had taken a simplistic approach in analysing the evidence before the court. The counsel for the plaintiff in the appeal acknowledged that some payments were indeed made for the expenses of the plaintiff company. The counsel for the plaintiff in the appeal had prepared a list itemizing each and every payment for the first group of cheques as directed by this Court. The object was to facilitate the parties to reach a compromise for an amicable settlement. However, the parties could not reach any compromise. [22] Thirdly, the same analysis applies with regard to the second group of cheques. Those payments were made to Dato Ng‟s own company, i.e. Narcissus Development Sdn Bhd and Funridge Development Sdn. Bhd. Those payments were made during the period between May 2009 and July 2011. At that time, Dato Ng was still capable of making decisions and was in control of the plaintiff company, yet, Dato Ng did Page 9 of 11 not complain about those payments. Why is PW1 questioning the defendant now? She was not in charge of the management of the affairs of the plaintiff company at that time, obviously she would not know what transpired between Dato Ng and the defendant. [23] Those payments were all made payable to Dato Ng‟s own company, obviously, the defendant must have acted under the instruction of Dato Ng to pay from the plaintiff company to Dato Ng‟s other companies. Why would the defendant have paid out money from the plaintiff company to Dato Ng‟s companies if there was no instruction from Dato Ng to do so? [24] The defendant was not the recipient of the money nor was she in control of Dato Ng‟s other companies. Why should she be made responsible for these payments? This Court could not make sense of the SCJ‟s judgment as to why the SCJ found the defendant to be liable for these group of cheques. [25] The plaintiff had failed to prove that the defendant was dishonest, and had made payments to Dato Ng‟s other companies without his authorization or had acted in breach of trust. Therefore, the defendant should not have been held liable for the cheques issued to Dato Ng‟s other companies. [26] This Court could only find the defendant to be liable for three cheques that she had issued in breach of strict instruction given to her not to use pre-signed cheques. This strict instruction could be found in the email from PW1 (when she assumed control of the plaintiff company Page 10 of 11 in early 2013) to the defendant dated 6.2.2013 (see exhibit D5). PW1 wrote in the email as follows: “…With that authority, I am instructing you that all blank checks presigned by Dato Ng (either for his personal accounts or the account of Kong Yeam and Chui Sieng) must be destroyed immediately and he shall not be made to sign any more checks or any kind of documents hereon. Any matters concerning him must be directed to me.” [27] That instruction has to be taken to include those pre-signed cheques of the plaintiff company. However, three cheques pre-signed by Dato Ng were issued by the defendant, namely cheques 843647, 843651 and 843655 for the amounts RM18,883.00, RM13,935.00 and RM13,335 respectively after the strict instruction was given to her. The three cheques amounted to RM46,153.00. [28] This Court could only find these three cheques were clearly issued without authorization and permission. After PW1 had issued the email on 6.2.2013 to the defendant, it could be said that the defendant‟s implied authority to use the cheques that had been pre-signed by Dato Ng had been revoked. Hence, the defendant no longer had the discretion to use those pre-signed cheques to make any payments, including payment for plaintiff company‟s expenses. Hence, this Court could only find the defendant liable for to the amount RM46,153.00 as the plaintiff company‟s losses. Page 11 of 11 Conclusion [29] Based on the above analysis and reasoning, this Court allowed the defendant‟s appeal in part and set aside the SCJ‟s decision in part and allowed only a judgment sum of RM46,153.00 to be entered against the defendant, and costs of RM2,000.00 be paid to the defendant by the plaintiff. -Signed- ………………………………………… (CHOO KAH SING) Judicial Commissioner High Court, Johor Bahru Counsel for the plaintiff : Salma Sakeena Tetuan Azwad Ihsan & Co. Counsel for the defendant : HK Ling Tetuan Kong Yeam, Chui Sieng & Shim

Tika 2.6.0

25-286-10/2015

PERAYU MALAYSIA AIRLINE SYSTEM BERHAD (APPOINTED ADMINISTRATOR) RESPONDEN JOYCE TAN @ TAN SIEW ENG

17/07/2017

YA DATUK SU GEOK YIAM

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DALAM MAHKAMAH TINGGU MALAYA DI KUALA LUMPUR IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR (APPELLATE AND SPECIAL POWERS DIVISION) IN THE FEDERAL TERRITORY OF MALAYSIA APPLICATION FOR JUDICIAL REVIEW NO: 25-286-10/2015 In the matter of an Application for an order of certiorari and an order of mandamus in respect of the Industrial Court Award No. 909 of Year 2015 dated 27.07. 2015 and received by the Applicant on 30.07.2015; And In the matter of Section 20(3) of the Industrial Relations Act 1967; And In the matter of Order 53 of the Rules of Court 2012 BETWEEN MALAYSIA AIRLINE SYSTEM BERHAD (APPOINTED ADMINISTRATOR) ... APPLICANT AND JOYCE TAN @ TAN SIEW ENG ... RESPONDENT GROUNDS OF JUDGMENT Applicant’s application for judicial review, enclosure (1) 1. On 30.10.2015, the Administrator, who was appointed under s. 5 of the Malaysia Airline System Berhad (Administration) Act 2015 (Act 75) (“the MASB (Administration) Act 2015”), filed this application for the applicant, through Messrs. Shearn Delamore & Co., the applicant’s solicitors (“the applicant’s solicitors”), pursuant to O. 53 of the Rules of Court 2012 (“the RC 2012”) for leave to commence a judicial review of the Industrial Court Award No. 909 of Year 2015 dated 27.07.2015 (“the Award”) in the Industrial Case No.: 11/4-447/13 (“the I.C. case”). 2. If leave is granted, the applicant seeks the following reliefs: (1) An order of certiorari to remove the Award to the Kuala Lumpur High Court and quashed; (2) An order to stay the execution of the Award pending the final outcome of substantive application for judicial review of the Award; (3) All necessary and incidental directions or whatever reliefs which this Court deems fit and beneficial; and (4) Costs of this application and incidental to this application to be costs-in-the cause. Parties in this application 3. The parties in this application are as follows: (1) Malaysia Airline System Berhad (“the MASB”) is the applicant. It is the former employer of the respondent; and (2) Joyce Tan @ Tan Siew Eng is the respondent. She is the former employee of the applicant. Background facts 4. The background facts, which led to the applicant filing enclosure (1), is as follows: (1) By a letter dated 24.10.1987, the respondent commenced her employment with the applicant on 02.11.1987, as a Trainee Flight Stewardess, with a monthly salary of RM 400.00; (2) The respondent was confirmed and certified to be qualified to operate flying duties as a Flight Stewardess on, successfully, completing the Kursus Perkhidmatan Kabin Kapal Terbang; (3) By a letter dated 08.12.1987, the respondent was appointed as a Flight Stewardess in Group B with effect from 23.12.1987; (4) By a letter dated 11.09.2007, the respondent was promoted to the position of Inflight Supervisor with effect from 08.09.2007; (5) By a letter dated 14.01.2008, the Claimant was confirmed as Inflight Flight Supervisor with effect from 08.12.2007; (6) On 31.08.2012, the respondent was called up by the Crew Deployment Centre for flight duty about 10 minutes after the commencement of her last day of the scheduled standby period on that date, viz from 29.08.2012 until 31.08.2012; (7) However, the respondent informed the Duty Officer that she was sick and she would be on medical leave and she would not be able to perform any duty on that day; (8) Subsequently, when the respondent was asked to produce a medical certificate as proof that she could not report for work on that day as she was sick, the respondent produced a medical certificate dated 31.08.2012 (“the MC”) from Klinik Rakan Medik, Kelana Jaya (“the clinic”); (9) Being doubtful of the genuineness of the MC, her superior officer wrote to the clinic to seek verification in writing from the clinic, which issued the MC, and he was informed in writing by the clinic that the respondent went to the clinic on 03.09.2012 and was issued with a medical certificate for 03.09.2012 by the clinic; (10) The clinic also provided to the respondent’s superior officer the original copy of the medical certificate dated 03.09.2012, which was issued by the clinic to the respondent on 03.09.2012; (11) The applicant then issued to the respondent a letter dated 25.09.2012 directing the respondent to show cause on the same date, viz 25.09.2012, to the allegation that she had committed a serious act of misconduct under the Rules and Regulations of the applicant, which attracts severe punishment as the MC submitted by her was found to have been tampered with (“the show cause letter”); (12) On the same date, viz 25.09.2012, the respondent replied to the show cause letter. In her reply, she admitted that she had altered the date in the MC from 03.09.2012 to 31.08.2012; (13) On the same date, viz 25.09.2012, the applicant suspended the respondent for her serious act of misconduct in tampering with the MC; (14) The applicant took the view that since the respondent was holding a high position at the material time, viz as the In-flight Flight Supervisor, the applicant was left with no other alternative but to dismiss the respondent due to her serious act of misconduct in tampering with the MC; (15) Hence, by a letter entitled “Punishment Order” dated 24.10.2012, the applicant dismissed the respondent with immediate effect for her serious act of misconduct for having tampered with the MC by altering the date of its issuance, viz from 03.09.2012 to 31.08.2012; (16) At the time of her dismissal on 24.10.2012 by the applicant, she was holding the position of In-flight Flight Supervisor with a basic salary of RM 4,347.00 per month; (17) The respondent was also paid the following allowances as at 30.09.2012: (1) Laundry allowance - RM 80.00 (2) Fleet CC allowance - RM 500.00 (3) Incentive allowance - RM 702.17 (4) Inflight cabin crew food allowance - RM 2,476.02 (18) Subsequently, the respondent made a representation to the Industrial Relations Department (“the IRD”) of the Ministry of Human Resources against her dismissal. She contended that it was done without just cause or excuse as the punishment of dismissal was unduly harsh in relation to her act of misdemeanor based on her unblemished record of 25 years of service, and the fact that another employee, namely, Esdjuna Sudzie binti Ismon (“Puan Esdjuna”), a Leading Stewardess, who committed a similar act of misdemeanor, was only given a lesser punishment, viz a deferment of annual increment; (19) Since the IRD could not resolve the respondent’s representation, on 26.02.2013, the Right Honourable Minister of Human Resources (“the Minister”) referred her representation to the Industrial Court for adjudication, pursuant to s. 20(3) of the Industrial Relations Act 1967 (“the IRA 1967”); (20) The Industrial Court commenced the trial of the Ministerial reference on 23.09.2014. It continued the trial on 24.09.2014 and 10.10.2014. On 18.12.2014, it continued and concluded the trial of the Ministerial reference; (21) On 21.01.2015, the applicant put in its written submissions through the applicant’s solicitors; (22) On 26.01.2015, the respondent put in her written submissions through the Malaysian Airline System Employees’ Union Peninsular Malaysia (“the Union”); (23) On 20.02.2015, the Malaysian Airline System Berhad (Administration) Act 2015 (“the MASB (Administration) Act 2015”) came into force; (24) S. 4 of the MASB (Administration) Act 2015 states as follows: “Part II ADMINISTRATION Placement of the Company, etc., under administration 4. Subject to the prior written approval of the Minister, a member of the Company, or the board of directors of the Company pursuant to a resolution of the board of directors, may place— (a) the Company; (b) any wholly owned subsidiary company of the Company; and (c) the following partially owned subsidiary companies of the Company: (i) Abacus Distribution Systems (Malaysia) Sdn. Bhd. (Company No. 180535-T); (ii) Aerokleen Services Sdn. Bhd. (Company No. 277266-X); and (iii) MAS Awana Services Sdn. Bhd. (Company No. 372384-D), under administration in accordance with this Act.” (25) On 25.05.2015, Mohammad Faiz bin Mohammad Azmi was appointed as the Administrator for the Administered Companies pursuant to s. 5 of the MASB (Administration) Act 2015; (26) S. 11(1)(e) of the MASB (Administration) Act 2015 provides that on the appointment of the Administrator, a moratorium shall take effect (“the moratorium”) during which no proceedings and no execution or other legal process in any court or tribunal may be commenced or continued with, and no distress may be levied, against the Administered Companies or their property except with the prior written consent of the Administrator; (27) S. 3 of the MASB (Administration) Act 2015 defines “Minister” to mean “the Prime Minister of Malaysia” and “Administered Companies” to mean the applicant; the applicant’s wholly owned subsidiary companies, and the specified subsidiary companies that have been placed under administration under s. 4; (28) S. 12 of the MASB (Administration) Act 2015 provides, inter alia, that unless the administration is sooner terminated under s. 6 or paragraph 20(3)(c), the duration of the moratorium referred to in s. 11 shall be for a period of twelve months commencing from the date of the appointment of the Administrator under subsection 5(1) (“the duration of the moratorium”). There appears to be a typographical error in s. 12 of the MASB (Administration) Act 2015 as there is no paragraph 20(3)(c) in the MASB (Administration) Act 2015. However, there is a s. 20(3)(c) in the MASB (Administration) Act 2015; (29) By a letter dated 25.05.2015, the applicant’s solicitors requested the Industrial Court to defer handing down its Award in the I.C. case citing the moratorium and the duration of the moratorium in s. 11(1)(e) and s. 12, respectively, of the MASB (Administration) Act 2015 (“the said request”); (30) On 09.06.2015, both parties appeared before the Industrial Court for the mention of the I.C. case and the applicant’s solicitors repeated the said request; (31) However, despite the two requests, one written and one oral, made by the applicant’s solicitors, to defer its Award, the Industrial Court handed down the Award on 27.07.2015; (32) The Award was in favour of the respondent; (33) On 30.07.2015, the applicant received the Award; and (34) Hence, on 30.10.2015, the applicant filed this application against the respondent, enclosure (1), for judicial review of the Award. The findings, decision and reasons for the findings and decision of the Industrial Court as set out in the Award 5. In the Award, the Industrial Court found that the punishment of dismissal imposed on the respondent was too harsh and disproportionate with her misconduct. The Industrial Court found that another employee was given a lesser punishment for a similar offence but the respondent, who had served the applicant for 25 years, was dismissed. 6. Hence, the Industrial Court held that the respondent’s dismissal was without just cause and excuse and it awarded to the respondent compensation in lieu of reinstatement and backwages totaling a sum of RM 108,394.00. 7. In allowing the respondent’s claim, the Industrial Court stated in paragraph 17 as follows: “17. In the circumstances of this case, by the fact that another employee received a lesser sentence for a similar offence, and the Claimant having served the Company for 25 years, this Court do agree that the punishment of dismissal was too harsh and disproportionate with the misconduct. It follows therefore, the dismissal was without just cause and excuse. (See the Award, Exhibit “LSP-4”, at p. 327 of the applicant’s affidavit-in-support, enclosure (3)). 8. In paragraph 19 of the Award, the Industrial Court stated as follows: “19. The Company’s counsel did inform the Court that whilst in moratorium, no proceedings in any Court or Tribunal can be continued without the permission of the Administrator, but this Court is of the opinion that the provision do not apply to this case the proceedings were completed before the Company went under administration. The Company went under administration when the hearings were completed pending this award.” (See the Award, Exhibit “LSP-4”, at p. 328 of the applicant’s affidavit-in-support, enclosure (3)). Cause papers filed for leave to commence the judicial review proceeding 9. The applicant filed the following cause papers for leave to commence the judicial review proceeding against the respondent: (1) Applicant’s application dated 30.10.2015 for judicial review, enclosure (1); (2) Applicant’s statement under O. 53, r. 3(2) of the RC 2012 (“the O. 53 statement”), enclosure (2), which was dated 30.10.2015 and filed on 30.10.2015; and (3) Applicant’s affidavit-in-support affirmed on 30.10.2015, by Lim San Peen, the Attorney (Registration No.: PA 44013/15) for Mohammad Faiz bin Mohammad Azmi, the Administrator for the applicant, enclosure (3), which was filed on 30.10.2015. Leave to commence the judicial review proceeding 10. On 12.01.2016, Hanipah Binti Farikullah J granted leave to the applicant to commence the judicial review proceeding against the respondent with costs of this application and incidental to this application to be costs-in-the cause. 11. Her Ladyship also granted an Order of stay of the execution of the Award pending the final outcome of the substantive judicial review application. Cause papers filed for the substantive application 12. The parties then filed the following additional cause papers for the substantive application for judicial review: (1) Applicant’s notice of hearing of application for judicial review, enclosure (6); (2) Respondent’s affidavit-in-reply affirmed on 23.02.2016, by the respondent herself, enclosure (8); (3) Applicant’s affidavit-in-reply affirmed on 11.03.2016, by Lim San Peen, the applicant’s Attorney, enclosure (11); (4) Applicant’s supplemental affidavit affirmed on 25.03.2016, by Vijayan Venugopal, an advocate and solicitor, in Messrs. Shearn Delamore & Co., the applicant’s solicitors, enclosure (12), which exhibited a copy of the Notes of Proceedings of the I.C. case as Exhibit “VJ-1”; (5) Applicant’s written submissions dated 26.04.2016, enclosure (13); (6) Applicant’s bundle of authorities (not e-filed); (7) Respondent’s written submissions dated 27.04.2016; (8) Applicant’s further submissions dated 18.05.2016; (9) Respondent’s written submissions-in-reply dated 16.02.2017, enclosure (24); (10) Applicant’s further submissions (2) dated 23.02.2017; and (11) Applicant’s supplemental bundle of authorities. Grounds for the substantive judicial review application 13. There are 2 (two) main grounds relied upon by the applicant to attack the Award. First ground 14. The first main ground is set out in Malay in sub-paragraphs 3.2.1 to 3.3 of paragraph 3 of the O. 53 Statement as follows: “3.2. Memandangkan peruntukan di dalam Akta MAS 2015, Mahkamah Perusahaan telah melakukan kesilapan yang ketara dalam memberikan Awad tersebut di mana, 3.2.1. Ia gagal mempertimbangkan bahawa Pemohon telah diletakkan di bawah pentadbiran Pentadbir berkuatkuasa dari 25.5.2015. 3.2.2. Ia gagal mengambil kira bahawa selaras dengan pelantikan Pentadbir, tempoh moratorium dua belas (12) bulan berkuat kuasa di mana persetujuan bertulis Pentadbir diperlukan untuk meneruskan prosiding perkara ini. 3.2.3. Ia menyalahertikan dan menyalahgunakan Seksyen 11 (e) Akta MAS 2015 di mana ia memperuntukkan secara nyata bahawa tiada prosiding boleh diteruskan, termasuk dalam memberi Awad, tanpa kebenaran bertulis Pentadbir. 3.2.4. Ia gagal menimbangkan permohonan peguamcara Pemohon di dalam surat bertarikh 25.5.2015 yang telah memohon penangguhan apa-apa awad oleh Mahkamah Perusahaan menurut peruntukan-peruntukan Akta MAS 2015. 3.2.5. Ia telah melangkaui dan/atau bertindak tanpa bidang kuasa dalam memberikan Awad berdasarkan peruntukan Akta MAS 2015. 3.3. Mahkamah Perusahaan telah melakukan kesilapan bidang kuasa yang serius apabila ia memberikan Awad tanpa persetujuan bertulis oleh Pentadbir mengikut peruntukan Akta MAS 2015.” 15. The first main ground concerns the, alleged, jurisdictional error committed by the Industrial Court due to the coming into force of the MASB (Administration) Act 2015; the appointment of the Administrator under the MASB (Administration) Act 2015; the moratorium; the duration of the moratorium; the two requests made by the applicant’s solicitors to the Industrial Court to defer its Award; the failure of the Industrial Court to defer the handing down of its Award; and the handing down by the Industrial Court of its Award on 27.07.2015, without first obtaining the written consent of the Administrator, contrary to s. 11(1)(e) read together with s. 12 of the MASB (Administration) Act 2015. 16. I shall refer to the first main ground as the moratorium ground and the issue arising from it as the moratorium issue. Second ground 17. The second main ground is set out in Malay in sub-paragraphs 3.1 to 3.1.14 of paragraph 3 of the O. 53 Statement, enclosure (2), as follows: “3.1 Dalam menyimpulkan bahawa hukuman pembuangan kerja adalah terlalu berat dan tidak seimbang dengan salah laku yang dilakukan oleh Responden, Mahkamah Perusahaan telah menggunapakai satu proses membuat keputusan yang cacat dan oleh itu telah melakukan kesilapan undang-undang di mana, 3.1.1. Isu perbezaan hukuman tidak relevan di dalam kes ini. 3.1.2. Mahkamah Perusahaan gagal menilai secara kritikal Perintah Hukuman bertarikh 11.6.2012 yang dikeluarkan kepada Ketua Pramugari (“Leading Stewardess”) yang membuat rujukan kepada dua surat penjelasan yang dikemukakan oleh Ketua Pramugari (“Leading Stewardess”) tersebut tetapi yang sama tidak pernah dikemukakan oleh Responden semasa prosiding di Mahkamah Perusahaan. 3.1.3. Mahkamah Perusahaan telah mengambil kira isu mengenai perbezaan hukuman yang melibatkan Ketua Pramugari (“Leading Stewardess”) tersebut walaupun fakta berkenaan dengan asas hukuman yang dijatuhkan kepada Ketua Pramugari (“Leading Stewardess”) tidak dikemukakan di hadapan Mahkamah Perindustrian. 3.1.4. Mahkamah Perusahaan telah menerima bukti Responden mengenai perbezaan hukuman dalam Perintah Hukuman bertarikh 11.6.2012 mengenai Ketua Pramugari (“Leading Stewardess”) tanpa bukti sokongan daripada Responden. 3.1.5. Mahkamah Perusahaan gagal menghadkan dirinya kepada pertimbangan sama ada pembuangan kerja itu adalah wajar dalam kes Responden berdasarkan keadaan tertentu kes Responden. 3.1.6. Mahkamah Perusahaan gagal mengambil kira bahawa Ketua Pramugari (“Leading Stewardess”) yang dirujuk di dalam Awad itu memegang jawatan sebagai seorang Pramugari Penerbangan (“Flight Stewardess”) pada masa pelakuan salah laku itu; suatu kedudukan yang lebih rendah daripada kedudukan Responden; Penyelia Dalam Penerbangan (“In-Flight Supervisor”). 3.1.7. Mahkamah Perusahaan gagal untuk menghayati bahawa Responden memegang jawatan sebagai Penyelia Dalam Penerbangan (“In-Flight Supervisor”), jawatan tertinggi di dalam hierarki anak kapal. 3.1.8. Mahkamah Perusahaan gagal untuk menghayati bahawa sebagai pekerja yang memegang kedudukan tertinggi di dalam hierarki anak kapal, ia adalah wajar untuk menjangka bahawa Responden memiliki tahap integrity dan kejujuran yang tinggi. 3.1.9. Mahkamah Perusahaan gagal mengambil kira bahawa sebagai pekerja yang telah lama berkhidmat, Responden dijangka menunjukkan contoh yang baik kepada pekerja dibawahnya dengan mematuhi prosedur Pemohon. 3.1.10 Mahkamah Perusahaan gagal untuk menghayati bahawa Responden telah mengaku salah lakunya dalam mengubah sijil cuti sakit. 3.1.11 Mahkamah Perusahaan gagal mengambil kira bahawa salah laku yang dilakukan oleh Responden adalah serius kerana Responden memalsukan sijil cuti sakit yang telah diserahkan kepada Pemohon. 3.1.12 Mahkamah Perusahaan gagal mengambil kira keterangan Responden ketika pemeriksaan balas di mana beliau bersetuju seperti berikut: a. Beliau telah mengubah sijil cuti sakit dengan menukar tarikh dari 03.09.2012 ke 31.08.2012; b. Beliau menyerahkan sijil cuti sakit yang telah diubah yang mempunyai tarikh 31.08.2012 kepada Pemohon; c. Beliau bersetuju bahawa sebagai pekerja, beliau tidak dibenarkan mengubah sijil cuti sakit. 3.1.13 Mahkamah Perusahaan gagal menilai fakta bahawa Responden telah diberikan surat amaran bertarikh 10.2.2004 dimana gaji beliau telah ditolak untuk satu (1) hari bagi kegagalan untuk melaporkan diri untuk penerbangan yang dijadualkan pada 24.1.2004. 3.1.14 Mahkamah Perusahaan gagal menghayati keterangan COW1 berkenaan keputusan untuk membuang kerja Responden dan telah menyalahertikan dan menyalahgunakan undang-undang yang berkaitan dengan isu hukuman keras (“harshness of the punishment”).” (Emphasis added). 18. The second main ground concerns the, alleged, errors of law committed by the Industrial Court in the Award in holding that the respondent’s dismissal was without just cause and excuse; that it was too harsh and disproportionate with the respondent’s misconduct as another employee received a lesser punishment for a similar offence but the respondent, who had served the applicant for 25 years, was dismissed; and the compensation in lieu of reinstatement and backwages totaling a sum of RM 108,394.00, which the Industrial Court awarded to the respondent. 19. I shall refer to the second main ground as the dismissal ground and the issue arising from it as the dismissal issue. 20. The dismissal issue is summarized as follows: (1) The decision making process of the Industrial Court was flawed as the issue of disparity of punishment was not relevant in the I.C. case; (2) In holding that the respondent’s dismissal was without just cause and excuse as the punishment of dismissal was too harsh and not commensurate with the respondent’s misconduct, the Industrial Court committed the following errors of law and/or acted outside its jurisdiction when it did the following: (a) It failed to take relevant matters into consideration; (b) It took into account irrelevant matters; (c) It asked itself the wrong questions or issues; (d) It applied the wrong test; (e) It made findings, which were inconsistent with the evidence placed before it, and it made findings, which were not supported by the evidence; and (f) It arrived at a decision, which was so perverse and unreasonable that no reasonable tribunal or person in similar circumstances would have arrived at. Respondent’s pleaded case before the Industrial Court 21. In paragraphs 8 – 24 of the statement of case dated 03.09.2013, filed by the Union, on her behalf, the respondent pleaded as follows: (1) On 03.08.2012, she operated flight duty on MH 16 from Kuala Lumpur to Amsterdam and developed a skin allergy. She also had severe cough with symptoms of flu. She continued with her allergy medication comprising the following: (a) Augmentin; (b) Amoxycillin; (c) Clavulanate potassium; (d) Aerius desloratadine; (e) Benadryl; and (f) Zyrtec; which were earlier prescribed by her doctor; (2) She operated flight duty on MH 135 from Kuala Lumpur to Brisbane on 17.08.2012. During this flight, she developed a severe sore throat. She also lost her voice resulting in her having to delegate in-flight announcements to other cabin crew; (3) During a night stop at Brisbane on 17.08.2012, she consulted a doctor, who diagnosed her as having a lung infection, which necessitated a strong course of antibiotics. However, the medication prescribed by the doctor at Brisbane resulted in her becoming drowsy; (4) She could not produce the Medical Record Book as the applicant had destroyed this document following her dismissal; (5) Her state of health did not improve from 18.08.2012 until 25.08.2012. Despite her medical condition, she continued to operate overseas during this period; (6) On 26.08.2012, her dermatitis allergy recurred. She also had fever including diarrhoea with loss of appetite. As a result, she was very weak; (7) On 27.08.2012, she visited the clinic. The examining doctor recommended her one day’s medical leave but she declined the medical leave. This was because she had a last flight to operate on 28.08.2012, after which she would be on standby from 29.08.2012 until 31.08.2012 (“the scheduled standby period”) (see a copy of the letter from the clinic dated 31.10.2012 confirming the respondent’s decline of sick leave for 27.08.2012, at p. 13 of the respondent’s Bundle of documents); (8) On 31.08.2012, she was called up by the Duty Officer (“the said Duty Officer”) for flight duty about 10 minutes after the commencement of her last day of the scheduled standby period; (9) As she was still not well on 31.08.2012, she informed the said Duty Officer that she would be on medical leave and would not be able to perform any duty on that day; (10) Thereafter, her off days were from 01.09.2012 until 03.09.2012. Although her state of health improved until 02.09.2012, she developed high fever again. Her diarrhoea also became worse (see the respondent’s duty rosters for August 2012 and September 2012, at pgs. 14-17 of the respondent’s Bundle of documents); (11) The doctor advised her to rest at home. The doctor also granted her medical leave for 03.09.2012 after prescribing the following medication to her: (a) Lomodium; (b) Progesic 500; and (c) Fucon hyoscine-N- Butylbromide. (12) On 25.09.2012, Rodzlin Ramli, the applicant’s Manager, Performance & Resources Management In-flight Services, issued her the show cause letter with the allegation that the MC submitted by her for 31.08.2012 was found to have been tampered with (see a copy of the show cause letter at pgs. 18 & 19 of the respondent’s Bundle of documents); (13) On 25.09.2012, she was compelled to reply, immediately, at 10.00 a.m. on being served the show cause letter by the Cabin Crew Administrator. She replied, dutifully, to the show cause letter; (14) She did not deny that the MC was altered. However, she explained that as a result of having consumed a large amount of medication for her medical ailment, which had commenced from 03.08.2012 until the date of the show cause letter, she was not in a right frame of mind at the material time (see a copy of the her letter at pgs. 20 & 21 of the respondent’s Bundle of documents); (15) By a letter dated 24.10.2012, which was issued by the Senior Manager, Strategic People Management and which she received on 09.11.2012, she was dismissed with immediate effect (see a copy of the letter of dismissal at pgs. 22-24 of the respondent’s Bundle of documents); (16) By a letter dated 16.11.2012, she appealed to the applicant’s Disciplinary Appeal Committee (“the DAC”) to seek reinstatement to her former position (“the letter of appeal”) (see a copy of the letter of appeal at pgs. 25 & 27 of the respondent’s Bundle of documents); (17) By a letter dated 18.12.2012, the applicant informed her that her appeal for reinstatement was dismissed by the DAC (see a copy of the applicant’s letter dated 18.12.2012 at p. 28 of the respondent’s Bundle of documents); (18) During her 25 years of service, prior to her dismissal, she had an unblemished record; (19) From the year 1994 to the date of her dismissal, she was given a total of 29 (twenty nine) letters of commendation/appreciation for commendable service by the applicant and also the customers of the applicant (see a copy of each of the letters of commendation/appreciation at pgs. 29-58 of the respondent’s Bundle of documents); and (20) Her terms and conditions of employment are covered by the Collective Agreement (“the CA”) between the applicant and the Union. 22. Due to a typographical error, there are 2 paragraphs in the statement of case, whith have the same number, viz 25. I shall refer to them as the first paragraph 25 and the second paragraph 25, respectively. 23. In the first paragraph 25 of the statement of case, the respondent contended that she was unfairly dismissed due to the following grounds: (1) The applicant did not convene a disciplinary inquiry against her. Her dismissal was decided single-handedly and arbitrarily by the Head of Human Capital Services in breach of the rules of natural justice and Article 25(2) the MAS/MASEU 2011/2014 Collective Agreement, which spells out as follows: “(2) Depending on the nature of the misconduct or indiscipline or efficiency, the Company may after due enquiry imposes on the employee one of the following punishment: (a) ………….. (b) ………….. (c) ………….. (d) Dismiss the employee (e) Any other punishment permissible under the law (3) The disciplinary enquiry shall be conducted in accordance with the Disciplinary Procedure of the Company.” (see an extract of “Article 25 – Discipline” of the MAS/MASEU 2011/2014 Collective Agreement, at pgs. 59-62 of the respondent’s Bundle of documents); (2) She was compelled by her immediate superior to, spontaneously, reply to the show cause letter upon being served with it at about 10.00 a.m. on 25.09.2012. This was done in breach of the applicant’s disciplinary procedure, which allows an employee to reply to a show cause letter within 14 days; (3) In a state of dilemma and having been compelled to reply, immediately, to the show cause letter she had, honestly, admitted to having altered the date of the MC. However, in making the admission, she had overlooked explaining in her reply to the show cause letter, that she was under an honest mistaken belief that she had a sick leave credit of 1 day’s sick leave, which was granted for her by the doctor on 03.09.2013, and that that day, viz 03.09.2013, was also her off-day, which she could set-off against the date she had reported sick, viz 31.08.2012, to fulfill the applicant’s administrative requirements; and (4) Zaiton Shaari, the applicant’s Senior Manager, Strategic People Management (“Zaiton Shaari”) did not or failed to, properly, consider the merits of her explanation to the show cause letter. She was also denied the opportunity to make any plea for clemency prior to the order of termination of her employment by Zaiton Shaari. 24. Hence, in the first paragraph 25(4) of the statement of case, the respondent pleaded that the punishment imposed on her was unduly harsh in relation to her act of misdemeanor, which was related to her inability to report for duty due to her medical unfitness, during the last few hours of her standby period, in that, in imposing the extreme punishment of dismissal on her, Zaiton Shaari, the applicant’s Senior Manager, Strategic People Management, did not or failed to consider the nature of her misconduct, the circumstances surrounding her misconduct and her past record, as follows: (1) She had an unblemished disciplinary record of 25 years; and (2) Her act of misdemeanour was not committed, willfully, as she was under a genuine mistaken belief that she had a sick leave credit for 03.09.2012, which was also her off day, and which she could use as a set off against the date she had reported sick to the said Officer, viz 31.08.2012. 25. In paragraph 25(4)(c) of the statement of case, the respondent also pleaded that the applicant had practised disparity of punishment in imposing the punishment of dismissal on her. This is because Puan Esdjuna, a Leading Stewardess; Mohd Hasy Idan Mohd Salleh, a F/O, who is a pilot; and another co-pilot; to name a few examples, who had committed similar acts of misdemeanours, were not dismissed but were given lesser punishments of deferments of annual increments (see a copy of Puan Esdjuna’s Punishment Order dated 11.06.2012, at pgs. 63-65 of the respondent’s Bundle of documents for the I.C. case). 26. In the second paragraph 25 of the statement of case, the respondent further pleaded that, in imposing the punishment of dismissal on her, she was a victim of partiality and vindictiveness of the applicant based on the following reasons: (1) That during the course of her inflight duty as an Inflight Supervisor on a flight from Kuala Lumpur to Sydney on 01.01.2012, she discovered an abuse of authority by Mohd Danny Rashdan, the then applicant’s Deputy Chief Executive Officer (“the Deputy CEO”), in upgrading his maid and infant child of 18 months from economy class to first class, in breach of the applicant’s regulations and that she had exposed this malpractice in the Voyage Report; (2) That the Voyage Report was, subsequently, released by an unknown source to Wee Choo Keong, the former Member of Parliament for Wangsa Maju, Malaysia. The said document was also posted in the internet in Wee Choo Keong’s Blog on 11.05.2012; (3) That this had generated adverse publicity for the applicant and had implicated its Senior Management staff, inter alia, the CEO and the Executive Vice President of Human Resources and Zahrah Zaid, who was the Head of Human Resources Divison, at the material time (see a copy of the relevant pages of Wee Choo Keong’s Blog relating to the Voyage Report at pgs. 66-84 of the respondent’s Bundle of documents); and (4) That the applicant had victimized her for being a union member in that Puan Esdjuna, a Leading Stewardess, who was a non union member, was, merely, given a punishment of deferment of her annual increment instead of a dismissal. 27. In paragraph 26 of the statement of case, the respondent contended and would contend that her dismissal was without any just cause or excuse and/or in breach of the principles of natural justice and/or an unfair labour practice and/or unlawful. 28. In paragraph 27 of the statement of case, the respondent pleaded that she would adduce all necessary evidence at the hearing in support of the statement of case. 29. Therefore, in paragraph 28 of the statement of case, the respondent prayed that the Industrial Court holds that her dismissal was without just cause or excuse and/or in breach of the rules of natural Justice and/or an unfair labour practice and/or unlawful and orders that she be reinstated without any loss of wages, allowances, services, seniority, privilege or benefits of any kind and or orders any other or alternate relief as the Industrial Court deems fit and proper. Applicant’s pleaded case before the Industrial Court 30. In its statement of reply dated 21.11.2013, which was filed through the applicant’s solicitors, the applicant pleaded, inter alia, as follows: (1) In paragraph 2, that in the circumstances of the matter, the dismissal of the respondent was with just cause or excuse; (2) In paragraph 5, that part of the duties of a cabin crew, including an Inflight Supervisor, is to be on standby duty as follows: (a) During the period of being on standby duty, the cabin crew is required to be at home or to make himself or herself available to be contacted by the applicant; and (b) Any cabin crew, who is scheduled to be on standby duty, will be called to report for duty in the event that the applicant faces a shortage of cabin crew for a specific flight; (3) In paragraph 5.1, that it is normal for a cabin crew, who is on a standby duty, to be called to report for duty, when another cabin crew, who is on duty, is absent or on medical leave; (4) In paragraph 5.2, that to ensure that the applicant operates each of its flights with a sufficient number of cabin crew, the applicant requires strict compliance with the standby duty schedule from all cabin crew and failure by a cabin crew to comply with the same amounts to a serious misconduct; (5) In paragraph 6, that the applicant puts the respondent to strict proof of her averments in paragraphs 8, 9.1, 9.2, 9.3, 9.4, 10, 11 and 12 of the statement of case but in any event, that those averments of the respondent are not relevant to the present matter; (6) In paragraph 7.12, that paragraphs 13, 14, 15, 16, 17, 18, 19 of the respondent’s statement of case are strictly denied by the applicant and the respondent is put to strict proof thereof; (7) In paragraph 8, that after the respondent’s dismissal with immediate effect, on 20.11.2012, the applicant received the letter of appeal from the respondent; (8) In paragraph 8.1, that save that the applicant received the letter of appeal on 20.11.2012, the contents of the letter of appeal are strictly denied by the applicant and the respondent is put to strict proof thereof; (9) In paragraph 8.2, that the DAC convened a meeting on 07.12.2012 to consider the respondent’s appeal. However, due to the gravity of the respondent’s misconduct, her appeal was dismissed and the respondent was informed of the dismissal of her appeal by the DAC vide the applicant’s letter dated 18.12.2012; (10) In paragraph 9, that the applicant denies that the respondent has an unblemished record of 25 years of service as the applicant had issued the respondent with a warning letter dated 10.02.2004 for her failure to report for duty on 24.01.2004; (11) In paragraph 10, that the respondent’s commendable service is not a relevant consideration in the present matter as the respondent was dismissed on the ground of having tampered with the MC and not due to her (poor) work performance. In any event, the applicant puts the respondent to strict proof of her averment in paragraph 23 of the statement of case (in regard to the 29 (twenty-nine) letters of commendation/appreciation received by her for her, alleged, commendable service); and (12) In paragraph 11, that the applicant admits the respondent’s averment in paragraph 24 of the statement of case that the respondent’s terms and conditions of employment are covered by the CA between the applicant and the Union. 31. In paragraph 12 and sub-paragraphs 12.1 to 12.5 in the statement-in-reply, the applicant refers to the first paragraph 25 of the statement of case and averred as follows: (1) The applicant is not obliged to convene a domestic inquiry prior to dismissing the respondent. Article 25(2) of the CA refers to “due inquiry” and does not impose a requirement to convene a domestic inquiry in all cases, particularly where – as in the present case – the misconduct is admitted. Hence, the failure to conduct a domestic inquiry would not render an otherwise fair dismissal, as unfair; (2) In any event, the respondent was accorded sufficient opportunity vide the show cause letter to be heard on the allegation of her misconduct. Furthermore, the respondent did not raise any objection to the show cause letter; (3) The applicant had given proper considerations to the respondent’s explanation to the show cause letter and found the same to be unsatisfactory; (4) In the other cases, which were mentioned by the respondent in subparagraph 25(4)(c) of the statement of case, the punishments, which were imposed by the applicant varied due to the ranking of the employees involved. However, in the respondent’s case, the applicant had to mete out a harsher punishment in view of the high position that she held in the applicant, viz as Inflight Flight Supervisor; and (5) The applicant strictly denies sub-paragraphs 25(1), 25(2), 25(3), 25(4)(a), 25(4)(b) and 25(4)(c) of the first paragraph 25 of the statement of case and puts the respondent to strict proof thereof. 32. In paragraph 13, the applicant denied the contents of paragraph 25 and sub-paragraphs 25.1, 25.2 and 25.3 of the second paragraph 25 of the respondent’s statement of case and puts the respondent to strict proof thereof. 33. In paragraph 14, the applicant further pleaded as follows: (1) that the misconduct, which was committed by the respondent, viz tampering with the MC, is unbecoming of someone holding a high ranking position like the applicant; (2) As an Inflight Supervisor, it is expected of the respondent to posses a high level of integrity and honesty; (3) The respondent was also responsible to prepare various documents pertaining to the work and performance of the cabin crew; and (4) Due to the foregoing, the applicant was not able to compromise with the respondent’s misconduct. 34. In paragraph 15, the applicant pleaded that in view of the nature and gravity of the misconduct committed by the respondent, which was further aggravated by her past misconduct, and bearing in mind the high ranking position of the respondent, the applicant could no longer repose the necessary trust and confidence in the respondent. In the circumstances, the termination of the respondent was with just cause or excuse. 35. In the same paragraph, the applicant further pleaded that it had observed the rules of natural justice and fair labour practice at all material times as the respondent was given the opportunity to rebut the allegation levelled against her. 36. In the same paragraph, the applicant also denied the respondent’s contentions in paragraph 26 of the statement of case that her dismissal was without any just cause or excuse and/or in breach of the rules of natural justice and/or an unfair labour practice and/or unlawful and puts the respondent to strict proof thereof. 37. In paragraph 16, the applicant pleaded that it would adduce all the necessary evidence at the hearing in support of its statement in reply. 38. In paragraph 17, the applicant pleaded that further and/or in the alternative, in the event that the Industrial Court finds that the dismissal of the respondent was without just cause or excuse (which is strictly denied), the plaintiff contends that there has been a complete breakdown of mutual trust and confidence between the parties and that reinstatement will not be appropriate in all the circumstances. 39. In the same paragraph, the applicant further pleaded that the dismissal of the respondent was justified in the circumstances and that, therefore, she is not entitled to the remedies and/or compensation as prayed for by her in paragraph 28 of her statement of case. 40. In paragraph 18 of its statement-in-reply, the applicant prayed that the Industrial Court dismisses the respondent’s claim. 41. In the last paragraph of its statement-in-reply, which is not numbered, the applicant pleaded that save as hereinbefore expressly admitted, the applicant denies the contentions in the statement of case as if the same were set forth and traversed seriatim. Issues for the determination of this Court in the substantive judicial review application 42. There are 2 (two) main issues for the determination of this Court in the substantive judicial review application. They are as follows: (1) Whether the the Industrial Court committed a jurisdictional error in handing down the Award without first obtaining the written consent of the Administrator by virtue of the moratorium in s. 11(1)(e) read together with the duration of the moratorium in s. 12 of the MASB (Administration) Act 2015? (2) Whether the Industrial Court committed any error of law in arriving at its decision in the Award that the respondent was dismissed without just cause and excuse as the punishment of dismissal, which was imposed on her, was too harsh or excessive for her misconduct? The law on judicial review 43. It is trite law that in an application for judicial review, it must be established that the inferior tribunal or other decision-making authority, whether exercising a quasi-judicial function or purely an administrative function, has committed an error of law in arriving at its decision. This is because it has no jurisdiction to commit an error of law. 44. This principle of law was reiterated and emphasized by the Federal Court in Hoh Kiang Ngan v Mahkamah Perusahaan Malaysia & Anor [1996] 4 CLJ 687. In that case, the Federal Court cited the following passage from Syarikat Kenderaan Melayu Kelantan Bhd. v Transport Workers Union [1995] 2 CLJ 748, which held as follows: “An inferior tribunal or other decision-making authority, whether exercising a quasi-judicial function or purely an administrative function, has no jurisdiction to commit an error of law. Henceforth, it is no longer of concern whether the error of law is jurisdictional or not. If an inferior tribunal or other public decision-maker does make such an error of law then he exceeds his jurisdiction. So too is jurisdiction exceeded, where resort is to an unfair procedure (see Raja Abdul Malek Muzaffar Shah bin Raja Shahruzzaman v. Setiausaha Suruhanjaya Pasukan Polis [1995] 1 CLJ 619), or where the decision reached is unreasonable, in the sense that no reasonable tribunal similarly circumstanced would have arrived at the impugned decision. It is neither feasible nor desirable to attempt an exhaustive definition of what amounts to an error of law, for the categories of such an error are not closed. But it may be safely said that an error of law would be disclosed if the decision-maker asks himself the wrong question or takes into account irrelevant considerations or omits to take into account relevant considerations (what may be termed an Anisminic error) or if he misconstrues the terms of any relevant statute, or misapplies or misstates a principle of the general law.” (Emphasis added). 45. The Supreme Court in Malayan Banking Bhd v Association Of Bank Officers, Peninsular Malaysia & Anor [1988] 3 MLJ 204 (“Malayan Banking Bhd”) held as follows: “The general principle would appear to be that it will usually be proper to treat a decision-maker’s tasks of fact finding and the drawing of factual inferences from established facts as falling within the decision-maker’s jurisdiction unless the decision-maker has reached absurd results or reached results absurdly.” 46. In Wong Yuen Hock v Syarikat Hong Leong Assurance Sdn Bhd And Another Appeal [1995] 2 MLJ 753, at p. 757, the Federal Court held as follows: “In exercising judicial review, the High Court was obliged not to interfere with the findings of the Industrial Court unless they were found to be unreasonable, in the sense that no reasonable man or body of men could reasonably come to the conclusion that it did, or that the decisions of the Industrial Court looked at objectively, were so devoid of any plausible justification that no reasonable person or body of persons could have reached them (see Lord Denning's judgment in Griffiths (Inspector of Taxes) v JP Harrison (Watford) Ltd [1962] 1 All ER 909 at p 916), and judgment of Lord Diplock in Bromley London Borough Council v Greater London Council & Anor [1983] 1 AC 768 at p 821; [1982] 1 All ER 153 at p 159; [1982] 2 WLR 92 at p 100).” 47. Based on the authorities cited by the applicant, as mentioned above, it is trite law that in order to succeed in an application for judicial review, the applicant must show that the Industrial Court has committed an error of law and/or acted outside its jurisdiction by doing any of the following: (1) It has taken irrelevant matters into consideration; (2) It has failed to take relevant matters into consideration; (3) It asked itself the wrong question or issue; (4) It applied the wrong test; (5) It made findings which were inconsistent with the evidence placed before it and it made findings, which were unsupported by evidence; and (6) It had reached a decision so perverse that no reasonable tribunal or person, similarly, circumstanced would have reached. Applicant’s submissions on the moratorium issue before this Court 48. I acceded to the applicant’s request that the moratorium issue be heard and disposed by this Court before this Court hears the dismissal issue. 49. Mr. Vijayan Venugopal, the learned counsel for the applicant, submitted that the moratorium issue should be decided in favour of the applicant. 50. He relied on the following reasons: (1) The MASB (Administration) Act 2015 came into force on 20.02.2015; (2) S. 2(1) of the MASB (Administration) Act 2015 provides that the MASB (Administration) Act 2015 shall apply for a period of five years from the date of the coming into operation of the MASB (Administration) Act 2015 or until the listing and quotation of the shares of the Malaysia Airlines Berhad (“the MAB”) on the official list of Bursa Malaysia Berhad, whichever is earlier; (3) Pursuant to s. 5 of the MASB (Administration) Act 2015, an Administrator was appointed for the applicant on 25.05.2015; (4) S. 12 of the MASB (Administration) Act 2015 provides that upon the appointment of the Administrator, a moratorium shall take effect for a period of twelve (12) months with provision to apply for an extension of up to a further twelve (12) months; (5) S. 11(1) of the MASB (Administration) Act 2015 provides for the effect of the appointment of the Administrator, which is, among others, as follows: “(e) no proceedings and no execution or other legal process in any court or tribunal may be commenced or continued with, and no distress may be levied, against the Administered Companies or their property except with the prior written consent of the Administrator.” (6) As the appointment of the Administrator would be made on 25.05.2015, the applicant’s solicitors wrote to the Industrial Court vide a letter dated 25.05.2015, requesting for a deferment of any Award to be handed down in respect of the I.C. case (see Exhibit “LSP-3”, of the applicant’s affidavit-in-support, enclosure (3)); (7) Subsequently, the I.C. case was called up for mention before the Industrial Court on 09.06.2015, whereby the applicant’s learned counsel reiterated the same request; (8) The handing down of the Award falls within the meaning of the word “proceedings” in s. 11(1)(e) of the MASB (Administration) Act 2015. (9) The moratorium was in force at the time the Award was handed down; (10) The handing down of the Award by the Industrial Court was done in clear contravention of the MASB (Administration) Act 2015 as there was no written consent ever obtained by the Industrial Court from the Administrator to continue with the proceedings in the I.C. case. For this reason alone, the Award should, rightfully, be quashed by this Court; (11) This is because by virtue of s. 11(1)(e) of the MASB (Administration) Act 2015, it is clear and unambiguous that no proceedings in any court or tribunal can be commenced or continued with against the Administered Companies, which include the applicant, without the written consent of the Administrator; (12) The instant judicial review application before this Court is not affected as it was not filed “against the Administered Companies”. It was instituted by the applicant, which is one of the Administered Companies, against the respondent. It was also instituted by the applicant with the written consent of the Administrator. Hence, it is not within the ambit of s. 11(1)(e) of the MASB (Administration) Act 2015; (13) However, the Industrial Court in the I.C. case did not obtain the prior written consent of the Administrator before it handed down the Award on 27.07.2015; (14) Despite the express provisions of the MASB (Administration) Act 2015, as contained in s. 11(1)(e) and s. 12, and the written and oral requests by the applicant’s solicitors and the applicant’s learned counsel, respectively, the Industrial Court took the view that since the hearings of the I.C. case were already completed before the applicant went under administration, those provisions did not apply to the I.C. case even though it had not handed down its Award yet, as the proceedings in the I.C. case were already completed before the applicant went under administration; (15) In doing so, the Industrial Court has disregarded the express provisions of the MASB (Administration) Act 2015 and failed to consider that the applicant had been placed under the administration of an Administrator with effect from 25.05.2015; (16) Since, the moratorium was effective for a period of 12 (twelve) months from the date of the appointment of the Administrator, viz, 20.02.2015, the written consent of the Administrator was required before the Industrial Court could continue with the proceeding in the I.C. case during the moratorium period; (17) This would include the handing down of an Award, which is part of the proceedings in the I.C. case. It is misconceived of the Industrial Court to rule that the proceedings in the I.C. case were completed prior to 20.02.2015, when, in fact, the I.C. case was still pending the Award to be handed down by the Industrial Court; (18) This is because the handing down of the Award by the Industrial Court has the effect of “continuing with the proceedings” and it is expressly provided in s. 11(1)(e) that “no proceedings may against the applicant be continued with” without the written consent of the Administrator; (19) Hence, the Industrial Court has misconstrued and misapplied s. 11(1)(e) of the MASB (Administration) Act 2015 read together with s. 12 of the MASB (Administration) Act 2015; and (20) Since the Industrial Court has disregarded the provisions of the MASB (Administration) Act 2015, it is necessary for this Court to review the Award and to grant an order of certiorari to quash it. 51. The applicant cited the Federal Court case of Danaharta Urus Sdn Bhd v Kekatong Sdn Bhd [2004] 1 CLJ 701 (“the Danaharta case”) in support of its submission on the moratorium issue. In the Danaharta case, the material facts are that the respondent had applied to challenge the validity of s. 72 of the Pengurusan Danaharta Nasional Berhad Act 1998 (Act 587) (“the Danaharta Act 1998”), which barred the courts from granting injunctive relief to the respondent as it, purportedly, contravened Article 8 (1) of the Federal Constitution. S. 72 of the Danaharta Act 1998 states as follows: “Notwithstanding any law, an order of a court cannot be granted: a. Which stays, restrains or affects the powers of the Corporation, Oversight Committee, Special Administrator of Independent Advisor under this Act; b. Which stays, restrains or affects any action taken, or proposed to be taken, by the Corporation, Oversight Committee, Special Administrator or Independent Advisor under this Act; c. Which compels the Corporation, Oversight Committee, Special Administrator or Independent Advisor to do or perform any act And any such order, if granted, shall be void and unenforceable and shall not be subject of any process of execution whether for the purpose of compelling obedience of the order or otherwise.” 52. In the Danaharta case, the issue to be determined by the Federal Court was whether s. 72 of the Danaharta Act 1998 was unconstitutional as it prohibits a court from granting an injunction thereby amounting to a restriction on the right of access to justice, which violates Article 8(1) of the Federal Constitution which reads as follows: “All persons are equal before the law and entitled to the equal protection of the law.” 53. The Federal Court, in its landmark decision in that case, held that s. 72 is not unconstitutional as it satisfies the requirements of the reasonable classification test. Hence, the Federal Court ordered the injunctive relief granted by the court below against Danaharta to be vacated. 54. The Federal Court held that the very nature of the common law right of access to justice itself cannot render Article 8 (1) of the Federal Constitution absolute, that the provision on its own is meaningless, that there must be in existence rules and regulations to enable the right to be exercised which may vary from time to time and that Parliament has the power to enact federal laws which can enlarge or curtail the powers of the court. 55. The federal laws which deal with the jurisdiction of the courts are made pursuant to Article 121 (1) of the Federal Constitution. Under s. 3(1) of the Civil Law Act 1956, the common law is applicable. At p. 714, the Federal Court said as follows: “It will become immediately apparent that this definition only authorises the reception of common law "... in so far as it is in operation in the Federation..." The word "operation" means "in force". Therefore art. 160(2) refers to a law which has already brought into operation the common law in the Federation. That law is s. 3(1) of the Civil Law Act 1956 ("s. 3(1)"). It reads as follows: Save so far as other provision has been made or may hereafter be made by any written law in force in Malaysia, the Court shall: (a) in West Malaysia or any part thereof, apply the common law of England and the rules of equity as administered in England on the 7th day of April 1956; (b) in Sabah, apply the common law of England and the rules of equity, together with statutes of general application, as administered or in force in England on the 1st day of December 1951; (c) in Sarawak, apply the common law of England and the rules of equity, together with statutes of general application, as administered or in force in England on the 12th day of December 1949, subject however to subsection (3)(ii): Provided always that the said common law, rules of equity and statutes of general application shall be applied so far only as the circumstances of the States of Malaysia and their respective inhabitants permit and subject to such qualifications as local circumstances render necessary.” 56. At p. 716, the Federal Court said as follows: “Be that as it may, and consistent with what has been stated thus far the very nature of the common law right of access to justice itself cannot render it absolute. It is meaningless on its own. There must be in existence rules and regulations to enable the right to be exercised which may vary from time to time. In this regard Halsbury's Laws of England 4th edn Reissue Vol 8(2) says at para. 141: The right of access to a court is not absolute: restrictions may be imposed since the right of access by its nature requires regulation, which may vary according to the needs and resources of the community and of individuals (see Golder v. United Kingdom A 18 [1975], 1 EHRR 524, E Ct HR, para 38).” 57. Hence, the provisions of the MASB (Administration) Act 2015 curtailing the access to this Court by the respondent has in no way rendered the MASB (Administration) Act 2015 void. This is supported by the following passage of the Federal Court’s Judgment, at pgs. 719 and 720: “Access to justice would therefore be a meaningless right without the existence of a court with jurisdiction and power to enable the right to be exercised. Thus access to justice under art. 8(1) is a general right which can be fulfilled only by laws enacted conferring jurisdiction and powers on the courts under the specific authority contained in art. 121(1). While art. 8(1) deals with the right per se. art. 121(1), on the other hand, confers power on Parliament to set up an institutionalised mechanism with power and jurisdiction to determine the extent and manner in which that right should be exercised. Articles 8(1) and 121(1) are therefore not in conflict but complement each other. The jurisdiction and power of the courts as provided by law is clearly the dominant element which determines the boundaries of access to justice. Article 8(1) cannot therefore be read in isolation. As both the provisions of the Constitution bear upon the same subject they must be read together and be so interpreted as to effectuate the great purpose of the instrument, that is to say, the Federal Constitution. The rule of harmonious construction therefore demands that both the provisions be so construed as to give meaning and effect to them with the result that access to justice shall be available only to the extent that the courts are empowered to administer justice. The corollary is that the manner and extent of the exercise of the right of access to justice is subject to and circumscribed by the jurisdiction and powers of the court as provided by federal law. As a matter of fact whenever a law is passed either enlarging or curtailing the jurisdiction and powers of the courts it has a direct bearing on the right of access to justice. The right is determined by the justiciability of a matter. If a matter is not justiciable there is no right of access to justice in respect of that matter. Thus Parliament can enact a federal law pursuant to the authority conferred by art. 121(1) to remove or restrict the jurisdiction and power of the court. In this regard Viscount Dilhorne correctly pointed out in his dissenting judgment in Hinds v. The Queen [1976] 1 All ER 353 at 378: We agree that the constitutions on the Westminster model were evolutionary and not revolutionary but it does not follow from that that the Parliament of a territory cannot by ordinary enactment alter the jurisdiction and powers of any court named in the Constitution.” 58. And at p. 720, the Federal Court said as follows: “Section 72 is a federal law that deals with the jurisdiction of the court with regard to the grant of injunctions. It is a law made by Parliament under the authority and scope of art. 121(1). As it deals with the jurisdiction of the court it is a "written law" within the meaning of s. 3(1) in so far as the common law right of access to justice contained therein is concerned. It is one that modifies the common law right of access to justice as permitted by s. 3(1). The modified right of access to justice will then be the common law in operation for the purpose of art. 160(2). It is this modified right of access to justice that will now become an integral part of art. 8(1). This is because art. 8(1) encapsulates the common law which has been prescribed or which has been modified by a written law and received through art. 160(2) read with s. 3(1). There will be no impediment to the accommodation of this change by art. 8(1) because, as explained earlier, the right of access to justice that was originally integrated into art. 8(1) is one which can be modified and is therefore not absolute. The right that had become integrated into art. 8(1) earlier must therefore now yield to the change that has been made.” 59. The meaning of equality under Article 8 (1) of the Federal Constitution does not mean all individuals must be treated equally. Article 8 (1) merely provides that the law must be applied equally to individuals, who are in similar circumstances. At pgs. 723-725, the Federal Court said as follows: “The passages just referred to read with the earlier parts of the judgment reproduced previously reveals that the Court of Appeal had conducted a rigid scrutiny of s. 72 and had immediately proceeded to rule it as being unconstitutional since it is contrary to the rule of law housed within art. 8(1) in that is fails to meet the minimum standards of fairness. But that is not our law. In order to appreciate our law it must first be understood that equality does not mean absolute equality of all men, which is a physical impossibility to attain (see Sheoshanker v. State of MP AIR 1951 Nag 58). In saying that equality is a legal concept which is easy to state but difficult to apply Suffian LP said in Datuk Haji Harun bin Hj Idris v. Public Prosecutor [1977] 2 MLJ 155 at p. 165: ... because, first, equality can only apply among equals and in real life there is little equality, and, secondly, while the concept of equality is a fine and noble one it cannot be applied wholesale without regard to the realities of life. While idealists and democrats agree that there should not be one law for the rich and another for the poor nor one for the powerful and another for the weak and that on the contrary the law should be the same for everybody, in practice that is only a theory, for in real life it is generally accepted that the law should protect the poor against the rich and the weak against the strong. Article 8(1) is therefore not intended to make unequals equal. As Chaudhari & Chaturvedi say in their book Law of Fundamenal Rights 4th edn at p. 15: Equality presupposes classes. Therefore, the only application of the equality clause in a society of classes is by creating, abolishing, reconstituting, recognising or providing for any facility for any class, at any suitable time. It follows that the requirement for equal protection of the law does not mean that all laws passed by a legislature must apply universally to all persons and that the law so passed cannot create differences as to the persons to whom they apply and the territorial limits within which they are in force (see Malaysian Bar & Anor v. Government of Malaysia [1987] CLJ 185 (Rep); [1987] 1 CLJ 459; [1987] 2 MLJ 165. In Ong Ah Chuan v. PP [1980] 1 LNS 181; [1981] 1 MLJ 64 Lord Diplock said at p. 72: Equality before the law and equal protection of the law require that like should be compared with like. What art. 12(1) (our Article 8(1)) assures to the individual is the right to equal treatment with other individuals in similar circumstances. Similarly as Hashim Yeop A Sani J (as he then was) said in Public Prosecutor v. Su Liang Yu [1976] 2 MLJ 128 at p. 129: The dominant idea in both expressions 'equal before the law' and 'equal protection of the law' is that of equal justice. The meaning of these two expressions have been decided in a number of decisions of the US Supreme Court and also the Indian Supreme Courts and certain principles have been settled and accepted. Due to the demands caused by the complexity of modern government the doctrine of classification was evolved by the courts for practical purposes and read into the equality provision. It has been accepted therefore that a legislature for the purpose of dealing with the complex problems arising out of an infinite variety of human relations cannot but proceed upon some sort of selection or classification of persons upon whom the legislation is to operate. It is also useful to refer to Public Prosecutor v. Khong Teng Khen & Anor [1976] 2 MLJ 166 where Suffian LP said at p. 170: The principle underlying Article 8 is that a law must operate alike on all persons under like circumstances, not simply that it must operate alike on all persons in any circumstances, nor that it 'must be general in character and universal in application and that the State is no longer to have the power of distinguishing and classifying persons... for the purpose of legislation', Kedar Nath v. State of West Bengal AIR 1953 SC 404, 406. In my opinion, the law may classify persons into children, juveniles and adults, and provide different criteria for determining their criminal liability or the mode of trying them or punishing them if found guilty; the law may classify persons into women and men, or into wives and husbands, and provide different rights and liabilities attaching to the status of each class; the law may classify offences into different categories and provide that some offences be triable in a Magistrate's court, others in a Sessions Court, and yet others in the High Court; the law may provide that certain offences be triable even in a military court; fiscal law may divide a town into different areas and provide that ratepayers in one area pay a higher or lower rate than those of another area, and in the case of income tax provide that millionaires pay more tax than others; and yet in my judgment in none of these cases can the law be said to violate Article 8. All that Article 8 guarantees is that a person in one class should be treated the same as another person in the same class, so that a juvenile must be tried like another juvenile, a ratepayer in one area should pay the same rate as paid by another ratepayer in the same area, and a millionaire the same income tax as another millionaire, and so on.” 60. The Federal Court also held that the only way for the Courts to rule that a written law is unconstitutional is that the party must show that it does not comply with the reasonable classification test. To satisfy this, one would need to look at the purpose and objectives of the Act. 61. At p. 737, the Federal Court said as follows: “It is now apposite to consider whether s. 72 meets the requirements of the reasonable classification test. What needs to be looked at for this purpose is the object of the Act and the role of s. 72 in attaining that object which have been eloquently set out in the written submission of the appellant.” Respondent’s submissions on the moratorium issue before this Court 62. Mr. Ravindra Murugavell, the learned counsel for the respondent, submitted that since various divisions of the Industrial Court have taken a common stand on this matter, the moratorium issue has no merit and should be decided in favour of the respondent. He cited the Industrial Court case of Nerin @ Erin Marapus v Malaysian Airlines System Berhad (“Nerin”) (Award No. 1232 of 2015) in support of his submission. 63. In that case, the material facts are that the hearing, which commenced on 29.10.2014 was completed on 06.04.2015. Subsequently, on 25.05.2015, the Administrator was appointed for the Administered Companies under s. 5 of the MASB (Administration) Act 2015. As a result of the appointment of the Administrator, s. 11(1)(e) of the MASB (Administration) Act 2015 became operative. 64. Nevertheless, the Industrial Court in that case was of the view that it has to act within the perimeters of the IRA 1967, in particular, s. 30(3) of the IRA 1967, which requires the Industrial Court to hand down the Award without delay and where practicable within thirty days from the date of a reference to it under subsection 20(3). 65. Therefore, the Industrial Court in that case held that it was duty bound to see to the completion of the case by handing down its award in accordance with that provision. The Industrial Court in that case was also of the view that the written consent of the Administrator need not be obtained before it hands down the award of the case. This is because the Industrial Court was of the view that it could not be said to be “continuing with” the proceeding of the Industrial Court case by handing down its Award. 66. In paragraphs [3] and [4] of its Award, the Industrial Court said as follows: “[3] It is the intention of Parliament that the administration of the Administered Companies under the said Act should be carried out effectively and without interruptions. In this case, the hearing commenced on 29 October 2014 and thereafter it continued on other dates till its completion on 6 April 2015. The court gave directions for the written submissions to be filed by 6 May 2015 but there were requests for the extension of the dates to file the written submissions which the court did grant to both parties. Hence, the first written submission was received on 5 June 2015. Meanwhile, the Administrator was appointed on 25 May 2015 so section 11 (1) of the said Act came into effect. [4] Nevertheless, this court has to act within the perimeters of the IRA and to hand down the award according to section 30 (3) of the IRA which states that “The Court shall make its award without delay...” Section 30 (5) of the IRA enjoins the court to act according to equity and good conscience and for the finality of this case, it is the opinion of this court that a written consent of the Administrator need not be obtained before the court hands down the award of the case as the court cannot be said to be “continuing with” the proceeding. The hearing before this 3 3/4-1157/13 court had commenced and the proceedings closed before the Administrator was appointed and this court is duty bound to see to the completion of the case by handing down this award.” (Emphasis added). 67. Mr. Ravindra Murugavell, the learned counsel for the respondent, also distinguished the factual matrix of the Danaharta case and the objectives of the Danaharta Act 1998 from the factual matrix of the instant case and the objectives of the MASB (Administration) Act 2015. Decision of this Court on the moratorium issue 68. Having heard and considered the submissions of both the parties, on 16.02.217, I agreed with the respondent’s submissions that the applicant’s moratorium issue has no merit. Hence, I rejected it. 69. The applicant did not file a notice of appeal against my decision dated 16.02.2017 in favour of the respondent on the moratorium issue. 70. Below are my reasons for deciding that issue (1) has no merit. Issue (1): Whether the Industrial Court committed a jurisdictional error in handing down the Award without first obtaining the written consent of the Administrator by virtue of the moratorium in s. 11(1)(e) read together with the duration of the moratorium in s. 12 of the MASB (Administration) Act 2015? 71. In this Judgment, I agreed with the submissions of and the reasons, which were given by Mr. Ravindra Murugavell, the learned counsel for the respondent, that issue (1) has no merit. 72. Hence, on issue (1), I was of the respectful view that the handing down of the Award by the Industrial Court on 27.07.2015 was not caught by the moratorium in s. 11(1)(e) read together with the duration of the moratorium in s. 12 of the MASB (Administration) Act 2015. 73. I was of the respectful view that since the hearing of the I.C. case before the Industrial Court was completed on18.12.2014, before the appointment of the Administrator on 25.05.2015, s. 11(1)(e) of the MASB (Administration) Act 2015 does not bar the Industrial Court from handing down its award without first obtaining the prior written consent of the Administrator to do so. Therefore, I was of the respectful view that Nerin was correctly, decided by the Industrial Court based on the reasons given by the Industrial Court in that case. This is because the Industrial Court has a specific time frame to deliver its award and this time frame is expressly stated in clear terms in s. 30(3) of the IRA 1967, viz without delay and where practicable within 30 days from the date of the conclusion of the hearing. 74. S. 30(3) of the IRA 1967 states as follows: “30. Awards (1) … (2) … (3) The Court shall make its award without delay and where practicable within thirty days from the date of reference to it of the trade dispute or of a reference to it under subsection 20(3). (4) – (9) …” 75. I was of the respectful view that if it was, indeed, the intention of the Legislature to bar the Industrial Court from handing down its award, after the appointment of the Administrator under s. 5 of the MASB (Administration) Act 2015 unless the Industrial Court has obtained the prior written consent of the Administrator, the Legislature, viz Parliament, would have provided for it in clear terms in the MASB (Administration) Act 2015. This is because Parliament must be taken to have been aware at the time the MASB (Administration) Act 2015 was passed that the Industrial Court is, statutorily, bound by s. 30(3) of the IRA 1967 to hand down its award without delay and where practicable within 30 (thirty) days from the date of Ministerial reference to it under s. 20(3) of the IRA 1967. Hence, the Legislature would have in clear words enacted that the word “proceedings” in s. 11 (1) (e) of the MASB (Administration) Act 2015 also includes the handing down of any award by the Industrial Court and that this is so even though the trial before the Industrial Court was completed before the appointment of the Administrator. 76. I was of the respectful view that the word “proceedings” means the filing of a claim in the Industrial Court against the applicant and the continuation of the trial of the claim against the applicant in the Industrial Court but that it did not include the handing down of an award by the Industrial Court by virtue of s. 30(3) of the IRA 1967 after the trial of the claim was completed prior to the appointment of the Administrator under s. 5 of the MASB (Administration) Act 2015. It follows that I was of the respectful view that s. 11 (1) (2) of the MASB (Administration) Act 2015 is not applicable to the factual matrix of this case. Hence, this Court is seised of jurisdiction to hear this judicial review application since it was filed by the applicant against the respondent and not vice versa and that the written consent, which was given to the applicant by the Administrator, to file the judicial review application did not enlarge the power of the Industrial Court or the power of this Court to hear the judicial review application of the applicant. 77. Hence, on the moratorium issue, this Court declared that this Court has jurisdiction to review the Award even though the I.C. handed down the Award without first obtaining the written consent of the Administrator. So that took care of the moratorium issue. The MASB (Administration) Act 2015 78. The MASB (Administration) Act 2015 was enacted to, inter alia, provide special laws for the administration of the applicant, for the appointment of an Administrator with certain prescribed functions and powers to administer and manage the applicant and to provide for the establishment of a new entity, which will replace the applicant as the national carrier. The preamble, which sets out the objectives of the MASB (Administration) Act 2015, states as follows: “An Act to provide special laws for the administration of the Malaysian Airline System Berhad, its wholly owned subsidiary companies, and its partially owned subsidiary companies providing goods or carrying out services or both that are essential to the operations of the Malaysian Airline System Berhad and the appointment of an administrator with the powers to administer and manage the Malaysian Airline System Berhad, its wholly owned subsidiary companies, and its partially owned subsidiary companies providing goods or carrying out services or both; to provide for the establishment of a new entity which will replace the Malaysian Airline System Berhad as the national carrier; and to provide for related matters.” 79. There are 5 (five) recitals in the MASB (Administration) Act 2015, which explain why it was necessary for the Parliament of Malaysia to enact the MASB (Administration) Act 2015. These state as follows: “WHEREAS special provisions are required in the public interest to ensure the continuity of the essential air services by the Malaysian Airline System Berhad as the national carrier and the provision of uninterrupted connectivity to and from and within Malaysia by the national carrier: AND WHEREAS legislation is the only means to expeditiously administer and manage the Malaysian Airline System Berhad, its wholly owned subsidiary companies and its partially owned subsidiary companies providing goods or carrying out services or both that are essential to the operations of the national carrier without disruption to their operations: AND WHEREAS the establishment of a new entity, that is the Malaysia Airlines Berhad, with a new business model is critical to ensure continuity, profitability and viability, and to assume certain businesses, property, rights, liabilities and affairs of the Malaysian Airline System Berhad: AND WHEREAS it is in the public interest to ensure the continued existence of a national carrier to facilitate Malaysia's economic development: AND WHEREAS legislation provides an effective, efficient and seamless means to transition the business, property, rights, liabilities and affairs of the Malaysian Airline System Berhad to the new entity:” 80. The MASB (Administration) Act 2015 received the Royal Assent on 30.12.2014. 81. It was published in the Gazette on 05.01.2015. 82. It came into force on 20.02.2015, which was the date appointed by the Prime Minister by notification in the Gazette for the coming into force of the MASB (Administration) Act 2015, pursuant to s. 1(2) therein read together with s. 3 of therein. 83. The Administrator was appointed under s. 5 of the MASB (Administration) Act 2015. 84. S. 9 of the MASB (Administration) Act 2015 sets out the functions of the Administrator. 85. S. 10 of the MASB (Administration) Act 2015 sets out the powers of the Administrator. 86. S. 11 of the MASB (Administration) Act 2015, which concerns the effect of the appointment of the Administrator, provides in paragraph (e) of sub-section (1) that upon the appointment of the Administrator, a moratorium shall take effect, during which, certain acts are prohibited. These acts are set out as follows: “Effect of appointment of Administrator 11. (1) On the appointment of the Administrator, a moratorium shall take effect during which— (a) ... (b) ... (c) ... (d) ... (e) no proceedings and no execution or other legal process in any court or tribunal may be commenced or continued with, and no distress may be levied, against the Administered Companies or their property except with the prior written consent of the Administrator; (f) ... (g) ...” 87. S. 12 deals with the duration of the moratorium. It provides, inter alia, that the duration of the moratorium shall be for a period of 12 (twelve) months commencing from the date of the appointment of the Administrator, unless sooner terminated under s. 6 or s. 20(3)(c). 88. S. 6 states as follows: “Duration of administration 6. The administration of the Administered Companies by the Administrator shall commence from the date of appointment of the Administrator under subsection 5(1) and shall continue until the administration is terminated by the appointer.” 89. S. 20 states as follows: “Decision of the appointer 20. (1) The appointer shall consider the proposal of the Administrator together with the report of the Independent Advisor submitted to the appointer under subsection 19(3). (2) Where the appointer approves the proposal, the Administrator shall implement the proposal in accordance with its terms. (3) Where the appointer rejects the proposal, the appointer may— (a) direct the Administrator to revise the proposal; (b) direct the Administrator to prepare a new proposal; or (c) terminate the administration of the Administered Companies.” (Emphasis added). 90. I agreed with the respondent that the objectives of the Danaharta Act 1998 and the objectives of the MASB (Administration) Act 2015 and the factual matrix of the Danaharta case, which was cited and relied upon by the applicant, are easily distinguishable from the factual matrix of the instant case. It is trite law that Parliament has the power to enact federal laws which can enlarge or curtail the powers of the courts. 91. In the Danaharta case, supra, at p. 737, column d, Augustine Paul FCJ, in speaking for the Apex Court, clearly, captured the objective of s. 72 of the Danaharta Act 1998 when he said as follows: “The object of Parliament in enacting this law has been clearly stated in the Preamble to the Act. It reads as follows: An Act to provide special laws for the acquisition, management, financing and disposition of assets and liabilities by the Corporation, the appointment of special administration with powers to administer and manage persons whose assets or liabilities have been acquired by the Corporation and for matters connected therewith or incidental thereto.” 92. The learned Judge also referred to the speech by the then Minister of Finance in Parliament when introducing the Bill for the Danaharta Act 1998. The learned Judge then said as follows: “The object of the Act was explained in clearer terms in the speech delivered by the then Minister of Finance in Parliament while introducing the Bill the Act. The material parts of it read as follows: … suatu akta untuk memberi kuasa kepada Pengurusan Danaharta Nasional Berhad untuk mengambilalih pinjaman-pinjaman tidak berbayar dari institusi kewangan dan menggunakan prosedur pintas bagi memindah serta mendapatkan hakmilik keatas asset atau sekuriti yang disandarkan keatas pinjaman dengan kententuan pemilikan, seterusnya menguruskan pinjaman dan asset serta melaksanakan rancangan menyusun semula asset-aset dibacakan kali kedua sekarang … … … Dengan itu kerajaan telah memutuskan untuk menubuhkan sebuah syarikat yang dikenali sebagai Pengurusan Danaharta Nasional Berhad atau pun Danaharta dengan tujuan khusus untuk mengambilalih pinjaman tidak berbayar daripada institusi kewangan di Malaysia dan seterusnya menguruskan NPL serta asset-aset yang terbabit. Ini akan membolehkan institusi kewangan menumpukan perhatian dan usaha kepada aktiviti perbankan komersial yang biasa tanpa perlu memberi lebih tumpuan untuk mendapatkan kembali pembayaran keatas hutang-hutang tersebut. Danaharta akan membeli pelbagai jenis pinjaman, mendapat hakmilik yang sempurna keatas aset yang berkaitan dengan NPL dan memindahkan hakmilik yang sempurna kepada pihak ketiga. Dengan menjual asset kepada Danaharta, bank dapat mengantikan NPL dengan wang tunai. Rundingan tentang harga jualan akan dijalankan secara komersial dan kedua-dua belah pihak, penjual dan pembeli, berurusniaga di atas kerelaan masing-masing …” 93. In those circumstances, since the spirit and objective of the Danaharta Act 1998 was to ensure that Danaharta was able to buy and take over the Non Performing Loans from Banks and Financial Institutions, to enable this Institutions to concentrate on their commercial banking activities without having to concentrate on their efforts to recover the Non Performing Loans, the prohibition against the granting of injunctions under s. 72 of the Danaharta Act 1998, was essential to give effect to the purpose and object of the Danaharta Act 1998. This is captured by the following excerpt from the learned Judge’s Judgement at p. 740, column b to d: “Thus in so far as disposition of assets was concerned the appellant was given additional power to sell charged lands by private treaty, without securing the usual court order as banks and other secured lenders are obliged to do so under the National Land Code 1965. Quite clearly sales of these properties would be substantially delayed if injunctive relief was available. It must also be observed that in order to enable the appellant to expeditiously and promptly dispose off properties at the very best recover value in line with Parliament’s intention it is important for it to be in a position to give good title to the proprietors fast so that purchasers can readily get themselves registered as proprietors after they have paid the full purchase price to the appellant. If purchasers cannot be registered quickly as proprietors because the appellant is restrained by injunction from completing sales it would have a crippling effect on its ability to dispose off the acquired properties.” 94. This is the reason why the Federal Court allowed the appeal of Danaharta to the effect that the granting of the injunction by the Court of Appeal against Danaharta from selling and distributing assets was held to be wrong, ultimately, enabling the disposal of the Non Performing Loans by Danaharta. 95. The spirit and objective of the MASB (Administration) Act 2015 are, clearly, stated in its preamble, which has been set out earlier in this Judgment. 96. The continued operations as a national carrier in an uninterrupted manner being the stated objective of the MASB (Administration) Act 2015 is an important consideration on the facts in the case before this Court. There is no evidence, whatsoever, before this Court that in handing down an award in favour of the respondent, the applicant will be impaired and/or the continued operations of the national carrier will be impeded. This is, especially, so as s. 11(1)(e) of the MASB (Administration) Act 2015 prohibits any execution of any award of the Industrial Court, which is handed down during the moratorium period. 97. As can be seen in the Danaharta Act 1998, the granting of the injunction against Danaharta would have been contrary to the very objective of the Danaharta Act 1998. The granting of such injunctions would have caused delay in third parties acquiring titles to be disposed of by Danaharta, thereby prolonging the resolution of disputes between the parties. Whereas, on the facts in the instant case before this Court, it cannot be argued by the applicant that the act of the Industrial Court in handing down the Award, will impede or impair the operations of the national carrier. 98. In view of the above reasons, the case of Danaharta is of no assistance to this Court as it can be easily distinguished looking at the factual matrix of the 2 (two) cases and the objectives of the 2 (two) Acts. 99. Hence, the moratorium issue has no merit and must be decided in favour of the respondent. Applicant’s submissions on the dismissal issue before this Court 100. I then heard submissions from the parties on the dismissal issue. 101. The applicant submitted that based on the reasons given and the authorities cited by the applicant in its written submissions and in its submissions-in-reply before this Court, issue (2) has merits and should be decided in favour of the applicant as the Industrial Court has commited errors of law when it arrived at its decision in the Award that the respondent was dismissed without just cause and excuse as the punishment of dismissal, which was imposed on her, was too harsh or excessive for her misconduct. Respondent’s submissions on the dismissal issue before this Court 102. The respondent submitted that issue (2) has no merit and ought to be dismissed as the 2nd respondent did not commit any error of law. The respondent relied on the following reasons: (1) The entire case is pillared on one single issue i.e. the doctrine of ‘disparity of punishment’; (2) In the Award, the Industrial Court decided as follows: “13. But on the issue of disparity of sentence, this issue merits further scrutiny. The Claimant produced a Punishment Order dated 11.6.2012 that shows a misconduct by a Leading Stewardess for being absent without prior leave and falsifying a medial document was punished with a warning and deferment of annual increment. 14. The Company argues that the lesser punishment on the Leading Stewardess was because of her explanation letter and by the fact that she was of a lower rank than the Claimant. The Company said that the punishment of dismissal against the Claimant was because of her senior position in the Company. 15. It is well established that the principal of equity and good conscience dictates that employees who committed the same misconduct should receive the same punishment. If the Company was of the opinion that the misconduct by the Leading Stewardess was not serious enough to warrant a dismissal, then the Company had to have a very good reason for imposing the punishment of dismissal on the Claimant who committed a similar offence. 16. The reason given by the Company was because the Claimant was of a higher position. It is the opinion of this Court that being in a senior position does not mean one automatically deserves the most severe of punishment. Especially when there are other alternatives for a lesser punishment. If the Company thinks that the Claimant was not fit to be in a position with a higher responsibility for committing the misconduct, the Company can always consider a demotion, for example. 17. In the circumstances of this case, by the fact that another employee received a lesser sentence for a similar offence, and the Claimant having served the Company for 25 years, this Court do agree that the punishment of dismissal was too harsh and disproportionate with the misconduct. It follows therefore, the dismissal was without just cause and excuse.” (Emphasis added). (3) There is a plethora of authorities on the doctrine of ‘disparity of punishment’, in particular, the case of Arasapan Ramaiah v Ampang Hotel Sdn Bhd (Concorde Hotel Kuala Lumpur) [2009] 1 ILR 68. In that case, the Industrial Court held as follows: “(6) The problem in this case had arisen due to a lack of communication between the parties. Had the claimant been conscientious and courteous enough to explain the respondent's practise to COW2 who had been new to the respondent and sought the latter's consent to change the fused bulbs after 5am, then the need for a formal complaint may not have arisen. Technically although the claimant had been guilty of the 2nd charge, in that he had taken 2 hours and 45 minutes inclusive of his meal break to attend to the job assigned instead of immediate action as directed by COW2 but in the final analysis, the job had been completed well within his shift. The respondent ought to have considered this fact before deciding on imposing the most severe punishment of dismissal on him. It had not been unreasonable for the claimant to have performed the job when he had and although he had been guilty of not obeying COW2's instructions immediately, he had eventually carried it out. Thus dismissal had been too harsh under the circumstances. Other Employee's in the same department as the claimant had only been punished with a warning letter. Eventhough the claimant had had some disciplinary problems previously and eventhough he had been of supervisory level, there should not have been such a vast disparity in the punishment meted out to him. Thus his dismissal had been without just cause and excuse (para 28).” (Emphasis added). (4) The other authorities, which have upheld the doctrine of ‘disparity of punishment’, are as follows: (1) Automotive Manufacturers (Malaysia Sdn Bhd v Ahmad Mohd Som [2009] 2 ILR 290, Industrial Court Kuala Lumpur; (2) Penfibre Sdn Bhd and Penang & S. Prai Textile Garment Industries Employees’ Union [1987] 2 ILR 259, Industrial Court Pulau Pinang; (3) Kelab Golf Negara Subang v Mat Idris Siakat [2004] 2 ILR 306, Industrial Court Kuala Lumpur; (4) Bumiputra Commerce Bank Bhd v Abdul Kahar Dudi & Ors [2005] 1 ILR 489, Industrial Court Kuala Lumpur; and (5) Network Foods Industries Sdn Bhd v Thandapani Tirugnanasambandam [2006] 1 ILR 281, Industrial Court Kuala Lumpur. (5) On the facts of the instant case, the applicant has invoked the doctrine of “disparity of punishment” on the ground that the respondent was holding a higher position than Puan Esdjuna. However, this Court should take note that Puan Esdjuna, the employee, who received the lesser punishment, was a Leading Stewardess, who also has supervisory functions over the other Stewardesses; and (6) Therefore, there is no rationale, whatsoever, to justify the vast disparity in punishment between the punishment of dismissal, which was imposed on the respondent, and the punishment of a final warning with a deferment of an annual increment, which was imposed on Puan Esdjuna. Decision of this Court on the dismissal issue 103. On 06.03.2017, I agreed with the submissions of Mr. Vijayan Venugopal, the learned counsel for the applicant, that the dismissal issue has merits and that an order of certiorari ought to be granted by this Court to quash the Award. 104. Consequently, I granted an Order of certiorari to remove the Award to this Court and quashed. 105. I then heard submissions from the learned counsels of both the parties on the amount of cost to be ordered against the respondent. Mr. Vijayan Venugopal, the learned counsel for the applicant, prayed for a sum of RM 10,000.00 as cost. 106. However, Mr. Ravindra Murugavell, the learned counsel for the respondent, proposed that no order as to cost be made by the Court against the respondent as the applicant had lost on the moratorium issue. 107. Nevertheless, Mr. Vijayan Venugopal, the learned counsel for the applicant, informed the Court that he still maintained his prayer of a sum of RM 10,000.00 to be paid to the applicant as cost because of the 3 sets of submissions, which he had put in on the merits of enclosure (1). 108. Having heard and considered their submissions, I agreed with the submission of Mr. Ravindra Murugavell, the learned counsel for the respondent. I, accordingly, ordered that there shall be no order as to cost. 109. Being dissatisfied with my decision dated 06.03.2017, on 03.04.2017, the respondent filed a notice of appeal to the Court of Appeal against my decision dated 06.03.2017. Issue (2): Whether the I.C. committed any error of law when it arrived at its decision in the Award that the respondent was dismissed without just cause and excuse as the punishment of dismissal, which was imposed on her, was too harsh or excessive for her misconduct? 110. Below are my reasons for deciding issue (2) in the affirmative. 111. On issue (2), I agreed with the submissions of the applicant that the Industrial Court committed an error of law when it arrived at its decision in the Award that the respondent was dismissed without just cause and excuse as the punishment of dismissal, which was imposed on her, was too harsh or excessive for her misconduct. The 6 (six) letters 112. There are 6 (six) letters, which are important. These are reproduced below. The applicant’s show cause letter dated 25.09.2012 113. The first letter is the show cause letter dated 25.09.2012 entitled “Memorandum” on the subject entitled “Tampered Medical Certificate – Fraud or dishonesty in connection with the business of the Company”. 114. It states as follows: “MEMORANDUM Ref : OPS PRM/SC010-2 To : IFS Joyce Tan Staff No: 012820-5 From : Manager Performance & Resource Management In-flight Services Date : 25th September 2012 Re : SHOW CAUSE Subject : Tampered Medical Certificate – Fraud or dishonesty in connection with the business of the Company It has been reported by Crew Deployment Centre (CDC) that the following medical certificate submitted by you was fraud to be a tampered medical certificate. Date of MC : 31st August 2012 Duty : Standby Name of Medical Institution : Klinik Rakan Medik – Kelana Jaya Serial No. : 027MC0060250 The allegations mentioned above are a serious act of misconduct under the Rules and Regulations of the Company and attracts major punishment. “You have therefore Committed an act of misconduct inconsistent with the fulfilment of your terms and Conditions of service with the Company by virtue of Clause 7, Para 7.1, of Appendix A, Act of Misconduct of MAS Disciplinary Procedure and such act of misconduct attracts severe punishment”. You are hereby required to submit your written explanation within three (03) working days, i.e. on or before 25th September 2012 on receipt of this letter as to why disciplinary action should not be taken against you. Should you fail to give your explanation as required within the stipulated time, it will be presumed that you have no explanation to offer and the Company may forthwith proceed with disciplinary action against you. Since the allegation levied against you is a serious nature, you are hereby removed from your roster with immediate effect pending further investigations. During this period you must be contactable at the following address awaiting further instructions. Address : C-6-8, STARVILLE APARTMENT JALAN USJ 19/6 47300, SUBANG JAYA Contact No : HP: 012 2369286 Please acknowledge receipt of this letter by signing and returning the attached copy to me. … (signed) … Rodzlin Ramli Manager Performance & Resources Management In-flight Services I hereby acknowledge receipt of this letter … (signed) … Name: Joyce Tan Staff No: 128205 Date: 25th September 2012 Time: 1000HRS Cc: Executive Vice President In-flight Services Head of Human Resources (Services, KLIA) Flight Operations Manager (Crew Deployment Centre) Controller, Performance & Resources Management.” The respondent’s letter of explanation dated 25.09.2012 115. The second letter is the respondent’s letter of explanation dated 25.09.2012 to the show cause letter entitled “INFLIGHT SERVICES DIVISION CABIN CREW LINE OPERATIONS”. 116. It states as follows: “INFLIGHT SERVICES DIVISION CABIN CREW LINE OPERATIONS Date: 25th September 2012 Address: STARVILLE APT, BLK Name: Joyce Tan C, C-6-8, USJ 19/6, Contact No.: 012-2369286 SUBANG JAYA, SGOR Staff No: 12820-5 Rank: IFS Fleet: WB Witness By: …………. Date: 25.09.2012 Time: 1000HRS Inflight Services Manager Cabin Crew Line Operations Dear Sir, Subject: TAMPERED MEDICAL CERTIFICATE ON THE 31ST AUGUST I WAS VERY SICK, DOWN WITH HIGH FEVER, DIAHRROAE, BAD COUGHING NON STOP & LOST MY VOICE PLUS MY CHIN ALLERGY WAS GETTING REDDER. BEING ON STANDBY ON 29, 30 & 31 AUGUST, I WAS NOT CALLED UP FOR FLIGHT THINKING THAT I COULD REST AT HOME BUT ON THE LAST DAY OF STANDBY 31 AUG, I WAS CALLED UP AT 1610HRS BY CDC OFFICER FOR FLIGHT. AFTER CONSUMING A LARGE AMOUNT OF MEDICATION, I WAS NOT IN A RIGHT FRAME OF MIND & WAS TOTALLY LOST ON WHAT TO DO HENCE I INFORMED THE OFFICER I HAD 01 DAY MC (31/08) FROM ‘KLINIK MEDIC’ WHICH I HADN’T SEEN … Crew Signature: … (signed) … Date: 25/09/12 For Office Use: Fleet Administrator: … (signed) … Date: 25/09/12 ZAINAB MAJID Inflight Services Executive Cabin Crew Line Operations (CCLOPS) Malaysia Airlines Action Taken: ……………………..…… Status: HRD referral ……………………..…… Signature: (signed) … THE DOCTOR YET. I HAVE NOT TAKEN MC FOR A VERY LONG TIME SINCE 2008 & BEING IN THE COMPANY FOR 25 YEARS, MY RECORD IS CLEAN. THE REASON WHY I PLEADED YOUR GOOD OFFICE FOR LENIENCY IS BECAUSE I WASN’T IN THE RIGHT FRAME OF MIND TO ALTER THE MC CERT & NEVER CROSSED MY MIND TO CALL MY F/A OR EVEN SEEK HER ADVICE TO TAKE E/L AS IT WAS A PUBLIC HOLIDAY. ONLY AFTER SPEAKING TO HER TODAY THAT I REALIZED MY MISTAKE. I WASN’T MY REAL SELF AS MY FEVER WAS HIGH WHEN I TAMPERED THE MC WHICH WAS DATED 03 SEPT TO 31 AUG. UNDER FTL, CABIN CREW CAN INFORM THE DEPT. THAH THEY ARE NOT WELL & NORMALLY THE DEPT. WILL LISTEN. ON THAT VERY DAY, 31 AUG, I COULDN’T THINK PROPERLY & WASN’T IN A RIGHT FRAME OF MIND TO TAMPER THE MC DUE TO MY HIGH FEVER, DIAHRROAE, NON STOP COUGHING & SORE THROAT, FEARING THAT I WILL BE CALLED TO THE OFFICE. THIS IS MY FIRST TIME ACT OF MISCONDUCT & I SINCERELY BEG FOR LENIENCY. EVEN AT TIMES WHEN I WAS REALY COUGHING PROFUSELY & LOST MY VOICE, I STILL GO FOR FLIGHT, THINKING THAT EVERYTHING IS OK & NOT TAKINGY MC. Crew Signature: … (signed) … Date: 25/09/12” The dismissal letter dated 24.10.2012 117. The third letter is the dismissal letter dated 24.10.2012 entitled “PUNISHMENT ORDER”. 118. It states as follows: “CONFIDENTIAL 24 October 2012 HRSPM/PO – 079/12/KUL Cik Joyce Tan @ Tan Siew Eng (S/No.: 0128205) C-6-8, Starville Apartment Jalan USJ 19/6 47300, Subang Jaya SELANGOR DARUL EHSAN Dear Cik Joyce Tan, PUNISHMENT ORDER We refer to the Show Cause letter ref OPS PRM/SC010-12 dated 25 September 2012 served to you by Manager Performance & Resources Management, Inflight Services and your letter of explanation. The Company noted that you have admitted guilt to have tempered the medical certificate below: Date of MC Duty Name of Medical Institution Serial No 31 August 2012 Standby Klinik Rakan Medik – Kelana Jaya 027MC 0060250 which you have submitted in support of your absence from standby duty on 31 August 2012. As an In-flight Supervisor of the Company, you are not only a leader but also a role model to the other Cabin Crew team members. Your action is tempering the medical certificate leaves a permanent blemish on your record. It is with regret to inform you that it is the Company’s decision that you be dismissed from the services of the Company with immediate effect. According to the Company Disciplinary Procedure, you have the right to appeal to the Disciplinary Appeals Committee of the Company within sixty (60) days from the date of the service of this letter to have the punishment reviewed. Should you decide to do so, you should address your appeal through the Company Secretary 3rd Floor, Admin 1 Building Complex A, Sultan Abdul Aziz Shah Airport 47200 Subang Selangor Darul Ehsan Stating your grounds in full. You are advised that only the appeal letter signed by you will be entertained for consideration. By copy of the letter, Head Human Resources (Payroll) is required to pay you the final payment of your salary and allowances after you have obtained the necessary Company clearance. The Company clearance from is attached herewith. Please acknowledge receipt of this letter by signing and returning the attached copy to me. Yours faithfully, … (signed) … Zaiton Shaari SENIOR MANAGER, STRATEGIC PEOPLE MANAGEMENT Zs/esy cc: Director of Human Resources cc: Manager, Crew Performance & Resources Management cc: Manager, FO – Crew Deployment Centre cc: Manager Human Resources Services KLIA cc: Manager Human Resources (Payroll) cc: Controller, FO – Crew Planning & Scheduling cc: Secretary General MASEU …………………………………………………………………………………. I hereby acknowledge receipt of this letter … (signed) … Name: Joyce Tan S/No: 128205 Date: 09 Nov 2012.” The respondent’s letter of appeal dated 16.11.2012 119. The fourth letter is the respondent’s letter of appeal dated 16.11.2012 entitled “Appeal for Reinstatement”. 120. It states as follows: “To, The Disciplinary Appeals Committee, c/o Company Secretary, 3rd Floor, Admin 1 Building, Complex A, Sultan Abdul Aziz Shah Airport, 47200 Subang, Selangor Darul Ehsan. 16th November 2012 Dear Sir/Madam, Re: Appeal for Reinstatement With reference to the above, i would like to humbly submit my appeal for reinstatement to my former position as In-flight Supervisor in the Company. The Punishment Order of Termination I have been served with was harsh and unconscionable punishment. This left me feeling victimized considering the length of service i have dedicated to for the last 24 years. Please allow me to explain the circumstances which led to this very unfortunate situation. On 03rd August 2012, I operated MH 16 KUL/AMS and it was during that period I may have contracted flu and cough plus my chin developed allergy. I was utterly unwell but I went on for flight and came back 04 days later. My crew even commented on my red chin that was dry and peeling (the thick make up did the trick). I continued my allergy medication (Augmentin amoxicillin + clavulanate potassium & Aerius desloratadine) and consumed cough and flu medication (Benadryl & Zyrtec) from my previous visits to the doctor in hope to ease the irritation. All medications made me drowsy. (Refer attached list of prescribed medications and side effects). On 17th August, I operated my next flight MH 135 KUL/BNE on my birthday with a sore throat and eventually led to me losing my voice altogether. Hence I had to delegate 03 of my crew who were rated (5 star rating) to deliver the announcements on my behalf for both sectors, BNE/KUL as well. I had indicated it in my eVR as per attached in the print out. During my night-stop in BNE, I had to call-in for a doctor and was diagnosed of having an infection of the lungs which required strong antibiotics. Unknowingly, the medication prescribed to me by the doctor rendered me feeling drowsy and disorientated that the only recourse available was to rest and allow the medication to wear off gradually. After 10 days, I had already consumed all the medication and was still feeling very weak and faint due to the persistent coughing and chin allergy medication that I was unable to go to the doctor again. I visited Klinik Rakan Medic, Kelana Jaya, and was prescribed with stronger medication (Zyrtec) which made me even drowsier. Within that week, I had operated multiple flights i.e. MH 388 KUL/PVG (29th August), MH 389 PVG/KUL (21st August), MH 74 KUL/HKG (24th August) and MH 74 HKG/KUL (25th August) as attached in August roster. My chin allergy re-occured on the 26th August and I had fever and diarrhea, hence I consumed Panadol (Coxa 500). I was very weak and had no appetite. I paid the doctor another visit on the 17th August to get a new batch of mediation in which she offered me Medical Certificate. I decline the offer knowing that I have another flight to fulfill the following day ie MH 390/391 KUL/XMN/KUL (18th August) with the hope I could withstand one more day of duty. Despite my condition I operated the flight safely. The next day I was on standby (29th, 30th and 31st August) and on my last day of standby i.e. 31st August, a public holiday, I was called for flight by the Duty Officer. I told him that I was unwell and had my medical leave from Klinik Rakan Medic. At that time, I was sure that I would obtain Medical Certificate from a legal medical professional and thought that as I wasl still not well enough to start my fliying duties, I rested at home. He duly acknowledged my absence from duty. All the medication I had consumed had taken its effect till I forgotten to obtain a legitimate Medical Certificate from the doctor. I felt slightly better on 01st and 02nd September but on 03rd September, my fever and diarrhea became worse. I immediately went to see the doctor whereby a stronger and drowsier medication (Lomodium, Progesic 500 & Fucon hyoscine-N-Butylbromide) was prescribed to hald my diarrhea and stomack ache. The doctor advised me to take Medical Certificate and rest at home but I decline thinking I would get better the next day and go to work. The doctor however, issued a Medical Certificate for me. She had also issued a supporting letter for my refusal of Medical Certificate as per attached. In all my years of flying, I have served the Company well in many capacities apart from my position as In-flight Supervisor which includes: 1. Volunteering to operate flights during crisis eg. Volcanic Ash crisis in Europe and Ops Pyramid bringing back Malaysians from Egypt and Jeddah. 2. Volunteering to be part of Humanitarian Support team in the Crisis Management Department and a part-time Assocaite Trainer. 3. Participating in various projects by the Company including numerous Company’s Corporate Social Responsibility (CSR) projects eg. Walkathon Welkins, Corporate Challenge Day and Toastmasters International. 4. Bringing a B747-400 aircraft engine on fire in mid air to safety with a total of 300 passengers and crew. 5. Involvement in French language for the benefit of passengers’ communication enhancement. I have done all these during my off-days and without neglecting my primary duties as an In-flight Supervisor with the Company which I have been proud to shoulder for the last 07 years. Without fail, I have always risen to the call of duty to the extend of calling the Duty Officer requesting for flights on standby as it is evident in all my performances/assessments/appraisals by the Company which will testify that I have been a dedicated, dutiful, loyal and responsible cabin crew. I have also received numerous positive feedbacks from the department of my performances as many passengers have written to the Company over the years of the wonderful in-flight services rendered by me and my cabin crew. To date, I have received 20 compliment letters within 2011/2012. I have also been an exemplary cabin crew as in all my 24 years, 11 months and 23 days in the Company; I have never been subjected or reprimanded for any misconduct or disciplinary issues whatsoever. This is my First Medical Certificate after may years of working. This incident would be the First time I have committed an act of misconduct in the Company and it is indeed very disappointing and shocking to state that I was summarily dismissed without any consideration to my years of dedicated and loyal service to the Company. I was not even given the opportunity to defend myself or make any plea for clemency prior to the order of termination and with to state that I was under duress at that time when I was told that if I gave my explaination before 25th September, I will not be removed from flight. I felt very disappointed and it took me by surprise. I was hit on the spot and contrary to what my Fleet Administrator had said. From my understanding, an explanation to a Show Cause letter can be provided within 3-7 days. It is a far cry for me that I was certainly denied any form of “Natural Justice” and as such my termination is without just cause or excuse. Company procedurs provide 14 days but here I was ask to write a letter on the spot. To quote a similar case, a Technical crew was offered only a warning letter but I was not and I felt victimised why the Technical crew was treated differently from me. Am I not a human being? I am hoping that your good office will reconsider and review any punishment short of a dismissal and permit me to be reinstated back to my former position after duly deliberating and considering the number of years of dedicated and loyal service I have given to the Company. Yours sincerely, ... (signed) ... IFS Joyce Tan @ Tan Siew Eng S/N 012820-5 20th November 2012” The applicant’s letter dated 18.12.2012 121. The fifth letter is the applicant’s letter dated 18.12.2012 entitled “Appeal”, which informed the respondent that her appeal was dismissed by the DAC”. 122. It states as follows: “18 December 2012 Our Ref.: GSP-056/5/12 [131212] Miss Joyce Tan @ Tan Siew Eng No. C-6-8, Block C Starville Apartment Jalan USJ 19/6 47300 SUBANG JAYA SELANGOR Miss RE : APPEAL We refer to the appeal made by you to the Management and regret to inform that the Disciplinary Appeal Committee which sat and considered your case has dismissed your appeal. Regards. Yours faithfully For MALAYSIAN AIRLINE SYSTEM BERHAD ... (signed) ... RIZANI BIN HASSAN Company Secretary zmy cc : Human Resources Attn: Puan Zaiton Shaari Email: zaitons@malaysiaairlines.com” The applicant’s solicitors’ letter dated 25.05.2015 123. The sixth letter is the applicant’s solicitors’ letter dated 25.05.2015 to the Industrial Court requesting for a deferment of any Award to be handed down in respect of the I.C. case. 124. It states as follows: “Shearn Delamore & Co Ruj Tuan Ruj Kami: SD(IR) 3806254(VJ) 25th May 2015 Registrar Mahkamah Perusahaan Jalan Mahkamah Persekutuan 50544 Kuala Lumpur Dear Sirs, RE: INDUSTRIAL COURT CASE NO. 11/4-447/13 JOYCE TAN @ TAN SIEW ENG -V- MALAYSIAN AIRLINE SYSTEM BERHAD We refer to the above matter which is pending an Award from this Honourable Court. We act for Malaysian Airline System Berhad in the instant matter. We have been informed by our client that, pursuant to Section 5 of the Malaysian Airline System Berhad (Administration) Act 2015 (hereinafter referred to as the “MAS Act 2015”), the Administrator is expected to be appointed on 25th May 2015. In the circumstances, the provisions of Section 11, 12, and 25(2) of the MAS Act 2015 will accordingly come into force. A moratorium shall therefore take effect during which no proceedings, actions and or executions may be commenced or continued with without the prior written consent of the Administrator. The moratorium period shall be for twelve (12) months from the date of the appointment of the Administrator, which provision to apply for an extension of up to a further twelve (12) months. We have accordingly been instructed to apply for a deferment of any Award being handed down in the instant matter, pursuant to the provisions of the MAS Act 2015. Yours faithfully, … (signed) … Shearn Delamore & Co Written by Vijayan Venugopal Telephone 603 2027 2784 Fax 603 2078 5625 Emel vijayan@shearndelamore.com c.c. 1. Malaysian Airline System Employees’ Union No. 40, Tingkat 1 Jalan USJ 10/1E Subang Jaya 47620 Petaling Jaya Fax/Post 2. Client By Email” Whether the respondent’s misconduct warranted the punishment of dismissal? 125. The applicant had decided that in the circumstances of the respondent’s case, the respondent’s misconduct warranted the punishment of dismissal and no less. 126. It was established during cross-examination that the respondent admitted the act of tampering with the medical certificate is a misconduct and she further agreed that the same is a serious misconduct (see p. 21 of the Notes of Proceedings in Exhibit “VJ-1”, of the applicant’s supplemental affidavit, enclosure (12)). 127. There is an abundance of cases decided by the Industrial Court on this point. 128. In Texas Instruments (M) Sdn. Bhd. v Flourmeena A/P Saminathan [1996] 2 ILR 128, the Industrial Court quoted an excerpt from Alfred Avins in “Employment Misconduct” which states as follows: “It is misconduct to present to the employer any forged document and it is not necessary to constitute the offence that the document be one of a financial nature…and it is punishable knowingly to use a forged document as genuine to mislead a superior even if the employee did not himself forge it.” 129. In Sime Bank Bhd v Mohd Shaib Md Yusof [2003] 2 ILR 530, at p. 540, the Industrial Court upheld the Bank’s decision to dismiss the employee for making a false medical claim of RM 50 based on a receipt, purportedly, issued by a private clinic. The Industrial Court held as follows: “The dishonest act of the claimant in submitting the false medical receipt has breached the fiduciary relationship of trust between the bank and the claimant.” 130. It must be emphasized that in this case, the respondent had, deliberately, changed the date of the MC from 03.09.2012 to 31.08.2012 and, thereafter, she had submitted the MC to the applicant. Applicant’s proven case before the Industrial Court 131. Zaiton Shaari (COW-1), the applicant’s witness, testified on the reasons for the decision of the applicant to dismiss the respondent. She testified as follows: “The misconduct that was committed by the Claimant, which is tampering with medical certificate, is unbecoming of someone holding a high ranking position in the Company. As an In-Flight Supervisor, it is expected of the Claimant to possess a high level of integrity and honesty. The Claimant was also responsible to prepare various documents pertaining to work and performance of cabin crew. Based on the reasons above, the Company is not able to compromise with the Claimant’s conduct.” (See A17 of the witness statement of COW-1 at p. 30 of Exhibit “LSP-1”, of the applicant’s affidavit-in-support, enclosure (3)). 132. I found that COW-1’s testimony in her examination-in-chief is consistent with her testimony during cross-examination. In cross-examination, she said as follows: “28. What is the criteria followed by Strategic People Management Committee to decide on the punishment of dismissal? - As referred earlier case was tabled to Strategic People Management Committee and based on seriousness of the misconduct committed by Claimant who was an In-Flight Supervisor it was not acceptable by the Company considering the high seniority she held. The In-Flight Supervisor is the highest position in the cabin crew hierarchy.” (See pgs. 8 & 9 of Exhibit “VJ-1”, of the applicant’s supplemental affidavit, enclosure (12)). 133. At this juncture, I noted that the Industrial Court did not reject the evidence of COW-1 on the decision of the applicant to dismiss the respondent. I also noted that the Industrial Court did not at any point in time find that COW-1 lacked the credibility of a truthful witness. 134. I further noted that it is a fact that the respondent did not dispute the charge levelled against her. The relevant excerpt from the respondent’s cross-examination is reproduced below. “71. You informed the Company you were on MC on 31/8/2012? - Yes. 72. You are aware you had to submit an MC for 31/8/2012? - Yes. 76. You than tampered into the date of the MC. Changing the date of the MC from 3/9/2012 to 31/8/2012? - Yes. 77. You submitted the tampered MC with the date 31/8/2012 to the Company? - Yes.” (See p. 18 of Exhibit “VJ-1”, of the applicant’s supplemental affidavit, enclosure (12)). 135. Hence, I was of the respectful view that, had the Industrial Court considered the following relevant considerations it would have decided that the punishment of dismissal was more than amply warranted in this case and that the dismissal of the respondent was with just cause and excuse: (1) The nature and gravity of the misconduct committed by the respondent, coupled with her own admission; (2) The respondent’s act of tampering with the MC was inconsistent with the faithful and honest discharge of her duties as an employee of the applicant; (3) As a result of the respondent’s act of tampering with the MC, the applicant could no longer repose the necessary trust and confidence in the respondent; (4) The applicant’s decision to dismiss the respondent is supported by the following evidence produced by the applicant before the Industrial Court: (1) The MC, which was produced by the respondent to the applicant, purportedly, dated 31.08.2012, before the issuance of the show cause letter to her (see p. 45 of Exhibit “LSP-1”, of the applicant’s affidavit-in-support, enclosure (3)); (2) The leter dated 19.09.2012 from the clinic, which confirmed that the respondent had attended the clinic on 03.09.2012 and she was given a medical certificate on 03.09.2012 (see p. 47 of Exhibit “LSP-1”, of the applicant’s affidavit-in-support, enclosure (3)); (3) The original medical certificate issued by the clinic dated 03.09.2012 (see p. 48 of Exhibit “LSP-1”, of the applicant’s affidavit-in-support, enclosure (3)); (4) The following admission of the respondent in her letter of explanation to the show cause letter: “…I wasn’t in the right frame of mind to alter the mc cert & never crossed my mind to call my F/A or even seek her advice to take E/L as it was a public holiday. Only after speaking to her today that I realized my mistake. I wasn’t my real as my fever was high when I tampered the mc which was dated 03 sept to 31 August.” (See p. 50 of Exhibit “LSP-1”, of the applicant’s affidavit-in-support, enclosure (3)). (5) The decision to dismiss the respondent was taken by the applicant after considering the nature and gravity of the misconduct involved, viz tampering with the MC, which was not acceptable to the applicant, especially, when the respondent was holding the position of an In-Flight Supervisor; and (6) In the light of the foregoing, the applicant proceeded to issue the letter of dismissal dated 24.10.2012, which states as follows: “As an In-flight Supervisor of the Company, you are not only a leader but also a role model to the other Cabin Crew team members. Your action in tempering the medical certificate leaves a permanent blemish on your record.” 136. However, on the dismissal issue, the Industrial Court found as follows: “The Claimant did not deny she committed the misdemeanour in tempering with the medical certificate but she said the punishment of dismissal was too harsh in the circumstances.” 137. The Industrial Court then ruled as follows: “12. In the opinion of this Court, there is only one issue in this case, i.e whether the punishment of dismissal is appropriate or proportionate with the misconduct in the circumstances of this case. 15. It is well established that the principal of equity and good conscience dictates that employees who committed the same misconduct should receive the same punishment. If the Company was of the opinion that the misconduct by the Leading Stewardess was not serious enough to warrant a dismissal, then the Company had to have a very good reason for imposing the punishment of dismissal on the Claimant who committed a similar offence.” 16. The reason given by the Company was because the Claimant was of a higher position. It is the opinion of this Court that being in a senior position does not mean one automatically deserves the most severe of punishment. Especially when there are other alternatives for a lesser punishment. If the Company thinks that the Claimant was not fit to be in a position with a higher responsibility for committing the misconduct the Company can always consider a demotion, for example. 17. In the circumstances of this case, by the fact that another employee received a lesser sentence for a similar offence, and the Claimant having served the Company for 25 years, this Court do agree that the punishment of dismissal was too harsh and disproportionate with the misconduct. It follows therefore, the dismissal was without just cause and excuse.” 138. In coming to its decision, the Industrial Court accepted the evidence of the respondent, who contended that in imposing the punishment of dismissal on her, there is a disparity of punishment between the punishment, which was imposed on her by the applicant and the punishment of a final warning and a deferment of her annual increment, which was imposed on Puan Esdjuna. The respondent relied on Puan Esdjuna’s Punishment Order dated 11.06.2012, which only gave Puan Esdjuna a final warning and imposed on her a deferment of her annual increment for committing the misconduct of being absent without prior leave and for the falsification/alteration of a medical document (see pgs. 146 – 148 of Exhibit “LSP-2”, of the applicant’s affidavit-in-support, enclosure (3)). 139. However, I noted that the Industrial Court did not take into consideration that although Puan Esdjuna’s Punishment Order dated 11.06.2012 had made reference to 2 (two) explanation letters submitted by Puan Esdjuna, the 2 (two) explanation letters were never produced before the Industrial Court by the respondent, as well as the facts, which formed the basis for the issuance of Puan Esdjuna’s Punishment Order dated 11.06.2012. This is in contrast with the applicant’s proven case before the I.C. case. The applicant had called COW-1, who testified on the facts, which formed the basis of the punishment of dismissal, which was imposed on the respondent. The applicant produced the relevant oral and documentary evidence in support thereof. COW-1 also testified that she had no knowledge of Puan Esdjuna’s Punishment Order dated 11.06.2012. 140. Notwithstanding that the nature of the misconducts committed by Puan Esdjuna and the respondent are similar, I agreed with the applicant that each case should be decided based on its factual circumstances and merits. I found that this is an instance where the Industrial Court had failed to confine itself to the issue whether the dismissal was justified in the specific case of the respondent based on the specific circumstances of the respondent’s case. 141. Hence, I am of the respectful view that the Industrial Court committed an error of law when it believed and accepted the evidence of the respondent based on the contents of Puan Esdjuna’s Punishment Order dated 11.06.2012 even though the respondent did not produce the 2 (two) explanation letters, which were submitted by Puan Esdjuna to support her (Puan Esdjuna’s) appeal for a lesser punishment and without the respondent calling the officer concerned, who had issued Puan Esdjuna’s Punishment Order dated 11.06.2012, to testify on the basis for imposing the lesser punishment on Puan Esdjuna, in order to corroborate the respondent’s evidence. Therefore, I agreed with the applicant that the Industrial Court had adopted a flawed decision-making process and that in doing so it had committed an error of law. 142. It is trite law that the main and only function of the Industrial Court is to determine whether the misconduct complained of by the employer had, in fact, been committed by the employee and if so, whether the misconduct warrants the dismissal of the employee. In Wong Yuen Hock, supra, the Federal Court held as follows at p. 762: “On the authorities, we were of the view that the main and only function of the Industrial Court in dealing with a reference under s 20 of the Act (unless otherwise lawfully provided by the terms of the reference), is to determine whether the misconduct or irregularities complained of by the management as the grounds of dismissal were in fact committed by the workman, and if so, whether such grounds constitute just cause or excuse for the dismissal..” 143. I am of the respectful view that had the Industrial Court applied the above excerpt of the judgment in that case correctly to the I.C. case, the Industrial Court would have confined itself strictly to the issues and specific facts pertaining to the respondent’s dismissal instead of straying away from them. 144. Hence, I agreed with the applicant that the Industrial Court fell into error when it failed to consider the following specific circumstances in the respondent’s case: (1) That the respondent admitted that as an In-Flight Supervisor, she was the highest ranking cabin crew during her flight duty (see p. 22 of the Notes of Proceedings, Exhibit “VJ-1”, of the applicant’s supplemental affidavit, enclosure (12)); (2) That at the time of the commission of her act of misconduct, Puan Esdjuna held the position of Leading Stewardess, a position, which is lower than that of the respondent’s position, as an In-Flight Supervisor; (3) That an employee, who holds the highest rank in the cabin crew hierarchy, is expected to possess a high level of integrity and honesty; (4) That as a long-serving employee, the respondent was expected to set a good example to her junior ranking employees by complying with the procedures of the applicant; (5) That the respondent admitted that she had tampered with the MC; and (6) That the respondent’s act of tampering with the MC was viewed by the applicant as both grave and serious in nature. 145. Hence, I agreed with the applicant that had the Industrial Court taken all the above specific circumstances of the respondent’s case into consideration, the Industrial Court would have held that they warranted her dismissal instead of a lesser punishment, similar to that which was imposed on Puan Esdjuna, viz a final warning and a deferment of an annual increment. 146. I agreed with the respondent that she has an unblemished record of 25 years of service as the warning letter dated 10.02.2004, which was, previously, issued to her cannot be taken into consideration since her pay for 1 (one) day was deducted due to her failure to report for a rostered flight on 24.01.2004 (see pgs. 60 & 61 of Exhibit “LSP-1”, of the applicant’s affidavit-in-support, enclosure (3)). Nevertheless, I agreed with the applicant that the Industrial Court has failed to appreciate COW-1’s evidence on the reasons for the decision by the applicant to dismiss the respondent. 147. I also agreed with the applicant that, in holding that the dismissal was too harsh a punishment to be imposed on the respondent, the Industrial Court has misconstrued and misapplied the law relating to the dismissal issue. 148. In this regard, the case of Harianto Effendy Bin Zakaria & Ors v Mahkamah Perusahaan Malaysia & Anor [2014] 6 MLJ 305, is applicable to the facts of the instant case. In that case, the material facts are that the appellants were dismissed for taking part in an illegal picket within the bank’s premises during banking hours. The Industrial Court upheld the dismissals of the appellants. The High Court and the Court of Appeal affirmed the Industrial Court’s decision. 149. In their appeal against the Court of Appeal’s decision, the appellants submitted that in upholding their dismissals, the courts below erred in not taking into account the fact that the bank had practised double standards in that five other employees had participated in the same picket were either found not guilty or were issued with a caution letter or punished with a two-year freeze in salary increment. The Federal Court dismissed their appeal and held as follows at pgs. 318 and 319 on the issue of double standards: “[40] We shall deal first with the appellants' contention that the second respondent was guilty of unequal treatment and double standards because five of the employees who were charged together with the appellants were not dismissed. On this issue we agree with the observation made by the Court of Appeal that there was no merit in the appellants' contention that the appellants' dismissal was actuated by discriminative practice. From the record, the allegation of the inconsistency of punishment of the five employees who were charged together with the appellants was misconceived. Three of the five employees, namely Zamir bin Ahmad, Noor Jam bin Kader Mohiden and Ahmad bin Kassim were found not guilty of the charge in the domestic inquiry that was conducted against them. Their suspensions from work were therefore uplifted. In respect of Maimunah bt Mat Nor, she was found guilty of the charge. However, taking into consideration her plea of mitigation, the second respondent uplifted her suspension and imposed the punishment of stoppage of increment for a period of two years with effect from January 2005. In respect of Rohana bt Abdul Samad, the second respondent, after taking into account her written explanation dated 21 November 2003, uplifted her suspension. She was instead issued with a caution letter dated 4 December 2003. These facts were taken into the consideration by the Industrial Court when it considered the fairness or otherwise of the dismissal of the appellants.” 150. The High Court case of Mohamad Kamal Majid v Mahkamah Perusahaan Malaysia & Satu Lagi [2014] 1 LNS 1759 (“Mohamad Kamal Majid”), is also applicable to the facts of the instant case. 151. In that case, the applicant filed a judicial review application seeking to quash the award of the Industrial Court, which upheld his dismissal. The applicant contended, inter alia, that the Industrial Court had erred when it failed to consider the disparity of punishment imposed on another employee of the 2nd respondent, who had committed a similar misconduct. However, the High Court held that there was no error committed by the Industrial Court in arriving at its Award. In dismissing the applicant’s judicial review application, the High Court said as follows: “[14] Akhirnya, peguam pemohon telah menegaskan bahawa responden pertama telah silap dari segi undang-undang apabila gagal memberi pertimbangan tentang hukuman yang berbeza dikenakan kepada pengurus responden kedua yang lain yang turut terlibat dengan cara membuat tuntutan balik perbelanjaan keraian yang sama dengan pemohon. Keputusan kes Malayan Banking Berhad v. Roslinda Hassan [2008] 3 ILR 368 dirujuk. Rujukan kepada Award, jelas menunjukkan responden pertama telah memutuskan: ...That others may have done so and gotten off lightly is not within the jurisdictional purview of the court in this instant case. Such allegations as was raised by the Claimant will thus have to fall by the way-side, and not be construed as mala fides on the Part of the Bank. (lihat akhir perenggan 2 di muka surat 42 Award) Adalah didapati bahawa responden pertama sememangnya tidak mengambil kira tentang tindakan responden kedua ke atas pegawai yang lain di atas alasan ianya bukan di bawah bidang kuasanya dan perkara tersebut tidak dapat menunjukkan tindakan mala fide responden kedua. Adalah didapati pandangan responden pertama tersebut bukanlah satu salah arahan atau satu kesilapan undang-undang yang boleh menjejaskan keseluruhan keputusan responden pertama. Sekiranya diteliti rekod prosiding perbicaraan di hadapan responden pertama, ada keterangan dari COW5 yang mengatakan 7 dari 10 Pengurus Cawangan responden kedua telah dikenakan hukuman yang sama dengan pemohon dan hanya 3 orang pegawai diberi amaran, diturunkan pangkat dan satu tidak diambil tindakan kerana didapati tidak terlibat. Faktanya bukanlah ada 'disparity' dalam tindakan atau hukuman, tetapi hanya ada perbezaan tindakan atau hukuman berdasarkan asas tindakan yang diambil. Alasan pemohon yang membandingkan hukuman diterimanya dengan pegawai responden kedua yang lain sememangnya tidak berkaitan dengan bidang kuasa responden pertama dan tidak menjadikan Award silap dari segi undang-undang.” 152. The Industrial Court case of Malaysian Airline System Bhd v Ritzerayan Abdul Rashid & Ors [1998] 3 ILR 971, is also applicable to the facts of the instant case. In that case, in response to the claimants’ submission that the company had not treated the claimants on an equal basis compared to the other employees of the company, as the company took disciplinary action against them and not the other employees, the Industrial Court said as follows at p. 984: “The learned counsel for the claimants has submitted that the company has not treated the claimants on equal basis as other stewards who were suspected, this inconsistency would entitle the court to come to the conclusion that the company acted unreasonably and therefore the dismissals were without just cause or excuse. I do not think this is the correct statement of law. It is not the right of the workman to question, why an employer should take a disciplinary action against him and not others.” 153. Reverting back to the present case, what the Industrial Court had done was to consider and determine the issue whether the punishment of dismissal was warranted by taking into consideration the evidence of a different type of punishment, which was imposed on another employee of the applicant, viz the deferment of an annual increment on Puan Esdjuna vide the Punishment Order dated 11.06.2012. By virtue of the decision of the High Court in Mohamad Kamal Majid, supra, the Industrial Court in the I.C. case has no jurisdiction to consider the applicant’s actions against another employee. Since it had done so, there is an error of law committed by the Industrial Court, which has caused the decision-making process of the Industrial Court to be flawed. 154. It is trite law that this Court can interfere with the decision of the Industrial Court if the latter had acted on an incorrect basis of fact. In Malayan Banking Bhd, supra, the Supreme Court held that a jurisdictional error is committed if a decision-maker acts upon an incorrect basis in fact. In that case, the Supreme Court said as follows at p. 206: “There are then some cases which assert that a jurisdictional error is committed if a decision-maker acts upon an incorrect basis in fact. The leading case is Secretary of State for Education and Science v Tameside Metropolitan Borough Council [1977] AC 1014 in which Lord Wilberforce said (at p 1047. that an official exercising a discretionary power commits a jurisdictional error if he or she acts 'upon an incorrect basis of fact'.” 155. In Lipo Corp Bhd v Mahkamah Perusahaan Malaysia & Anor [2013] 9 MLJ 888, Varghese George J held, inter alia, that there would be a case for intervention if it was shown that the decision maker had taken into account an irrelevant consideration in coming to the conclusion he reached. The learned Judge said as follows at p. 895: “[11] Intervention on the grounds of illegality or irrationality (or perversity) in the findings can be availed of where it was shown to the court that there was no evidence whatsoever to support the finding, or if the conclusions recorded were diametrically contrary to evidence on record. There would also be a case for intervention if it was shown that the decision maker had asked himself the wrong question or had omitted to take into account relevant consideration and to the contrary had taken into account irrelevant consideration or had misconstrued provision of relevant statute or principles of law in coming to the conclusion he reached.” 156. Reverting back to the instant case, the applicant conceded that it must prove that the respondent’s dismissal was with just cause or excuse. 157. As stated earlier, the Federal Court in Wong Yuen Hock, supra, has set out a 2-pronged test, which must be met in dismissal cases. The first prong is whether the employee is guilty of the misconduct complained of. The second prong is whether such misconduct warrants the punishment of dismissal. 158. Since the respondent had admitted to the misconduct in this present case, the first prong of the test has been met. As for the second prong of the test, since Mr. Ravindra Murugavell, the learned counsel for the respondent, has graciously conceded that the respondent’s misconduct warranted the punishment of dismissal, the second prong of the test has also been met. Whether there was a disparity in the punishment meted out to the respondent and the punishments meted out to the other employees, who had committed similar acts of misconduct? 159. It is the contention of the respondent that there was a disparity of punishment as a Leading Stewardess, a Pilot and a Co-Pilot, who had each committed similar acts of misconduct, were not dismissed but were given lesser punishments. 160. The issue of disparity in punishment has been, aptly, explained in the Industrial Court case of Bank Bumiputra Malaysia Bhd v Ghazali Bin Kassim [1995] 1 ILR 113. In that case, the Industrial Court cautioned against the indiscriminate application of the disparity of punishment argument. It held that the argument is likely to be relevant if there are others cases which are truly similar, or sufficiently similar, to afford an adequate basis for the argument. It explained that this is because the emphasis in the section is upon the particular circumstances of the individual employee’s case. The onus is on the workman show that the disparity is to be found in similar cases occurring at or soon after the time that he was subjected to the punishment of dismissal. The Industrial Court said as follows on the disparity of punishment argument: “At the outset the Court cautions itself that arguments founded upon disparity of disciplinary sanctions are to be considered with great care. It is perhaps timely to set out the cautionary note sounded by Mr. Justice Waterhouse in the case of Hadjioannou v. Coral Casinos Ltd [1981] IRLR 352 cited by learned Counsel for the bank that: Industrial tribunals would be wise to scrutinize arguments based upon disparity with particular care. It is only in the limited circumstances that we have indicated that the argument is likely to be relevant and there will not be many cases in which the evidence supports the proposition that there are others cases which are truly similar, or sufficiently similar, to afford an adequate basis for the argument. The danger of the argument is that a tribunal may be led away from a proper consideration of the issues raised by s. 57(3) of the Act of 1978. The emphasis in the section is upon the particular circumstances of the individual employee’s case. ... Where, however, there are indeed disparities in punishment in respect of an employer's treatment of his employees who are guilty of "truly similar" or "sufficiently similar" misconduct, it is an established principle in industrial law that the same gives an employee who is subjected to the severest punishment of dismissal while another is dealt with otherwise a cause for complaint that he had been unjustly treated. … The Court is of the view that where the disparity argument is raised and provided that the offences and the circumstances in which they occur are essentially similar in nature, it would be sufficient if the claimant can show that the disparity is to be found in similar cases occurring at or soon after the time that he was subject to the punishment of dismissal.” (Emphasis added). 161. It is clear from the decision in that case that the argument on the disparity in punishment is relevant only if the offences and the circumstances in which they occurred are, essentially, similar in nature. The burden is, thus, on the workman to show that the disparity is to be found in similar cases occurring at or soon after the time the workman was dismissed. 162. Reverting back to the instant case, the respondent had produced Puan Esdjuna’s Punishment Order dated 11.6.2012. However, the respondent did not lead any evidence pertaining to the Punishment Orders of the Pilot and Co-Pilot, respectively. Puan Esdjuna was found to be absent without prior leave and she had falsified/altered her medical document and the applicant decided to issue her a final warning and a deferment of her annual increment. 163. Nevertheless, I found that the respondent’s case could be distinguished from Puan Esdjuna’s case, based on the following facts and circumstances: (1) The respondent had admitted to the misconduct committed by her. This fact is absent from Puan Esdjuna’s case; (2) Puan Esdjuna was holding the position of a Flight Stewardess at the time of the commission of the misconduct, whilst the respondent was holding the position of an In-Flight Supervisor; and (3) The position held by the respondent is the highest in the cabin crew hierarchy during flight as confirmed by the respondent during cross-examination. Her evidence is reproduced below. “125 : Q&A71 Put: As In-Flight Supervisor you are the highest ranking Cabin Crew during flight? · Yes” 164. I also noted that the acts of misconduct committed by Puan Esdjuna and the respondent, respectively, did not arise from the same set of facts. In fact, as stated earlier, the acts of misconduct were committed by two different categories of employees, where the harshest punishment of dismissal was meted out to the respondent, who held the highest position of cabin crew during flight. 165. The Judgment of the Federal Court on this point in Beatrice At Fernandez v Sistem Penerbangan Malaysia & Anor [2005] 2 CLJ 713 (“Beatrice’s case”) is applicable to the facts of the instant case. In that case, the material facts are that the terms and conditions of the appellant’s employment were governed by a collective agreement. They provide, inter alia, that the appellant has to resign from her position as a Flight-Stewardess, if she ever becomes pregnant. Subsequently, the appellant became pregnant and her contract of service was terminated by her employer. The appellant then brought an action against her employer for, inter alia, a declaration that the collective agreement was ultra vires Article 8 of the Federal Constitution as she was not accorded equal protection under the collective agreement. The High Court rejected her claim and held that the collective agreement did not in any way contravene the Federal Constitution. The decision of the High Court was affirmed by the Court of Appeal. The appellant applied for leave to appeal to the Federal Court but her appeal was dismissed by the Federal Court. 166. In construing Article 8 of the Federal Constitution, the Federal Court held that the equal protection, which is contained in that Article, extends only to persons in the same class. The Federal Court also held that the provision of the collective agreement, which requires the appellant to resign on becoming pregnant, only applies to the female cabin crew. The Federal Court further held, inter alia, that the appellant could not compare her position with other employees, who are not in the same category of work. At p. 721, the Federal Court said as follows: “The applicant chose to join the first respondent as a flight stewardess and agreed to be bound by the collective agreement. It would have been different if she had joined the first respondent as a member of its administrative staff. The applicant cannot compare herself with the ground staff or with the senior chief stewardesses or chief stewardesses as they were not employed in the same category of work.” 167. Reverting back to the instant case, and upon applying the principle of law, which was enunciated in Beatrice’s case, I was of the respectful view that the respondent’s reliance on the comparison between her case and Puan Esdjuna’s case is misplaced as the latter held a lower rank than her and Puan Esdjuna’s 2 (two) letters of explanation, which were considered by the applicant before giving her a lesser punishment were not produced to the Industrial Court by the respondent for the consideration of the Industrial Court. 168. In other words, since the particular circumstances of this case are not, essentially, similar to Puan Esdjuna’s case, the disparity in punishment argument, which was raised and relied upon by the respondent to defeat the applicant’s judicial review application must be rejected as being an irrelevant consideration in the determination by the Industrial Court of the issue whether the respondent’s misconduct warranted the punishment of dismissal. In view of the fact that the Industrial Court has taken into account an irrelevant matter, the Award is flawed and liable to be quashed by this Court. 169. In the Industrial Court case of Malaysian Airline System Bhd v Ritzerayan Abdul Rashid & Ors, supra, another division of the Industrial Court took a different approach on the disparity in punishment argument. In that case, the Industrial Court held that it is not the right of the workman to question, why an employer should take a disciplinary action against him and not others. At p. 984, the Industrial Court said as follows: “The learned counsel for the claimants has submitted that the company has not treated the claimants on equal basis as other stewards who were suspected, this inconsistency would entitle the court to come to the conclusion that the company acted unreasonably and therefore the dismissals were without just cause or excuse. I do not think this is the correct statement of law. It is not the right of the workman to question, why an employer should take a disciplinary action against him and not others.” (Emphasis added). 170. Therefore, I agreed with the applicant that based on the 2 (two) authorities referred to above, the Industrial Court has erred in law in the instant case, in holding that the dismissal of the respondent was without just cause or excuse, solely, because another employee had received a lesser sentence for a similar offence. 171. Based on the above reasons, I am of the respectful view that the Award ought to be quashed as the Industrial Court arrived at findings contrary to the evidence before it and had, consequently, arrived at a conclusion, which was perverse and illogical and which no reasonable tribunal or person in similar circumstances would have arrived at. Conclusion 172. In the premises, I granted an Order of certiorari to remove the Award to this Court and quashed with no order as to cost. Dated: 17 July 2017 (DATUK SU GEOK YIAM) Judge High Court Civil NCvC 11 Kuala Lumpur COUNSELS 1. Mr. Vijayan Venugopal, the learned counsel for the applicant at: Messrs. Shearn Delamore & Co Advocates & Solicitors Peguambela & Peguamcara 7th Floor, Wisma Hamzah Kwong-Hing No. 1, Leboh Ampang 50100 Kuala Lumpur 2. Mr. Ravindra Murugavell, the learned counsel for the respondent, at: Messrs. Murugavell Arumugam & Co Advocates & Solicitors No. 120-2A, Tingkat 2 Jalan Tun Sambanthan, Brickfields 50470 Kuala Lumpur CASE REFERENCE: 1. Hoh Kiang Ngan v Mahkamah Perusahaan Malaysia & Anor [1996] 4 CLJ 687. 2. Syarikat Kenderaan Melayu Kelantan Bhd. v Transport Workers Union [1995] 2 CLJ 748. 3. Malayan Banking Bhd v Association Of Bank Officers, Peninsular Malaysia & Anor [1988] 3 MLJ 204. 4. Wong Yuen Hock v Syarikat Hong Leong Assurance Sdn Bhd And Another Appeal [1995] 2 MLJ 753. 5. Danaharta Urus Sdn Bhd v Kekatong Sdn Bhd [2004] 1 CLJ 701. 6. Nerin @ Erin Marapus v Malaysian Airlines System Berhad (Award No. 1232 of 2015). 7. Arasapan Ramaiah v Ampang Hotel Sdn Bhd (Concorde Hotel Kuala Lumpur) [2009] 1 ILR 68. 8. Automotive Manufacturers (Malaysia Sdn Bhd v Ahmad Mohd Som [2009] 2 ILR 290, Industrial Court Kuala Lumpur. 9. Penfibre Sdn Bhd and Penang & S. Prai Textile Garment Industries Employees’ Union [1987] 2 ILR 259, Industrial Court Pulau Pinang. 10. Kelab Golf Negara Subang v Mat Idris Siakat [2004] 2 ILR 306, Industrial Court Kuala Lumpur. 11. Bumiputra Commerce Bank Bhd v Abdul Kahar Dudi & Ors [2005] 1 ILR 489, Industrial Court Kuala Lumpur. 12. Network Foods Industries Sdn Bhd v Thandapani Tirugnanasambandam [2006] 1 ILR 281, Industrial Court Kuala Lumpur. 13. Texas Instruments (M) Sdn. Bhd. v Flourmeena A/P Saminathan [1996] 2 ILR 128. 14. Sime Bank Bhd v Mohd Shaib Md Yusof [2003] 2 ILR 530. 15. Harianto Effendy Bin Zakaria & Ors v Mahkamah Perusahaan Malaysia & Anor [2014] 6 MLJ 305. 16. Mohamad Kamal Majid v Mahkamah Perusahaan Malaysia & Satu Lagi [2014] 1 LNS 1759. 17. Malaysian Airline System Bhd v Ritzerayan Abdul Rashid & Ors [1998] 3 ILR 971. 18. Lipo Corp Bhd v Mahkamah Perusahaan Malaysia & Anor [2013] 9 MLJ 888. 19. Bank Bumiputra Malaysia Bhd v Ghazali Bin Kassim [1995] 1 ILR 113. 20. Beatrice At Fernandez v Sistem Penerbangan Malaysia & Anor [2005] 2 CLJ 713. LEGISLATION REFERENCE: 1. Section 20 (3) of the Industrial Relations Act 1967. 2. Sections 3, 4, 5, 9, 10, 11, 11(1)(e), 12 and 20(3)(c) of the Malaysian Airline System Berhad (Administration) Act 2015. 3. Section 72 of the Pengurusan Danaharta Nasional Berhad Act 1998 (Act 587). 4. Article 8 of the Federal Constitution. 101

Tika 2.6.0

25-286-10/2015

PERAYU MALAYSIA AIRLINE SYSTEM BERHAD (APPOINTED ADMINISTRATOR) RESPONDEN JOYCE TAN @ TAN SIEW ENG

17/07/2017

YA DATUK SU GEOK YIAM

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=f5876c04-91de-4d6d-b414-659cf5d64fa0&Inline=true

DALAM MAHKAMAH TINGGU MALAYA DI KUALA LUMPUR IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR (APPELLATE AND SPECIAL POWERS DIVISION) IN THE FEDERAL TERRITORY OF MALAYSIA APPLICATION FOR JUDICIAL REVIEW NO: 25-286-10/2015 In the matter of an Application for an order of certiorari and an order of mandamus in respect of the Industrial Court Award No. 909 of Year 2015 dated 27.07. 2015 and received by the Applicant on 30.07.2015; And In the matter of Section 20(3) of the Industrial Relations Act 1967; And In the matter of Order 53 of the Rules of Court 2012 BETWEEN MALAYSIA AIRLINE SYSTEM BERHAD (APPOINTED ADMINISTRATOR) ... APPLICANT AND JOYCE TAN @ TAN SIEW ENG ... RESPONDENT GROUNDS OF JUDGMENT Applicant’s application for judicial review, enclosure (1) 1. On 30.10.2015, the Administrator, who was appointed under s. 5 of the Malaysia Airline System Berhad (Administration) Act 2015 (Act 75) (“the MASB (Administration) Act 2015”), filed this application for the applicant, through Messrs. Shearn Delamore & Co., the applicant’s solicitors (“the applicant’s solicitors”), pursuant to O. 53 of the Rules of Court 2012 (“the RC 2012”) for leave to commence a judicial review of the Industrial Court Award No. 909 of Year 2015 dated 27.07.2015 (“the Award”) in the Industrial Case No.: 11/4-447/13 (“the I.C. case”). 2. If leave is granted, the applicant seeks the following reliefs: (1) An order of certiorari to remove the Award to the Kuala Lumpur High Court and quashed; (2) An order to stay the execution of the Award pending the final outcome of substantive application for judicial review of the Award; (3) All necessary and incidental directions or whatever reliefs which this Court deems fit and beneficial; and (4) Costs of this application and incidental to this application to be costs-in-the cause. Parties in this application 3. The parties in this application are as follows: (1) Malaysia Airline System Berhad (“the MASB”) is the applicant. It is the former employer of the respondent; and (2) Joyce Tan @ Tan Siew Eng is the respondent. She is the former employee of the applicant. Background facts 4. The background facts, which led to the applicant filing enclosure (1), is as follows: (1) By a letter dated 24.10.1987, the respondent commenced her employment with the applicant on 02.11.1987, as a Trainee Flight Stewardess, with a monthly salary of RM 400.00; (2) The respondent was confirmed and certified to be qualified to operate flying duties as a Flight Stewardess on, successfully, completing the Kursus Perkhidmatan Kabin Kapal Terbang; (3) By a letter dated 08.12.1987, the respondent was appointed as a Flight Stewardess in Group B with effect from 23.12.1987; (4) By a letter dated 11.09.2007, the respondent was promoted to the position of Inflight Supervisor with effect from 08.09.2007; (5) By a letter dated 14.01.2008, the Claimant was confirmed as Inflight Flight Supervisor with effect from 08.12.2007; (6) On 31.08.2012, the respondent was called up by the Crew Deployment Centre for flight duty about 10 minutes after the commencement of her last day of the scheduled standby period on that date, viz from 29.08.2012 until 31.08.2012; (7) However, the respondent informed the Duty Officer that she was sick and she would be on medical leave and she would not be able to perform any duty on that day; (8) Subsequently, when the respondent was asked to produce a medical certificate as proof that she could not report for work on that day as she was sick, the respondent produced a medical certificate dated 31.08.2012 (“the MC”) from Klinik Rakan Medik, Kelana Jaya (“the clinic”); (9) Being doubtful of the genuineness of the MC, her superior officer wrote to the clinic to seek verification in writing from the clinic, which issued the MC, and he was informed in writing by the clinic that the respondent went to the clinic on 03.09.2012 and was issued with a medical certificate for 03.09.2012 by the clinic; (10) The clinic also provided to the respondent’s superior officer the original copy of the medical certificate dated 03.09.2012, which was issued by the clinic to the respondent on 03.09.2012; (11) The applicant then issued to the respondent a letter dated 25.09.2012 directing the respondent to show cause on the same date, viz 25.09.2012, to the allegation that she had committed a serious act of misconduct under the Rules and Regulations of the applicant, which attracts severe punishment as the MC submitted by her was found to have been tampered with (“the show cause letter”); (12) On the same date, viz 25.09.2012, the respondent replied to the show cause letter. In her reply, she admitted that she had altered the date in the MC from 03.09.2012 to 31.08.2012; (13) On the same date, viz 25.09.2012, the applicant suspended the respondent for her serious act of misconduct in tampering with the MC; (14) The applicant took the view that since the respondent was holding a high position at the material time, viz as the In-flight Flight Supervisor, the applicant was left with no other alternative but to dismiss the respondent due to her serious act of misconduct in tampering with the MC; (15) Hence, by a letter entitled “Punishment Order” dated 24.10.2012, the applicant dismissed the respondent with immediate effect for her serious act of misconduct for having tampered with the MC by altering the date of its issuance, viz from 03.09.2012 to 31.08.2012; (16) At the time of her dismissal on 24.10.2012 by the applicant, she was holding the position of In-flight Flight Supervisor with a basic salary of RM 4,347.00 per month; (17) The respondent was also paid the following allowances as at 30.09.2012: (1) Laundry allowance - RM 80.00 (2) Fleet CC allowance - RM 500.00 (3) Incentive allowance - RM 702.17 (4) Inflight cabin crew food allowance - RM 2,476.02 (18) Subsequently, the respondent made a representation to the Industrial Relations Department (“the IRD”) of the Ministry of Human Resources against her dismissal. She contended that it was done without just cause or excuse as the punishment of dismissal was unduly harsh in relation to her act of misdemeanor based on her unblemished record of 25 years of service, and the fact that another employee, namely, Esdjuna Sudzie binti Ismon (“Puan Esdjuna”), a Leading Stewardess, who committed a similar act of misdemeanor, was only given a lesser punishment, viz a deferment of annual increment; (19) Since the IRD could not resolve the respondent’s representation, on 26.02.2013, the Right Honourable Minister of Human Resources (“the Minister”) referred her representation to the Industrial Court for adjudication, pursuant to s. 20(3) of the Industrial Relations Act 1967 (“the IRA 1967”); (20) The Industrial Court commenced the trial of the Ministerial reference on 23.09.2014. It continued the trial on 24.09.2014 and 10.10.2014. On 18.12.2014, it continued and concluded the trial of the Ministerial reference; (21) On 21.01.2015, the applicant put in its written submissions through the applicant’s solicitors; (22) On 26.01.2015, the respondent put in her written submissions through the Malaysian Airline System Employees’ Union Peninsular Malaysia (“the Union”); (23) On 20.02.2015, the Malaysian Airline System Berhad (Administration) Act 2015 (“the MASB (Administration) Act 2015”) came into force; (24) S. 4 of the MASB (Administration) Act 2015 states as follows: “Part II ADMINISTRATION Placement of the Company, etc., under administration 4. Subject to the prior written approval of the Minister, a member of the Company, or the board of directors of the Company pursuant to a resolution of the board of directors, may place— (a) the Company; (b) any wholly owned subsidiary company of the Company; and (c) the following partially owned subsidiary companies of the Company: (i) Abacus Distribution Systems (Malaysia) Sdn. Bhd. (Company No. 180535-T); (ii) Aerokleen Services Sdn. Bhd. (Company No. 277266-X); and (iii) MAS Awana Services Sdn. Bhd. (Company No. 372384-D), under administration in accordance with this Act.” (25) On 25.05.2015, Mohammad Faiz bin Mohammad Azmi was appointed as the Administrator for the Administered Companies pursuant to s. 5 of the MASB (Administration) Act 2015; (26) S. 11(1)(e) of the MASB (Administration) Act 2015 provides that on the appointment of the Administrator, a moratorium shall take effect (“the moratorium”) during which no proceedings and no execution or other legal process in any court or tribunal may be commenced or continued with, and no distress may be levied, against the Administered Companies or their property except with the prior written consent of the Administrator; (27) S. 3 of the MASB (Administration) Act 2015 defines “Minister” to mean “the Prime Minister of Malaysia” and “Administered Companies” to mean the applicant; the applicant’s wholly owned subsidiary companies, and the specified subsidiary companies that have been placed under administration under s. 4; (28) S. 12 of the MASB (Administration) Act 2015 provides, inter alia, that unless the administration is sooner terminated under s. 6 or paragraph 20(3)(c), the duration of the moratorium referred to in s. 11 shall be for a period of twelve months commencing from the date of the appointment of the Administrator under subsection 5(1) (“the duration of the moratorium”). There appears to be a typographical error in s. 12 of the MASB (Administration) Act 2015 as there is no paragraph 20(3)(c) in the MASB (Administration) Act 2015. However, there is a s. 20(3)(c) in the MASB (Administration) Act 2015; (29) By a letter dated 25.05.2015, the applicant’s solicitors requested the Industrial Court to defer handing down its Award in the I.C. case citing the moratorium and the duration of the moratorium in s. 11(1)(e) and s. 12, respectively, of the MASB (Administration) Act 2015 (“the said request”); (30) On 09.06.2015, both parties appeared before the Industrial Court for the mention of the I.C. case and the applicant’s solicitors repeated the said request; (31) However, despite the two requests, one written and one oral, made by the applicant’s solicitors, to defer its Award, the Industrial Court handed down the Award on 27.07.2015; (32) The Award was in favour of the respondent; (33) On 30.07.2015, the applicant received the Award; and (34) Hence, on 30.10.2015, the applicant filed this application against the respondent, enclosure (1), for judicial review of the Award. The findings, decision and reasons for the findings and decision of the Industrial Court as set out in the Award 5. In the Award, the Industrial Court found that the punishment of dismissal imposed on the respondent was too harsh and disproportionate with her misconduct. The Industrial Court found that another employee was given a lesser punishment for a similar offence but the respondent, who had served the applicant for 25 years, was dismissed. 6. Hence, the Industrial Court held that the respondent’s dismissal was without just cause and excuse and it awarded to the respondent compensation in lieu of reinstatement and backwages totaling a sum of RM 108,394.00. 7. In allowing the respondent’s claim, the Industrial Court stated in paragraph 17 as follows: “17. In the circumstances of this case, by the fact that another employee received a lesser sentence for a similar offence, and the Claimant having served the Company for 25 years, this Court do agree that the punishment of dismissal was too harsh and disproportionate with the misconduct. It follows therefore, the dismissal was without just cause and excuse. (See the Award, Exhibit “LSP-4”, at p. 327 of the applicant’s affidavit-in-support, enclosure (3)). 8. In paragraph 19 of the Award, the Industrial Court stated as follows: “19. The Company’s counsel did inform the Court that whilst in moratorium, no proceedings in any Court or Tribunal can be continued without the permission of the Administrator, but this Court is of the opinion that the provision do not apply to this case the proceedings were completed before the Company went under administration. The Company went under administration when the hearings were completed pending this award.” (See the Award, Exhibit “LSP-4”, at p. 328 of the applicant’s affidavit-in-support, enclosure (3)). Cause papers filed for leave to commence the judicial review proceeding 9. The applicant filed the following cause papers for leave to commence the judicial review proceeding against the respondent: (1) Applicant’s application dated 30.10.2015 for judicial review, enclosure (1); (2) Applicant’s statement under O. 53, r. 3(2) of the RC 2012 (“the O. 53 statement”), enclosure (2), which was dated 30.10.2015 and filed on 30.10.2015; and (3) Applicant’s affidavit-in-support affirmed on 30.10.2015, by Lim San Peen, the Attorney (Registration No.: PA 44013/15) for Mohammad Faiz bin Mohammad Azmi, the Administrator for the applicant, enclosure (3), which was filed on 30.10.2015. Leave to commence the judicial review proceeding 10. On 12.01.2016, Hanipah Binti Farikullah J granted leave to the applicant to commence the judicial review proceeding against the respondent with costs of this application and incidental to this application to be costs-in-the cause. 11. Her Ladyship also granted an Order of stay of the execution of the Award pending the final outcome of the substantive judicial review application. Cause papers filed for the substantive application 12. The parties then filed the following additional cause papers for the substantive application for judicial review: (1) Applicant’s notice of hearing of application for judicial review, enclosure (6); (2) Respondent’s affidavit-in-reply affirmed on 23.02.2016, by the respondent herself, enclosure (8); (3) Applicant’s affidavit-in-reply affirmed on 11.03.2016, by Lim San Peen, the applicant’s Attorney, enclosure (11); (4) Applicant’s supplemental affidavit affirmed on 25.03.2016, by Vijayan Venugopal, an advocate and solicitor, in Messrs. Shearn Delamore & Co., the applicant’s solicitors, enclosure (12), which exhibited a copy of the Notes of Proceedings of the I.C. case as Exhibit “VJ-1”; (5) Applicant’s written submissions dated 26.04.2016, enclosure (13); (6) Applicant’s bundle of authorities (not e-filed); (7) Respondent’s written submissions dated 27.04.2016; (8) Applicant’s further submissions dated 18.05.2016; (9) Respondent’s written submissions-in-reply dated 16.02.2017, enclosure (24); (10) Applicant’s further submissions (2) dated 23.02.2017; and (11) Applicant’s supplemental bundle of authorities. Grounds for the substantive judicial review application 13. There are 2 (two) main grounds relied upon by the applicant to attack the Award. First ground 14. The first main ground is set out in Malay in sub-paragraphs 3.2.1 to 3.3 of paragraph 3 of the O. 53 Statement as follows: “3.2. Memandangkan peruntukan di dalam Akta MAS 2015, Mahkamah Perusahaan telah melakukan kesilapan yang ketara dalam memberikan Awad tersebut di mana, 3.2.1. Ia gagal mempertimbangkan bahawa Pemohon telah diletakkan di bawah pentadbiran Pentadbir berkuatkuasa dari 25.5.2015. 3.2.2. Ia gagal mengambil kira bahawa selaras dengan pelantikan Pentadbir, tempoh moratorium dua belas (12) bulan berkuat kuasa di mana persetujuan bertulis Pentadbir diperlukan untuk meneruskan prosiding perkara ini. 3.2.3. Ia menyalahertikan dan menyalahgunakan Seksyen 11 (e) Akta MAS 2015 di mana ia memperuntukkan secara nyata bahawa tiada prosiding boleh diteruskan, termasuk dalam memberi Awad, tanpa kebenaran bertulis Pentadbir. 3.2.4. Ia gagal menimbangkan permohonan peguamcara Pemohon di dalam surat bertarikh 25.5.2015 yang telah memohon penangguhan apa-apa awad oleh Mahkamah Perusahaan menurut peruntukan-peruntukan Akta MAS 2015. 3.2.5. Ia telah melangkaui dan/atau bertindak tanpa bidang kuasa dalam memberikan Awad berdasarkan peruntukan Akta MAS 2015. 3.3. Mahkamah Perusahaan telah melakukan kesilapan bidang kuasa yang serius apabila ia memberikan Awad tanpa persetujuan bertulis oleh Pentadbir mengikut peruntukan Akta MAS 2015.” 15. The first main ground concerns the, alleged, jurisdictional error committed by the Industrial Court due to the coming into force of the MASB (Administration) Act 2015; the appointment of the Administrator under the MASB (Administration) Act 2015; the moratorium; the duration of the moratorium; the two requests made by the applicant’s solicitors to the Industrial Court to defer its Award; the failure of the Industrial Court to defer the handing down of its Award; and the handing down by the Industrial Court of its Award on 27.07.2015, without first obtaining the written consent of the Administrator, contrary to s. 11(1)(e) read together with s. 12 of the MASB (Administration) Act 2015. 16. I shall refer to the first main ground as the moratorium ground and the issue arising from it as the moratorium issue. Second ground 17. The second main ground is set out in Malay in sub-paragraphs 3.1 to 3.1.14 of paragraph 3 of the O. 53 Statement, enclosure (2), as follows: “3.1 Dalam menyimpulkan bahawa hukuman pembuangan kerja adalah terlalu berat dan tidak seimbang dengan salah laku yang dilakukan oleh Responden, Mahkamah Perusahaan telah menggunapakai satu proses membuat keputusan yang cacat dan oleh itu telah melakukan kesilapan undang-undang di mana, 3.1.1. Isu perbezaan hukuman tidak relevan di dalam kes ini. 3.1.2. Mahkamah Perusahaan gagal menilai secara kritikal Perintah Hukuman bertarikh 11.6.2012 yang dikeluarkan kepada Ketua Pramugari (“Leading Stewardess”) yang membuat rujukan kepada dua surat penjelasan yang dikemukakan oleh Ketua Pramugari (“Leading Stewardess”) tersebut tetapi yang sama tidak pernah dikemukakan oleh Responden semasa prosiding di Mahkamah Perusahaan. 3.1.3. Mahkamah Perusahaan telah mengambil kira isu mengenai perbezaan hukuman yang melibatkan Ketua Pramugari (“Leading Stewardess”) tersebut walaupun fakta berkenaan dengan asas hukuman yang dijatuhkan kepada Ketua Pramugari (“Leading Stewardess”) tidak dikemukakan di hadapan Mahkamah Perindustrian. 3.1.4. Mahkamah Perusahaan telah menerima bukti Responden mengenai perbezaan hukuman dalam Perintah Hukuman bertarikh 11.6.2012 mengenai Ketua Pramugari (“Leading Stewardess”) tanpa bukti sokongan daripada Responden. 3.1.5. Mahkamah Perusahaan gagal menghadkan dirinya kepada pertimbangan sama ada pembuangan kerja itu adalah wajar dalam kes Responden berdasarkan keadaan tertentu kes Responden. 3.1.6. Mahkamah Perusahaan gagal mengambil kira bahawa Ketua Pramugari (“Leading Stewardess”) yang dirujuk di dalam Awad itu memegang jawatan sebagai seorang Pramugari Penerbangan (“Flight Stewardess”) pada masa pelakuan salah laku itu; suatu kedudukan yang lebih rendah daripada kedudukan Responden; Penyelia Dalam Penerbangan (“In-Flight Supervisor”). 3.1.7. Mahkamah Perusahaan gagal untuk menghayati bahawa Responden memegang jawatan sebagai Penyelia Dalam Penerbangan (“In-Flight Supervisor”), jawatan tertinggi di dalam hierarki anak kapal. 3.1.8. Mahkamah Perusahaan gagal untuk menghayati bahawa sebagai pekerja yang memegang kedudukan tertinggi di dalam hierarki anak kapal, ia adalah wajar untuk menjangka bahawa Responden memiliki tahap integrity dan kejujuran yang tinggi. 3.1.9. Mahkamah Perusahaan gagal mengambil kira bahawa sebagai pekerja yang telah lama berkhidmat, Responden dijangka menunjukkan contoh yang baik kepada pekerja dibawahnya dengan mematuhi prosedur Pemohon. 3.1.10 Mahkamah Perusahaan gagal untuk menghayati bahawa Responden telah mengaku salah lakunya dalam mengubah sijil cuti sakit. 3.1.11 Mahkamah Perusahaan gagal mengambil kira bahawa salah laku yang dilakukan oleh Responden adalah serius kerana Responden memalsukan sijil cuti sakit yang telah diserahkan kepada Pemohon. 3.1.12 Mahkamah Perusahaan gagal mengambil kira keterangan Responden ketika pemeriksaan balas di mana beliau bersetuju seperti berikut: a. Beliau telah mengubah sijil cuti sakit dengan menukar tarikh dari 03.09.2012 ke 31.08.2012; b. Beliau menyerahkan sijil cuti sakit yang telah diubah yang mempunyai tarikh 31.08.2012 kepada Pemohon; c. Beliau bersetuju bahawa sebagai pekerja, beliau tidak dibenarkan mengubah sijil cuti sakit. 3.1.13 Mahkamah Perusahaan gagal menilai fakta bahawa Responden telah diberikan surat amaran bertarikh 10.2.2004 dimana gaji beliau telah ditolak untuk satu (1) hari bagi kegagalan untuk melaporkan diri untuk penerbangan yang dijadualkan pada 24.1.2004. 3.1.14 Mahkamah Perusahaan gagal menghayati keterangan COW1 berkenaan keputusan untuk membuang kerja Responden dan telah menyalahertikan dan menyalahgunakan undang-undang yang berkaitan dengan isu hukuman keras (“harshness of the punishment”).” (Emphasis added). 18. The second main ground concerns the, alleged, errors of law committed by the Industrial Court in the Award in holding that the respondent’s dismissal was without just cause and excuse; that it was too harsh and disproportionate with the respondent’s misconduct as another employee received a lesser punishment for a similar offence but the respondent, who had served the applicant for 25 years, was dismissed; and the compensation in lieu of reinstatement and backwages totaling a sum of RM 108,394.00, which the Industrial Court awarded to the respondent. 19. I shall refer to the second main ground as the dismissal ground and the issue arising from it as the dismissal issue. 20. The dismissal issue is summarized as follows: (1) The decision making process of the Industrial Court was flawed as the issue of disparity of punishment was not relevant in the I.C. case; (2) In holding that the respondent’s dismissal was without just cause and excuse as the punishment of dismissal was too harsh and not commensurate with the respondent’s misconduct, the Industrial Court committed the following errors of law and/or acted outside its jurisdiction when it did the following: (a) It failed to take relevant matters into consideration; (b) It took into account irrelevant matters; (c) It asked itself the wrong questions or issues; (d) It applied the wrong test; (e) It made findings, which were inconsistent with the evidence placed before it, and it made findings, which were not supported by the evidence; and (f) It arrived at a decision, which was so perverse and unreasonable that no reasonable tribunal or person in similar circumstances would have arrived at. Respondent’s pleaded case before the Industrial Court 21. In paragraphs 8 – 24 of the statement of case dated 03.09.2013, filed by the Union, on her behalf, the respondent pleaded as follows: (1) On 03.08.2012, she operated flight duty on MH 16 from Kuala Lumpur to Amsterdam and developed a skin allergy. She also had severe cough with symptoms of flu. She continued with her allergy medication comprising the following: (a) Augmentin; (b) Amoxycillin; (c) Clavulanate potassium; (d) Aerius desloratadine; (e) Benadryl; and (f) Zyrtec; which were earlier prescribed by her doctor; (2) She operated flight duty on MH 135 from Kuala Lumpur to Brisbane on 17.08.2012. During this flight, she developed a severe sore throat. She also lost her voice resulting in her having to delegate in-flight announcements to other cabin crew; (3) During a night stop at Brisbane on 17.08.2012, she consulted a doctor, who diagnosed her as having a lung infection, which necessitated a strong course of antibiotics. However, the medication prescribed by the doctor at Brisbane resulted in her becoming drowsy; (4) She could not produce the Medical Record Book as the applicant had destroyed this document following her dismissal; (5) Her state of health did not improve from 18.08.2012 until 25.08.2012. Despite her medical condition, she continued to operate overseas during this period; (6) On 26.08.2012, her dermatitis allergy recurred. She also had fever including diarrhoea with loss of appetite. As a result, she was very weak; (7) On 27.08.2012, she visited the clinic. The examining doctor recommended her one day’s medical leave but she declined the medical leave. This was because she had a last flight to operate on 28.08.2012, after which she would be on standby from 29.08.2012 until 31.08.2012 (“the scheduled standby period”) (see a copy of the letter from the clinic dated 31.10.2012 confirming the respondent’s decline of sick leave for 27.08.2012, at p. 13 of the respondent’s Bundle of documents); (8) On 31.08.2012, she was called up by the Duty Officer (“the said Duty Officer”) for flight duty about 10 minutes after the commencement of her last day of the scheduled standby period; (9) As she was still not well on 31.08.2012, she informed the said Duty Officer that she would be on medical leave and would not be able to perform any duty on that day; (10) Thereafter, her off days were from 01.09.2012 until 03.09.2012. Although her state of health improved until 02.09.2012, she developed high fever again. Her diarrhoea also became worse (see the respondent’s duty rosters for August 2012 and September 2012, at pgs. 14-17 of the respondent’s Bundle of documents); (11) The doctor advised her to rest at home. The doctor also granted her medical leave for 03.09.2012 after prescribing the following medication to her: (a) Lomodium; (b) Progesic 500; and (c) Fucon hyoscine-N- Butylbromide. (12) On 25.09.2012, Rodzlin Ramli, the applicant’s Manager, Performance & Resources Management In-flight Services, issued her the show cause letter with the allegation that the MC submitted by her for 31.08.2012 was found to have been tampered with (see a copy of the show cause letter at pgs. 18 & 19 of the respondent’s Bundle of documents); (13) On 25.09.2012, she was compelled to reply, immediately, at 10.00 a.m. on being served the show cause letter by the Cabin Crew Administrator. She replied, dutifully, to the show cause letter; (14) She did not deny that the MC was altered. However, she explained that as a result of having consumed a large amount of medication for her medical ailment, which had commenced from 03.08.2012 until the date of the show cause letter, she was not in a right frame of mind at the material time (see a copy of the her letter at pgs. 20 & 21 of the respondent’s Bundle of documents); (15) By a letter dated 24.10.2012, which was issued by the Senior Manager, Strategic People Management and which she received on 09.11.2012, she was dismissed with immediate effect (see a copy of the letter of dismissal at pgs. 22-24 of the respondent’s Bundle of documents); (16) By a letter dated 16.11.2012, she appealed to the applicant’s Disciplinary Appeal Committee (“the DAC”) to seek reinstatement to her former position (“the letter of appeal”) (see a copy of the letter of appeal at pgs. 25 & 27 of the respondent’s Bundle of documents); (17) By a letter dated 18.12.2012, the applicant informed her that her appeal for reinstatement was dismissed by the DAC (see a copy of the applicant’s letter dated 18.12.2012 at p. 28 of the respondent’s Bundle of documents); (18) During her 25 years of service, prior to her dismissal, she had an unblemished record; (19) From the year 1994 to the date of her dismissal, she was given a total of 29 (twenty nine) letters of commendation/appreciation for commendable service by the applicant and also the customers of the applicant (see a copy of each of the letters of commendation/appreciation at pgs. 29-58 of the respondent’s Bundle of documents); and (20) Her terms and conditions of employment are covered by the Collective Agreement (“the CA”) between the applicant and the Union. 22. Due to a typographical error, there are 2 paragraphs in the statement of case, whith have the same number, viz 25. I shall refer to them as the first paragraph 25 and the second paragraph 25, respectively. 23. In the first paragraph 25 of the statement of case, the respondent contended that she was unfairly dismissed due to the following grounds: (1) The applicant did not convene a disciplinary inquiry against her. Her dismissal was decided single-handedly and arbitrarily by the Head of Human Capital Services in breach of the rules of natural justice and Article 25(2) the MAS/MASEU 2011/2014 Collective Agreement, which spells out as follows: “(2) Depending on the nature of the misconduct or indiscipline or efficiency, the Company may after due enquiry imposes on the employee one of the following punishment: (a) ………….. (b) ………….. (c) ………….. (d) Dismiss the employee (e) Any other punishment permissible under the law (3) The disciplinary enquiry shall be conducted in accordance with the Disciplinary Procedure of the Company.” (see an extract of “Article 25 – Discipline” of the MAS/MASEU 2011/2014 Collective Agreement, at pgs. 59-62 of the respondent’s Bundle of documents); (2) She was compelled by her immediate superior to, spontaneously, reply to the show cause letter upon being served with it at about 10.00 a.m. on 25.09.2012. This was done in breach of the applicant’s disciplinary procedure, which allows an employee to reply to a show cause letter within 14 days; (3) In a state of dilemma and having been compelled to reply, immediately, to the show cause letter she had, honestly, admitted to having altered the date of the MC. However, in making the admission, she had overlooked explaining in her reply to the show cause letter, that she was under an honest mistaken belief that she had a sick leave credit of 1 day’s sick leave, which was granted for her by the doctor on 03.09.2013, and that that day, viz 03.09.2013, was also her off-day, which she could set-off against the date she had reported sick, viz 31.08.2012, to fulfill the applicant’s administrative requirements; and (4) Zaiton Shaari, the applicant’s Senior Manager, Strategic People Management (“Zaiton Shaari”) did not or failed to, properly, consider the merits of her explanation to the show cause letter. She was also denied the opportunity to make any plea for clemency prior to the order of termination of her employment by Zaiton Shaari. 24. Hence, in the first paragraph 25(4) of the statement of case, the respondent pleaded that the punishment imposed on her was unduly harsh in relation to her act of misdemeanor, which was related to her inability to report for duty due to her medical unfitness, during the last few hours of her standby period, in that, in imposing the extreme punishment of dismissal on her, Zaiton Shaari, the applicant’s Senior Manager, Strategic People Management, did not or failed to consider the nature of her misconduct, the circumstances surrounding her misconduct and her past record, as follows: (1) She had an unblemished disciplinary record of 25 years; and (2) Her act of misdemeanour was not committed, willfully, as she was under a genuine mistaken belief that she had a sick leave credit for 03.09.2012, which was also her off day, and which she could use as a set off against the date she had reported sick to the said Officer, viz 31.08.2012. 25. In paragraph 25(4)(c) of the statement of case, the respondent also pleaded that the applicant had practised disparity of punishment in imposing the punishment of dismissal on her. This is because Puan Esdjuna, a Leading Stewardess; Mohd Hasy Idan Mohd Salleh, a F/O, who is a pilot; and another co-pilot; to name a few examples, who had committed similar acts of misdemeanours, were not dismissed but were given lesser punishments of deferments of annual increments (see a copy of Puan Esdjuna’s Punishment Order dated 11.06.2012, at pgs. 63-65 of the respondent’s Bundle of documents for the I.C. case). 26. In the second paragraph 25 of the statement of case, the respondent further pleaded that, in imposing the punishment of dismissal on her, she was a victim of partiality and vindictiveness of the applicant based on the following reasons: (1) That during the course of her inflight duty as an Inflight Supervisor on a flight from Kuala Lumpur to Sydney on 01.01.2012, she discovered an abuse of authority by Mohd Danny Rashdan, the then applicant’s Deputy Chief Executive Officer (“the Deputy CEO”), in upgrading his maid and infant child of 18 months from economy class to first class, in breach of the applicant’s regulations and that she had exposed this malpractice in the Voyage Report; (2) That the Voyage Report was, subsequently, released by an unknown source to Wee Choo Keong, the former Member of Parliament for Wangsa Maju, Malaysia. The said document was also posted in the internet in Wee Choo Keong’s Blog on 11.05.2012; (3) That this had generated adverse publicity for the applicant and had implicated its Senior Management staff, inter alia, the CEO and the Executive Vice President of Human Resources and Zahrah Zaid, who was the Head of Human Resources Divison, at the material time (see a copy of the relevant pages of Wee Choo Keong’s Blog relating to the Voyage Report at pgs. 66-84 of the respondent’s Bundle of documents); and (4) That the applicant had victimized her for being a union member in that Puan Esdjuna, a Leading Stewardess, who was a non union member, was, merely, given a punishment of deferment of her annual increment instead of a dismissal. 27. In paragraph 26 of the statement of case, the respondent contended and would contend that her dismissal was without any just cause or excuse and/or in breach of the principles of natural justice and/or an unfair labour practice and/or unlawful. 28. In paragraph 27 of the statement of case, the respondent pleaded that she would adduce all necessary evidence at the hearing in support of the statement of case. 29. Therefore, in paragraph 28 of the statement of case, the respondent prayed that the Industrial Court holds that her dismissal was without just cause or excuse and/or in breach of the rules of natural Justice and/or an unfair labour practice and/or unlawful and orders that she be reinstated without any loss of wages, allowances, services, seniority, privilege or benefits of any kind and or orders any other or alternate relief as the Industrial Court deems fit and proper. Applicant’s pleaded case before the Industrial Court 30. In its statement of reply dated 21.11.2013, which was filed through the applicant’s solicitors, the applicant pleaded, inter alia, as follows: (1) In paragraph 2, that in the circumstances of the matter, the dismissal of the respondent was with just cause or excuse; (2) In paragraph 5, that part of the duties of a cabin crew, including an Inflight Supervisor, is to be on standby duty as follows: (a) During the period of being on standby duty, the cabin crew is required to be at home or to make himself or herself available to be contacted by the applicant; and (b) Any cabin crew, who is scheduled to be on standby duty, will be called to report for duty in the event that the applicant faces a shortage of cabin crew for a specific flight; (3) In paragraph 5.1, that it is normal for a cabin crew, who is on a standby duty, to be called to report for duty, when another cabin crew, who is on duty, is absent or on medical leave; (4) In paragraph 5.2, that to ensure that the applicant operates each of its flights with a sufficient number of cabin crew, the applicant requires strict compliance with the standby duty schedule from all cabin crew and failure by a cabin crew to comply with the same amounts to a serious misconduct; (5) In paragraph 6, that the applicant puts the respondent to strict proof of her averments in paragraphs 8, 9.1, 9.2, 9.3, 9.4, 10, 11 and 12 of the statement of case but in any event, that those averments of the respondent are not relevant to the present matter; (6) In paragraph 7.12, that paragraphs 13, 14, 15, 16, 17, 18, 19 of the respondent’s statement of case are strictly denied by the applicant and the respondent is put to strict proof thereof; (7) In paragraph 8, that after the respondent’s dismissal with immediate effect, on 20.11.2012, the applicant received the letter of appeal from the respondent; (8) In paragraph 8.1, that save that the applicant received the letter of appeal on 20.11.2012, the contents of the letter of appeal are strictly denied by the applicant and the respondent is put to strict proof thereof; (9) In paragraph 8.2, that the DAC convened a meeting on 07.12.2012 to consider the respondent’s appeal. However, due to the gravity of the respondent’s misconduct, her appeal was dismissed and the respondent was informed of the dismissal of her appeal by the DAC vide the applicant’s letter dated 18.12.2012; (10) In paragraph 9, that the applicant denies that the respondent has an unblemished record of 25 years of service as the applicant had issued the respondent with a warning letter dated 10.02.2004 for her failure to report for duty on 24.01.2004; (11) In paragraph 10, that the respondent’s commendable service is not a relevant consideration in the present matter as the respondent was dismissed on the ground of having tampered with the MC and not due to her (poor) work performance. In any event, the applicant puts the respondent to strict proof of her averment in paragraph 23 of the statement of case (in regard to the 29 (twenty-nine) letters of commendation/appreciation received by her for her, alleged, commendable service); and (12) In paragraph 11, that the applicant admits the respondent’s averment in paragraph 24 of the statement of case that the respondent’s terms and conditions of employment are covered by the CA between the applicant and the Union. 31. In paragraph 12 and sub-paragraphs 12.1 to 12.5 in the statement-in-reply, the applicant refers to the first paragraph 25 of the statement of case and averred as follows: (1) The applicant is not obliged to convene a domestic inquiry prior to dismissing the respondent. Article 25(2) of the CA refers to “due inquiry” and does not impose a requirement to convene a domestic inquiry in all cases, particularly where – as in the present case – the misconduct is admitted. Hence, the failure to conduct a domestic inquiry would not render an otherwise fair dismissal, as unfair; (2) In any event, the respondent was accorded sufficient opportunity vide the show cause letter to be heard on the allegation of her misconduct. Furthermore, the respondent did not raise any objection to the show cause letter; (3) The applicant had given proper considerations to the respondent’s explanation to the show cause letter and found the same to be unsatisfactory; (4) In the other cases, which were mentioned by the respondent in subparagraph 25(4)(c) of the statement of case, the punishments, which were imposed by the applicant varied due to the ranking of the employees involved. However, in the respondent’s case, the applicant had to mete out a harsher punishment in view of the high position that she held in the applicant, viz as Inflight Flight Supervisor; and (5) The applicant strictly denies sub-paragraphs 25(1), 25(2), 25(3), 25(4)(a), 25(4)(b) and 25(4)(c) of the first paragraph 25 of the statement of case and puts the respondent to strict proof thereof. 32. In paragraph 13, the applicant denied the contents of paragraph 25 and sub-paragraphs 25.1, 25.2 and 25.3 of the second paragraph 25 of the respondent’s statement of case and puts the respondent to strict proof thereof. 33. In paragraph 14, the applicant further pleaded as follows: (1) that the misconduct, which was committed by the respondent, viz tampering with the MC, is unbecoming of someone holding a high ranking position like the applicant; (2) As an Inflight Supervisor, it is expected of the respondent to posses a high level of integrity and honesty; (3) The respondent was also responsible to prepare various documents pertaining to the work and performance of the cabin crew; and (4) Due to the foregoing, the applicant was not able to compromise with the respondent’s misconduct. 34. In paragraph 15, the applicant pleaded that in view of the nature and gravity of the misconduct committed by the respondent, which was further aggravated by her past misconduct, and bearing in mind the high ranking position of the respondent, the applicant could no longer repose the necessary trust and confidence in the respondent. In the circumstances, the termination of the respondent was with just cause or excuse. 35. In the same paragraph, the applicant further pleaded that it had observed the rules of natural justice and fair labour practice at all material times as the respondent was given the opportunity to rebut the allegation levelled against her. 36. In the same paragraph, the applicant also denied the respondent’s contentions in paragraph 26 of the statement of case that her dismissal was without any just cause or excuse and/or in breach of the rules of natural justice and/or an unfair labour practice and/or unlawful and puts the respondent to strict proof thereof. 37. In paragraph 16, the applicant pleaded that it would adduce all the necessary evidence at the hearing in support of its statement in reply. 38. In paragraph 17, the applicant pleaded that further and/or in the alternative, in the event that the Industrial Court finds that the dismissal of the respondent was without just cause or excuse (which is strictly denied), the plaintiff contends that there has been a complete breakdown of mutual trust and confidence between the parties and that reinstatement will not be appropriate in all the circumstances. 39. In the same paragraph, the applicant further pleaded that the dismissal of the respondent was justified in the circumstances and that, therefore, she is not entitled to the remedies and/or compensation as prayed for by her in paragraph 28 of her statement of case. 40. In paragraph 18 of its statement-in-reply, the applicant prayed that the Industrial Court dismisses the respondent’s claim. 41. In the last paragraph of its statement-in-reply, which is not numbered, the applicant pleaded that save as hereinbefore expressly admitted, the applicant denies the contentions in the statement of case as if the same were set forth and traversed seriatim. Issues for the determination of this Court in the substantive judicial review application 42. There are 2 (two) main issues for the determination of this Court in the substantive judicial review application. They are as follows: (1) Whether the the Industrial Court committed a jurisdictional error in handing down the Award without first obtaining the written consent of the Administrator by virtue of the moratorium in s. 11(1)(e) read together with the duration of the moratorium in s. 12 of the MASB (Administration) Act 2015? (2) Whether the Industrial Court committed any error of law in arriving at its decision in the Award that the respondent was dismissed without just cause and excuse as the punishment of dismissal, which was imposed on her, was too harsh or excessive for her misconduct? The law on judicial review 43. It is trite law that in an application for judicial review, it must be established that the inferior tribunal or other decision-making authority, whether exercising a quasi-judicial function or purely an administrative function, has committed an error of law in arriving at its decision. This is because it has no jurisdiction to commit an error of law. 44. This principle of law was reiterated and emphasized by the Federal Court in Hoh Kiang Ngan v Mahkamah Perusahaan Malaysia & Anor [1996] 4 CLJ 687. In that case, the Federal Court cited the following passage from Syarikat Kenderaan Melayu Kelantan Bhd. v Transport Workers Union [1995] 2 CLJ 748, which held as follows: “An inferior tribunal or other decision-making authority, whether exercising a quasi-judicial function or purely an administrative function, has no jurisdiction to commit an error of law. Henceforth, it is no longer of concern whether the error of law is jurisdictional or not. If an inferior tribunal or other public decision-maker does make such an error of law then he exceeds his jurisdiction. So too is jurisdiction exceeded, where resort is to an unfair procedure (see Raja Abdul Malek Muzaffar Shah bin Raja Shahruzzaman v. Setiausaha Suruhanjaya Pasukan Polis [1995] 1 CLJ 619), or where the decision reached is unreasonable, in the sense that no reasonable tribunal similarly circumstanced would have arrived at the impugned decision. It is neither feasible nor desirable to attempt an exhaustive definition of what amounts to an error of law, for the categories of such an error are not closed. But it may be safely said that an error of law would be disclosed if the decision-maker asks himself the wrong question or takes into account irrelevant considerations or omits to take into account relevant considerations (what may be termed an Anisminic error) or if he misconstrues the terms of any relevant statute, or misapplies or misstates a principle of the general law.” (Emphasis added). 45. The Supreme Court in Malayan Banking Bhd v Association Of Bank Officers, Peninsular Malaysia & Anor [1988] 3 MLJ 204 (“Malayan Banking Bhd”) held as follows: “The general principle would appear to be that it will usually be proper to treat a decision-maker’s tasks of fact finding and the drawing of factual inferences from established facts as falling within the decision-maker’s jurisdiction unless the decision-maker has reached absurd results or reached results absurdly.” 46. In Wong Yuen Hock v Syarikat Hong Leong Assurance Sdn Bhd And Another Appeal [1995] 2 MLJ 753, at p. 757, the Federal Court held as follows: “In exercising judicial review, the High Court was obliged not to interfere with the findings of the Industrial Court unless they were found to be unreasonable, in the sense that no reasonable man or body of men could reasonably come to the conclusion that it did, or that the decisions of the Industrial Court looked at objectively, were so devoid of any plausible justification that no reasonable person or body of persons could have reached them (see Lord Denning's judgment in Griffiths (Inspector of Taxes) v JP Harrison (Watford) Ltd [1962] 1 All ER 909 at p 916), and judgment of Lord Diplock in Bromley London Borough Council v Greater London Council & Anor [1983] 1 AC 768 at p 821; [1982] 1 All ER 153 at p 159; [1982] 2 WLR 92 at p 100).” 47. Based on the authorities cited by the applicant, as mentioned above, it is trite law that in order to succeed in an application for judicial review, the applicant must show that the Industrial Court has committed an error of law and/or acted outside its jurisdiction by doing any of the following: (1) It has taken irrelevant matters into consideration; (2) It has failed to take relevant matters into consideration; (3) It asked itself the wrong question or issue; (4) It applied the wrong test; (5) It made findings which were inconsistent with the evidence placed before it and it made findings, which were unsupported by evidence; and (6) It had reached a decision so perverse that no reasonable tribunal or person, similarly, circumstanced would have reached. Applicant’s submissions on the moratorium issue before this Court 48. I acceded to the applicant’s request that the moratorium issue be heard and disposed by this Court before this Court hears the dismissal issue. 49. Mr. Vijayan Venugopal, the learned counsel for the applicant, submitted that the moratorium issue should be decided in favour of the applicant. 50. He relied on the following reasons: (1) The MASB (Administration) Act 2015 came into force on 20.02.2015; (2) S. 2(1) of the MASB (Administration) Act 2015 provides that the MASB (Administration) Act 2015 shall apply for a period of five years from the date of the coming into operation of the MASB (Administration) Act 2015 or until the listing and quotation of the shares of the Malaysia Airlines Berhad (“the MAB”) on the official list of Bursa Malaysia Berhad, whichever is earlier; (3) Pursuant to s. 5 of the MASB (Administration) Act 2015, an Administrator was appointed for the applicant on 25.05.2015; (4) S. 12 of the MASB (Administration) Act 2015 provides that upon the appointment of the Administrator, a moratorium shall take effect for a period of twelve (12) months with provision to apply for an extension of up to a further twelve (12) months; (5) S. 11(1) of the MASB (Administration) Act 2015 provides for the effect of the appointment of the Administrator, which is, among others, as follows: “(e) no proceedings and no execution or other legal process in any court or tribunal may be commenced or continued with, and no distress may be levied, against the Administered Companies or their property except with the prior written consent of the Administrator.” (6) As the appointment of the Administrator would be made on 25.05.2015, the applicant’s solicitors wrote to the Industrial Court vide a letter dated 25.05.2015, requesting for a deferment of any Award to be handed down in respect of the I.C. case (see Exhibit “LSP-3”, of the applicant’s affidavit-in-support, enclosure (3)); (7) Subsequently, the I.C. case was called up for mention before the Industrial Court on 09.06.2015, whereby the applicant’s learned counsel reiterated the same request; (8) The handing down of the Award falls within the meaning of the word “proceedings” in s. 11(1)(e) of the MASB (Administration) Act 2015. (9) The moratorium was in force at the time the Award was handed down; (10) The handing down of the Award by the Industrial Court was done in clear contravention of the MASB (Administration) Act 2015 as there was no written consent ever obtained by the Industrial Court from the Administrator to continue with the proceedings in the I.C. case. For this reason alone, the Award should, rightfully, be quashed by this Court; (11) This is because by virtue of s. 11(1)(e) of the MASB (Administration) Act 2015, it is clear and unambiguous that no proceedings in any court or tribunal can be commenced or continued with against the Administered Companies, which include the applicant, without the written consent of the Administrator; (12) The instant judicial review application before this Court is not affected as it was not filed “against the Administered Companies”. It was instituted by the applicant, which is one of the Administered Companies, against the respondent. It was also instituted by the applicant with the written consent of the Administrator. Hence, it is not within the ambit of s. 11(1)(e) of the MASB (Administration) Act 2015; (13) However, the Industrial Court in the I.C. case did not obtain the prior written consent of the Administrator before it handed down the Award on 27.07.2015; (14) Despite the express provisions of the MASB (Administration) Act 2015, as contained in s. 11(1)(e) and s. 12, and the written and oral requests by the applicant’s solicitors and the applicant’s learned counsel, respectively, the Industrial Court took the view that since the hearings of the I.C. case were already completed before the applicant went under administration, those provisions did not apply to the I.C. case even though it had not handed down its Award yet, as the proceedings in the I.C. case were already completed before the applicant went under administration; (15) In doing so, the Industrial Court has disregarded the express provisions of the MASB (Administration) Act 2015 and failed to consider that the applicant had been placed under the administration of an Administrator with effect from 25.05.2015; (16) Since, the moratorium was effective for a period of 12 (twelve) months from the date of the appointment of the Administrator, viz, 20.02.2015, the written consent of the Administrator was required before the Industrial Court could continue with the proceeding in the I.C. case during the moratorium period; (17) This would include the handing down of an Award, which is part of the proceedings in the I.C. case. It is misconceived of the Industrial Court to rule that the proceedings in the I.C. case were completed prior to 20.02.2015, when, in fact, the I.C. case was still pending the Award to be handed down by the Industrial Court; (18) This is because the handing down of the Award by the Industrial Court has the effect of “continuing with the proceedings” and it is expressly provided in s. 11(1)(e) that “no proceedings may against the applicant be continued with” without the written consent of the Administrator; (19) Hence, the Industrial Court has misconstrued and misapplied s. 11(1)(e) of the MASB (Administration) Act 2015 read together with s. 12 of the MASB (Administration) Act 2015; and (20) Since the Industrial Court has disregarded the provisions of the MASB (Administration) Act 2015, it is necessary for this Court to review the Award and to grant an order of certiorari to quash it. 51. The applicant cited the Federal Court case of Danaharta Urus Sdn Bhd v Kekatong Sdn Bhd [2004] 1 CLJ 701 (“the Danaharta case”) in support of its submission on the moratorium issue. In the Danaharta case, the material facts are that the respondent had applied to challenge the validity of s. 72 of the Pengurusan Danaharta Nasional Berhad Act 1998 (Act 587) (“the Danaharta Act 1998”), which barred the courts from granting injunctive relief to the respondent as it, purportedly, contravened Article 8 (1) of the Federal Constitution. S. 72 of the Danaharta Act 1998 states as follows: “Notwithstanding any law, an order of a court cannot be granted: a. Which stays, restrains or affects the powers of the Corporation, Oversight Committee, Special Administrator of Independent Advisor under this Act; b. Which stays, restrains or affects any action taken, or proposed to be taken, by the Corporation, Oversight Committee, Special Administrator or Independent Advisor under this Act; c. Which compels the Corporation, Oversight Committee, Special Administrator or Independent Advisor to do or perform any act And any such order, if granted, shall be void and unenforceable and shall not be subject of any process of execution whether for the purpose of compelling obedience of the order or otherwise.” 52. In the Danaharta case, the issue to be determined by the Federal Court was whether s. 72 of the Danaharta Act 1998 was unconstitutional as it prohibits a court from granting an injunction thereby amounting to a restriction on the right of access to justice, which violates Article 8(1) of the Federal Constitution which reads as follows: “All persons are equal before the law and entitled to the equal protection of the law.” 53. The Federal Court, in its landmark decision in that case, held that s. 72 is not unconstitutional as it satisfies the requirements of the reasonable classification test. Hence, the Federal Court ordered the injunctive relief granted by the court below against Danaharta to be vacated. 54. The Federal Court held that the very nature of the common law right of access to justice itself cannot render Article 8 (1) of the Federal Constitution absolute, that the provision on its own is meaningless, that there must be in existence rules and regulations to enable the right to be exercised which may vary from time to time and that Parliament has the power to enact federal laws which can enlarge or curtail the powers of the court. 55. The federal laws which deal with the jurisdiction of the courts are made pursuant to Article 121 (1) of the Federal Constitution. Under s. 3(1) of the Civil Law Act 1956, the common law is applicable. At p. 714, the Federal Court said as follows: “It will become immediately apparent that this definition only authorises the reception of common law "... in so far as it is in operation in the Federation..." The word "operation" means "in force". Therefore art. 160(2) refers to a law which has already brought into operation the common law in the Federation. That law is s. 3(1) of the Civil Law Act 1956 ("s. 3(1)"). It reads as follows: Save so far as other provision has been made or may hereafter be made by any written law in force in Malaysia, the Court shall: (a) in West Malaysia or any part thereof, apply the common law of England and the rules of equity as administered in England on the 7th day of April 1956; (b) in Sabah, apply the common law of England and the rules of equity, together with statutes of general application, as administered or in force in England on the 1st day of December 1951; (c) in Sarawak, apply the common law of England and the rules of equity, together with statutes of general application, as administered or in force in England on the 12th day of December 1949, subject however to subsection (3)(ii): Provided always that the said common law, rules of equity and statutes of general application shall be applied so far only as the circumstances of the States of Malaysia and their respective inhabitants permit and subject to such qualifications as local circumstances render necessary.” 56. At p. 716, the Federal Court said as follows: “Be that as it may, and consistent with what has been stated thus far the very nature of the common law right of access to justice itself cannot render it absolute. It is meaningless on its own. There must be in existence rules and regulations to enable the right to be exercised which may vary from time to time. In this regard Halsbury's Laws of England 4th edn Reissue Vol 8(2) says at para. 141: The right of access to a court is not absolute: restrictions may be imposed since the right of access by its nature requires regulation, which may vary according to the needs and resources of the community and of individuals (see Golder v. United Kingdom A 18 [1975], 1 EHRR 524, E Ct HR, para 38).” 57. Hence, the provisions of the MASB (Administration) Act 2015 curtailing the access to this Court by the respondent has in no way rendered the MASB (Administration) Act 2015 void. This is supported by the following passage of the Federal Court’s Judgment, at pgs. 719 and 720: “Access to justice would therefore be a meaningless right without the existence of a court with jurisdiction and power to enable the right to be exercised. Thus access to justice under art. 8(1) is a general right which can be fulfilled only by laws enacted conferring jurisdiction and powers on the courts under the specific authority contained in art. 121(1). While art. 8(1) deals with the right per se. art. 121(1), on the other hand, confers power on Parliament to set up an institutionalised mechanism with power and jurisdiction to determine the extent and manner in which that right should be exercised. Articles 8(1) and 121(1) are therefore not in conflict but complement each other. The jurisdiction and power of the courts as provided by law is clearly the dominant element which determines the boundaries of access to justice. Article 8(1) cannot therefore be read in isolation. As both the provisions of the Constitution bear upon the same subject they must be read together and be so interpreted as to effectuate the great purpose of the instrument, that is to say, the Federal Constitution. The rule of harmonious construction therefore demands that both the provisions be so construed as to give meaning and effect to them with the result that access to justice shall be available only to the extent that the courts are empowered to administer justice. The corollary is that the manner and extent of the exercise of the right of access to justice is subject to and circumscribed by the jurisdiction and powers of the court as provided by federal law. As a matter of fact whenever a law is passed either enlarging or curtailing the jurisdiction and powers of the courts it has a direct bearing on the right of access to justice. The right is determined by the justiciability of a matter. If a matter is not justiciable there is no right of access to justice in respect of that matter. Thus Parliament can enact a federal law pursuant to the authority conferred by art. 121(1) to remove or restrict the jurisdiction and power of the court. In this regard Viscount Dilhorne correctly pointed out in his dissenting judgment in Hinds v. The Queen [1976] 1 All ER 353 at 378: We agree that the constitutions on the Westminster model were evolutionary and not revolutionary but it does not follow from that that the Parliament of a territory cannot by ordinary enactment alter the jurisdiction and powers of any court named in the Constitution.” 58. And at p. 720, the Federal Court said as follows: “Section 72 is a federal law that deals with the jurisdiction of the court with regard to the grant of injunctions. It is a law made by Parliament under the authority and scope of art. 121(1). As it deals with the jurisdiction of the court it is a "written law" within the meaning of s. 3(1) in so far as the common law right of access to justice contained therein is concerned. It is one that modifies the common law right of access to justice as permitted by s. 3(1). The modified right of access to justice will then be the common law in operation for the purpose of art. 160(2). It is this modified right of access to justice that will now become an integral part of art. 8(1). This is because art. 8(1) encapsulates the common law which has been prescribed or which has been modified by a written law and received through art. 160(2) read with s. 3(1). There will be no impediment to the accommodation of this change by art. 8(1) because, as explained earlier, the right of access to justice that was originally integrated into art. 8(1) is one which can be modified and is therefore not absolute. The right that had become integrated into art. 8(1) earlier must therefore now yield to the change that has been made.” 59. The meaning of equality under Article 8 (1) of the Federal Constitution does not mean all individuals must be treated equally. Article 8 (1) merely provides that the law must be applied equally to individuals, who are in similar circumstances. At pgs. 723-725, the Federal Court said as follows: “The passages just referred to read with the earlier parts of the judgment reproduced previously reveals that the Court of Appeal had conducted a rigid scrutiny of s. 72 and had immediately proceeded to rule it as being unconstitutional since it is contrary to the rule of law housed within art. 8(1) in that is fails to meet the minimum standards of fairness. But that is not our law. In order to appreciate our law it must first be understood that equality does not mean absolute equality of all men, which is a physical impossibility to attain (see Sheoshanker v. State of MP AIR 1951 Nag 58). In saying that equality is a legal concept which is easy to state but difficult to apply Suffian LP said in Datuk Haji Harun bin Hj Idris v. Public Prosecutor [1977] 2 MLJ 155 at p. 165: ... because, first, equality can only apply among equals and in real life there is little equality, and, secondly, while the concept of equality is a fine and noble one it cannot be applied wholesale without regard to the realities of life. While idealists and democrats agree that there should not be one law for the rich and another for the poor nor one for the powerful and another for the weak and that on the contrary the law should be the same for everybody, in practice that is only a theory, for in real life it is generally accepted that the law should protect the poor against the rich and the weak against the strong. Article 8(1) is therefore not intended to make unequals equal. As Chaudhari & Chaturvedi say in their book Law of Fundamenal Rights 4th edn at p. 15: Equality presupposes classes. Therefore, the only application of the equality clause in a society of classes is by creating, abolishing, reconstituting, recognising or providing for any facility for any class, at any suitable time. It follows that the requirement for equal protection of the law does not mean that all laws passed by a legislature must apply universally to all persons and that the law so passed cannot create differences as to the persons to whom they apply and the territorial limits within which they are in force (see Malaysian Bar & Anor v. Government of Malaysia [1987] CLJ 185 (Rep); [1987] 1 CLJ 459; [1987] 2 MLJ 165. In Ong Ah Chuan v. PP [1980] 1 LNS 181; [1981] 1 MLJ 64 Lord Diplock said at p. 72: Equality before the law and equal protection of the law require that like should be compared with like. What art. 12(1) (our Article 8(1)) assures to the individual is the right to equal treatment with other individuals in similar circumstances. Similarly as Hashim Yeop A Sani J (as he then was) said in Public Prosecutor v. Su Liang Yu [1976] 2 MLJ 128 at p. 129: The dominant idea in both expressions 'equal before the law' and 'equal protection of the law' is that of equal justice. The meaning of these two expressions have been decided in a number of decisions of the US Supreme Court and also the Indian Supreme Courts and certain principles have been settled and accepted. Due to the demands caused by the complexity of modern government the doctrine of classification was evolved by the courts for practical purposes and read into the equality provision. It has been accepted therefore that a legislature for the purpose of dealing with the complex problems arising out of an infinite variety of human relations cannot but proceed upon some sort of selection or classification of persons upon whom the legislation is to operate. It is also useful to refer to Public Prosecutor v. Khong Teng Khen & Anor [1976] 2 MLJ 166 where Suffian LP said at p. 170: The principle underlying Article 8 is that a law must operate alike on all persons under like circumstances, not simply that it must operate alike on all persons in any circumstances, nor that it 'must be general in character and universal in application and that the State is no longer to have the power of distinguishing and classifying persons... for the purpose of legislation', Kedar Nath v. State of West Bengal AIR 1953 SC 404, 406. In my opinion, the law may classify persons into children, juveniles and adults, and provide different criteria for determining their criminal liability or the mode of trying them or punishing them if found guilty; the law may classify persons into women and men, or into wives and husbands, and provide different rights and liabilities attaching to the status of each class; the law may classify offences into different categories and provide that some offences be triable in a Magistrate's court, others in a Sessions Court, and yet others in the High Court; the law may provide that certain offences be triable even in a military court; fiscal law may divide a town into different areas and provide that ratepayers in one area pay a higher or lower rate than those of another area, and in the case of income tax provide that millionaires pay more tax than others; and yet in my judgment in none of these cases can the law be said to violate Article 8. All that Article 8 guarantees is that a person in one class should be treated the same as another person in the same class, so that a juvenile must be tried like another juvenile, a ratepayer in one area should pay the same rate as paid by another ratepayer in the same area, and a millionaire the same income tax as another millionaire, and so on.” 60. The Federal Court also held that the only way for the Courts to rule that a written law is unconstitutional is that the party must show that it does not comply with the reasonable classification test. To satisfy this, one would need to look at the purpose and objectives of the Act. 61. At p. 737, the Federal Court said as follows: “It is now apposite to consider whether s. 72 meets the requirements of the reasonable classification test. What needs to be looked at for this purpose is the object of the Act and the role of s. 72 in attaining that object which have been eloquently set out in the written submission of the appellant.” Respondent’s submissions on the moratorium issue before this Court 62. Mr. Ravindra Murugavell, the learned counsel for the respondent, submitted that since various divisions of the Industrial Court have taken a common stand on this matter, the moratorium issue has no merit and should be decided in favour of the respondent. He cited the Industrial Court case of Nerin @ Erin Marapus v Malaysian Airlines System Berhad (“Nerin”) (Award No. 1232 of 2015) in support of his submission. 63. In that case, the material facts are that the hearing, which commenced on 29.10.2014 was completed on 06.04.2015. Subsequently, on 25.05.2015, the Administrator was appointed for the Administered Companies under s. 5 of the MASB (Administration) Act 2015. As a result of the appointment of the Administrator, s. 11(1)(e) of the MASB (Administration) Act 2015 became operative. 64. Nevertheless, the Industrial Court in that case was of the view that it has to act within the perimeters of the IRA 1967, in particular, s. 30(3) of the IRA 1967, which requires the Industrial Court to hand down the Award without delay and where practicable within thirty days from the date of a reference to it under subsection 20(3). 65. Therefore, the Industrial Court in that case held that it was duty bound to see to the completion of the case by handing down its award in accordance with that provision. The Industrial Court in that case was also of the view that the written consent of the Administrator need not be obtained before it hands down the award of the case. This is because the Industrial Court was of the view that it could not be said to be “continuing with” the proceeding of the Industrial Court case by handing down its Award. 66. In paragraphs [3] and [4] of its Award, the Industrial Court said as follows: “[3] It is the intention of Parliament that the administration of the Administered Companies under the said Act should be carried out effectively and without interruptions. In this case, the hearing commenced on 29 October 2014 and thereafter it continued on other dates till its completion on 6 April 2015. The court gave directions for the written submissions to be filed by 6 May 2015 but there were requests for the extension of the dates to file the written submissions which the court did grant to both parties. Hence, the first written submission was received on 5 June 2015. Meanwhile, the Administrator was appointed on 25 May 2015 so section 11 (1) of the said Act came into effect. [4] Nevertheless, this court has to act within the perimeters of the IRA and to hand down the award according to section 30 (3) of the IRA which states that “The Court shall make its award without delay...” Section 30 (5) of the IRA enjoins the court to act according to equity and good conscience and for the finality of this case, it is the opinion of this court that a written consent of the Administrator need not be obtained before the court hands down the award of the case as the court cannot be said to be “continuing with” the proceeding. The hearing before this 3 3/4-1157/13 court had commenced and the proceedings closed before the Administrator was appointed and this court is duty bound to see to the completion of the case by handing down this award.” (Emphasis added). 67. Mr. Ravindra Murugavell, the learned counsel for the respondent, also distinguished the factual matrix of the Danaharta case and the objectives of the Danaharta Act 1998 from the factual matrix of the instant case and the objectives of the MASB (Administration) Act 2015. Decision of this Court on the moratorium issue 68. Having heard and considered the submissions of both the parties, on 16.02.217, I agreed with the respondent’s submissions that the applicant’s moratorium issue has no merit. Hence, I rejected it. 69. The applicant did not file a notice of appeal against my decision dated 16.02.2017 in favour of the respondent on the moratorium issue. 70. Below are my reasons for deciding that issue (1) has no merit. Issue (1): Whether the Industrial Court committed a jurisdictional error in handing down the Award without first obtaining the written consent of the Administrator by virtue of the moratorium in s. 11(1)(e) read together with the duration of the moratorium in s. 12 of the MASB (Administration) Act 2015? 71. In this Judgment, I agreed with the submissions of and the reasons, which were given by Mr. Ravindra Murugavell, the learned counsel for the respondent, that issue (1) has no merit. 72. Hence, on issue (1), I was of the respectful view that the handing down of the Award by the Industrial Court on 27.07.2015 was not caught by the moratorium in s. 11(1)(e) read together with the duration of the moratorium in s. 12 of the MASB (Administration) Act 2015. 73. I was of the respectful view that since the hearing of the I.C. case before the Industrial Court was completed on18.12.2014, before the appointment of the Administrator on 25.05.2015, s. 11(1)(e) of the MASB (Administration) Act 2015 does not bar the Industrial Court from handing down its award without first obtaining the prior written consent of the Administrator to do so. Therefore, I was of the respectful view that Nerin was correctly, decided by the Industrial Court based on the reasons given by the Industrial Court in that case. This is because the Industrial Court has a specific time frame to deliver its award and this time frame is expressly stated in clear terms in s. 30(3) of the IRA 1967, viz without delay and where practicable within 30 days from the date of the conclusion of the hearing. 74. S. 30(3) of the IRA 1967 states as follows: “30. Awards (1) … (2) … (3) The Court shall make its award without delay and where practicable within thirty days from the date of reference to it of the trade dispute or of a reference to it under subsection 20(3). (4) – (9) …” 75. I was of the respectful view that if it was, indeed, the intention of the Legislature to bar the Industrial Court from handing down its award, after the appointment of the Administrator under s. 5 of the MASB (Administration) Act 2015 unless the Industrial Court has obtained the prior written consent of the Administrator, the Legislature, viz Parliament, would have provided for it in clear terms in the MASB (Administration) Act 2015. This is because Parliament must be taken to have been aware at the time the MASB (Administration) Act 2015 was passed that the Industrial Court is, statutorily, bound by s. 30(3) of the IRA 1967 to hand down its award without delay and where practicable within 30 (thirty) days from the date of Ministerial reference to it under s. 20(3) of the IRA 1967. Hence, the Legislature would have in clear words enacted that the word “proceedings” in s. 11 (1) (e) of the MASB (Administration) Act 2015 also includes the handing down of any award by the Industrial Court and that this is so even though the trial before the Industrial Court was completed before the appointment of the Administrator. 76. I was of the respectful view that the word “proceedings” means the filing of a claim in the Industrial Court against the applicant and the continuation of the trial of the claim against the applicant in the Industrial Court but that it did not include the handing down of an award by the Industrial Court by virtue of s. 30(3) of the IRA 1967 after the trial of the claim was completed prior to the appointment of the Administrator under s. 5 of the MASB (Administration) Act 2015. It follows that I was of the respectful view that s. 11 (1) (2) of the MASB (Administration) Act 2015 is not applicable to the factual matrix of this case. Hence, this Court is seised of jurisdiction to hear this judicial review application since it was filed by the applicant against the respondent and not vice versa and that the written consent, which was given to the applicant by the Administrator, to file the judicial review application did not enlarge the power of the Industrial Court or the power of this Court to hear the judicial review application of the applicant. 77. Hence, on the moratorium issue, this Court declared that this Court has jurisdiction to review the Award even though the I.C. handed down the Award without first obtaining the written consent of the Administrator. So that took care of the moratorium issue. The MASB (Administration) Act 2015 78. The MASB (Administration) Act 2015 was enacted to, inter alia, provide special laws for the administration of the applicant, for the appointment of an Administrator with certain prescribed functions and powers to administer and manage the applicant and to provide for the establishment of a new entity, which will replace the applicant as the national carrier. The preamble, which sets out the objectives of the MASB (Administration) Act 2015, states as follows: “An Act to provide special laws for the administration of the Malaysian Airline System Berhad, its wholly owned subsidiary companies, and its partially owned subsidiary companies providing goods or carrying out services or both that are essential to the operations of the Malaysian Airline System Berhad and the appointment of an administrator with the powers to administer and manage the Malaysian Airline System Berhad, its wholly owned subsidiary companies, and its partially owned subsidiary companies providing goods or carrying out services or both; to provide for the establishment of a new entity which will replace the Malaysian Airline System Berhad as the national carrier; and to provide for related matters.” 79. There are 5 (five) recitals in the MASB (Administration) Act 2015, which explain why it was necessary for the Parliament of Malaysia to enact the MASB (Administration) Act 2015. These state as follows: “WHEREAS special provisions are required in the public interest to ensure the continuity of the essential air services by the Malaysian Airline System Berhad as the national carrier and the provision of uninterrupted connectivity to and from and within Malaysia by the national carrier: AND WHEREAS legislation is the only means to expeditiously administer and manage the Malaysian Airline System Berhad, its wholly owned subsidiary companies and its partially owned subsidiary companies providing goods or carrying out services or both that are essential to the operations of the national carrier without disruption to their operations: AND WHEREAS the establishment of a new entity, that is the Malaysia Airlines Berhad, with a new business model is critical to ensure continuity, profitability and viability, and to assume certain businesses, property, rights, liabilities and affairs of the Malaysian Airline System Berhad: AND WHEREAS it is in the public interest to ensure the continued existence of a national carrier to facilitate Malaysia's economic development: AND WHEREAS legislation provides an effective, efficient and seamless means to transition the business, property, rights, liabilities and affairs of the Malaysian Airline System Berhad to the new entity:” 80. The MASB (Administration) Act 2015 received the Royal Assent on 30.12.2014. 81. It was published in the Gazette on 05.01.2015. 82. It came into force on 20.02.2015, which was the date appointed by the Prime Minister by notification in the Gazette for the coming into force of the MASB (Administration) Act 2015, pursuant to s. 1(2) therein read together with s. 3 of therein. 83. The Administrator was appointed under s. 5 of the MASB (Administration) Act 2015. 84. S. 9 of the MASB (Administration) Act 2015 sets out the functions of the Administrator. 85. S. 10 of the MASB (Administration) Act 2015 sets out the powers of the Administrator. 86. S. 11 of the MASB (Administration) Act 2015, which concerns the effect of the appointment of the Administrator, provides in paragraph (e) of sub-section (1) that upon the appointment of the Administrator, a moratorium shall take effect, during which, certain acts are prohibited. These acts are set out as follows: “Effect of appointment of Administrator 11. (1) On the appointment of the Administrator, a moratorium shall take effect during which— (a) ... (b) ... (c) ... (d) ... (e) no proceedings and no execution or other legal process in any court or tribunal may be commenced or continued with, and no distress may be levied, against the Administered Companies or their property except with the prior written consent of the Administrator; (f) ... (g) ...” 87. S. 12 deals with the duration of the moratorium. It provides, inter alia, that the duration of the moratorium shall be for a period of 12 (twelve) months commencing from the date of the appointment of the Administrator, unless sooner terminated under s. 6 or s. 20(3)(c). 88. S. 6 states as follows: “Duration of administration 6. The administration of the Administered Companies by the Administrator shall commence from the date of appointment of the Administrator under subsection 5(1) and shall continue until the administration is terminated by the appointer.” 89. S. 20 states as follows: “Decision of the appointer 20. (1) The appointer shall consider the proposal of the Administrator together with the report of the Independent Advisor submitted to the appointer under subsection 19(3). (2) Where the appointer approves the proposal, the Administrator shall implement the proposal in accordance with its terms. (3) Where the appointer rejects the proposal, the appointer may— (a) direct the Administrator to revise the proposal; (b) direct the Administrator to prepare a new proposal; or (c) terminate the administration of the Administered Companies.” (Emphasis added). 90. I agreed with the respondent that the objectives of the Danaharta Act 1998 and the objectives of the MASB (Administration) Act 2015 and the factual matrix of the Danaharta case, which was cited and relied upon by the applicant, are easily distinguishable from the factual matrix of the instant case. It is trite law that Parliament has the power to enact federal laws which can enlarge or curtail the powers of the courts. 91. In the Danaharta case, supra, at p. 737, column d, Augustine Paul FCJ, in speaking for the Apex Court, clearly, captured the objective of s. 72 of the Danaharta Act 1998 when he said as follows: “The object of Parliament in enacting this law has been clearly stated in the Preamble to the Act. It reads as follows: An Act to provide special laws for the acquisition, management, financing and disposition of assets and liabilities by the Corporation, the appointment of special administration with powers to administer and manage persons whose assets or liabilities have been acquired by the Corporation and for matters connected therewith or incidental thereto.” 92. The learned Judge also referred to the speech by the then Minister of Finance in Parliament when introducing the Bill for the Danaharta Act 1998. The learned Judge then said as follows: “The object of the Act was explained in clearer terms in the speech delivered by the then Minister of Finance in Parliament while introducing the Bill the Act. The material parts of it read as follows: … suatu akta untuk memberi kuasa kepada Pengurusan Danaharta Nasional Berhad untuk mengambilalih pinjaman-pinjaman tidak berbayar dari institusi kewangan dan menggunakan prosedur pintas bagi memindah serta mendapatkan hakmilik keatas asset atau sekuriti yang disandarkan keatas pinjaman dengan kententuan pemilikan, seterusnya menguruskan pinjaman dan asset serta melaksanakan rancangan menyusun semula asset-aset dibacakan kali kedua sekarang … … … Dengan itu kerajaan telah memutuskan untuk menubuhkan sebuah syarikat yang dikenali sebagai Pengurusan Danaharta Nasional Berhad atau pun Danaharta dengan tujuan khusus untuk mengambilalih pinjaman tidak berbayar daripada institusi kewangan di Malaysia dan seterusnya menguruskan NPL serta asset-aset yang terbabit. Ini akan membolehkan institusi kewangan menumpukan perhatian dan usaha kepada aktiviti perbankan komersial yang biasa tanpa perlu memberi lebih tumpuan untuk mendapatkan kembali pembayaran keatas hutang-hutang tersebut. Danaharta akan membeli pelbagai jenis pinjaman, mendapat hakmilik yang sempurna keatas aset yang berkaitan dengan NPL dan memindahkan hakmilik yang sempurna kepada pihak ketiga. Dengan menjual asset kepada Danaharta, bank dapat mengantikan NPL dengan wang tunai. Rundingan tentang harga jualan akan dijalankan secara komersial dan kedua-dua belah pihak, penjual dan pembeli, berurusniaga di atas kerelaan masing-masing …” 93. In those circumstances, since the spirit and objective of the Danaharta Act 1998 was to ensure that Danaharta was able to buy and take over the Non Performing Loans from Banks and Financial Institutions, to enable this Institutions to concentrate on their commercial banking activities without having to concentrate on their efforts to recover the Non Performing Loans, the prohibition against the granting of injunctions under s. 72 of the Danaharta Act 1998, was essential to give effect to the purpose and object of the Danaharta Act 1998. This is captured by the following excerpt from the learned Judge’s Judgement at p. 740, column b to d: “Thus in so far as disposition of assets was concerned the appellant was given additional power to sell charged lands by private treaty, without securing the usual court order as banks and other secured lenders are obliged to do so under the National Land Code 1965. Quite clearly sales of these properties would be substantially delayed if injunctive relief was available. It must also be observed that in order to enable the appellant to expeditiously and promptly dispose off properties at the very best recover value in line with Parliament’s intention it is important for it to be in a position to give good title to the proprietors fast so that purchasers can readily get themselves registered as proprietors after they have paid the full purchase price to the appellant. If purchasers cannot be registered quickly as proprietors because the appellant is restrained by injunction from completing sales it would have a crippling effect on its ability to dispose off the acquired properties.” 94. This is the reason why the Federal Court allowed the appeal of Danaharta to the effect that the granting of the injunction by the Court of Appeal against Danaharta from selling and distributing assets was held to be wrong, ultimately, enabling the disposal of the Non Performing Loans by Danaharta. 95. The spirit and objective of the MASB (Administration) Act 2015 are, clearly, stated in its preamble, which has been set out earlier in this Judgment. 96. The continued operations as a national carrier in an uninterrupted manner being the stated objective of the MASB (Administration) Act 2015 is an important consideration on the facts in the case before this Court. There is no evidence, whatsoever, before this Court that in handing down an award in favour of the respondent, the applicant will be impaired and/or the continued operations of the national carrier will be impeded. This is, especially, so as s. 11(1)(e) of the MASB (Administration) Act 2015 prohibits any execution of any award of the Industrial Court, which is handed down during the moratorium period. 97. As can be seen in the Danaharta Act 1998, the granting of the injunction against Danaharta would have been contrary to the very objective of the Danaharta Act 1998. The granting of such injunctions would have caused delay in third parties acquiring titles to be disposed of by Danaharta, thereby prolonging the resolution of disputes between the parties. Whereas, on the facts in the instant case before this Court, it cannot be argued by the applicant that the act of the Industrial Court in handing down the Award, will impede or impair the operations of the national carrier. 98. In view of the above reasons, the case of Danaharta is of no assistance to this Court as it can be easily distinguished looking at the factual matrix of the 2 (two) cases and the objectives of the 2 (two) Acts. 99. Hence, the moratorium issue has no merit and must be decided in favour of the respondent. Applicant’s submissions on the dismissal issue before this Court 100. I then heard submissions from the parties on the dismissal issue. 101. The applicant submitted that based on the reasons given and the authorities cited by the applicant in its written submissions and in its submissions-in-reply before this Court, issue (2) has merits and should be decided in favour of the applicant as the Industrial Court has commited errors of law when it arrived at its decision in the Award that the respondent was dismissed without just cause and excuse as the punishment of dismissal, which was imposed on her, was too harsh or excessive for her misconduct. Respondent’s submissions on the dismissal issue before this Court 102. The respondent submitted that issue (2) has no merit and ought to be dismissed as the 2nd respondent did not commit any error of law. The respondent relied on the following reasons: (1) The entire case is pillared on one single issue i.e. the doctrine of ‘disparity of punishment’; (2) In the Award, the Industrial Court decided as follows: “13. But on the issue of disparity of sentence, this issue merits further scrutiny. The Claimant produced a Punishment Order dated 11.6.2012 that shows a misconduct by a Leading Stewardess for being absent without prior leave and falsifying a medial document was punished with a warning and deferment of annual increment. 14. The Company argues that the lesser punishment on the Leading Stewardess was because of her explanation letter and by the fact that she was of a lower rank than the Claimant. The Company said that the punishment of dismissal against the Claimant was because of her senior position in the Company. 15. It is well established that the principal of equity and good conscience dictates that employees who committed the same misconduct should receive the same punishment. If the Company was of the opinion that the misconduct by the Leading Stewardess was not serious enough to warrant a dismissal, then the Company had to have a very good reason for imposing the punishment of dismissal on the Claimant who committed a similar offence. 16. The reason given by the Company was because the Claimant was of a higher position. It is the opinion of this Court that being in a senior position does not mean one automatically deserves the most severe of punishment. Especially when there are other alternatives for a lesser punishment. If the Company thinks that the Claimant was not fit to be in a position with a higher responsibility for committing the misconduct, the Company can always consider a demotion, for example. 17. In the circumstances of this case, by the fact that another employee received a lesser sentence for a similar offence, and the Claimant having served the Company for 25 years, this Court do agree that the punishment of dismissal was too harsh and disproportionate with the misconduct. It follows therefore, the dismissal was without just cause and excuse.” (Emphasis added). (3) There is a plethora of authorities on the doctrine of ‘disparity of punishment’, in particular, the case of Arasapan Ramaiah v Ampang Hotel Sdn Bhd (Concorde Hotel Kuala Lumpur) [2009] 1 ILR 68. In that case, the Industrial Court held as follows: “(6) The problem in this case had arisen due to a lack of communication between the parties. Had the claimant been conscientious and courteous enough to explain the respondent's practise to COW2 who had been new to the respondent and sought the latter's consent to change the fused bulbs after 5am, then the need for a formal complaint may not have arisen. Technically although the claimant had been guilty of the 2nd charge, in that he had taken 2 hours and 45 minutes inclusive of his meal break to attend to the job assigned instead of immediate action as directed by COW2 but in the final analysis, the job had been completed well within his shift. The respondent ought to have considered this fact before deciding on imposing the most severe punishment of dismissal on him. It had not been unreasonable for the claimant to have performed the job when he had and although he had been guilty of not obeying COW2's instructions immediately, he had eventually carried it out. Thus dismissal had been too harsh under the circumstances. Other Employee's in the same department as the claimant had only been punished with a warning letter. Eventhough the claimant had had some disciplinary problems previously and eventhough he had been of supervisory level, there should not have been such a vast disparity in the punishment meted out to him. Thus his dismissal had been without just cause and excuse (para 28).” (Emphasis added). (4) The other authorities, which have upheld the doctrine of ‘disparity of punishment’, are as follows: (1) Automotive Manufacturers (Malaysia Sdn Bhd v Ahmad Mohd Som [2009] 2 ILR 290, Industrial Court Kuala Lumpur; (2) Penfibre Sdn Bhd and Penang & S. Prai Textile Garment Industries Employees’ Union [1987] 2 ILR 259, Industrial Court Pulau Pinang; (3) Kelab Golf Negara Subang v Mat Idris Siakat [2004] 2 ILR 306, Industrial Court Kuala Lumpur; (4) Bumiputra Commerce Bank Bhd v Abdul Kahar Dudi & Ors [2005] 1 ILR 489, Industrial Court Kuala Lumpur; and (5) Network Foods Industries Sdn Bhd v Thandapani Tirugnanasambandam [2006] 1 ILR 281, Industrial Court Kuala Lumpur. (5) On the facts of the instant case, the applicant has invoked the doctrine of “disparity of punishment” on the ground that the respondent was holding a higher position than Puan Esdjuna. However, this Court should take note that Puan Esdjuna, the employee, who received the lesser punishment, was a Leading Stewardess, who also has supervisory functions over the other Stewardesses; and (6) Therefore, there is no rationale, whatsoever, to justify the vast disparity in punishment between the punishment of dismissal, which was imposed on the respondent, and the punishment of a final warning with a deferment of an annual increment, which was imposed on Puan Esdjuna. Decision of this Court on the dismissal issue 103. On 06.03.2017, I agreed with the submissions of Mr. Vijayan Venugopal, the learned counsel for the applicant, that the dismissal issue has merits and that an order of certiorari ought to be granted by this Court to quash the Award. 104. Consequently, I granted an Order of certiorari to remove the Award to this Court and quashed. 105. I then heard submissions from the learned counsels of both the parties on the amount of cost to be ordered against the respondent. Mr. Vijayan Venugopal, the learned counsel for the applicant, prayed for a sum of RM 10,000.00 as cost. 106. However, Mr. Ravindra Murugavell, the learned counsel for the respondent, proposed that no order as to cost be made by the Court against the respondent as the applicant had lost on the moratorium issue. 107. Nevertheless, Mr. Vijayan Venugopal, the learned counsel for the applicant, informed the Court that he still maintained his prayer of a sum of RM 10,000.00 to be paid to the applicant as cost because of the 3 sets of submissions, which he had put in on the merits of enclosure (1). 108. Having heard and considered their submissions, I agreed with the submission of Mr. Ravindra Murugavell, the learned counsel for the respondent. I, accordingly, ordered that there shall be no order as to cost. 109. Being dissatisfied with my decision dated 06.03.2017, on 03.04.2017, the respondent filed a notice of appeal to the Court of Appeal against my decision dated 06.03.2017. Issue (2): Whether the I.C. committed any error of law when it arrived at its decision in the Award that the respondent was dismissed without just cause and excuse as the punishment of dismissal, which was imposed on her, was too harsh or excessive for her misconduct? 110. Below are my reasons for deciding issue (2) in the affirmative. 111. On issue (2), I agreed with the submissions of the applicant that the Industrial Court committed an error of law when it arrived at its decision in the Award that the respondent was dismissed without just cause and excuse as the punishment of dismissal, which was imposed on her, was too harsh or excessive for her misconduct. The 6 (six) letters 112. There are 6 (six) letters, which are important. These are reproduced below. The applicant’s show cause letter dated 25.09.2012 113. The first letter is the show cause letter dated 25.09.2012 entitled “Memorandum” on the subject entitled “Tampered Medical Certificate – Fraud or dishonesty in connection with the business of the Company”. 114. It states as follows: “MEMORANDUM Ref : OPS PRM/SC010-2 To : IFS Joyce Tan Staff No: 012820-5 From : Manager Performance & Resource Management In-flight Services Date : 25th September 2012 Re : SHOW CAUSE Subject : Tampered Medical Certificate – Fraud or dishonesty in connection with the business of the Company It has been reported by Crew Deployment Centre (CDC) that the following medical certificate submitted by you was fraud to be a tampered medical certificate. Date of MC : 31st August 2012 Duty : Standby Name of Medical Institution : Klinik Rakan Medik – Kelana Jaya Serial No. : 027MC0060250 The allegations mentioned above are a serious act of misconduct under the Rules and Regulations of the Company and attracts major punishment. “You have therefore Committed an act of misconduct inconsistent with the fulfilment of your terms and Conditions of service with the Company by virtue of Clause 7, Para 7.1, of Appendix A, Act of Misconduct of MAS Disciplinary Procedure and such act of misconduct attracts severe punishment”. You are hereby required to submit your written explanation within three (03) working days, i.e. on or before 25th September 2012 on receipt of this letter as to why disciplinary action should not be taken against you. Should you fail to give your explanation as required within the stipulated time, it will be presumed that you have no explanation to offer and the Company may forthwith proceed with disciplinary action against you. Since the allegation levied against you is a serious nature, you are hereby removed from your roster with immediate effect pending further investigations. During this period you must be contactable at the following address awaiting further instructions. Address : C-6-8, STARVILLE APARTMENT JALAN USJ 19/6 47300, SUBANG JAYA Contact No : HP: 012 2369286 Please acknowledge receipt of this letter by signing and returning the attached copy to me. … (signed) … Rodzlin Ramli Manager Performance & Resources Management In-flight Services I hereby acknowledge receipt of this letter … (signed) … Name: Joyce Tan Staff No: 128205 Date: 25th September 2012 Time: 1000HRS Cc: Executive Vice President In-flight Services Head of Human Resources (Services, KLIA) Flight Operations Manager (Crew Deployment Centre) Controller, Performance & Resources Management.” The respondent’s letter of explanation dated 25.09.2012 115. The second letter is the respondent’s letter of explanation dated 25.09.2012 to the show cause letter entitled “INFLIGHT SERVICES DIVISION CABIN CREW LINE OPERATIONS”. 116. It states as follows: “INFLIGHT SERVICES DIVISION CABIN CREW LINE OPERATIONS Date: 25th September 2012 Address: STARVILLE APT, BLK Name: Joyce Tan C, C-6-8, USJ 19/6, Contact No.: 012-2369286 SUBANG JAYA, SGOR Staff No: 12820-5 Rank: IFS Fleet: WB Witness By: …………. Date: 25.09.2012 Time: 1000HRS Inflight Services Manager Cabin Crew Line Operations Dear Sir, Subject: TAMPERED MEDICAL CERTIFICATE ON THE 31ST AUGUST I WAS VERY SICK, DOWN WITH HIGH FEVER, DIAHRROAE, BAD COUGHING NON STOP & LOST MY VOICE PLUS MY CHIN ALLERGY WAS GETTING REDDER. BEING ON STANDBY ON 29, 30 & 31 AUGUST, I WAS NOT CALLED UP FOR FLIGHT THINKING THAT I COULD REST AT HOME BUT ON THE LAST DAY OF STANDBY 31 AUG, I WAS CALLED UP AT 1610HRS BY CDC OFFICER FOR FLIGHT. AFTER CONSUMING A LARGE AMOUNT OF MEDICATION, I WAS NOT IN A RIGHT FRAME OF MIND & WAS TOTALLY LOST ON WHAT TO DO HENCE I INFORMED THE OFFICER I HAD 01 DAY MC (31/08) FROM ‘KLINIK MEDIC’ WHICH I HADN’T SEEN … Crew Signature: … (signed) … Date: 25/09/12 For Office Use: Fleet Administrator: … (signed) … Date: 25/09/12 ZAINAB MAJID Inflight Services Executive Cabin Crew Line Operations (CCLOPS) Malaysia Airlines Action Taken: ……………………..…… Status: HRD referral ……………………..…… Signature: (signed) … THE DOCTOR YET. I HAVE NOT TAKEN MC FOR A VERY LONG TIME SINCE 2008 & BEING IN THE COMPANY FOR 25 YEARS, MY RECORD IS CLEAN. THE REASON WHY I PLEADED YOUR GOOD OFFICE FOR LENIENCY IS BECAUSE I WASN’T IN THE RIGHT FRAME OF MIND TO ALTER THE MC CERT & NEVER CROSSED MY MIND TO CALL MY F/A OR EVEN SEEK HER ADVICE TO TAKE E/L AS IT WAS A PUBLIC HOLIDAY. ONLY AFTER SPEAKING TO HER TODAY THAT I REALIZED MY MISTAKE. I WASN’T MY REAL SELF AS MY FEVER WAS HIGH WHEN I TAMPERED THE MC WHICH WAS DATED 03 SEPT TO 31 AUG. UNDER FTL, CABIN CREW CAN INFORM THE DEPT. THAH THEY ARE NOT WELL & NORMALLY THE DEPT. WILL LISTEN. ON THAT VERY DAY, 31 AUG, I COULDN’T THINK PROPERLY & WASN’T IN A RIGHT FRAME OF MIND TO TAMPER THE MC DUE TO MY HIGH FEVER, DIAHRROAE, NON STOP COUGHING & SORE THROAT, FEARING THAT I WILL BE CALLED TO THE OFFICE. THIS IS MY FIRST TIME ACT OF MISCONDUCT & I SINCERELY BEG FOR LENIENCY. EVEN AT TIMES WHEN I WAS REALY COUGHING PROFUSELY & LOST MY VOICE, I STILL GO FOR FLIGHT, THINKING THAT EVERYTHING IS OK & NOT TAKINGY MC. Crew Signature: … (signed) … Date: 25/09/12” The dismissal letter dated 24.10.2012 117. The third letter is the dismissal letter dated 24.10.2012 entitled “PUNISHMENT ORDER”. 118. It states as follows: “CONFIDENTIAL 24 October 2012 HRSPM/PO – 079/12/KUL Cik Joyce Tan @ Tan Siew Eng (S/No.: 0128205) C-6-8, Starville Apartment Jalan USJ 19/6 47300, Subang Jaya SELANGOR DARUL EHSAN Dear Cik Joyce Tan, PUNISHMENT ORDER We refer to the Show Cause letter ref OPS PRM/SC010-12 dated 25 September 2012 served to you by Manager Performance & Resources Management, Inflight Services and your letter of explanation. The Company noted that you have admitted guilt to have tempered the medical certificate below: Date of MC Duty Name of Medical Institution Serial No 31 August 2012 Standby Klinik Rakan Medik – Kelana Jaya 027MC 0060250 which you have submitted in support of your absence from standby duty on 31 August 2012. As an In-flight Supervisor of the Company, you are not only a leader but also a role model to the other Cabin Crew team members. Your action is tempering the medical certificate leaves a permanent blemish on your record. It is with regret to inform you that it is the Company’s decision that you be dismissed from the services of the Company with immediate effect. According to the Company Disciplinary Procedure, you have the right to appeal to the Disciplinary Appeals Committee of the Company within sixty (60) days from the date of the service of this letter to have the punishment reviewed. Should you decide to do so, you should address your appeal through the Company Secretary 3rd Floor, Admin 1 Building Complex A, Sultan Abdul Aziz Shah Airport 47200 Subang Selangor Darul Ehsan Stating your grounds in full. You are advised that only the appeal letter signed by you will be entertained for consideration. By copy of the letter, Head Human Resources (Payroll) is required to pay you the final payment of your salary and allowances after you have obtained the necessary Company clearance. The Company clearance from is attached herewith. Please acknowledge receipt of this letter by signing and returning the attached copy to me. Yours faithfully, … (signed) … Zaiton Shaari SENIOR MANAGER, STRATEGIC PEOPLE MANAGEMENT Zs/esy cc: Director of Human Resources cc: Manager, Crew Performance & Resources Management cc: Manager, FO – Crew Deployment Centre cc: Manager Human Resources Services KLIA cc: Manager Human Resources (Payroll) cc: Controller, FO – Crew Planning & Scheduling cc: Secretary General MASEU …………………………………………………………………………………. I hereby acknowledge receipt of this letter … (signed) … Name: Joyce Tan S/No: 128205 Date: 09 Nov 2012.” The respondent’s letter of appeal dated 16.11.2012 119. The fourth letter is the respondent’s letter of appeal dated 16.11.2012 entitled “Appeal for Reinstatement”. 120. It states as follows: “To, The Disciplinary Appeals Committee, c/o Company Secretary, 3rd Floor, Admin 1 Building, Complex A, Sultan Abdul Aziz Shah Airport, 47200 Subang, Selangor Darul Ehsan. 16th November 2012 Dear Sir/Madam, Re: Appeal for Reinstatement With reference to the above, i would like to humbly submit my appeal for reinstatement to my former position as In-flight Supervisor in the Company. The Punishment Order of Termination I have been served with was harsh and unconscionable punishment. This left me feeling victimized considering the length of service i have dedicated to for the last 24 years. Please allow me to explain the circumstances which led to this very unfortunate situation. On 03rd August 2012, I operated MH 16 KUL/AMS and it was during that period I may have contracted flu and cough plus my chin developed allergy. I was utterly unwell but I went on for flight and came back 04 days later. My crew even commented on my red chin that was dry and peeling (the thick make up did the trick). I continued my allergy medication (Augmentin amoxicillin + clavulanate potassium & Aerius desloratadine) and consumed cough and flu medication (Benadryl & Zyrtec) from my previous visits to the doctor in hope to ease the irritation. All medications made me drowsy. (Refer attached list of prescribed medications and side effects). On 17th August, I operated my next flight MH 135 KUL/BNE on my birthday with a sore throat and eventually led to me losing my voice altogether. Hence I had to delegate 03 of my crew who were rated (5 star rating) to deliver the announcements on my behalf for both sectors, BNE/KUL as well. I had indicated it in my eVR as per attached in the print out. During my night-stop in BNE, I had to call-in for a doctor and was diagnosed of having an infection of the lungs which required strong antibiotics. Unknowingly, the medication prescribed to me by the doctor rendered me feeling drowsy and disorientated that the only recourse available was to rest and allow the medication to wear off gradually. After 10 days, I had already consumed all the medication and was still feeling very weak and faint due to the persistent coughing and chin allergy medication that I was unable to go to the doctor again. I visited Klinik Rakan Medic, Kelana Jaya, and was prescribed with stronger medication (Zyrtec) which made me even drowsier. Within that week, I had operated multiple flights i.e. MH 388 KUL/PVG (29th August), MH 389 PVG/KUL (21st August), MH 74 KUL/HKG (24th August) and MH 74 HKG/KUL (25th August) as attached in August roster. My chin allergy re-occured on the 26th August and I had fever and diarrhea, hence I consumed Panadol (Coxa 500). I was very weak and had no appetite. I paid the doctor another visit on the 17th August to get a new batch of mediation in which she offered me Medical Certificate. I decline the offer knowing that I have another flight to fulfill the following day ie MH 390/391 KUL/XMN/KUL (18th August) with the hope I could withstand one more day of duty. Despite my condition I operated the flight safely. The next day I was on standby (29th, 30th and 31st August) and on my last day of standby i.e. 31st August, a public holiday, I was called for flight by the Duty Officer. I told him that I was unwell and had my medical leave from Klinik Rakan Medic. At that time, I was sure that I would obtain Medical Certificate from a legal medical professional and thought that as I wasl still not well enough to start my fliying duties, I rested at home. He duly acknowledged my absence from duty. All the medication I had consumed had taken its effect till I forgotten to obtain a legitimate Medical Certificate from the doctor. I felt slightly better on 01st and 02nd September but on 03rd September, my fever and diarrhea became worse. I immediately went to see the doctor whereby a stronger and drowsier medication (Lomodium, Progesic 500 & Fucon hyoscine-N-Butylbromide) was prescribed to hald my diarrhea and stomack ache. The doctor advised me to take Medical Certificate and rest at home but I decline thinking I would get better the next day and go to work. The doctor however, issued a Medical Certificate for me. She had also issued a supporting letter for my refusal of Medical Certificate as per attached. In all my years of flying, I have served the Company well in many capacities apart from my position as In-flight Supervisor which includes: 1. Volunteering to operate flights during crisis eg. Volcanic Ash crisis in Europe and Ops Pyramid bringing back Malaysians from Egypt and Jeddah. 2. Volunteering to be part of Humanitarian Support team in the Crisis Management Department and a part-time Assocaite Trainer. 3. Participating in various projects by the Company including numerous Company’s Corporate Social Responsibility (CSR) projects eg. Walkathon Welkins, Corporate Challenge Day and Toastmasters International. 4. Bringing a B747-400 aircraft engine on fire in mid air to safety with a total of 300 passengers and crew. 5. Involvement in French language for the benefit of passengers’ communication enhancement. I have done all these during my off-days and without neglecting my primary duties as an In-flight Supervisor with the Company which I have been proud to shoulder for the last 07 years. Without fail, I have always risen to the call of duty to the extend of calling the Duty Officer requesting for flights on standby as it is evident in all my performances/assessments/appraisals by the Company which will testify that I have been a dedicated, dutiful, loyal and responsible cabin crew. I have also received numerous positive feedbacks from the department of my performances as many passengers have written to the Company over the years of the wonderful in-flight services rendered by me and my cabin crew. To date, I have received 20 compliment letters within 2011/2012. I have also been an exemplary cabin crew as in all my 24 years, 11 months and 23 days in the Company; I have never been subjected or reprimanded for any misconduct or disciplinary issues whatsoever. This is my First Medical Certificate after may years of working. This incident would be the First time I have committed an act of misconduct in the Company and it is indeed very disappointing and shocking to state that I was summarily dismissed without any consideration to my years of dedicated and loyal service to the Company. I was not even given the opportunity to defend myself or make any plea for clemency prior to the order of termination and with to state that I was under duress at that time when I was told that if I gave my explaination before 25th September, I will not be removed from flight. I felt very disappointed and it took me by surprise. I was hit on the spot and contrary to what my Fleet Administrator had said. From my understanding, an explanation to a Show Cause letter can be provided within 3-7 days. It is a far cry for me that I was certainly denied any form of “Natural Justice” and as such my termination is without just cause or excuse. Company procedurs provide 14 days but here I was ask to write a letter on the spot. To quote a similar case, a Technical crew was offered only a warning letter but I was not and I felt victimised why the Technical crew was treated differently from me. Am I not a human being? I am hoping that your good office will reconsider and review any punishment short of a dismissal and permit me to be reinstated back to my former position after duly deliberating and considering the number of years of dedicated and loyal service I have given to the Company. Yours sincerely, ... (signed) ... IFS Joyce Tan @ Tan Siew Eng S/N 012820-5 20th November 2012” The applicant’s letter dated 18.12.2012 121. The fifth letter is the applicant’s letter dated 18.12.2012 entitled “Appeal”, which informed the respondent that her appeal was dismissed by the DAC”. 122. It states as follows: “18 December 2012 Our Ref.: GSP-056/5/12 [131212] Miss Joyce Tan @ Tan Siew Eng No. C-6-8, Block C Starville Apartment Jalan USJ 19/6 47300 SUBANG JAYA SELANGOR Miss RE : APPEAL We refer to the appeal made by you to the Management and regret to inform that the Disciplinary Appeal Committee which sat and considered your case has dismissed your appeal. Regards. Yours faithfully For MALAYSIAN AIRLINE SYSTEM BERHAD ... (signed) ... RIZANI BIN HASSAN Company Secretary zmy cc : Human Resources Attn: Puan Zaiton Shaari Email: zaitons@malaysiaairlines.com” The applicant’s solicitors’ letter dated 25.05.2015 123. The sixth letter is the applicant’s solicitors’ letter dated 25.05.2015 to the Industrial Court requesting for a deferment of any Award to be handed down in respect of the I.C. case. 124. It states as follows: “Shearn Delamore & Co Ruj Tuan Ruj Kami: SD(IR) 3806254(VJ) 25th May 2015 Registrar Mahkamah Perusahaan Jalan Mahkamah Persekutuan 50544 Kuala Lumpur Dear Sirs, RE: INDUSTRIAL COURT CASE NO. 11/4-447/13 JOYCE TAN @ TAN SIEW ENG -V- MALAYSIAN AIRLINE SYSTEM BERHAD We refer to the above matter which is pending an Award from this Honourable Court. We act for Malaysian Airline System Berhad in the instant matter. We have been informed by our client that, pursuant to Section 5 of the Malaysian Airline System Berhad (Administration) Act 2015 (hereinafter referred to as the “MAS Act 2015”), the Administrator is expected to be appointed on 25th May 2015. In the circumstances, the provisions of Section 11, 12, and 25(2) of the MAS Act 2015 will accordingly come into force. A moratorium shall therefore take effect during which no proceedings, actions and or executions may be commenced or continued with without the prior written consent of the Administrator. The moratorium period shall be for twelve (12) months from the date of the appointment of the Administrator, which provision to apply for an extension of up to a further twelve (12) months. We have accordingly been instructed to apply for a deferment of any Award being handed down in the instant matter, pursuant to the provisions of the MAS Act 2015. Yours faithfully, … (signed) … Shearn Delamore & Co Written by Vijayan Venugopal Telephone 603 2027 2784 Fax 603 2078 5625 Emel vijayan@shearndelamore.com c.c. 1. Malaysian Airline System Employees’ Union No. 40, Tingkat 1 Jalan USJ 10/1E Subang Jaya 47620 Petaling Jaya Fax/Post 2. Client By Email” Whether the respondent’s misconduct warranted the punishment of dismissal? 125. The applicant had decided that in the circumstances of the respondent’s case, the respondent’s misconduct warranted the punishment of dismissal and no less. 126. It was established during cross-examination that the respondent admitted the act of tampering with the medical certificate is a misconduct and she further agreed that the same is a serious misconduct (see p. 21 of the Notes of Proceedings in Exhibit “VJ-1”, of the applicant’s supplemental affidavit, enclosure (12)). 127. There is an abundance of cases decided by the Industrial Court on this point. 128. In Texas Instruments (M) Sdn. Bhd. v Flourmeena A/P Saminathan [1996] 2 ILR 128, the Industrial Court quoted an excerpt from Alfred Avins in “Employment Misconduct” which states as follows: “It is misconduct to present to the employer any forged document and it is not necessary to constitute the offence that the document be one of a financial nature…and it is punishable knowingly to use a forged document as genuine to mislead a superior even if the employee did not himself forge it.” 129. In Sime Bank Bhd v Mohd Shaib Md Yusof [2003] 2 ILR 530, at p. 540, the Industrial Court upheld the Bank’s decision to dismiss the employee for making a false medical claim of RM 50 based on a receipt, purportedly, issued by a private clinic. The Industrial Court held as follows: “The dishonest act of the claimant in submitting the false medical receipt has breached the fiduciary relationship of trust between the bank and the claimant.” 130. It must be emphasized that in this case, the respondent had, deliberately, changed the date of the MC from 03.09.2012 to 31.08.2012 and, thereafter, she had submitted the MC to the applicant. Applicant’s proven case before the Industrial Court 131. Zaiton Shaari (COW-1), the applicant’s witness, testified on the reasons for the decision of the applicant to dismiss the respondent. She testified as follows: “The misconduct that was committed by the Claimant, which is tampering with medical certificate, is unbecoming of someone holding a high ranking position in the Company. As an In-Flight Supervisor, it is expected of the Claimant to possess a high level of integrity and honesty. The Claimant was also responsible to prepare various documents pertaining to work and performance of cabin crew. Based on the reasons above, the Company is not able to compromise with the Claimant’s conduct.” (See A17 of the witness statement of COW-1 at p. 30 of Exhibit “LSP-1”, of the applicant’s affidavit-in-support, enclosure (3)). 132. I found that COW-1’s testimony in her examination-in-chief is consistent with her testimony during cross-examination. In cross-examination, she said as follows: “28. What is the criteria followed by Strategic People Management Committee to decide on the punishment of dismissal? - As referred earlier case was tabled to Strategic People Management Committee and based on seriousness of the misconduct committed by Claimant who was an In-Flight Supervisor it was not acceptable by the Company considering the high seniority she held. The In-Flight Supervisor is the highest position in the cabin crew hierarchy.” (See pgs. 8 & 9 of Exhibit “VJ-1”, of the applicant’s supplemental affidavit, enclosure (12)). 133. At this juncture, I noted that the Industrial Court did not reject the evidence of COW-1 on the decision of the applicant to dismiss the respondent. I also noted that the Industrial Court did not at any point in time find that COW-1 lacked the credibility of a truthful witness. 134. I further noted that it is a fact that the respondent did not dispute the charge levelled against her. The relevant excerpt from the respondent’s cross-examination is reproduced below. “71. You informed the Company you were on MC on 31/8/2012? - Yes. 72. You are aware you had to submit an MC for 31/8/2012? - Yes. 76. You than tampered into the date of the MC. Changing the date of the MC from 3/9/2012 to 31/8/2012? - Yes. 77. You submitted the tampered MC with the date 31/8/2012 to the Company? - Yes.” (See p. 18 of Exhibit “VJ-1”, of the applicant’s supplemental affidavit, enclosure (12)). 135. Hence, I was of the respectful view that, had the Industrial Court considered the following relevant considerations it would have decided that the punishment of dismissal was more than amply warranted in this case and that the dismissal of the respondent was with just cause and excuse: (1) The nature and gravity of the misconduct committed by the respondent, coupled with her own admission; (2) The respondent’s act of tampering with the MC was inconsistent with the faithful and honest discharge of her duties as an employee of the applicant; (3) As a result of the respondent’s act of tampering with the MC, the applicant could no longer repose the necessary trust and confidence in the respondent; (4) The applicant’s decision to dismiss the respondent is supported by the following evidence produced by the applicant before the Industrial Court: (1) The MC, which was produced by the respondent to the applicant, purportedly, dated 31.08.2012, before the issuance of the show cause letter to her (see p. 45 of Exhibit “LSP-1”, of the applicant’s affidavit-in-support, enclosure (3)); (2) The leter dated 19.09.2012 from the clinic, which confirmed that the respondent had attended the clinic on 03.09.2012 and she was given a medical certificate on 03.09.2012 (see p. 47 of Exhibit “LSP-1”, of the applicant’s affidavit-in-support, enclosure (3)); (3) The original medical certificate issued by the clinic dated 03.09.2012 (see p. 48 of Exhibit “LSP-1”, of the applicant’s affidavit-in-support, enclosure (3)); (4) The following admission of the respondent in her letter of explanation to the show cause letter: “…I wasn’t in the right frame of mind to alter the mc cert & never crossed my mind to call my F/A or even seek her advice to take E/L as it was a public holiday. Only after speaking to her today that I realized my mistake. I wasn’t my real as my fever was high when I tampered the mc which was dated 03 sept to 31 August.” (See p. 50 of Exhibit “LSP-1”, of the applicant’s affidavit-in-support, enclosure (3)). (5) The decision to dismiss the respondent was taken by the applicant after considering the nature and gravity of the misconduct involved, viz tampering with the MC, which was not acceptable to the applicant, especially, when the respondent was holding the position of an In-Flight Supervisor; and (6) In the light of the foregoing, the applicant proceeded to issue the letter of dismissal dated 24.10.2012, which states as follows: “As an In-flight Supervisor of the Company, you are not only a leader but also a role model to the other Cabin Crew team members. Your action in tempering the medical certificate leaves a permanent blemish on your record.” 136. However, on the dismissal issue, the Industrial Court found as follows: “The Claimant did not deny she committed the misdemeanour in tempering with the medical certificate but she said the punishment of dismissal was too harsh in the circumstances.” 137. The Industrial Court then ruled as follows: “12. In the opinion of this Court, there is only one issue in this case, i.e whether the punishment of dismissal is appropriate or proportionate with the misconduct in the circumstances of this case. 15. It is well established that the principal of equity and good conscience dictates that employees who committed the same misconduct should receive the same punishment. If the Company was of the opinion that the misconduct by the Leading Stewardess was not serious enough to warrant a dismissal, then the Company had to have a very good reason for imposing the punishment of dismissal on the Claimant who committed a similar offence.” 16. The reason given by the Company was because the Claimant was of a higher position. It is the opinion of this Court that being in a senior position does not mean one automatically deserves the most severe of punishment. Especially when there are other alternatives for a lesser punishment. If the Company thinks that the Claimant was not fit to be in a position with a higher responsibility for committing the misconduct the Company can always consider a demotion, for example. 17. In the circumstances of this case, by the fact that another employee received a lesser sentence for a similar offence, and the Claimant having served the Company for 25 years, this Court do agree that the punishment of dismissal was too harsh and disproportionate with the misconduct. It follows therefore, the dismissal was without just cause and excuse.” 138. In coming to its decision, the Industrial Court accepted the evidence of the respondent, who contended that in imposing the punishment of dismissal on her, there is a disparity of punishment between the punishment, which was imposed on her by the applicant and the punishment of a final warning and a deferment of her annual increment, which was imposed on Puan Esdjuna. The respondent relied on Puan Esdjuna’s Punishment Order dated 11.06.2012, which only gave Puan Esdjuna a final warning and imposed on her a deferment of her annual increment for committing the misconduct of being absent without prior leave and for the falsification/alteration of a medical document (see pgs. 146 – 148 of Exhibit “LSP-2”, of the applicant’s affidavit-in-support, enclosure (3)). 139. However, I noted that the Industrial Court did not take into consideration that although Puan Esdjuna’s Punishment Order dated 11.06.2012 had made reference to 2 (two) explanation letters submitted by Puan Esdjuna, the 2 (two) explanation letters were never produced before the Industrial Court by the respondent, as well as the facts, which formed the basis for the issuance of Puan Esdjuna’s Punishment Order dated 11.06.2012. This is in contrast with the applicant’s proven case before the I.C. case. The applicant had called COW-1, who testified on the facts, which formed the basis of the punishment of dismissal, which was imposed on the respondent. The applicant produced the relevant oral and documentary evidence in support thereof. COW-1 also testified that she had no knowledge of Puan Esdjuna’s Punishment Order dated 11.06.2012. 140. Notwithstanding that the nature of the misconducts committed by Puan Esdjuna and the respondent are similar, I agreed with the applicant that each case should be decided based on its factual circumstances and merits. I found that this is an instance where the Industrial Court had failed to confine itself to the issue whether the dismissal was justified in the specific case of the respondent based on the specific circumstances of the respondent’s case. 141. Hence, I am of the respectful view that the Industrial Court committed an error of law when it believed and accepted the evidence of the respondent based on the contents of Puan Esdjuna’s Punishment Order dated 11.06.2012 even though the respondent did not produce the 2 (two) explanation letters, which were submitted by Puan Esdjuna to support her (Puan Esdjuna’s) appeal for a lesser punishment and without the respondent calling the officer concerned, who had issued Puan Esdjuna’s Punishment Order dated 11.06.2012, to testify on the basis for imposing the lesser punishment on Puan Esdjuna, in order to corroborate the respondent’s evidence. Therefore, I agreed with the applicant that the Industrial Court had adopted a flawed decision-making process and that in doing so it had committed an error of law. 142. It is trite law that the main and only function of the Industrial Court is to determine whether the misconduct complained of by the employer had, in fact, been committed by the employee and if so, whether the misconduct warrants the dismissal of the employee. In Wong Yuen Hock, supra, the Federal Court held as follows at p. 762: “On the authorities, we were of the view that the main and only function of the Industrial Court in dealing with a reference under s 20 of the Act (unless otherwise lawfully provided by the terms of the reference), is to determine whether the misconduct or irregularities complained of by the management as the grounds of dismissal were in fact committed by the workman, and if so, whether such grounds constitute just cause or excuse for the dismissal..” 143. I am of the respectful view that had the Industrial Court applied the above excerpt of the judgment in that case correctly to the I.C. case, the Industrial Court would have confined itself strictly to the issues and specific facts pertaining to the respondent’s dismissal instead of straying away from them. 144. Hence, I agreed with the applicant that the Industrial Court fell into error when it failed to consider the following specific circumstances in the respondent’s case: (1) That the respondent admitted that as an In-Flight Supervisor, she was the highest ranking cabin crew during her flight duty (see p. 22 of the Notes of Proceedings, Exhibit “VJ-1”, of the applicant’s supplemental affidavit, enclosure (12)); (2) That at the time of the commission of her act of misconduct, Puan Esdjuna held the position of Leading Stewardess, a position, which is lower than that of the respondent’s position, as an In-Flight Supervisor; (3) That an employee, who holds the highest rank in the cabin crew hierarchy, is expected to possess a high level of integrity and honesty; (4) That as a long-serving employee, the respondent was expected to set a good example to her junior ranking employees by complying with the procedures of the applicant; (5) That the respondent admitted that she had tampered with the MC; and (6) That the respondent’s act of tampering with the MC was viewed by the applicant as both grave and serious in nature. 145. Hence, I agreed with the applicant that had the Industrial Court taken all the above specific circumstances of the respondent’s case into consideration, the Industrial Court would have held that they warranted her dismissal instead of a lesser punishment, similar to that which was imposed on Puan Esdjuna, viz a final warning and a deferment of an annual increment. 146. I agreed with the respondent that she has an unblemished record of 25 years of service as the warning letter dated 10.02.2004, which was, previously, issued to her cannot be taken into consideration since her pay for 1 (one) day was deducted due to her failure to report for a rostered flight on 24.01.2004 (see pgs. 60 & 61 of Exhibit “LSP-1”, of the applicant’s affidavit-in-support, enclosure (3)). Nevertheless, I agreed with the applicant that the Industrial Court has failed to appreciate COW-1’s evidence on the reasons for the decision by the applicant to dismiss the respondent. 147. I also agreed with the applicant that, in holding that the dismissal was too harsh a punishment to be imposed on the respondent, the Industrial Court has misconstrued and misapplied the law relating to the dismissal issue. 148. In this regard, the case of Harianto Effendy Bin Zakaria & Ors v Mahkamah Perusahaan Malaysia & Anor [2014] 6 MLJ 305, is applicable to the facts of the instant case. In that case, the material facts are that the appellants were dismissed for taking part in an illegal picket within the bank’s premises during banking hours. The Industrial Court upheld the dismissals of the appellants. The High Court and the Court of Appeal affirmed the Industrial Court’s decision. 149. In their appeal against the Court of Appeal’s decision, the appellants submitted that in upholding their dismissals, the courts below erred in not taking into account the fact that the bank had practised double standards in that five other employees had participated in the same picket were either found not guilty or were issued with a caution letter or punished with a two-year freeze in salary increment. The Federal Court dismissed their appeal and held as follows at pgs. 318 and 319 on the issue of double standards: “[40] We shall deal first with the appellants' contention that the second respondent was guilty of unequal treatment and double standards because five of the employees who were charged together with the appellants were not dismissed. On this issue we agree with the observation made by the Court of Appeal that there was no merit in the appellants' contention that the appellants' dismissal was actuated by discriminative practice. From the record, the allegation of the inconsistency of punishment of the five employees who were charged together with the appellants was misconceived. Three of the five employees, namely Zamir bin Ahmad, Noor Jam bin Kader Mohiden and Ahmad bin Kassim were found not guilty of the charge in the domestic inquiry that was conducted against them. Their suspensions from work were therefore uplifted. In respect of Maimunah bt Mat Nor, she was found guilty of the charge. However, taking into consideration her plea of mitigation, the second respondent uplifted her suspension and imposed the punishment of stoppage of increment for a period of two years with effect from January 2005. In respect of Rohana bt Abdul Samad, the second respondent, after taking into account her written explanation dated 21 November 2003, uplifted her suspension. She was instead issued with a caution letter dated 4 December 2003. These facts were taken into the consideration by the Industrial Court when it considered the fairness or otherwise of the dismissal of the appellants.” 150. The High Court case of Mohamad Kamal Majid v Mahkamah Perusahaan Malaysia & Satu Lagi [2014] 1 LNS 1759 (“Mohamad Kamal Majid”), is also applicable to the facts of the instant case. 151. In that case, the applicant filed a judicial review application seeking to quash the award of the Industrial Court, which upheld his dismissal. The applicant contended, inter alia, that the Industrial Court had erred when it failed to consider the disparity of punishment imposed on another employee of the 2nd respondent, who had committed a similar misconduct. However, the High Court held that there was no error committed by the Industrial Court in arriving at its Award. In dismissing the applicant’s judicial review application, the High Court said as follows: “[14] Akhirnya, peguam pemohon telah menegaskan bahawa responden pertama telah silap dari segi undang-undang apabila gagal memberi pertimbangan tentang hukuman yang berbeza dikenakan kepada pengurus responden kedua yang lain yang turut terlibat dengan cara membuat tuntutan balik perbelanjaan keraian yang sama dengan pemohon. Keputusan kes Malayan Banking Berhad v. Roslinda Hassan [2008] 3 ILR 368 dirujuk. Rujukan kepada Award, jelas menunjukkan responden pertama telah memutuskan: ...That others may have done so and gotten off lightly is not within the jurisdictional purview of the court in this instant case. Such allegations as was raised by the Claimant will thus have to fall by the way-side, and not be construed as mala fides on the Part of the Bank. (lihat akhir perenggan 2 di muka surat 42 Award) Adalah didapati bahawa responden pertama sememangnya tidak mengambil kira tentang tindakan responden kedua ke atas pegawai yang lain di atas alasan ianya bukan di bawah bidang kuasanya dan perkara tersebut tidak dapat menunjukkan tindakan mala fide responden kedua. Adalah didapati pandangan responden pertama tersebut bukanlah satu salah arahan atau satu kesilapan undang-undang yang boleh menjejaskan keseluruhan keputusan responden pertama. Sekiranya diteliti rekod prosiding perbicaraan di hadapan responden pertama, ada keterangan dari COW5 yang mengatakan 7 dari 10 Pengurus Cawangan responden kedua telah dikenakan hukuman yang sama dengan pemohon dan hanya 3 orang pegawai diberi amaran, diturunkan pangkat dan satu tidak diambil tindakan kerana didapati tidak terlibat. Faktanya bukanlah ada 'disparity' dalam tindakan atau hukuman, tetapi hanya ada perbezaan tindakan atau hukuman berdasarkan asas tindakan yang diambil. Alasan pemohon yang membandingkan hukuman diterimanya dengan pegawai responden kedua yang lain sememangnya tidak berkaitan dengan bidang kuasa responden pertama dan tidak menjadikan Award silap dari segi undang-undang.” 152. The Industrial Court case of Malaysian Airline System Bhd v Ritzerayan Abdul Rashid & Ors [1998] 3 ILR 971, is also applicable to the facts of the instant case. In that case, in response to the claimants’ submission that the company had not treated the claimants on an equal basis compared to the other employees of the company, as the company took disciplinary action against them and not the other employees, the Industrial Court said as follows at p. 984: “The learned counsel for the claimants has submitted that the company has not treated the claimants on equal basis as other stewards who were suspected, this inconsistency would entitle the court to come to the conclusion that the company acted unreasonably and therefore the dismissals were without just cause or excuse. I do not think this is the correct statement of law. It is not the right of the workman to question, why an employer should take a disciplinary action against him and not others.” 153. Reverting back to the present case, what the Industrial Court had done was to consider and determine the issue whether the punishment of dismissal was warranted by taking into consideration the evidence of a different type of punishment, which was imposed on another employee of the applicant, viz the deferment of an annual increment on Puan Esdjuna vide the Punishment Order dated 11.06.2012. By virtue of the decision of the High Court in Mohamad Kamal Majid, supra, the Industrial Court in the I.C. case has no jurisdiction to consider the applicant’s actions against another employee. Since it had done so, there is an error of law committed by the Industrial Court, which has caused the decision-making process of the Industrial Court to be flawed. 154. It is trite law that this Court can interfere with the decision of the Industrial Court if the latter had acted on an incorrect basis of fact. In Malayan Banking Bhd, supra, the Supreme Court held that a jurisdictional error is committed if a decision-maker acts upon an incorrect basis in fact. In that case, the Supreme Court said as follows at p. 206: “There are then some cases which assert that a jurisdictional error is committed if a decision-maker acts upon an incorrect basis in fact. The leading case is Secretary of State for Education and Science v Tameside Metropolitan Borough Council [1977] AC 1014 in which Lord Wilberforce said (at p 1047. that an official exercising a discretionary power commits a jurisdictional error if he or she acts 'upon an incorrect basis of fact'.” 155. In Lipo Corp Bhd v Mahkamah Perusahaan Malaysia & Anor [2013] 9 MLJ 888, Varghese George J held, inter alia, that there would be a case for intervention if it was shown that the decision maker had taken into account an irrelevant consideration in coming to the conclusion he reached. The learned Judge said as follows at p. 895: “[11] Intervention on the grounds of illegality or irrationality (or perversity) in the findings can be availed of where it was shown to the court that there was no evidence whatsoever to support the finding, or if the conclusions recorded were diametrically contrary to evidence on record. There would also be a case for intervention if it was shown that the decision maker had asked himself the wrong question or had omitted to take into account relevant consideration and to the contrary had taken into account irrelevant consideration or had misconstrued provision of relevant statute or principles of law in coming to the conclusion he reached.” 156. Reverting back to the instant case, the applicant conceded that it must prove that the respondent’s dismissal was with just cause or excuse. 157. As stated earlier, the Federal Court in Wong Yuen Hock, supra, has set out a 2-pronged test, which must be met in dismissal cases. The first prong is whether the employee is guilty of the misconduct complained of. The second prong is whether such misconduct warrants the punishment of dismissal. 158. Since the respondent had admitted to the misconduct in this present case, the first prong of the test has been met. As for the second prong of the test, since Mr. Ravindra Murugavell, the learned counsel for the respondent, has graciously conceded that the respondent’s misconduct warranted the punishment of dismissal, the second prong of the test has also been met. Whether there was a disparity in the punishment meted out to the respondent and the punishments meted out to the other employees, who had committed similar acts of misconduct? 159. It is the contention of the respondent that there was a disparity of punishment as a Leading Stewardess, a Pilot and a Co-Pilot, who had each committed similar acts of misconduct, were not dismissed but were given lesser punishments. 160. The issue of disparity in punishment has been, aptly, explained in the Industrial Court case of Bank Bumiputra Malaysia Bhd v Ghazali Bin Kassim [1995] 1 ILR 113. In that case, the Industrial Court cautioned against the indiscriminate application of the disparity of punishment argument. It held that the argument is likely to be relevant if there are others cases which are truly similar, or sufficiently similar, to afford an adequate basis for the argument. It explained that this is because the emphasis in the section is upon the particular circumstances of the individual employee’s case. The onus is on the workman show that the disparity is to be found in similar cases occurring at or soon after the time that he was subjected to the punishment of dismissal. The Industrial Court said as follows on the disparity of punishment argument: “At the outset the Court cautions itself that arguments founded upon disparity of disciplinary sanctions are to be considered with great care. It is perhaps timely to set out the cautionary note sounded by Mr. Justice Waterhouse in the case of Hadjioannou v. Coral Casinos Ltd [1981] IRLR 352 cited by learned Counsel for the bank that: Industrial tribunals would be wise to scrutinize arguments based upon disparity with particular care. It is only in the limited circumstances that we have indicated that the argument is likely to be relevant and there will not be many cases in which the evidence supports the proposition that there are others cases which are truly similar, or sufficiently similar, to afford an adequate basis for the argument. The danger of the argument is that a tribunal may be led away from a proper consideration of the issues raised by s. 57(3) of the Act of 1978. The emphasis in the section is upon the particular circumstances of the individual employee’s case. ... Where, however, there are indeed disparities in punishment in respect of an employer's treatment of his employees who are guilty of "truly similar" or "sufficiently similar" misconduct, it is an established principle in industrial law that the same gives an employee who is subjected to the severest punishment of dismissal while another is dealt with otherwise a cause for complaint that he had been unjustly treated. … The Court is of the view that where the disparity argument is raised and provided that the offences and the circumstances in which they occur are essentially similar in nature, it would be sufficient if the claimant can show that the disparity is to be found in similar cases occurring at or soon after the time that he was subject to the punishment of dismissal.” (Emphasis added). 161. It is clear from the decision in that case that the argument on the disparity in punishment is relevant only if the offences and the circumstances in which they occurred are, essentially, similar in nature. The burden is, thus, on the workman to show that the disparity is to be found in similar cases occurring at or soon after the time the workman was dismissed. 162. Reverting back to the instant case, the respondent had produced Puan Esdjuna’s Punishment Order dated 11.6.2012. However, the respondent did not lead any evidence pertaining to the Punishment Orders of the Pilot and Co-Pilot, respectively. Puan Esdjuna was found to be absent without prior leave and she had falsified/altered her medical document and the applicant decided to issue her a final warning and a deferment of her annual increment. 163. Nevertheless, I found that the respondent’s case could be distinguished from Puan Esdjuna’s case, based on the following facts and circumstances: (1) The respondent had admitted to the misconduct committed by her. This fact is absent from Puan Esdjuna’s case; (2) Puan Esdjuna was holding the position of a Flight Stewardess at the time of the commission of the misconduct, whilst the respondent was holding the position of an In-Flight Supervisor; and (3) The position held by the respondent is the highest in the cabin crew hierarchy during flight as confirmed by the respondent during cross-examination. Her evidence is reproduced below. “125 : Q&A71 Put: As In-Flight Supervisor you are the highest ranking Cabin Crew during flight? · Yes” 164. I also noted that the acts of misconduct committed by Puan Esdjuna and the respondent, respectively, did not arise from the same set of facts. In fact, as stated earlier, the acts of misconduct were committed by two different categories of employees, where the harshest punishment of dismissal was meted out to the respondent, who held the highest position of cabin crew during flight. 165. The Judgment of the Federal Court on this point in Beatrice At Fernandez v Sistem Penerbangan Malaysia & Anor [2005] 2 CLJ 713 (“Beatrice’s case”) is applicable to the facts of the instant case. In that case, the material facts are that the terms and conditions of the appellant’s employment were governed by a collective agreement. They provide, inter alia, that the appellant has to resign from her position as a Flight-Stewardess, if she ever becomes pregnant. Subsequently, the appellant became pregnant and her contract of service was terminated by her employer. The appellant then brought an action against her employer for, inter alia, a declaration that the collective agreement was ultra vires Article 8 of the Federal Constitution as she was not accorded equal protection under the collective agreement. The High Court rejected her claim and held that the collective agreement did not in any way contravene the Federal Constitution. The decision of the High Court was affirmed by the Court of Appeal. The appellant applied for leave to appeal to the Federal Court but her appeal was dismissed by the Federal Court. 166. In construing Article 8 of the Federal Constitution, the Federal Court held that the equal protection, which is contained in that Article, extends only to persons in the same class. The Federal Court also held that the provision of the collective agreement, which requires the appellant to resign on becoming pregnant, only applies to the female cabin crew. The Federal Court further held, inter alia, that the appellant could not compare her position with other employees, who are not in the same category of work. At p. 721, the Federal Court said as follows: “The applicant chose to join the first respondent as a flight stewardess and agreed to be bound by the collective agreement. It would have been different if she had joined the first respondent as a member of its administrative staff. The applicant cannot compare herself with the ground staff or with the senior chief stewardesses or chief stewardesses as they were not employed in the same category of work.” 167. Reverting back to the instant case, and upon applying the principle of law, which was enunciated in Beatrice’s case, I was of the respectful view that the respondent’s reliance on the comparison between her case and Puan Esdjuna’s case is misplaced as the latter held a lower rank than her and Puan Esdjuna’s 2 (two) letters of explanation, which were considered by the applicant before giving her a lesser punishment were not produced to the Industrial Court by the respondent for the consideration of the Industrial Court. 168. In other words, since the particular circumstances of this case are not, essentially, similar to Puan Esdjuna’s case, the disparity in punishment argument, which was raised and relied upon by the respondent to defeat the applicant’s judicial review application must be rejected as being an irrelevant consideration in the determination by the Industrial Court of the issue whether the respondent’s misconduct warranted the punishment of dismissal. In view of the fact that the Industrial Court has taken into account an irrelevant matter, the Award is flawed and liable to be quashed by this Court. 169. In the Industrial Court case of Malaysian Airline System Bhd v Ritzerayan Abdul Rashid & Ors, supra, another division of the Industrial Court took a different approach on the disparity in punishment argument. In that case, the Industrial Court held that it is not the right of the workman to question, why an employer should take a disciplinary action against him and not others. At p. 984, the Industrial Court said as follows: “The learned counsel for the claimants has submitted that the company has not treated the claimants on equal basis as other stewards who were suspected, this inconsistency would entitle the court to come to the conclusion that the company acted unreasonably and therefore the dismissals were without just cause or excuse. I do not think this is the correct statement of law. It is not the right of the workman to question, why an employer should take a disciplinary action against him and not others.” (Emphasis added). 170. Therefore, I agreed with the applicant that based on the 2 (two) authorities referred to above, the Industrial Court has erred in law in the instant case, in holding that the dismissal of the respondent was without just cause or excuse, solely, because another employee had received a lesser sentence for a similar offence. 171. Based on the above reasons, I am of the respectful view that the Award ought to be quashed as the Industrial Court arrived at findings contrary to the evidence before it and had, consequently, arrived at a conclusion, which was perverse and illogical and which no reasonable tribunal or person in similar circumstances would have arrived at. Conclusion 172. In the premises, I granted an Order of certiorari to remove the Award to this Court and quashed with no order as to cost. Dated: 17 July 2017 (DATUK SU GEOK YIAM) Judge High Court Civil NCvC 11 Kuala Lumpur COUNSELS 1. Mr. Vijayan Venugopal, the learned counsel for the applicant at: Messrs. Shearn Delamore & Co Advocates & Solicitors Peguambela & Peguamcara 7th Floor, Wisma Hamzah Kwong-Hing No. 1, Leboh Ampang 50100 Kuala Lumpur 2. Mr. Ravindra Murugavell, the learned counsel for the respondent, at: Messrs. Murugavell Arumugam & Co Advocates & Solicitors No. 120-2A, Tingkat 2 Jalan Tun Sambanthan, Brickfields 50470 Kuala Lumpur CASE REFERENCE: 1. Hoh Kiang Ngan v Mahkamah Perusahaan Malaysia & Anor [1996] 4 CLJ 687. 2. Syarikat Kenderaan Melayu Kelantan Bhd. v Transport Workers Union [1995] 2 CLJ 748. 3. Malayan Banking Bhd v Association Of Bank Officers, Peninsular Malaysia & Anor [1988] 3 MLJ 204. 4. Wong Yuen Hock v Syarikat Hong Leong Assurance Sdn Bhd And Another Appeal [1995] 2 MLJ 753. 5. Danaharta Urus Sdn Bhd v Kekatong Sdn Bhd [2004] 1 CLJ 701. 6. Nerin @ Erin Marapus v Malaysian Airlines System Berhad (Award No. 1232 of 2015). 7. Arasapan Ramaiah v Ampang Hotel Sdn Bhd (Concorde Hotel Kuala Lumpur) [2009] 1 ILR 68. 8. Automotive Manufacturers (Malaysia Sdn Bhd v Ahmad Mohd Som [2009] 2 ILR 290, Industrial Court Kuala Lumpur. 9. Penfibre Sdn Bhd and Penang & S. Prai Textile Garment Industries Employees’ Union [1987] 2 ILR 259, Industrial Court Pulau Pinang. 10. Kelab Golf Negara Subang v Mat Idris Siakat [2004] 2 ILR 306, Industrial Court Kuala Lumpur. 11. Bumiputra Commerce Bank Bhd v Abdul Kahar Dudi & Ors [2005] 1 ILR 489, Industrial Court Kuala Lumpur. 12. Network Foods Industries Sdn Bhd v Thandapani Tirugnanasambandam [2006] 1 ILR 281, Industrial Court Kuala Lumpur. 13. Texas Instruments (M) Sdn. Bhd. v Flourmeena A/P Saminathan [1996] 2 ILR 128. 14. Sime Bank Bhd v Mohd Shaib Md Yusof [2003] 2 ILR 530. 15. Harianto Effendy Bin Zakaria & Ors v Mahkamah Perusahaan Malaysia & Anor [2014] 6 MLJ 305. 16. Mohamad Kamal Majid v Mahkamah Perusahaan Malaysia & Satu Lagi [2014] 1 LNS 1759. 17. Malaysian Airline System Bhd v Ritzerayan Abdul Rashid & Ors [1998] 3 ILR 971. 18. Lipo Corp Bhd v Mahkamah Perusahaan Malaysia & Anor [2013] 9 MLJ 888. 19. Bank Bumiputra Malaysia Bhd v Ghazali Bin Kassim [1995] 1 ILR 113. 20. Beatrice At Fernandez v Sistem Penerbangan Malaysia & Anor [2005] 2 CLJ 713. LEGISLATION REFERENCE: 1. Section 20 (3) of the Industrial Relations Act 1967. 2. Sections 3, 4, 5, 9, 10, 11, 11(1)(e), 12 and 20(3)(c) of the Malaysian Airline System Berhad (Administration) Act 2015. 3. Section 72 of the Pengurusan Danaharta Nasional Berhad Act 1998 (Act 587). 4. Article 8 of the Federal Constitution. 101

Tika 2.6.0

22NCVC-154-04/2014

PLAINTIF PERAK INTEGRATED NETWORK SERVICES SDN BHD DEFENDAN 1. HAJI AHMAD KAMAL BIN ZAKARIA (No. K/P: 640601-08-7195) 2. AZRI BIN IBRAHIM (No. K/P: 650716-08-5017) 3. AZRINA MOHAMAD AZIZ (No. K/P: 760622-14-5100) 4. SHARUL AZMAN BIN EHSAN AHMAD (No. K/P: 800614-08/5957) 5. BUNGA RAYA ICT SDN. BHD. (No. Syarikat: 587118-A) (Dahulu dikenali sebagai Bunga Raya Rekabina Dan Bekal Sdn. Bhd.) 6. URBAN DOMAIN SDN BHD (No. Syarikat: 652499-P)

14/07/2017

YA DATUK S. NANTHA BALAN

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=f5b65b04-a0bc-4cce-bef3-25f72dbc3f82&Inline=true

rL\I,A.\x MAHKr\.\L\H Tl.\l(i(3T \t,\I.‘\\ A 1')IKlh\I,‘\I.l'\IT’I R DALAM \vz1L;\\n\H Pl-.R~FK AI\ M\L\Y. A GUAMAflfl Q 154 0412915 AN 1‘ \Lu PERAK INTEGRATED NETWORK SERVICES SDN BHD (V0. >ym1m szuuu) PLAINTIF 1) N 1 HA]! AHMAD KAMAL BIN ZAKARIA (No. K P- (HU(:\}1—U8—'l95j AZRI EIN IBRAHIM ‘(No K 'P- (.5n’mr\» 501"; 1 AZRINA MOIIAMADAZIZ No 1; P "am. +s\n4r 4 SHARUL AZMAN BIN EHSAN AHMAD n\1..1\ I’ EUU(:H»Ul(/3‘)5T 5. BUNGA RAYA [Cr SDN. BHD 0 .»,mm savxusm in u//r4 (/l/£nIlAA// 12/144, BI///gm my my/W r>,mam/ hm W) 5 URBAN DOMAIN SDN BHD (M. _~\mL.u. 2499 P} DEFENDAN-DEFENDAN GROU D ‘D5 flwl Tm/I Page 1 no 51 Introduclinn 1. Tl-lcsc at: my pounds ofyudgmem me: a full zml. -nle \TI!\1 was conducted from :2 m 26 August. 14 Ocmlx-l and finally rm. 1 m ll Nnv:lnb<-r 2016 (11 am) Th: dlspurc pun...-ll kn rhc dmelupmenr mud ransLru:I|m'l uf lclzcolnrnummunn towers md bmadmuny bmdband mlumuuuu m me sum ofPemk. 2. The plnnuff I-loldx :4 Nemlork Fauhues Provide: Llcsnse (“NI-‘P Licence") lssutd undu ttcnans 30 and 125 of me Comrnunlcauona and Mulnmcdla Art 199»; (“EMA”) which was valsd from I1 July 2005 [0 ln July 2015 (pm rm) Th<-mllfiar the Validity nfrhc NFP Lltenct was cxlcl-lded from ll July 2013 lo 10 Jul). 2025 (p A2.» B7) 3. lb: plamuffs dam agunst mg dtferldznts is in. bzmdl ofvzuons dunes lm:lud.mg brmch of fiduciary dunes allegedly owed to an plmurr, 1-ll: plmnuff also clalrns rhu me am rleitndam had bxezcl-ltd I115 dunes as 2 dltcctox ufthe phinnff. The mam plank of Ihc plamuffs claim Is an l1Ueged“=xclu.<|v: concesslnn agmmuu" wluch was mnxcred mm bcmcen the plaxlnnff and ill: Sm: czmmmcnl of1’('uI< me It pux-portrd lmnk vmlurc ngmcn-lcnr wl-llzh x. said to be binding on all the defendants Paggzusz 17 16.} Al the hem of am plalnnffs chum (dunng this ma!) 1! an cumplalnl ml. regards to, my .54, lhc cnnillucuon and allcgcd u\Vncrxlnp by BRSB of 18 small and mmlv almclulcx wlml. was collsuuctcd in: CELCOM, and wlucll monllng to BR.5B, was done based on co- ordinate: glvm w them by CELCUM. 164 In this mgaxd, ll IS alleged bv the plalnnff um pursuant to (H: vnnnui ngrctmenrs MK pleaded in mg .\soc. mm was a yum! vcmulc not |ulu bcnvn-L-n Lhc purics lu tht l.g,.~.~¢.mlm (plzll-luff and UDSB), but I! also lncludcd D2, D3, D4, ERSB and DI, who was allegrzdly, Lhc a/Inga of BRSB and wuss Th: zgwtemenrs ox the ptmclpal docluntms whlch {hr plmurr r:|.Izs an (0 support ltx clalm against the defendant: for my alleged lnmll an |aIm venture agreement .11: ax follows‘ -1) b) Ihc [mu uf zwud dated 27 juuug 2005 from {he Slam of Pen}: (0 the plalnurr (p,E— B6); Lh: memorandum of agreement dmd 22 February 2006 between 1311513 and Dam’ FCW (“MOA")(p l-7, E3); me Shzlel-loldcns Agretmcm lama 21 MM 2007 benrccn plamuii and LDSB (‘Shareholders Agpcemcnaxp H1162 as), mums: 18 (:7 the rmnagtmcm agxrnmcnl datcd 21 May zoo‘ bntween the plamu“. PINS osc. UDSB ma PINS cam: Sdn Bhd (p.l65r18l, 83) (“Manzgemenl Aglccl‘ncnI")1 (d) lhc Fm: supplememal Mznzgemcm ;'\grccmcnI dated 27 l\J:y 2007 between the plunmr and PTN5 osc (p. 7 :33, B3)(“1" supp. Management Ag-mcmen and (g) the concession agxecmtm bcrwecu mc Sm: of Punk and an plan-nuff dated 10 ]ul}r 2007 (p 139 — 209, B3) ("concession agxzzmu-Al") Ac:uId.|ng m the pumuri, the 101111 vcnturc was an an taxrymg out of am plmuuffs \I:ur)<3 under me concession zgrtement by mm 05: which was the corporal: vd-uclc to can-ry out the |om[ mm, for (11: benefit of, amongst odlus, zhz plamufi. Pursuant to me yolnl mum, me conccsswn wuxks were mukded [O PINS om by Ihc piamurr. It Is Furthzr alkgcd (Int 02, D3 and D4 we at the material umns emplayces of PINS osc D2 was Ihc men Chief Execunm 0mm of PIN nsc. H: \'|:'$\§ nppnmmly nummarcd by D1, D] M, the Finzrmzl mu :\d.min|suzL\vc Oflicu uf PINS OSC, nammmcd by DI D} was in the smile umc on nmm dnrctor 1.. mm During the um, D3 said am she performed mes: flnanml and admmlsuadve functions wms: at PINS osc, alnhungx sh: was not an cmployee of the plrunuffor PINS , Rather. sh: was an cmpluyrn ofTeIefl<7w and ma: she mexely pexfonncd rhes: funcrzons albeit. that she was nor an nmployce ohhr p|ammTur PINS osc. mg. :2 .15; Iv 20 D4 was ml L-mplo):e of Tclcflow. He .m..cd PINS osc M Sltt Acquisition Exccuuvc and M. um pmmmcd lo Lcgallsauou OFficcrn[P|N5 osc Subscqucnd}, he left PINS 05C and jomed BRSB D1 W a duecrm of an plamdff and PINS osc. 1: is alleged ma: .: all nuteual urnes, D1 had full conrxol of was OSC.Il1s zllzged mm m: defend.-«ms knnw nnd/or ought m haw: knwwn of the plaxnuffs mum; :ances< on and the join: mm ma also knew and/at ought to know an. the plnmurn uuercsr. 1.mer.: ma rlghls under lhc (onus. .1 ngkcmcnx and an Llcensc z\gIv.-untm dmcd 1 jun: mm (between an plzmufi ma Ttlcox) would L»: armed by me mungrmcm ma optmnons or PINS osc. 1: xs alleged by me plamurr max by Hnuc of Lheu Vmuus posmcns, me d¢[cndznLs wcm able [0 obmn mg :Iu—md.\na(:s for the Takes’ ptefcnad mm: for mu (decommumcanon mm on tlrucmres an lhc Sure of Pen}: Iogerhex w|Lh their spccificaunns for ma. tower or szxucmms. 1. xx nllrged am m breach of an \-anuus dunes mcludmg aaumy dunes nwed w m: plainuffi lhc defn-Ildzms (9 ahuscd and nuuppmprulcd confldcnual unronnauun. Pigtliafil (1.) misappropriated and dlsslpnled (I1: pl.1mrifA'.< business and/ox husmus oppormmues to 13115}! by pmcunng sun for the T2160: using such miormauon and dxvemng um um: and us busxnass m BRSB,nnd (nu) pxcfurcd mm own personal mlucsls and dxszrgztckd an pxmmm imrxesm, rights and obligations as am exclusive concessxnnnw in the Slate nivmk According to the plunulf, as ;. xcsult of dam branches, mm was am: (0 hudd and 1nd bum mucus Lzlccommunlcanons towels or smlctules m am Star: Pcnk for Talcus. 1: is alleged um LI-ms: sues, man. went otigjnally teqnestcd {tom PINS or PINS osc, wnc subxrquendy mmclzd bv the T=lcn.< 1: .5 alleged that the drfnndanu .1“; dull duecxly mm m: Telms no pmcure or dncrr business In mun The plmnnfrclm-us mm m don-Ag su . 0) ll-At zlcfcndanls acted unlawfully; (II) the dtfcndanrs had conspucd; (us) the defendants inlcrfcrtd mm an p|aAnufFs busmcss, ma: and/or cunlncluxl tights: (x\') the defcndmm mlnpplopxuttd or d.\a:1paI:d mg plalnuffs bnsmcss or busnnasx npponulllucs; has not :2 (V) the defendants caused um and damngc m uh: plfllllflff. 23. Further and/or m the alnrmauvc. n .5 alleged um D2 Io D4. mgtrher mm masn and UDSB,1<nnwmgly assisted rm bunch of hi! dunes mcludmg breach of fiduznly dune» (as I dxxccxor) mm: Io my plmnuff Funhcx and/at m the .|.llcm:u\*e, u ,3 alleged mm m as my ega of mm: ma unss is equally mm: to. all of BRSE‘< ma UD5B's bzeuhu apart fxom ms pnsom] um-n~ Furvhu and/or m me allemauvc, m .3 also vxcanouslv lab]: for Lh: vanous breaches of Lhe ozlm dcfendams. 24 Th: rehcfsought m me Asnc m M rollmw. --.. A daduvnnn um ll}: nakndmn m m hrvuh nflkexr na..¢,...y dmzs mu m an: :>m..mr. n. m Dc'e1Iflll\'$.Jm!Il|y xm/nrievtnlly. ..= hovmndna ‘is! on]! Idewmmunlcnwn lav-an 31!: in ma aw: m‘Pcu.k mu have rm mm or In my mun hy In: :“ Ddcrvdlnl m ..., ..r Ah: magma (huunnfltr wfrrrud .0 .s u»: 1:: sum’), An mjunaian 1.» rnlmn m. Defendant) fmm mam pvunauding, pdfmllung and/nrmnunuung vnlh mg cmmm zml/or lgreclmnu ... rclmmnuu m. as sue). a An nsoum m’ .n prmmfids ... mains in m was cl m: Dcfmdums or rccnwd 5, any war pm». M emily m. hehalful um D¢|'endanL1 Invn nx as sm mm msullmg mm. .1»: Delzndarm‘ bread! “rum: fiduclar) dunes m u.= mm..." al a.._» nstls. mnchard mm In: vmuzudx nr manic} m result of Ilmr much or an dulus mu w m mmun. .5 -mm: 0. mnxlnmuw Influx nu III: p I An nrdar mu lb: o.r=..a-ms. manly nndhwr 1rvenl\y.v-11/ 1.. m: mmm all sums dncavned mam: fmmd In be duz {mm m Dtlzndams mg. the ulung ..r mum“. mgumz g AH ncnnnn. inqumcs um «um. dntumru 3 drcmud Ippmpllill. n Genenl damugn. addmnnnl and exzmplzry dlmagnx m H: uuuncd. . xnnm. ml 14!! unuunu due nml puulfln za, me Ixfrndznu :1 mg ram: vi 5% pal anmlm rm an dam: n¢ pulgvvlcnx nnm mu ;2u|:m=m. ,. (on; k Fu|IIKr\c|Iefi«rmherv:||:l5I.h|s Hov\ounb|:CmuldecInx fix“ Dtfence or D1 and unsa (D6) 25 26. D1 and mass contend am Lhe plunuff 15 bmad {tom banging [ms clmm by (axon of m/mm and Dr umppd Th: Pk) o; m‘ /mitmlu .5 pmdxcated on an fan nm the plnnnnirs prtsem claim could have bccn, but was not bmugjul up when n sun nns filed by IJDSB against Duo’ FCW, PINS nnd PINS osc by u y of Knnln Lumpux Hugh Cnun Sun No. 22NCC-ID-41707/2012 pann 1041") which ms filed on A July 2012 (F: E!) The Smcmcnt of r.1n.n azngm. Inuslnuon) fur suu104l n found n F 2747, 5:. PIN; osc was and lust defendant and PINS was Lh: second defendant 1n sun 1041 PlNb filcd n defence and countrrrhim on 19 March 2013 ([368-34) wherein they coumtrtlnunnd for n sum of RM3.22A.904.1D. Dam’ FCW was me mud dcfzndanr nu ma: um. Iudg-mznr m sun ma: glwn afru mu mil on :(. Sepicmbcx 2013 {p.1EJ-136 ma). Thereafter, n wmdmg up mu-nnnn No, ZXNCC-bD»0I/201A was filed by UDSE against mm osc un 27 January 2014 (p 7 BIO) ng. as all: 27 29 The wmdmg up penuon was aha nmdcr secriml 2m (1) (1; of uh: Companies An was under an “|usl Ind cqunablt" pnnmple. Emhmlly. (hr winding up oi PINS OSC wns sought by UDSB as . sharcholdu On KIN: basis of 2 dcudlock m managuuem and R dxsappexmncc of [ht subsuatum hr the compnn)/'5 core busmess UDSB nlmd. mm aim, oh the yudgmem dawd 25 Srptembcz 2013 which was gunned in sun um as endenclllg the “deadlock” 1n zhc hem: of dlxccturs. The prucnr sun was subsequently aha by vms on 2 Apn] 2014. m ma upsn contend um Lhc mmhhh agrecmtnr dxd hm confer mlmc nghzs on I11: plninufflo hhuu wlccommumcauon Iowan m am Sun: of Punk m mu cxcluswn of all others, -my comend am by Conduct. me phnuff ms m rm accepted, am an C0n(eS5|On agreunmt am no. cunftr exclusxve nglm On the p1mu'ir K0 huud tclecommunxcauon lowers m the $13!: of Peak to am txcluuon or all mhm As such, mg plalnfiff .3 mapped from Chiming any “:‘(:Iu§Iv|ry". The defcndants also contend (hm as H rmulr. mg plmnllff ha. dmingnnumlsly rezoned to pludmg breach of fiduuzry dunes uahhg mm . purponcd Jam! mm bnxed on zgncmtntx which ms plmurnay. uughl (0 be mad wguhcr 11.: zpeemcnu “had upon by an pmhurnh snlppon cfus contumun {ax Lht existent: of a 101m \'tn(u[: are. m: mnctssson agretrnznt, me MUA, uh: Shamholden Agreement. the Manzggmem Agtezrnml and 1" Supp. Managcmtnr :\g;v::men(. Paguvmix Th: defendants contend um mm n no such mint vmrurc -my contend am they dn not UWC any fiduciary DI’ cnntncmnl duuux whatsoever la an p1nmLi[l. mm acr:..d».... (amend um me, do no! posts: :11: puwcrs or nuLhomy 0. means m udhz: mm; m the Inannu as alleged in an ASOC They connend um 1311313 and UDSB are controlled by men rcspecuv: board of dnectols and nut by DI Thu; conund um D2 was me our: who obmmed the coordinates frum ch: Tclms for all the poles and small and mum smlcrurcs \rhu:h were built by mm; m the Star: nfP=rak. Hcncc. thew comcnd mm the plaAnufl‘s allcganon w-uh Kugzrd m the 1.llcg:d Irnsusc cf znnfidcntml mferrnauon |s mlseoncenvrd They contend um the mm; which an mud m due ASUC we mes on which onlv poles ma small and mm uructuxas (and not lowers) were bud: and consnruucd. In any zvent, Lhzy are not Iowa: and wezr consflucterl by BRSB mm the ngxecmtnl and comm of mg plamnff. Defence uf D2, D3, D4 3| D2. D3 and 04 also contend um um plalnnffis mm: from mmg (ms claim by mm of rr;/mlmz/11 and/or rrtappc/. They comnnd am the cuncesslun zgmcmcnl mu um confer m1..m “gm; on me plzmuif m bunld mlccommunlcanon lowus m Lhe Sm: uf Peak :0 [ht exclusion nf all others. vzgellolsz 32. 35. They also comma mm by conduct. the plaintiff has ncccpled to hr: rmz am the Cnnuiurin ngrccmcnt am um confer cxtluslvc nghts on Lhc phnnuff to ma ssxssummumssucn sows m ms Sum of Pen]: to use exclusion of six oLhexs They slso mmsnd um 15 s result, the plmnuff has couuived Io pltad breaches of fidunzry duuss mslng {mm 2 pm: \enrure basbd on sgsssmsms whzch are to be read togcdler. These axe ass MOA, (HI: Shareholdus and 1" Supp Mnnzgunml Agreement. These defendants cnnr<n<l um um xx Agrccmcnt. the Mznagnnmr :\g1tem:m nu sud. mm vznnue. Thay comcnd am smcc they in nu! prunes to the ayV.'cn1cnti and are not dnvsczon ul shuclioldcrs ox nnuployctx of me plamufi. (hay do not own any nuuassy 01 conuacuml duty to the plmurr Thzy cunltnd um smc: any 1:: not duvctoxs or slmehowsss of BRSB_ Lh:y do not poxsess ms poms at auduouty or mans Io Ilulizc BRSB m ms manncx as alleged m Lhr ASOC D2 cnmcnds am he was \hc on: whu nbmncd fmxn the Telzax, ms ct.-—ord|n:k:s an su ms poles and smsu ma mim szmclurcs which wn: built by mun m ms State of rmk. Hence, dxcsc dcfcndsnts ccuknd ms: the pxmurrs zlleganon mm Jegzxd to me allegtd confidenunl xnioxmzuon xs rmstonccwed ss Lhesc at: am, not confidcnual mfonnsuon ma sscmdly, my me not mformauon ova which use plmnnff has any pmpvritmly or ovmrxshxp rights Dan is M :2 Bliss‘; defence N. am; (D5) maintains that the phmnrrs chnh n rnlsconcuvcd rmn xhz very begxnmng as n Is gwounded on the bash that the plaumff had acquired exclusive nghrx m bmld tulccummuntcnuun Infmsrnxcmxci (Is dcflnul n. the conccssmn agreement) .n zhc 1311513 contends that (h: nhnnnrrs dmm n rrusconcexvtd as n was grounded nn d1: Sulc or Punk In rhn: exclusion of all udnuls cuoncous hm dm the rtlecnmmumcnuun pmudm (m pur.Icu.|2( Maxis Bmadband Sdn BM. Celcom (Mzlzysm) Bcrhnd aha Dug Telecovnmummuon Sdn Bhd) hm to award all commas for the mnstmcnon of mm; m the Sm: or Pcmk to the plzinufé :\ccord|ng m B11513, the pumnnrrs claim is misconcclvrd as rh= car ordlmucx proudcd h) rhc T:-Ices was “OI cunfidcnunl n..ronn.nnn gnexl m1...n-=1,» In rhr: plmnuff um mfuurmnun {KC avulable {mm a soulcc known as Jr. .5 contended that m: plalnnifs dam .5 mlswnccxvad as an: sttuctuzcs hmh by mm; on the nllegtd silt m nut (u\ve1s hm hm srrmll and rmm srxucmks wknclu at: below an mclus m high: whmas towns are by defininon, my slxucnlxe nbove 45 mm: n. bright 1: 1s alleged am the phmnrr. wh (hr knowledge that mzsxa had bulk such small and mini sxrucruks, nu (’d H: agmcmcnl or acquiesced K0 the consuutuon or sud: suuznucs b\- mun am: therefore mnmmms Lhu I11: phmnzzn csmppcd from mounung the prcscnt daun Fagzlllolfl 4. According m an plaimzffi the defendnnn had» (a) jbusud mu mfimnmion: mmuppmpuzled confldmml (b) nusapplopruktd and dlsslpztzd due plamurrs business and/or business opponumues m um um. defendant by procuring min for reltcommunlcaunu compamcs by using such Anfonnauon and ammng (he same mm as business .0 me am. «(mum and (5, pxefexxed mm own p<*r.mn;\l inuercsls and d.|s:cg:azd1ng um plamnm uucrests. nghks and abbgauans as the exclusive conccssionant m ([1: SmI<o[Pcxak The slaning pon-M ufthe plam(ifl"s cm... .5 a lcucr Dfnwnld am! 27 jnnuary 2006 by the Sum Guvcrnmcnl of Penk ("the Stale ol Ferak") (0 ma plmnufl and Lhuezfxcn an zycemtm dazed l0_]uly zoo‘ bmmn the State or Pcrak and me plmnuif (“me conczssinn agrternznl") (p we to 209 B5) whcrtm ‘he State of Fenk had zppamndy Appomtzd (hr. plainuff as the exclusive concessinnnirt and “one slop cenur" for, my ah. (hr dew‘-Iopment and consxrucuon of :11] Iclecommunlcnrmn mm. and bmndcasnng/bmndl>.1nd Infrnsuucmkc m ma Sm: ufPcnk Punsuanz (0 01 m anniupation of me concession zgleemtnl, Lhc plamuif entered u-no discussions Mm the am ddendanr, Hap Ahmad Kzuml Em zmm (“D1”) (0 unduuke . ‘cunt wnnn: ma. mg pmnurr meme: 35 tunes .1... comcnds :1... me p1.....im clan-n .. Iniscnnczlvcd .. D1. D2, D3 and D4 ... not under any 4.... .0 xscutc mm for lb: Tm... Accordmg .0 mass. the p1.......-rs .13.... .5 .150 .....c....m..d .5 .. was me 4.... of [Wm ch. Wan aux. 1; bung 4.: Guneml Manzger of consuumon swam of PINS 05C to ..1=....ry the sites 5... me Telcos. The wilnuses No. wnn... Nu... - Dtlciiplion \ 1 him Ch: x»... n... \ M....g..... Duotmral ch. I......n ; Pcnk 1...c,;...=a ‘ Nclwmk suvm 5.1.. I BM 2 Zadcy Che w... 3... Dlnuorofhnk vwz vvm .\\.a..u.r. 1-mu x....g....e.: :<.».w...J. w/zn..,, Scrwcer 5.... EM . W-W r--~ 3. D. n... emmu L’,x—D1x:(luruH’cxn|1 mm mm Knmnl 1;... 7...... Invngrmmd N..w...k own; 21):" S<z\1(z< 5a.. Bhd x.» Wuux o. .4... Hm lbnhxm — :=..,<:....r1=....u...¢ mm mm mz" ‘ Offltu rage") of ms osc ; 5 Am... Bum ux,r......c¢ and lows nwm M..n.......| A... . .m................. .\.....5.. "D3" nf vms osc .5 Slnuhru\ 3...»... B... Ex-Lxnmuv: Offiurai mm mm rm... Ahnuh , mm L\:(. ‘ ..m.. 7 .u.....\ r-.:......: Dum..»...(Bn.~'u — ‘ Dws mm H...-.... 1:... Abdul “us-* ‘ xv/.5 vuenuldz Analysis 36. as. Dunng cmss-examination, FWI confirmed than me M<)A1s void and agreed that third pamzs m um bound by vhe cnnctssmn ngrvxxncnt. He ngrzcd am [he cuncesunn aglcemcn: only mm: “lm.wy dun mwus" (Sec: clause 11.1 and Schedule I) and not small and mmhnruclurcxs. Hr Agreed mu m 2 mm dated 10 December was (P450451 B6) [0 m We of Punk, mg pnmurr had ma: an Ipphczuon for “exclusnl or “exclusnle nghts". Pwl zgxeed um .11: concession agtoement mnnot confer any power m an: plzmuff or the sum of Punk me: mantis am fall Within xhc mm. of the NF? hcrnce which n gv-Ivemtd by .11; cm and enfnrted by Mcm mm, m: de{cml:nLs muunlcd me u,,»um:... am xssuts oven zfltged "u\I'nershlp" ofTc|Lo mimsznmure :5 not wndun me mubu or :11: Cvnccssion ngxcemcnz. mm wns mama .0 the Llcenct Agncmem 1 jun: zoos bcnvzcn Telms and Lhe plmnuff (P3714: B5) (which pr:-dates and whxh was reigned [0 m clam: L3] of me conccsslon zgxccmmr) Under clause 2.3 (P 15 33> of me Licmce Agjzemrnn u is clcax (HM (hue is no cxclumuy and it reads 2»- ~2 J Fnnhr avo1dnn:::vIdnuIvl.l|IiI Alnunnu u rnhcrud i-In by In: Optnlun on . nuncxnllulve »..a....a naming hnem coulamzd mu mm ...., nl \h: n.,=..m.. mun cnlznng ....., mmllr zgveanznns wilt: mm plmtx duly hcnlled under Ab: cm my mama me omum {mm M. ug mm»! shnnng mfmxrunum with any olim p.mm..a .7. H3 ilxvwn mfnsnwcnn ~ [emphasis added] m. 11 M .1 39. In ms rtgmd, Pm agrud during crns.v:x5\mInznun am Tclcos can mud may own mfrauxucmrc ma zppomr znyunc m bndd um \nA'rasLrucIu:c for mu. an agreed Tclcos hm mm own NFP Licence Issuzd by MCMC Thq‘ an build mm own towels. polzs. srmll mu mun structures PM said he cnuld not zuntmlzcr whether the plmndff informed at drew the atmrmon of me State of Peak to Lhe “nun-cxrJusA\':" nntum or an L|ccns|n_z Agxcemenl between the plninm and Telcos. P\Vl agreed lhzl anyunr ma. NFP Llccncc can own and pmvxd: any nerwoxk fanlmrs A NFP hccnsee can nppmm In cnnlv to cnnarxucl mfmsuucturc an lllcrn. A cnnrxacrur domg mfnstrwcture does not mm] a NFP hcence. \Y/11:: . conmcm nezds Is an approval from me authonnies. such as loan] zuLhomy, Fur Deputmznt (BOMB:\),'1‘:1mgn Nnsmml Bcrhzd mm), ma due Dtpzrmumt of C1v1.l Anauon (DCA), PW! stud am the plalnnff has 2 NH’ Lxcensc (med by MCMC) which is geoglaphlcally confined to State of Perak. Trlcns hm: NFP licrncrs and gem: of (hue Incomes atc fnr [he wl-mlc nrMa1n.«1a P\X‘1 was zlm rtfr.-ned tu Sczuun 113 cm winch pmhibirs any munupullsuc or anu— compcnuvc mnduu. Secdon 131 CMA reads ns:— rnmlzmnn .... ..xa.on...-um «maul A hmuee nun mu mgng: In my mum \-«huh Du: nu: pnrpme nf suhiumially xnnng cnmpnilion m n nm..numnn.n mulm." muzusz 40. 41 on ma xssuc nr var/milraln. mm am that the am um: am [he :\l|:gauon of breach or fiducury duty znd conspiracy wni mixed was when the Instant suit was mm in Apnl 2014 an .ms was shown to bc not zltogtlhu mums ss 1>\>:'2 had [used ms same xssues an his nffid.~1\1(s An opposmon to d1: winding up peunon filed ts; unsn on 27 January 2014 via Windmg up Peuuon No zmccroo-01/2014 agzlnst PINS osc (pf, mm .»\r any mre. what .s undeniable n that the nllsgnuonx in ll-us sunk war not raised us put at’ thc dtfcucc and munluclannn In sum 1041. 1.. xerms o{ Lhc uarmlivc or owns and Khc plunuffs conduct, 1/L:-a‘-wt ms wnsuucuon of “illcgal mwtrs" or "illngnl Telco suucrurcs, u is xtkvam to note max Lhe plmnuff had sent a km to MCMC dated 3 Dectmlza 2009 (p272—273 B6) xvhcmn they complanncd to ma MCMC about “Lllzgal telecommunmauon mwus" ("Mmam re/IkamMt»hv1_;nng dllrirrnurum bamm") wmds wue bum ta, mass The leucr was authnxed by-P\\1'2 PW! and PW2 confirmed lhm MCMC never responded lo the puamurn sud complaint md In the but or that knuwlcdgu, no acuan hn bccn taken 17,- MCMC agunxl B11513. Sxgruficnxdy, the (up): or -mam /aamaw was also plcnously cscalatzd to me Slam of max and this Is m b: found 11: ms pnaanusrs mm m the Stat: Setremry dated 10 Deccmbu zoos (p.I50—l5l B6), ma 2: UIBZ :2 43. In um lent: the plnmnff cornplamzd about ihe canscnmmn or “nmwnt ham/)1" and Han rcqucslcd rm “cx::lus|\'c lights". Em mm was nr) action by Lhc Slam oIPe1:k. Indeed. no union was ukm ngunsl EH58 «um by the mac or Pemk 01 by MCMC For am mmex, ncxdncr flu: plainuff nor 1>n\'s osc look my acuon against BRSB oz zgaxnst D1. on ch: topic arm/~.1mzm, u is also xelcranr m refer to W22: affidavn m opposition m uh: wmdlng up of wins osc Q-:.E4A'I» 343,312), when he «ml the folluwlng» s m Hljl Armani mm Em Znknnl pad: map mash yang mnlrnal mm mendnmnx om m Abduklah mm Ch: Wan ylng muupakln ,x...;..u. ms «mu mcmlsuh Memnmmmm pmmsm mm mm A-mun unluk munlnu a... lncnyrwwzug konlnk-kmunk kcynnyman rms kc yehuahaymknt mm Rryl (tr Sdn um (d-huhmyl nah gnu... an-up ma Rekabim am Bckzl sm am» melulm kudmduhn mam. schugxi Fnlyrlh y-ms dan cw Bungl Rayn 1:1 s.:.. Bhd pad: wuss m-m.| Icnzbul Pad: sum; mus: yang m.1I=ml.Dr rm. Kim-I lun Znlum mg mtmplun pmuawal dam nI|Iu‘L! kepadz mm vemlzuan flan peuyclewmfllln kmulnlkkunlmk I-ms mm. xcsarlla mum. lrbenpn nnug hkmngm Re-mmm mcnesu-:m.. n....g. mu m sun mm mg. m.. kzndcrun (‘~¢|uclr") unluk mtlzsap lceluarkonlmkrkomnk ywgxcpnlmyz dvbtnhin km. ms Cln vclcipan an pcnyclcwcnfim kelum lwnu-nk-kmnuk yum: um; nmnxu. up Dr 1-mi mu hm hm. zzbayn ptueawnl flan pengums Kwpmvfizn hcuamn mm. knlultnyn mum man. man unluk llIE!l’Ipelfi]l‘1XIl|7Ik"I[7H.k vcmhnnan mzmrw mm klekumumhsi bug) PlN& an Dr Han Kama! Inn um. husxm hebanpu lakmngln mcmvmnm v-:nz€I.IhuIn ;-em. mcvmemi x-am-m dxrninln uleh khmvkhcn pm: Iszgl lnendmkun manu- m..... m.m.......m yang M... sum. mengznal mm lupak-Ix;-k menaruncmn tclckamumkan yang am a... wage).-rmu :.=.s¢...a.... ......k ..;.........a.. ...=.........e..... ...a............... bug: pihzk kA>:nAkl.en ms. 4». n.. H... Kzmd b... blram um... Ixbcnpa I.zk.u..g... mg... mcndnpul .....u....... ...... ...r...m.... ...=.....e.... ..,..x up-k yang .ai..=.|..k.... My ........—..,......a.. ....1...........m. .1... k..¢..4...=.. rm: .x... mm... .......u lwlmnnya um. mtndapukzn 5...... ....=x um vem:bul blm mu. k|\:n- 1.1.... ms: (.1) D. H...x<.....ax ..... Z|k|rmbevnmnbeb:npak.:.kAIang:nI scum «nun ...... ....-........ rcynunmu kepnln uukil. mu... yms mm m...,.a»..... wk ya... d......... u|=h k.....~k..... rws ma... flmpnl .a.p.......... ..; n...-1. Km. 1.... 14...... I1:-mama mm... .........,-,a.. 5.». ..y. alum mcnyclawcng m.\........ .:.......4.. mank- llpik mg udak bokn .a.p....|= . om. runs .......1. krpcmmgnu n....... .1... .cr Sfln mm. m u... .;......u b... 7ak2.rm x.:......1.... .k... b.......s... ...... dcngxu m...u.;.. Pms Imp: p:ng,:ulw.|n ms .1... .....c..1...ya.. up... lapnk ,...., dnelrwuu kemdn 1me«.4<v.:.. ms ....m... 5...... my. ncr 5.1.. gm. m u. H... Kama] b... 2...... mm. bebuagn kakxungan .¢...:. ..............|.... ....u....... ....g ...p....|.». melnlux 1.¢.r...1..|.:.. mack: am... ms .1... ......a.......... sqala ....u....... ...... .......;..... p............. ms .1... ...¢......y. .»e..gg.....1.... ...¢..a..k... J... ....x........ mrnhul .......x mcluap .1... mznyelewcng ko...nm.......... mm kerunynnn ms ......... k.,.c......y-. M... ......... am...- mtnggunakan 2...... Rxyz ucr 5.1.. at... s:hIga| .....s...;.. (......»... pal-snpan .1... .....y:..»....g.... ...m.... Scum ..... mm: mm. 4...... ........a..... F... o.-ma... ........ yang Irrnylla ulah a.::..;. a... dxseleueng m... ulnh QM: n.. llajv Kamfl .3... zm... mcnggllnakzn ...a.......... M... Pms Melulm sum ............. pengumsan rms osc > g mm. .......x..... pun ov-oI~2um .1... ...-.V.......r...sy..... .. Inpnk- .....k pcmbmnn ynng buikm um. diknui rum setup Iapak yang ........... olzh u....u.=.. ms- MRSM mg»... ur» T......=r. lusm u... Slum SM Izzudm mm 5...... s..... mum .... a....,..u ac... kalcknl saiuul vr....u...x vm Ddcsiv" -:......n Page 2: ms: 1: Km: .4 ..mm am. dulvvuwilkan lehIp| Emubir zm mm. Mmi| Mcsyunll m's gang Ankzlsdalihn nleh kzluungan mg : u dmgnn my mu Knmnl Mn 7I.k:rm umuk .u...g¢...:,.m upak-uptk ymg dimmuukh khan-khan mls. Tapak-fzmk Yxng nun... Iaselnl lzlxhpun dmnmlz ulah um Mm) PINS. Dr mp Knmnl hm Zuhml bnunm bcbcvnpl kmkwungm dlhm pengumsln wms osc with mmflzullakm Ivzdudukan dzn pmguxuh meleka ....u.x mmuklumm Ivepadz ms mm Tun-k-Taymk v... Dvltflp mm: lrdnk am tlxpelnlrhl nnmk kehmd-A klxzn-klmn ms “ (F E40—s:1,mz) «:4. l"uxLhex, in m mcmhez affidaxit m me sun: pmcetdsngs, vwz smzd at p 502 E12, mg iollownngk 4). Kmml at an mnlmal nmes owed . mg. dnny u. ()1: Kzspn-n1knI': umuplny u 4: mm: and pus-In m canlml mu m dzuly Imvmu m the Re&puud:rn': calnpiny I v:n|) hem: Ind mm mm Kmul ma bruchm his fidunnrv AIu|y ma mm 9» Rspomknl In ht u. nmcm Ifflmlues nlucmcndu-I1x<:unenI umul-an ufmreomvllly Al .1: mnlmnl um. Kamnl ma Ihe Pclmonds annpm) rm IA: valves: nlwlonxfid profits:-in] Kamal um um: ullcully pmfihed am we wnslnumnn mm down by me mspmmm 5 Lavmpanzt I vmly helm: Ind xuxe mm Kamal u m: Dnracmr ma smmum u! “I: ll:§nund<m‘I unmpnn} mu uuxcd me Keswudem to bread: ma nm wmply mm mm Arnn: in me Maxugemcnl Agmnnsnl and neglcued. or refused 1.. pa) ma Rzxpndcnfx c.m.p...y; mmlnry payments ma am: - (p.392. mz) Pig: :1 Ms: 6. In responsc. m pzmgmphs 9 and ID of ms nffidan arrmm an 27 mm. 2014,01 ..—u.ca mg [n||0wm5:- «Pu, -v. In pmmuhr. 1 humbly mm mm pumgraph 15 .: «.naa1m.s This .»- AIK nm um xmx ax cnnlnbmnry nu ma: nllzgxmvnt ul’ wwmaflfl pmmm... ...a mm: mm ....,m me All m... yuan, no um. ha: bun mm :7,» nnyune apinn mm. mm .4 mo. .m..n.m.. ID Fnrngl-1ph2‘71i:sundI:lnu5 n. tvklenuw Ixoevcrwnywn in rupeu um, wrongful pmfilurlnn and .u...| mm. m (h: suit.‘ (p a [emphasis 10, mg, addcd] 44. n .5 significant to nor: um um plmnuff med an appeal to the Couzt of Appual nusmg out of the yudgmem um was givml m suit 1041 and me decision on». Count ofAppea.l .5 teponzd 2‘ Pm Inlrgm/rd Nmmrle Xtrvxm mu BM u rm» Danni: my BM d*Anar. [zone] 6 CL] xzo CA. In us judgment the Cuun of Appeal ma rcmaxkrd am the mmplamrs and allcganons made agu (H: affidavus m oppnxulnn m me wmnlmg up r:fPI.\'S <1 :13: D! In sc, Ought to haw: hem tamed m the tuumcrzhlm m am: 1041. I: 1x relevant m rcfcx In Lhc foIlo\\'|ng pauguphs from [him judgmc Conn o(App:1l:- nr oi the ma; n M: cnnlcndcd um Lhe pan) :.s«...g xrmndy namely nu; ma Icspnndcnl rnuxl mum in mm vulh than ma. The nppcllnm claimed xm Pwl wn me my egn afxhz Em Icxwndull Ht m Iflvgnl m lmvc xrplwmd nu! mam me lo nmmpuny krwwn ax Bung! Rn}: xcr Sdn mu m whvch rm had vexlud urinal. mm M: mm, ma in bmszh arms fiduunn mm by using Infnnnalim hcvwflcul m Ihrbu:InemoVI)1:|w<Y||l1ua siphon om wnuxxs up n mmpany vzgrumil u 43 [171 n .5 m b: nmcd xhal me .n.;.u..... uinhluc nip:-wzr.hnnh ..r Muninry «um um um rw: a. nu um me. at m. nm n-,.....a.... m nlvl pludcd u. an .,.,..u...r- dflenu ...a (nunltrchim and nmzlnknl nun.“ ma mlmlkvelalm lu um ..-u.... m ......-n... u wlnvly my .. .... um rvlnlnu .. nu. winding up ,.un..7.. pnxrcmngx W van cummtheod Illa lhA>[Inlg||:nInlh|1 mm. mm a m...: mo laws 1: wmdd be morn appmprialt n ms: uHc|M 5 Inc pl:2xJ:d m we prucnl mu m plmcullr ... mum in mm sun nldmvame Anon in as In cmhh: IN: fits! mmmm n.. rm‘; and addmn: .m.u..: undrlvct dunltg mm mm - [L-mphasls added] 1: \nIl hr rcculkd mm me pmm um W115 emnmnlly filed on 2 ‘\pn1 2m4 Th: mlmm qnemun 3 why was me .-1..m ma -he mulmunlc of ;A|.Icg:\ucms agmnsl m. a.»rcm1;..u. hcrcm, nu! mm; m sun 1041? Th: relmcd qucsuon .5 wheducx me przscnr clnm could l-mu; been mcludwl as part of the mas :oun(u—cla|nI m mu 1041? In ms regard. u 15 unpoxunl to mm» mm wsa W already a pal)‘ to mu 104: PINS was mg sczond drfcndanr m um um. PINS Osc wax the rum dcfcndanr And Dam‘ . rum me llurd dcfrndznz 11...; ;u the [mm on eh: pl:unn|'I's mu wm alrudv bcfom um cum m .~uI{ um. nu» qummn ., wheLhcr vms could hnvc added .11 L112 prcxcnl defendants. namely D1, D2. D3, D4 and BRSB as addmoml dcfendams to |hc counterclinm m sun 1041? In um mgnrd. u :5 mnlcnal (0 note um Ordtr I5 Rule 3 Rules 0; Court 2012 cams for an inclusion of nddmonal panics no any mummlanu that the dcfcndzm may wish m rrmlm. Pig: 1; ma 40. so And :0. i« I: rzlnvam to ask why vms did not make lhc prrscm clam: :5 pm of m ccaulucvclmm m mi: 1041.: 1. W therefore strongly mgucd for the dcfcndnm: Ll-nu Imed on the ram and cxrcurnsnnca-.~ alluded .0 above, m/mm. m Lhc ‘we; sensc" apphed and am the mm.“ sun was an obvmus max-ufcsunon of an abuse or pmccss [set Mauaharmt .Walgvalanv 1/ Mmtm Du/am NW Illa/qyjta z-= arwr. [2009] 2 m.) cm FC; Dv .4..r/mo m Ream hr 1. rim.” 13 29» mm Ktmmmrdrrly and my [mm] 11 MI.I"02 Hc. Hmamn .~ Hendmmv [1343] 57 ER 313, 3 HM: mo, /n/Mm)! r Carr ll"/and a Ca [2000] mm. as). I: is of cmusc ms: nu: whether m/nmma m uh: Mdcl sense should be pcnuluml Io mu a am is . mm. am 5 (0 be dezanmncd on an mu of gun case, always mung regard to wane Ihn juslicz nf Ihe individual and particular cast lies x wan lcmm m ms topic 1:: due course I now move on re the topic of ms pmnurrs plcaded cm In mu case n .5 qum clcnx (hm the plaintiff: pleaded case as ptk ma .-\soc, docs not make . d.\sun:unn buwccu lowczs and small ma muu—sLrucmxes. The pmnurrs plczdcd case had evuydlxng m do with mmucnon of “In\»-ens" and Lhe hqacklng or muzppropnauon of “confidenuzl suns or of purported mfonmuon" or “mud: scum". >.;eso.m The arr" by m to undertake a ,mm vznmrc WAS pmmma on rm repuvsenmuun than hc I-mrl thz vcqumlc cxpuuxr, personnel and conunclurs to design nnd cumuxuct mlzcommunxcanun towers. In um end 2 mcmumndum of agrcnntnl (“MOA"j dated 2: February zone was slgnud hen»/can one om Fzdzxl Ch: \\"an (“Da:o‘ FCW') and Bung: km Rekabms dan M21 Sdn Bhd, am am. defendant (“D5"). 72 D3 is now known 51! Bun,-m mp xcr Sdn mm (“BRSB"). 1 xhall, for cunvcnlrtnce, xcfer m as as nxsnsm um lime, Dam‘ rcw wzs ncuhcr :1 sluucholdex no. duecroz of mu pmnurc nm MOA however, descubts Data‘ 1-‘cw as bung “of Funk Inmgmted Network Services Sdn um". um he .5 also dtscnbed m rhc document 15 “Dm Dx, Fzdzxl of mg orhetpmf’ A: an signmg page (p.7, B3). Dam’ FCWs1gn:d on I-n.» mm bahalfi E\:nnml|_\, Dam’ FC\‘<' rhmugh his cnmpany, Punk Cummumcnuon Tc:l1nologyS(In El-ml (war) zcquued 1“ rhc slmrts of me pl;1inuA'A' Dun‘ Fcw um brcnme a dflectoz of kl): plzmdff DI became a dxxtcrux or the plm-mff an 30 June 2006. According to D1. he had hclprd om FC\X' m gunng me Icqmsxre funding for an purchase of the slums m mg plamnrr. P31: a alfiz 501 50.: 30.3 The ASOC made no dlmntnon bclwccn uznumcnon and rxwnerxhlp of lowers mud/or small and mtnrsmlcrmcs. 11.: .v\s0c madc no referent: \vhatsoe.Vtr m me agtremtnl between Ihc mkzholders 2: (ha cmcul mm 05: mctung on a july 2009 when Dam’ Fcw. Iwsn(P\X"l), Zad:y(P\3.'Z) and D1 mg pxescnt md u m agreed am, “for small ma mini structure, the buxiness was open m all is agxted by both punks " (p 223 as). llnwvvux, Ins (“PW2B", W72 smd um (hue was 2 “\Imvu" to mg m wppxem.-mu, wlmcss suzcmem sxclusnv 50.4 I: Is relevant (0 none that men was no mmuan ofwzlvu in >0.5 [ht mm mmess sratemem (“PW2A"). A: an} ram. the smcillcd “waxvcr" them’) a not pludcd m an Asor: u. m Xllc mply m (Inc dcfcnccs um WCIC filed ma rmly came mu. am: PW2 hnd “gm of on witness xralcmeut wmh ms fled pnol (0 cummtnccmcnl of um Bu: P\\'7Z \v1< mnmd cnough to zdmn khnt (ht wuver theory clme nbouz after he had sight ofD1's wxuucss skatcrnem. Page 31 ms: 51 so 7 In (ms kegard. he was asked 1!: cr0s.<—axn|mnanon.“1I»/9‘ 1: rim .:/:m5» _'m4 art awn mm pmm barf agvrrtl ,1 u; 5 ]nj my guzr as), .7 war ncutr IA?/ulrttd 1,. 2;» (lawn t/MI mm//and nim- urn:/we: Ir/rt:/yr «/1 mm mm mm; and per mil .2 1/." He said, "Mr were mnnn/rating an my dug’ law (4: mm mm). Trim /mu/ed/mm bang my in mzmmamm at am." so 3 Ev=nmz|.|_\' he capflulned md sud . “I m'r mu)’. n was put to PW: um (her: was “M twdcrrrr Mal auamr/rp nmfln-hid:/M" and he said. "I/Jarru mm /Aatlbmw up I now mm m m: (cpl: of V1‘!/A41,/I11/I1 In my Max». the following factors are rcl:\'anr in klm mum. or me M-gulncnl mu mmmm appll .'1l1es:.- [actors m also our budding black rm um nxgurncnt dm wns mzdc quite umchandy by cuunsel for D1, am the complaints md allegations Igamst D1 and the ma defendants 2:: spurious mm at: an "zt'\‘:rthoug,ht". 51 1 Fm. .5 the comm! of an plamnrrs pleaded case (pu rhc A500 and \‘h: nrtemp\ at dcpzmng from u m nmuul axpecls dunng :11: um. 51.2 Stcondly, in sun 1041, Dl was the mam wnmcss fax the plzmnifl [UDSB) ma undmven! cross cxammariun by counsel {at second drfendzm (pms) mg :1 Ms: 51.3 Thwdly. and Very pernncnlly. rvcryunc who was mvulvcd In an -mm Infrnsuunutc Izunnux .n the Sun: at Punk, know exactly whit wzs going on and who was doing what. am And so me pmnnrr (Pms) knew at all matenzl Limes zxncdy what wn. happening in the Sun: ofPemk Then n no snggnsunn am my wen; unawixr. In {am an: plnnnm lent: amd 3 Detcmlzzr 3009 m Mcmc shuws [hut they were fully a\v41n' of 1311513‘; Tclcn Infnsuucmlc: acuvxucs. 51.6 111: paint .5 mm d1: {acts and the evident: were in exutcnce from Lhe bcgmnmg nna at any um, n was In exlstencc and was known to all pnmzs when (he dcfmcc and zollnlebclanm an pms (as :11: mond dcfzudnm) was filed on 19 March 2013 |n m|tl041. Hence, an plaintiff could hm, bul and not Include the present alarm is part aflu coumerdalxn agaxmt me pxusent dcfcndanu. 513 It cannot be denied um sun mm involved all an same pzmcxpanlx or playcxs and ma tvcryflnng (0 do with an concession nycuntnt. the MOA, Shareholder: Ayn-zmeni, Marmgcmmt Agxumznr nnd me 1" supp. Mznagcmznl J\g,tccmcnl ct: wuoaau And 5... the qucsnnn Is: whuher the prcwm ...i. wax in aflerlhuughl .....s 2 .e...u...i.:.. for ch. nu|corne 1.. suit 1041 and/or filing of Ihe winding up puilion by unsa against PINS osc? 52.. 1.. u... nzgald, baszd .r me chronolngy of cm... ....1 me mznncx ... whuch um :35: has bum pleaded ...d m cudtrmc of P\l1'1 ...d P 2, .. .5 qmne cl... rm... mg .......m of exems and me conduit of m. panics. .1... .5: ptcsem 5.... is a. nftuthoughx and qml: pombly aka 5.. 0.4.. ... nzuzxalxsc. so r.. as pomblt. (hr outcome .1... was \c:u:11v:d m mg ml... pmcecdlngs “huh am not |':\\'nur xhc plnlnuff 1.. this rcgnd, I c.....o. .g...m rh: pnsubullry .9... .... present «.... was filed M... .u. ..hI.q..c mouvc or a rullalcnl purpose. 0.. .1... analysis, and b.-ncd on me n7|rnm\'v.- uf rm. au...1..~d u. cnrlml, I ..... cunuvmtcd lhal ma. 3... .5 plainly and patently .. abuse of process No 40...», .. ., a..m...,... .0 conclude .1... . puny should he bmgd by rzx/m{4ra.'a ... me mdu sens: from pxusccllung . 5.... which could me he... nu. wzs not mdudcd ... an 2...... plocgedmg. Fag: an U161 53 54. 525 In myvxew. an facts hen: are mm compelling and an .5 nn Inmsncc m the defendants, pnrucululy D1 whr) hnd lu gn thwugh 1 Mona round of rigorous cmasrcxammzuon mixing our of the same {mun mazux Ind mmmng an same actols and documenns. 52.s In dus Iqzard. it should be nutad than in sun 1041, D1 ms cross-cxnnunrd extensively over Iwo dz): fmm 3 to 9 July mm by Mr P Gannnarhnn for PINS and Ms Fiona Budxpnlnr fr): Dnlo’ FOX’. In the present cm, D! was cms— cxnmnnrd for Iwo days (3 Nov and 9 Nov 2016) 11 xx also relcvam to nor: am Dam’ FCW ma Zndzy (P\V2’2) msufizd Ln sun 1041. 1 un ofcourse.m1ndfu| of the txccpuon to rw_/mluafa but n must be borne m mind an: me txcepnon n muted m msucc, cquxry ma [mrnrss T1-ms. looking in me summon n. ma round, and \-.1llIn\Ir demanding into sptnfits, mm: nun I alrudy hm, n n my fin-n cundunnn am in would bc umuu, mcqunublc nna unfml no! to bat an prrcscnt sun on 111: mm uf rr:/udzmm In :11: mm mm. As mated previously, nn 2 mus 05: meeting (p 221 no at p.Z23— 224) an .5 July 2009, Dam’ FCW (why rwmd :1»p1m.:f:»m~g» PCT) was plcsent together wun m and PW2 Th: mceung is mm: as 1: Shaw; (hr Sm: or rmnd of ti}: pamzs and um jg-xczmenr Ihar wm xcuzhcd hem/rm an panics. »...;s..m To my mmd. the ngrrcmem mm was .- «dud gwti n5: :0 ml .mm/ and negates any mm. uf naucmy duucs on on put Because ofns nnpnmmcc, 1 luv: upxuduced the relevant pan of ma mimics‘- Na D~s=r-vim" Frvm Mon ‘ngmm A_Lm=um.m n) v..r...n...:..».v.u.<«m. n..n..;a... n....m.n.. ,.....u-W. ....u. sass 5: Pen W NAK mmly x>..n.:w4H Mrulh mm. I?.Z..m.;a.. Ind ‘W’ alsn Is rawmmmdllvou .9 cm... m pm .....a Fem for MK um Wm: mm n. cm xlunnlaenny M .45..“ MN .. .w.,.:.1 m vtn by C<I:nm kkuuse mu mmnzsn .5 .n mu. ;.s,m...............:.4.xm, ‘ [. Ball .-«.4 -mm um my udnpvvl .»..mu mum: mass or cn Ihvumnll-ml 9'15"‘ m ma....u...a..».,m. Pcm sum. Cekon M ....y nlltv R»: be .. -enier mu m use flea .. .x.:. r... ...r ..m..... ms \\l am pamu mm Inn .1» NEW nmll an-I ....... ,....m.. must 5: tiechved Ind m......a 4., on m mm. for ,..m M mx ......-mm ma mm... :5 suIwmrmomla0SA rm pemm ..,,,m.: .5 W 5 man: Iulh RM4,sm fun in ms par mbmisxml Mz:Imgxd_ywme111l :2 15 pm L V , _ 1 meaauu 54. 57. It is significant :0 note um although n was 51 PINS nsc memng, pnnm had dlscussnd mutter! relating m BRSB md PCI‘ And Ilthuugll u was not a muung of um board of lhc plannufl, um»; plcsenr at Lhe mecung mcludrd dneclms on me bond of xhc plmua, nzmsly Duo‘ row and D1, A: an, (ale, .1 would he axufiual and d.IsAngcnuo\L< :0 make any dlsuncuon of corporate muues pumly lxczuse n us a PINS osc EXCO mecung mm than a meeung of th: bmud of directors of the plmncr. If at .11 the plnmuff deans .: 5: :0 make a dnmnuwn, mu. It would be a “disunctinn wlrhnur ll dxff:-rI:n:c” The end result .s an. cvuyonc ;: am meenng l-ml uncqmvocnlly mud uncundxuonally Agreed, mncmmd to and ncquxcsccd Io mus mu vcr uomg me busmcss for smnll and mum suucmlts Dunng cxcsrexnrmnmnn, rm zgmd. mm reference lo .11: mctung on 6 july 2009. um mm “:15 an zgxtcmem um rcr and mus mule do xmzll and mum struchncx. In mas xcgmn. it Is not mspmc mm all \‘h= structures mm W: built by mass and \vhu:h .1.» the mbyccr mnncr or :11: prrxcnl sun, wcr: so mu;-ts (100 rm) and below. ‘um, they no not Iowa: .3 toxvcns are nny suuclures whxch am more than 45 males m hengm Plnlnly, based on ms aguxment, me plamuffxs esmpped [mm ukmg urnbuge mm Ihe cunsmlcuon of man and m|nI—smActuzcs by mass. PW1 agreed am Lhexe vms no mennon oi“owncrsh1p" .1 the mtuing I mil deal ma. ownership m dug course. mm at 52 53. The um Issue )5 whcthcx mm was a mum venture bckwcen the p|=...un, mm: and 1:353 and whmhcr Lhc .\:o_\ 51...‘-mam Aglvuucnn Manngcment Agxccxntnl, I" Supp. Manngtmtnt Ayccmcnt and Ltccncc Agmmm. can hc cnnsmlzd as men being a pin! venture, 1 mil snarl mm the mus ofvhc MUA. The MOA was deaxly 4. docummt which m Intended to captuzc me dlscussums between Dam’ 1-‘cw and on (ihnollgh BRSB) Itlaung no me strung up ofa ]'\'co PW1 and PW2 «gzvcd «ha. (1): M0/\ becamt void by rfflllxlon orume. Emu. ofrhcm agreed um um wns nu mum: of any agrctmcnr or understanding between Duo’ rcw and D1 of mv extension of (1.: mm, There .5 also no nvuknct am D1 ma uscd uusn m “pm: mass as the pzmciplnt m um Jvw. mus, me and xtsulz .5 ma: me MOA ma become vmd and fell out of rh: tquauon Thus, the may of uoss nppnrs m 1). part of 2 ml. rnnszmon, leadmg up to am cxenlnon of me Sllaxeholdrxs Agtecmmt by which the plamuff and unsa wet: m participate m 2 jvm The ]Vco com-mplnea by me SI-mrrholders :\grccm:m was ulrnnusly pms o. .Tu my rmnd, BRSB land dropped out .2! me [mum and W15 not pan oi me jVcu Indttd me comnmponncous cvndcnct suppom the concluslon um BRSB was quuc free to pmupue m me buslncss mum. me mm orwlm was dxscussed at Lhc crucial meeung held on a_1uL\— 2009 when men ms an zgmnnmt um PCT and Bush could do small and mm: suucmxts 1: .5 critical m am: am Da(o' 1-‘cw. 2 dxmctor of (h: plainnff was pr:s<lIr at (In! mccnng. D1 was also a duccmr nr the p]i|nLiff m um nm: was 31 ans: 59 A: such, when everyone ma agreed am BRSB and PCT may (In small and mm: stnxzrurcx, I (In rm: Sec how um um bc may «mum at mmm L7: branch of d.\z(cmxs duty or breach of fiduciary duuns The suggcsuun am on was m Lunch ofhss duuts M 2 d.|kc(or of mg plzmnff xs thunforc plalulv untmable. Thus, at ,5 dmx mm for all mm and purposes me plmnnff had zxpressly or implxuzly agrzed um BRSB my pamupm u. ch: business of small and m|m structures And. for puxpases or mi: sun. mm‘; acnwncs m'~:.13 Tnlco tnfrastxucmre was only m the context of .<m:\1| and mlm suucturu, \vhu:l1 .5 commonly understood :3 mxvolnng Tclco smxelulca or 1 height of 30 mums ma Inn And d-us cu does not concern me consuucuon of towns by BRSB, 1=\v2 m rm sonfinncd Klus dunng mg ml end of his cross euxnmzmn am am case .5 confined om; m small and mm: suucnxrts 1: bean repuung um mm; would be any structuxrs mezsnnng man: am. 45 mains. But the ASOC makes no dxxuncdun between mnsrmcnon ofrowers and mu: ma mini xlructures In nus cm all the .urucn\m.( ma. Wtm cnn-uuctcd by mm; were below 30 mm. Dining the m, H appcnrcd Lha! me Inflow grounds of am pL1|nufF§ compliant um, fim, am am: ma not 5011: Llxmugh mg process An! zpplymg for zll ma xppmvzls vu rms osc um um u not me plead:-i case 2. per :h:1\SOC. pm 39 Mix an I mm nnw m “ownerlhi The p|......m new cnmplmm .. mm them was no agrecment hy Ihc pmuex .h... BRSB cauld “nwn" an nnall and mm: nrncmrcs It xum» coulemltd dual to own Lhrsc snuctuxcs one would ma 3 NH’ Lxcensc ma. 1.... .0 be xssucrl by MCMKJ In ms «gm. mvzs supplemenun \v|mr.ss mm-Mn. (pwzs) .5 rclcmnt. He agreed ma. P\\"2E W prepamd zfzcr he had seen Dr. xnmrss smttmcm In PWZB, l>\x2 said.» -on Ahmad Km... r...- cvmrndcd n... by min-e ..r IIK mm... "rm wmllavrd mm mumrre, um buunen .. open .0 all .u ...:....: 4. A-1!/rpm’/var‘ ... Ihe \(\.(uvv|n’!)1r 1-wsuwc Rnvmmules funded 4»yu.»« s..mm'*n.. {H3512} «Has. FINScss¢nually w....a ... nduxnlly a. rvlpvcl nl Imull nml ...... ..n.«..m. .n.«-:., ..m......... Ahmad x.....: to mum . mu ....1 min: ...-.m..m ..... ..n........n... any .u..... 1.. .....m ..m.. um M... .5 yuur mspnnsc ... aw A r..<n,., .5 an whmln um uwcalcs mg pun} why hax pmpostd .1.../... mu... the normal pnnnn .. m........ x......: Thu ‘M15 ...,. uprma .7, rm. 1 b<h:\'uhanh:ft>m\l!lmg Ins awmm fmm us ......,....I {am ..... umcd [Ad:y‘: .......:, ... appcnr nru .0 this .<.......m.. Sguvmlly. Ilww .........m M... .. ll“: mnclm: we an «. July mm; Al .5... palm. we 1...». am mm: 11! m Vrleos, umzv .1... cguw... wen mu...‘ ....... ... mm M .... ..u...m =........i....iu .gm...¢... wnh ».. Yank me: I. M 2 mmyhcntmi um: for u. rm-M ufltr 9.. ma gmcufl ekclmn ksuhed m a cum: of gowrnmtm In mg pm: m w: ma dnmcully cxyllnnlngihc n....<.\. cnmI:x<|nn.\un nytcmrnl ... we IKW gmummg pany n was snll . lcgslh xm..1...g agremucnl :7... ..... Ilul WM ..\mll=ngIng .. enfwn: ... ,,.......-.. mm. nap... havmg .. rm. ngm. .. wnuld rim ham hen Ms‘... far us ... mt ma: .....= g.u\‘emmml m enh-we me cxdumvc wnccsslmmrc ..g.m..u.. rm whrn mu... pm... mm M (‘clean me dnuvwrcd u» be banding Inwus mxhnm going mmugh ms we took . ... w..u= nppvuueh w. uzld n....a :<.....: um n. nnuln n...m ,....u ...a min xlruulra lnr In: mm (I: mix wn um. I . I-lumen) g... .....s« ... ........m....;, g KVIIBRE: 9.. .,....§..u§ vagewmiz 7.4 m “RS/I! me CJIIafFxccuI|vc Officnr of mm: Am Hm Ibmlurn (-132") and .-\2mm Moharnzd A112 (--my mm the general rnnnngu and rmmu amm mspecuvcly onmsa 7.5 The shueholdcxs of BRSB are Puau Nm... Bum Mohd Yusoff (D1’s mic) and Mahd Fakml Hxsyzm Bm Abdul Wafl (D12 ncphcw) 71. PINS osc & M;mIrenxnce Scrviccx 5:11: and (“PINS osc") was mam-pnntcd nn 15 Fcbnury zoos (p66-71 EA) md was me tmwupanv which was to .\:n-c is :11: on: stop cmrrt [or the devclopmenl and conmucuon of tekcommumcnuon mfrasnrucluxe In due same of Pemk D2 was ch: Chm Exuuuv: Omcu or PINS 05C for about two mmuhs (mm May to jun: 2007 Mm he cemd m 1:: the Chef Executive Officel of PINS OSC. he crmnnucd m assm me mmpauy, gum. wnhnul an, fannnl dcslgmmon. s,1 He conunucd lo nssnsl P1315 osc unuljmunry mos. A: m ume of uh: uul, D2 was general nmnagu of Telzflow Corpontum bdn Bhd (“T:l¢flnvri'). s2 Teleflaw :5 the company durough which D1 Imdcnook Ihe development and relrcommumcatlon mfxasrmckux: work in eh: sum ofK:dah. Puesalsi 61. 11.. ..=|..... ......e..a....:.. ...... held 1.; ms ...» nu... .. ... awnenlip ..| ...»... n.»...., ... ...... Inc dunnn .. Illmv :u......a x......: .. ...... 1... ...»... . .... .. .... ..., Illrulrumnrs. w. zflecmzly ma .... ,..ev.... ...‘. panic: ...... M...“ !..r....:........e. .. .... ...... .r...... o... M WCK‘ ...». .. ...... ...... .... ...-... ...... ......” m... as. .... bv.......Iy ......p... ...... mav ..........,. rms osc 1.. .... mgald, rem was Kl .... .5 . comma; WYIIER ...... mm x..¢.............. r... ...)... pm. I. ... .. «...... of .... cxcluswilt .. Punk u... .. I....v.. .: ... ...... ol govnnmam .. n... .. why .. ...... 22:. ...: r..n..w...g ...»: .5 .1... -mu .......y .1... he my ..:.s.....u,. ....J.. . we ........<.m... .... ..x........:...:....... .. cucon ln ...... you 1... IKW .... Plzuc ...... .... .. ...... ;.......« ..., .... ufxulu VII" ... .w...2.: ... vcnx I73 Celmm beam: the Iuulnzs .5 all .x...... ... ,..nu......... .... ..».....,w The .4... v... .... ... ... mm...» at .........<....... |l>< v..r..n...:....... /m....a Km: .»....m t. ...........a .7 .1. s. r... ...... .1»... c¢|......, I... .. M... zlsu ... .. . ...... ward r... PCIA r..nv.c.. mm ... .... nquutmcnl .1... .n me ....~ v..r........c...... ma .. be .:::I-an .... ............1 m ms .5 ...; ....‘-...... ...... for Femk .. .... w..,, we ............... rmv excluswul ...a 5.... .. .... .... .....m.....: .. ... 5.... nfhmk, .. ...... =...-...- Itlnphasn added] This pm... mm .... once .g.... ... me .11 ....po...... mrenng bslwcen .... mkehnldgn of ...... nmmgcmtm ....a¢. ...: auspices of pins osr 11.. .-........e. at’ ...: mccung .... .. p. 22:. 224 B6. Duzmg .h.» mu], them was .... mspuz: .. .0 mg nctulacy or 4.: minums A. such, .. .... .3“. all .o...... .1... ...: ..-.......c. r...1y accurately Inflected ...: ......... .1... were dxscussed .... 4 J..1_.~ 2009. 1. .s |rnp0kl:n( .0 ...: ma. D...‘ FCW and D1 wue .150 prcsenl .. ...: ...=e....g. wt/1 um .15.. present pay. n ma 02. 63 The mlnutzs are very crucial m understandmg rhc agrzcmenr or undersrzndxng mm was reached bcrw-::n Khc pame: mt-u-M man and muII—st1ur.tur-:5 They mad us {unem- ~ Ag; 11;: Bumuxx ., Fur xmnll ...a mm .-.m...., nu saw... s. ...,c.. ... .u .. .m.a », um plrllu .. mm mm: Igueed am any cxtluxmly avundcd m mhn‘ 51153 at Pcu mm“: Ind mm: nlnmuk MAIHAQS 0, me Sign cam or my omcnclnlnd |1ndIe:.n<ilh:rPCTA mam entitled 0 (Kim: far any cums: ms. HAK noufy than he wnll pervovwlly makr 3 gond inlmducnon Ind mu-mhnmdnlinn m Ldnom In mm I-cm {or M was mm. mm Ilsa! he cm‘: gannk: my nu at max wfll mg Iwankd m I>c'r/\ W Czlcnm beam: this 0..,...m .1 all nboul n, pcrfmluavwc am delnery. and“ (p.22)rZ2b, 3:») 1 find u mam mmgumg am mu Lhz PINS osc rnrcung on 6 July 2009 (p.223 B6), Lhe plzlntlffwmxr [0 MCMC via new ama s Dccembcr 2009 mmplnmmg uf wmm It/tkrzmwt/A-x1tr_ya«g dzlxna mm /mrwrr M um mm...» prmmfmnwx .rm1n: /mm mt/a/I4! MN: u/4» yanlzut Bing; Rm R:/alum: ¢~ Em] Id» EM. " (p.272 Ba) but no mm. was taken by MLMC. Nenlacr Wfl any ncdon mm by an plzmuff against mass 01 us allegtd mm W", D1. nmm, dcspxtr. me complamts about rhr. cunskrucuon of “nurture mm./', me plmnnff appcais m hnve no pmlzlcms wuh mass budding polns and mlrwsnrucrures so: YTL as may be glsannd from m: mmllres of mmmg cmwened by me plmnlxff on 3 April 2010 which wm attended by Dam‘ Fcw, m. mm mm) and PW: (Zndry) (see mmutrs ofmecung ar p.34 B9) mu: ma 64. 65. It n mreksung tn nor: am rvcn N am meeting n was agtced/understood that men would lmuld pu1u/mans stmcmzv.-s lui than 100 rm (30 mains). lndccd, ii men was any caxhu wrongdoing by BILSB or D! for am xmllel, n n cuuous um nothmg was ma about BRSB’s conduct on is Apnl 2010. lnsvcad, u appeals to be um n wns “b\ume:s as nsunr‘ as far as the pmnnrc was conccmed and a: is crystal am that sh: pmnunhnd no Issues mu. BRSB buxldmg pelts/small and mmI—5Iru:nxres [ox Tclms An for BRSB allegedly “<7wnIng" (1125: small and minx-stnncmms \v1KhL7ul n NFP Iccnca. tht mule was nut specifically plcnzlrd znd n n. any event, plmnly nn Issue for an MCMC to handle wulun the pun Acw of mu pun‘ (ms of the cm It n undzmnblc am an Issue nr “0wnc(ship" or small and mun snnnnm was not specifically mm: in an .-\s0c Heme, n must be dxsrvgaxded Al any mg. cven xi n n to ht consldrxzd, I find um nurhex an plamnff nor (hr Slam of Funk have any wnsdnmun ovu o\vu(-rs}-up as n [alln uurhm an pnnlcw or MCMC/CM.~\ Indccd, pm hixnsrlfngrccd um rhcsc Ire mnucza [or .uc.\(c. In ans rtgzrd, lht uvldcnse shows um ch: plnnufl‘: new dated a Decunbcr 2009 [p.272—273 no) to MCMC rhultd no xcspons: from an MCMC. Thu: vs no cvldenct of my action that was uktn by MCMC ipinst BRSB In ch: pxtscnl context, :1 matters not an: 10: whnhcr MCMC dud or Intends m uke or not to rzkr my action against BKSB as an pmnnrr 1m no 5.} in H1: mnnun hum next to thc Lwsue nfcu-ordinate: Page 43 nm 66 (.7. Basically. .. .= alleged by m: p1......rr am the defendants in colluuun Wllh ems. ma “I.....ckea'* .7. “......pp.........c.v' .1.“ mlcrnnl cu-a1'd.Innxes ...+..c|. wcrc mcant rm ..\.e brlwfll or an plnlnufi. The phlnuffs complain! ... Lhxs mgird .5 .. paragraphs I‘)(c), (.1) ma (c) ASDC Whlfh .2... as:— “ca .u.....e. Kama! Am, Am... and sum... Aumn 3.... ......g :1 .m......¢u .2... .....a ...r............ whom the me; .u.....¢.. luv Ih: u:e«...........c...... lawns Dy Ihz |=1.......~r. clmus. (hr: Cunfid»-mini ...xo..........., mg. would pmpormuy .c...:I. .......p. ...........¢.n .m........=. an m...m.r...< w......n-.c|......; »........: Km... /mi. M... ...a sn....| A........ mp... ....«.n.; ..m;...¢a ....u... semmd sunable 50:3, wuuld not piss on Ike: .9.-...=.. mes .. ..s ...r............. In .... Plnmulf .. mas osc. and/or ml‘ mvmml otherwise. .5... runs! ol'I).: ms mquened 5, II» .=|.......rm.....s .x........... be ...;.......a: Ahmad .<.....|. Am. Aznna and s......| A........ would .......4 ......,.,;..-.,......u..c: .... ..r.......... ......m. min waned a, Ilem o. my on: M then. far Ilmr mvn h<n¢fiL m Dzfs-ndzm: mud than a... ........y WHIY ....- |>.......n. um... um pmpoy: m: pmvfion .11.»... .«....a 5.... ... III: ms . cum... through miss wulmnlme ......».1......,;..r.r...-1...... 3... I End .1... mg c....1=...c duzs nu! ...pp.... .1.. ...ru....= or (ontlusmn .1... any such c.H..a....... wuc yven 1. ldcm .0 ma plaintiff and subsgqucndy ...,.:m1 0. drvcned or nusnpplopdzmd by 4.: dzfcndnnls. For cxzmplt, one may xeicx .0 . lam. dated :7 August 200". whmh was sent by CELCOM .0 me p1.....arr. 1. ma. as:— csmm Ru} .9... c.y.u...u.>...owr.~<s/oxouz. \60gus1007 Punk .....g....a Scmus sa. at... <.... .. . zwl .: Punk m... n.«c...... Mn: 1... mm ....... Fageunlél Punk Duul xmm. UF.Tn In Arum-A x.m.:z.s... mm Par. nwumu mmaum n<|=nsrnuK1lI|u1‘.L|:KoMIINIKAsl stun a.msmc rnocwum vumk cncnn um n|:kuAn rxvujukkttbtflrpaklndl if-s ‘j ' riruk um: dtnglnsnkulunyu memvmhn ma. wink n... umul ......mn. Iflllplklurrutdlhn .nn..m...w.n....w..u.x s.m.mm....x...=-..n Eu an an mm u...ma..... ylnxgdtlawulhnndnlah up.“ bcnkul. sy..u,.... a... vain: punenruun uwuuu .... Na sum... u. hm: Suumn >knahI\‘M x mum um man. no mmmo 2 umm um mm rm an 5 mm um mmm r... m . KcaAnuAvs.n nun: Inrnmn Tma to mum: .< mmms Auwv uumm n... so aluox s nwzsmz xnnvlv mum. 1.... so xwuazks 1 mmmmm uuw n71m4>m 1.7..’ so : xcsmm zwvnv mlmvisu 1..., w o xwuuw smm Ionvuvv 1..., In Lzwacowc 1o Avammv mm mum: Ttrnr ea uuu uwm u Kouwcnzrax rmlnv mum um.» «I u msmcmo mm muuum Tmzr an n s£LAnAaArL mm mmmw Fmrr no u mm.“ nuns! muwzaaas Yw.-1 A: u Koscamnm umuz momssa Tvna as 1. Kay: mm. mnuw 1.... 4: rtaaumrs 11 kaamaxu uvul Inrmw To-tr as u rc.KL)4aA>uku «mu Inonnns 1.... 4; u umum. mm. mumom Yawn: so u mmuu um-in Iannun r.... en: “ musuu Spcsllilran um um mm. tzkkwnunxhsw mm m. min: a. am... rcu-mm. Pcrhsanu (Lmtru: Agrezvnznl) ,.,.. .m...a.u..,,... p-anzxnmp.-mans Manyup dun meuywnhhn mm." Inimlnkmx ...,u..m..<. Viflrun am ....u.,.=.sm.-..u mm." Munben nukhun mu. ..=...«.....,. man mm M Mn .4... unu .....m.m.n m. m:_.nmu..wxmuy«:)am... p-¢....m.m:.. pk ms mulyvlmng A... nanyegxnhn Ixdullnnn mu nan.»- Tcnumau u-an Mm mm. as...» cm... Mm..." buhxseggndan n.,........;m.x n.....mu....., hnyn Stlunn. Iamu mm “.1 u, Ahdlmnhmmv Dlhwun Fugului Ben: Falgunnux mam... mm..." mu Cdwm (M) Baiud s.:...... 68. En s~..m...um..:. mu. kuun Kmhngalrun din Puulcunjn SmI.M:><m:|u¥ a... Eh-hnk En Raul! M-nsw Kn-u mu..m x....a.‘.u om.-4 am... m...» u: oz . M. as) Next. i: is necessary to zefu (0 me BRSB silcs in (h: Sm: ur Peak which wuc bud: fox CELCOM. «usrossm_sym>cm srrbtauzvm .4. M m. y..... y..m.. ..4_. .m... In-sum m M. »-.u y.. w A n .m.- Inlumw u.....m.. M 7.. mg. ....u."u'u'J"s.:. “' E‘f..':.".,“ 2 . I/W mm .mm.- $151. hm; an -Mu-... [ r.-flaw _. ‘ n--“rm J A Sm ..u...» H“... '.i..'mZ';TL.‘ m. M. » Pagusmsx (.9 W. Wald .. M. W. ‘.,M...,._n. .. .m.m. P41: W...“ Wm. WM. Amp M “- Hvmv an VH1 M lb®l M .w.m Y»! ‘- M %.....;r.: :;: M hum! W. lllpenmmp-um-wnhyl2.B6 . m.....,M I u.m,,.~.. , M.,m.,.,.,,.,... . xW..,.\m 5 m.,M.,K...~mw (pIl,B£v Thar: is no l-mm rm Rh: mggcsuzon .11.. co-oldunms or sites was mlszppmpriucd or d.we.u:d_ hm, them is nbsoluzdy no ewdenct um um cooxdinmzs for me CELCOM mas (smu and mini suucruzts) Wu: given by CELCOM to am pmnurr and xhcreafiu mmkcd or muapproprnrnd by BRSB. Secondly. a cursory comparison bzlwecn Lhe co-ordinates mm were given by CELCOM (0 (hr plnirmff and an co—oxd.1m(es ma by BRSB to build mmll and I-mm suucnlru mm am [he co-ordinates m in dxfkrenr Iouzions Frum mg comparison, .2 .5 clnr am ch: cu- urdmmu um Wu: gun by CELCOM m Lhc plninnff (p.42 ~ 43 as) in: fur “mw:u" mtaxunng between 45 mutls .0 my mans m height. pm 47 alil 70. 71. Thus. the co-nrdmares and H1: Vuucr\Ire.< am were built by BRSB at: Iamlly dlffucnl There n no zndzncc -nn. D4 (Sham!) went nkunnd looking rm sum and cum: luck and rcponed m an plnmnrr um um 41: no sucs or am sn:x are not sunalzlc tic. He sand Lhnv. when looking for gm, he may: wtnl wnn lwnn (mm) at an: onhu peman. And so h: was never zlonc as there was always somcon: :15: ml}: hm bccaus: he md to hold an global pmmonlng (“arsn mdcr and another ptrson had to dnve the nnnom. us (hry \\':m around looking for smtahlc sues. As such. mm was alwnyx on: mher person and plmnnffwuuld hm knuwn arm had huackrd Lha: nnnnunnm or an sun 1 End nun: men n no ¢\'Ir.|<nc: [1111 ::o—ord.u-Aalts wort gwzn by any of I11: 'l':1:os to the plmnuff.-md was snbsequcuLlvd.1v:m:d by an defendants In ans regard, Lh: pnnannxrs records or am so4:nLl:d ca—ord1m::s wen not pxoduccd. Them .5 no cvxdcncc (Int an ccroxdlnates wn: gun to me phinuff in am am place. It must be born: In mind am (hes: coordinates “ct: yven by an Telcos to rhme who wcm suppmed m I:nnsIruc( the ram Infnsuuctum. Thu nsnn mi-es flue quzxuun whether lhc cururdmntcs am zonfidcnlud mkun'nnLio||.Tl1c ncxt qnesuon n whether any :1: "Lmck secrets". In um rcgald. I find no cwdcncc than an co-nrdmnnzs uc confidcnual mfnrmuuon ox undc scmcu Ancordmg to an dcfendznLS. me no-ordxnams are obzumbl: from ARM: which 15 an nutomurd systcm whxnh an be ncusstd, Qunc obvmusly, from cmunl Inforrnzunn could luv: been chmad 1! somtone ch: rclzmnt Telco had rzsnfied during the trial. »...un4sz 72. 73 In rl-n.» regard. rhn burdrn was an the pmnnr: Io ndduc: the mqnmle mrmmmnn thmugll 1111: Tclcu The failure to all somrtonr. mm :11: Tclco crcalud 1 "gzp" m m pmnum case theory Qum o|:v1ousl)',in an mm,“ at szlvagng the case, 1>\x/2 mine up wnh an narrative um um p1zAnufl"‘wzi\:d" cxclusmty fol BRSB to budd smzll ma mam suucmtcs hm not [0 “o\vn" d-nos: mum“; Howtvex, this aspect of P\X?’s cvidcncc czmc abcun after he me me opportunity of xeadmg DI‘: wxuucss sraremrnl which W filed/served \v|-nth ma )1‘! to b: signed ma so-culled rendered as (‘\1d<ncc‘ Aim, uh: “\v|I\':r" was rm xptuficzlly m cvcn |mpI.Ied.l) plmdcd in me ASOC Caumcl cm the dcfmdnntzs sud um If wmvu was pmdcd, mm um: defence. (3) would have been very mm. dlfierenl. Ema, mlaru/Au, on um zglccmcnt/undenund.|ng um wax reached by mg puties ox promgomuz, namely Duo‘ FCW//D1 at Lhe rnzcung on 6 July 2009 (pZ2Z—224, no), u is my mm am the plaunuff cannot mm 2 claim based on BRSB'= bundmg and alleged owning of small and mnnrstzumxzts ma are furthu not cnudcd in make 2 am. agwlnir D1 for breach M fiduciary dunes If at all. nu may have rcncgcd an ms axsunnce am hi wauld Instruct BRSE (D Kubmu 15 sulmmsluns ID PINS 05C for “pcnrut appmvu" but am ,1 1.: dud Image on his pmlmscs, um olhwlf cannot support mg plamuifs causes of zcuon as pleaded m me ASUC As 1 sad caxlln, me pxmurrs pleaded use as per me AS013 and n-un|— suucmres. does um make a dlsnncnon between mums and snnll Fag: Is M62 74. Th: plunnffs pleaded case M evuythnng :0 do ma. zvnsmlcnon of mwm and m: I-maclcxng or |nisappmpnRnnn or ms or nf purprmed cn|1l'xdcnnnlInfurmaunn or su-mllcd ma: scc1c|s.'1'hc .-\SOC mud: nn dxslmcuun buwccn consuucuun and ownership of towers and/or small mu-u srxutlules. The ASOC made no rtfcncnoe wlmsmm .0 me all Lmpormnl agmcment between the smlmholdus at m: muual PINS osc mmmg on 6 july 2009 whne mm’ Fcw, Iwan (PW1). Zzdey (PW2) and D1 were pxcsenr. where n was agxeed am xi 1: was Wu and mum mumucs, t||=n n zgccd 1;, an panics. the busxness was open to all Then we have Pwzx supplemclllnry Incas <mI:rnL-nr (PWZB) Which: he alluded to . so—:allcr.I waiver lo the cxclusxvny Essenmlly he szud am an pmmarr waived cxclusnvlly for construction of small md mm: smzcmxcs bu: am not waive “exc|us1\1t-," fax “o\vnushIp" But when .5 no menuon of am m .11: man! xvnmess sulemem, W2 (A). The so—cz.Llcd mm rhzoxy was not pltadzd m the .-\soc or m rlu: reply m me defmces mm was filed and tr .5 remnrluble cl-m PW2 (E), wluclw is the aupvplcrncnury w1m=ss statement for pm, only nmc about after me pmnurr mu sxghz of ms mmnss smtmcm «ma. “I25 filed puoz to an commencement or ma]. 1; .5 significant am PW2{B) um filed wlulst mm W bung c(oss—=:<.am|ned. At any mg. PW! (Iwan) ma pwz (lanky) smd um Tzlco busmnss is . busmtss um where all (1.: stakeholders lmcw what was going on. pm said um cveryonr knew Mm was gmng on m [ht Sm: ur Pmk rugasuail 8.3 The ml: sharel-Aoldu nf Teleflmv it the maternal mm» mu F-.TD Mnkmur M.1ln»'si: Sdn Bhd (“I-.‘[‘D") D1 was a shmhumu mu ducczor or E11) D] was also a ducctox of Tcleflow at all material umcs. 3.4 Subscqumdy an dmlmiamg o{T¢Icflo\V cllangcd and D1 and ms wag Nzznn Bum Mohd Ynsuff beczmc am: xhazeholders of Tcleflow on mt: also hcczrnc n dxrecmr o{TcI:f|nw At the lime of the uni. D3 rhe Clmf Execunv: Oinm uf Tnk-flow simhml Arman Bm Ehxnu Ahmad (“DJ”) was the nu: ncqul um: zxc<uu\': 0! pm: 0. . mm mm [mm 2 Octobcz 2000 Un 1 jnmmxy zoos, D4 was pwmottd to be me Legzhsnuon Execunvc or PINS use He mgmd [mm PINS osc on 31 _|uly 2003 ms mm: BRSB as us “Pzgawax Pcrhubungan Kcmm dan Koxpom" .—\t me ume of d1: mal, D4 was haldzng on position 1; same: Limson (Jmm ufTeIeflow Nommclazure 10 The mm] rnamx of dus personahuts and pames and u may 12: confusing and redmus to use mvolves sevznl cnunes. Icfcr [0 man by um; ongmal namex. As such, |n ms yudgvncnnl shall use mg follmnng nnmcnchture m tcfcmng. am aim, to the p:Imcx.1ndn'1dua|s DI mm-. Pa¢e6MS1 7a 71 78. Hwcc. all Ihusr whn Wu’! mvulvcd m uh: Telcn h.r..sm.m..; IXI xhc sum of Punk Includulg Lhc plaumff, knew all ma ncnvlly of (hi: parucs, |ndudm_g what BRSB was doing an xhc State of Punk. Thu: was no suncpnuou: tonduct md nclyun: who um mvolvtd "1 mg Telcu Anfusuucluv: busmnss m m Sum of Pmk kn:\\' mcav what .5 was gomg on and who was dmng what, And so, :11: plmnuff must haw: known 2| .u matcnnl times what was hnppexllnjz m the Sam n[Prrnk. »:.wi—A//t E1158 I find no c\'u.|encc -hm rho plaintiff wcrc um\\\'M: of (hings nhzz \VCIE hnppclllng on the Sun: of Pu-ak .;;.m3 the devnlupmmll and cunsuucuon of Telcc mfrasuucluuc. lndaed, me plmuir am not even sugest man an zhc construcuon of small and min! srnlctules suncpuuously On the zonuaxy. It was done opchh, And that )5 why the plmnnffwxas able :0 send lam: nfcnmplamx m MCMC and thc Sm: 5ccremry. In rm, it is chm item the phhnures mm of a December 2009 m MCMC, than the plmnuff val vuy much «wan: oi B11513: ‘(um mfmsuuuurc acuvlues m flit Sum of Funk Th: point am .5 [0 b: gathered from all of mg abovc minus .5 that, all the ram and the evxdtncz were h. cxxstrncc [mm the hegummg and at any rate, they hm an cxlstcnce and known to the plamuffwhrn ch: dcfencc and cuumuclann wns filed on 19 March mu m sun um Thzse are hm markers that W11! dxxmwred subsequent!) m luddzn and I.h.<cov:rc¢| hm um 51 mix 79. so As I shred much, am filing of Lhls sun m hght of all of the tvcms had mm placc eaxhcr, 1: an abuse of process. Thu sun should clearly hm bczn bmught as pm ni the vms coumuclalm m nm 104! and D1 In D5 could have been brought In as nddlunnnl pm.“ to an tuumcrcluum-I In um wax, X5“ necessity and mm.“ paruzs would have been prcstm and everyvhmg could hm been dealt wuh by due lumtd Indy m am case 01 count, Hut 1041 would have become a mom complex but am 15 fax bmex am. [0 have two (2) Calms to hear suns which nose out cf (11: same factual mauix mvo g more m Its: xhc same playzrx and the samc dnc\1m:ms. clmh. this is .1 class): cm when mappe/and ru- /Mmzm should apply. 1;. so {At ax an cuolduutes ax: contcmcd, them 25 no cndmcc .0 sugcst may em caoldmntes were gun by CELCOM to me phmua Ind/at that Lhesr. woxdlnzlts wtxc huacked by my one of am defendants and gjvcn (0 BRSB :0 ccnskuct and/M no allegedly) own mm scmclums. Alnhongh u \x1s pleaded. u. the ASOC that the mes Wm: Imsappropnatcd. u ..« relevant m now am the plaxnflfri xrnlxluscs confirnwd .1... .hc_.v hm hp u-u.1=..cc or m\s7«ppmpnzLmn. A; 1 hm sud ember, Lhczc was knnwlcdgc on ma pan of Lhe plasnuff ma uh: pcoplt running an plamufi ax to what was gomg on Fi::5lI7liZ 81 Thus, I find n my strange that me pl:|m1IT nrvel cnnfmntcd 121 war}. the ..-enee which ne now hung \cnuL1K:-cl ne lacing |.vxcnch:x uf fduelnry duucx .7. Inenel. of: ]o|nr vcnlurc. 1. .-....y be (called d... .n his nradm. n. Iesponsc n. me \vmd.mg up, D1 sud, “/11! 1/195: J/Mn, no amen rm bun film in. argon: agatm! M: u. mpezl /jmzh flkgatwm. " During snb.-n.ss.ons, counsel [01 D! and unss, Daluk Ensnan Vuldaxgon smd me answex .o .1... nagging quasnon .5 very simple. He said meee \\ns no ncflun mkcn pmaonely agamsi 01 because an: sun ..s an “afienh0IIghr" He md n.e.e were no nenee at nu prrvmuily and cvtryrl-ung clsc n... was bxuughl up in one en» .. an afterthought I nglw wad. counsel's obsen/anon. lndccd, .r Dl wn. playing nu these Machmvcllmn gzmzs and me pmnnrr had mktn umbragc D. drzenee \nLh D1’: ee..d..e., Lhen .. .5 surpnzmg rim men .5 not even on: 1e.ee. 0|’ n memoundum or .n.nn.es wh|ch cvldences my rebuke by me p1...n..{c to D1 about me Inter’; conduct. The sxlencc or macnun an me p|e.n..rre pan w.'¢7— uzr D1 was rhemfoxc qultc mp.-....ng m me. 1. is posslblc :1... the plaintiff needed m beans: 11: .5 me cxpul .n thxs run: and well eon.-..e.eeI wnlu me Tclcos and so [hay d.|d not due In "rock the 1......" 11.... ms) wen hav: been me :35: 1.... (ha: .5 eon.ee..ne and is not me pm... The point is. .i die pmnnrr was awm that D1 was dmng someehmg wrong and he was doing all these manipulations and hijacking ofconrdmates etc (together with D2 _ D4) and passtd n m BRSB, then me should be some smoking mm ewdenee ofsuch misconduct. 3..., that .e no mdenee of me. a. .11. And pleadings :11‘: nor cvidznce vapessviix as 1.. so 5.... m is concerned. hewns no donhk. the ........ person ... em; and uuss h... a... nfltselfdncx ..... ....1.. 1.... me ulltnga, In an nxrcnt u... .. ...e...:e. lhc Mung of .|.. coxpoxau: veil. 1.. unit: for me veil of mcoxporauon .5 be 1.1.... .. .....s. be 3...»... A... 0. WM me ../2.. .3. of U1):B and mass ...d was using .1.ese compames .5 . 5...... o. a am... and 3 dtvlcc .o dcfmud Lhe plmnuff. None of .1... .5 evident ... .1... cam. The pnnclples for the 1.c....g of the corpoxare \':i.l are q....e mu established and m to be found ... lhc fnlknvlng xeminnl cascs:— 1) cmmm... 3...}. ./a 5......» 1....» ¢- 0... .. Ve/mm, ./0 P.m.m ¢- 0... [2015] 1 ML] 773 FC; ...d 2) Pmlv P:ImdtlRz.rw4rrt.r 11..../pd 70.. [2013] UKSC 3-1 1-‘..s., I .... ..o. coxwmced a... D1 .5 th: ultzr go of UDSB and BRSB. 3...: even .{ he .5 the .1... tga of dues: eempamee .1.e.e .....s. be evident: .1... I1: usad .1.e cumpamcs .. . sl-mm or a facade or demo. .0 perpctuatc 2 rm... 0. .0 comm.“ unlawful ans. .0 ...e.a ox e.-ad. hzbxlury. A. I xmd. .1... 1... ..o. um. provcn m the prcienr c...e In so 5.. .. the -..u.,;....... nfbrcich ..ra..e.....*. 4...... against on, I am or the view ..... .1.. ,.e........ bccamc .......m1 0. condoned by .1.. mus osc EXCO rneeung on 5 july 2009, -aeesmsz am Thu: was . mggesnnn by the plaintiff m mlmuon m me mccung offijuly 2009, (hm by um um: mun um: built about is sues um um wcrc nul d|scloscr.| to rhc plmurr. 1 find mg; to 1,: Amplxuslbln: becaus: Lhe xmun:c> tlicmszlvcs mm xtfclenoc (0 D1 undermlung ma! he will ensue um BRSB nu link: :11: necessary npplncauons m PINS osc for H1: applmnl. And so thus was dxsdosuxc. The pumurr knew mu: 1|’. And I nouccd fmm ch: ASUC vlnztxefemncc was made m events um took place m 2003 without regard to (hronolngy. \‘(’hnevur may havz bun me cm and whmm mam may have mkcn place, an: mun nlwzvs look at cvcms chmnolugxcallv. Th: Lunehne .5 u-npolmnt. On 6 July 2009, cvexybody was happ\ mm each other Everybody agtred um BRSB and PC!‘ can go ah:ad and do mg business m-arm small ml mnni stzuclurcs Thu: was not 3 problem for me paints an am they \\‘2\n(:d was am me submission should made to mus osc. Hm-mu, me failure to submit to PINS osc for approvll and k|1( mum ax mabyhry :0 ohm or slum: fccs, rt: u nm the plnmuffi pleaded cast. For cumplctcnus, 1 would ma um whcrhcl mg plmnuff csn sue am: for mu sularmtung through nus osc .5 wmedung whnch .5 :1 lug: beans: nnsn my luv: Ins defunct: (O my such clmm becnus: ofpnvxty ofmnuact tic. In I1-us «gm, PW! himself sud am the concession agxeemcnt 15 lxmccn the Sure Di Pen]: and me plmm and aims nut bmd anybody :15. Thus. W1’: ovm cvidencc um Inga, demohxllcd me plamnm hm: smlcnlxr ufrhe case. vzgpssmiz Summary 55 Exxmunlly, having Luwltd .hm..,;h me docummuaq e\‘u.k-nt: and the "Smmnary of Evtdtncc" whxch was prepnerl by the pnmes (and which is (O b: ma m comuucnnn mm these guunds of yudgment), 1 find am me pLa.\nufl‘§ pltfidcd (ax: although me|icu1ouslypl:idcd.was no! pxoven an a balance ofpmbnbdidzs. And despnc rm zlabomle pltndmgs 25 pm the ASCII, no exidencz W lead m rupcct ofrhc mulmudc ofnllegztxom that were made agxlnlt the defendants As nghu, submmed by ow anmm \'mdargcn ('01 D! and LDSE, PW/I and PWZ made suong nlltpdons m [hur witness smmmu mu when conimmnd dumg cmss—:xamInauun, daay “backed air‘. In particular, th: plnnuffdxd not lend any or any czzdible cudcncc to subsmnnate am: serious allegmion um “tr: mid: m pmyapm I9 (c), (d) and (:1 of an .-\SOC‘ Funhcr. mm nllcgzkluns xwkc nut put m 01 (um) and (Du. In so far as me alIcg:LIun un.;...pam, .s concerned. the use WA: ncl mu put to any or die \\'1Lnacss<s and me pL-Au-uifX‘s witnesses dwmselvcs sud um um conspiracy Lhcory Is pmdncatud on me £:::( am my 219 all ch:-st :0 D1. BRSB and unsn. Thus die consplxacy dueory xtsts on the prklmse um (11: defendants wet: closcly assocmed mm D1. BRSB ma UDSB, In an result. conspiracy was not pmven on 2 balance of pnxbnblllnex. Clns: nssuclation Inay at me. be ;. bmlamg black in: conspimcy mu. am of mclfmnnnt he cquxawd ma. cunsplncy my 55 ms: sx, Ax I said carltcr. (her: is no Lwtdcnce am any to ordinates wcrc glvvzn by any Tclzu m rhc plmnuff nna amnea awn, tn am; There n aha rm cvldcncn: am an). sum WEIC divcncd nwn, [mm :11: plaintiff or mlsappmpnalcd. Bnsed on their ovcnll conduu. an plaxnuffis plnmly mapped from allegmg dm Lhc conslxucunn of small and n-unt-smuznues by BRSB was 1:: launch or a purported joint venture. In my vim‘, thus was no imm vcnuuc 1! least m so an as small and mlm-suucmres Wu: concerned lndetd, bmn on on clear and nnequwocal aguement mm was mashed by m parncs nr an pmtngnnms ('D.1Io'FCW/and on M the mrcanng on <._1u|,» 2009, fax small and mu-u—sL\*utlu1cs “Ibo bulincu 1: W /a 4/1 as lgntcd by boIhpAm':A" 1; .5 ma r:lc\'am and slgufiunl um pulsuanl. m clause 2 3 of an Lnctncc Agreement hntwcen me plamuff and Tdcus /‘p.15 133), an mnngtmml bemecn the pzzues wars on . ‘‘non~¢xclus1xr'' mus. And rhls means mu me Telco 15 free to choose anyone I0 wnsmlct (hr small and rmnulxucnure for them. Next. n 13 Irnpexauve .n consider sccnon 133 cm which pmrnnm anwcnmpcrinve condun. In so far as m: mwnmmp" issuc lo: srmll and mum suuuule is concerned. mm was a point am ms blought up num belatedly lhmugh N23. The Assn: ofowncnhlp was no! pludtd and 1s m any zvcllr. untuublc. mg 57 M61 59 mm, me agreement rhar “ms readwd on 5 Jun, 2000 wxu an agreement mm me “busmcs>" was open to all Sccnndly, the mm. far .11: rnccung un a July 2009, do not reklccl my exctpuon fox “o\vnerslup" or small and mAm—sLrut{urcs. 'l1md.ly, mm was no cndcluce mm Ems legally ownzd my or the small and mm. stxuctuxcs which me; had buxlr fax mg Telco (CELCOM). Agnm mam: from CELCOM an mus Issue would hzv: been hclpiul and would hzvz gm ngm on rh: wmnmmp" Issu: Founhly, m any e'\':nr, reganll -- omm u cnnrmncd m Ihc concession nglccment, the (me Icgnl pusmon .5 (Int me Issue of "n\I:n11r:|up" of Lht srmll and mlnrsuucluu-5 nml BRSITS lack Ufa NFP hwnxc etc, an issue: Wm. u. wlthm me purview of the CM.\ and tr is [or MCMC m handle, FlRhly,1( zlso hens mpenung am the concession agtccmenr does not bmd numpuues Canclusinn 90. In the (Hull, bma on the mac.“ nm was pmscnlcd. 1 am unpcllcd m an cnncluxiun am the plnnufl 11.. nm myxgn on a balnnc: ofpxohnbilltlu dm:— (3) me defendants med unhwfully, (b) me drfmdanls had conspired. (c) the dcrcndanu inlcrfzrcd mm uh: plunnffx b.m..m, cud: Ind/or cunlnciual "gnu, mg 51 um (J) (6) <0 (33 the defendants mxsapptopnmzd a. dxsnpnxcd the ,;1:mu£rs busmeu or busmcsa upporlunlu Telcos mu pwnded mg planlnff mm co—oxd.\nzL:s or sites mud um um sues wuc subscquzndy xctmcted by the Tcltus, me defrndzms Cmlstd loss and damage to :11: plamnfl: me cmxdmzas wl-uch wcrc used by BBB to build small and mAni—sl.tucmK:s for CELCOM was gwcn m m: plainuffand mlsappkupnned by BRSB; me covordxnztcs wax: ovmcd by me plmnuff. ch: cn—ordimm.< wet: confidential mfonnmion ox trade secrets: me defendants confidcnua! mfonnmon; abuscd and nnszppxopnzted me as us: 00 (m) (H) (0) me dafcndanrs misappropriated and d\s:1pzked .11: plnmuffi nmxnm Ind/or u...;..m uppoxtuniucs to am; by procuring sues [or me mm, uxing such mfounsuon ma dlvcrung me same ma us busmcss m BRSB; mg defendants prekncd mm own pexsnnal lmucszs nnd dmcgaxdzd mg plmnliffs .mm:.<. nghls and obligations as m: alleged 4.-xcluswc znxlccasmnaue m the Star: ul‘ Punk, ‘(hem um . mm venture whuch bmds ma dcfcndnnts; D1 mu m breach cflus fiducnry anus; as d.|r:r.-tor uf the plasnufli D1 was the mm W of BRSB and /or UDSB me am am: companies wue used .s a sham or . am“ ..; cumnur [mud agzmn an plaintiff or m mm zny 1:91 lmblluy such ii m war, die lifimg mm corpuram vul. Page so of ex vu xx xu m xm Punk lmquarzd Nuwk serum 54.. m [‘‘\‘h( plmnufl" or “PlNS"\,. pms osc k .\|zmIcn:u<c smm Sdn Bhd (“PINS osc"), Uvbam Dormm Mn and mt.) muss-W,‘ Bung’: Ram 1c'r Sdn mm ms) M11155"), Feral: Commummnnn Tcchnulogy an and rrrcm. Tclcmmllmnlrznnn crm)}1an)L‘((“T:lEaI"). YA'L'kd¢cammnmunon Sdn Bhd cw "J. CELCOM 7\hhysm Buhnd ckcucom, nmr..a;.1r.m \‘('av1(“DIlD‘FCW"). my Ahmad Km: 3... Lzhm man" ox“DW1"), Smrz Goxrmmenl of may Dzml mam" rm: Stan nf rem". Neumrk vmlm Pmv1dul.1c¢:-n5c1“NFPL|czns: . On: Smp cum woscw, u.1._W ;u...........c...m. ma Mulumulm Comm-ussxon ("MCMC"). romm.mm.m.»u Ind Mu|unn:n|1a.\c1 was (“cm-3, mm Emmi Cnnxpnnj (‘sac’), Inmt Vcnluvc Conlpam (“J1/co’) >..a.vsz Ontcnmz 9:. For the rczsons as dlstussed nbovc, I am of (I12 vlzw mm m /1/vflmtu ma ma/rpd apply in me pkscnl case and -he plmnriff nw precluded {mm mnunung um chum against |hc acrmdmu. Fxmlly, 1 m nlm of am View an: based on nu: evidence dun W prestnmd :0 dus Coun, mu plaintiff has izukd to prove an a bmm of probnbllmcs, ma mulumd: of zlltgznons (hm wu: Imma against me deftndsms (pt: me ASOC) Conscqucndy, zhr. plamuffs cm .5 dnsmisscd The plamnff .5 m pay mm to D1 and UDSB (D6) in me mml sum of kmzonmn no Th: plmntiffxs to pay costs Io D2173 and D4 In the Inral sum of RM7§.00O,I‘»0 Thc plmnun xx m pny mar: 01' RM75,UUU m m HRSB (D5) All costs :1: sub};-cl u-. 4% zllucalor. Urdu acw(d.\ngly. D:(e:14]u.Iy 2017 ( Mm s. Namha Balan (J Judge — Hzgh Cour: Km: Lumpur pm in win Counsel: km. Smgl-A lngcvhcx ma. cu Owcc ma Vxlhc Nam (MW 01 Own and Pamvm) Plamnffi mm’ Bnstinn Vcndnrgcm togezhcl wuh Gulc Vcndargon and Vmcenl um (mm mm. N11: 6‘ Wm) rm m and on s Ravcncsnn (.\/Iran‘ Rzwenemn) rm D; D3 and D4 Lgong Kwong wan (Mum Lzwtg Kwvg um) rm D5. Statutes: oxdu 15 Rule 3 Rules ofCouu 2012 sccuon 30 Commumcuions and .\lu.ILim:d.\a Act I998 Sccuon 126 of Lh: Communicnuc/ns and Mulnrnedla Act 1998 Section 133 Communicmon and Mulumedm Act 1998 Cues referred m; Mn/mbuzvan Mn/n_1yaIan1 « Mmtm Dalam Nggm Magm ¢— am [2009] 2 ML] 550 FC Dr/{N/Ia/J m Radzinh b1 1. Hrmm L‘ 17, Iyrrrh mmmm and am [2014] n ML}702 HC Hmdcrmn . Hm1¢r1art|lE45] 57 mz 313, 3 am 100 julwvn 1/ Gyr: Wm v (9. [2000] UKHL as Gmbman Iivgb r/a Bzgawan Iulgb c- on. p. yummy 1/11 Potntmzm} 0' on [20:51 1 ML] 773 FC Prw v Pmm Rm-um ummi 7 ON. [2013] UKSC 34 meszmz The Dilpule n. The gst mm plamuffs complamns am (I-mr: has btcn 2 brzach of fiduciary’ dunes or oblngauans by pNu:§ m . jnlm m.....». agrc-(nuns, whereby pmyccn mm shuuld have been undutzkcn by :11: p1..nun were davtzrcd no arms. unsn .3 a shareholder of PINS use. on was 4. dueclor of rms from 30 June 2005 mm 14 November 2012 (whm 1.: was not re—e|ec(:d Is : dnrzctor). According m D1, Date’ FC\‘</") asked hm m be 3 ducctox and he ayced. According m DI he btczmz a duccmr om: piaanum (2) beams: nf his knmvlrdge and cxpunenz: m the runsuuzrmn oflclcmmmunlcnnon towns: (I1) beans: oflus good ralnnnnslup mm the'l':1cos. (c) because he was willmg m nssxst Dam’ FCW to gel . loan to buy an shuts m the plnntiff em. Pcrlndman Kunapuan Negcri Punk. (a) because kc pxcicnted me busulzss module fur the plaxnnfflu Pcxbzdnnan Ken-mum Ncgm Peak 12 Acwxdzng m D1, he was not x¢~:1m.d as a durecrm of mg plmua btcausc UDSB 1-ml filed a sun on 4 Julgl 2012 zpnnsl Dam’ FCW, vms osc and PINS vuelwisz I5 14 DI and D3 are duumrs of unsn D1 ..« . shareholder ufUDSB The shnrchcldcn uflVDSB(.1s :. 51m 2015) (p.12 ,m) 11:: .. clm Hcc Chung 30.000 shuns; u. DI 40,000 shuts, m Nor As'adah Bum Abdullah 30.000 shms — dunng due ml, D} said am she was 30% shareholdrr of UDSB B). pmngmph m2) and (13) of me Amendtd Smnncn: of Chum ("ASDC"), u 15 alleged mm D: had run couuol ormzsu and/or ups}; as the dnectoxs ma slxauholden of Ems and unsa m nolmnets of D1 and/or an accustomed to act m accordance vmh flu: xnsuncnons of D1, 1: was contended um D1 .5 the a/trrago of mass and mass. The MUA was cxeculed he-tvnv.-cu HIGH and Dam’ FC\3?'. Th: pnnlcs dmrctu welt suppcwcd to develop 1]! xnfraxmmmn: for Tdcos m am Sun: or Pen]: m a jVco. 1: .5 zlkgcd ma: D1 subsequend) dcddcd [0 us: UDSB as me cnuly m pzmupatz 1n me J\’co, m lieu oi BRSB PINS osc was appmnu; the jug. As at 2.5 Drccmber 2007, the shaxehnldcrs of PINS osc (p.59 B4) were as follows’ ‘ The plmnlifl‘ 50,000 utd.InIr}' «hares tqluvnlznl 10 50% afthr. «ml Issued and paid up capital of 100,000 oxdmzrg shues , husarsz u BRSB I ordinary sham . mm! m UDSB:-$1.999 crdmaxy shares The plsinufi‘s me m. At 2” matmal umes, the plamuffwns appoxmcd by me Sm: of Puak :5 (hr txclustvc zonwssionme and as the 05C, re: the devclopmrni and ennslnlcnon of Ielncommulucmon mm or srnlzturcs in (h: Sm: ur Punk. 16! Azcordlng lo 111: pI2.\nn|T, the concessmn includes uwncrshnp of mg suucrurca and due lmsmg/mm: of dues: structures to Tclcos for ma. opcmnons. In Lhxs rcgmd, the plmnnffrchcd upon rh: lnun ofawaxd dated 2" Ianuan zoos ma the cnnoessmn zpetmenr 152 But u is xmpnnznr to now .. rh: outser. xhc conccsnrm agrccmcm covers mfl_\ “heavy duly towers" and nut “lmlll and mini-nmcnucl", mg former bung zsuucmlcs which m mom dun 43 mm m mam and the 1mm hung stxncmrrx Whlth are less than 30 mans m he|gh| Pagelflofil

Pytesseract-0.3.10

W-03(IM)(NCC)-20-02/2016

PERAYU Azlin Azrai bin Lan Hawari RESPONDEN UNITED OVERSEAS BANK (MALAYSIA) BHD ……… RESPONDEN

Bankruptcy — Bankruptcy notice — Setting aside — Respondent obtained final judgment against appellant — Respondent proceeded with judgment debtor summons (‘JDS’) — Appellant defaulted in payment of monthly installment as provided under JDS — Respondent filed bankruptcy notice against appellant — Whether respondent could commence bankruptcy proceedings as JDS already in place against appellant — Whether there had been modification or variation of original judgment — Whether appellant in breach of JDS — Whether original judgment nullified by JDS — Whether bankruptcy notice valid in light of different amount claimed — Bankruptcy Act 1967 [Act 360], ss 3(1)(i) & 5(1); Debtors Act 1957 [Act 256], ss 3 & 8; Rules of Court 2012 [ (P.U. (A) 205/2012], O 42 r 12

12/07/2017

YA DATO' ZABARIAH BINTI MOHD YUSOFKorumYA DATO' ALIZATUL KHAIR BINTI OSMAN KHAIRUDDINYA DATUK NALLINI PATHMANATHANYA DATO' ZABARIAH BINTI MOHD YUSOF

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=0824bba2-a622-436b-84b0-7617c15e0837&Inline=true

1 DALAM MAHKAMAH RAYUAN MALAYSIA (BIDANG KUASA RAYUAN) RAYUAN SIVIL NO: W-03(IM)(NCC)-20-02/2016 ANTARA AZLIN AZRAI BIN LAN HAWARI …………..PERAYU DAN UNITED OVERSEAS BANK (MALAYSIA) BHD ………RESPONDEN [Dalam Mahkamah Tinggi Malaya Di Kuala Lumpur (Bahagian Dagang) Dalam kebankrapan No: 29NCC-1787-2015 Dalam Perkara seksyen-seksyen 3, 4, 6, 24, 88 dan lain-lain seksyen Akta Kebankrapan 1967 Dan Dalam perkara Kaedah-Kaedah 91, 99, 114 dan lain-lain kaedah, Kaedah- Kaedah Kebankrapan 1969 Re: Azlin Azrai bin Lan Hawari (K/P Baru: 670808-03-5365) (K/P Lama: A0788372) Ex Parte: United Overseas bank (Malaysia) Bhd _______________________________________________________ 2 CORUM: ALIZATUL KHAIR BINTI OSMAN KHAIRUDDIN, JCA NALLINI PATHMANATHAN, JCA ZABARIAH BINTI MOHD YUSOF, JCA JUDGMENT 1. The Appellant/Judgment Debtor (JD) appealed against the decision of the learned High Court Judge dated 28.1.2016 which had affirmed the decision of the learned Senior Assistant Registrar’s (SAR) decision dated 26.8.2015, in dismissing the JD’s application to set aside the Bankruptcy Notice dated 31.3.2015 (BN) issued by the Respondent/Judgment Creditor (JC). 2. It is to be noted that there are 2 similar appeals premised on similar causes of action and issues relating thereto, i.e. appeals No: W-03(IM)(NCC)-19-2016 and W-03(IM)(NCC)-21-2016. Parties agreed that the decision of the present Appeal would bind these other 2 appeals. 3. After hearing the submissions from parties and perusing through the Appeal records of the present Appeal, we are of the unanimous view that there are no merits in the Appeal and therefore dismissed the 3 appeals. Herein below are our grounds. 3 BACKGROUND: 4. On 11.8.2011, the JC had obtained final judgment against the JD for the sum of RM79,804,851.04 together with costs and interests. The final judgment was however, not satisfied. 5. On 28.9.2011, the JC commenced Judgment Debtor Summons (JDS) proceedings against the JD. In the JDS Proceedings, the JC obtained an order against the JD on 13.11.2014, whereby the Senior Assistant Registrar (SAR) ordered the JD to pay: i) RM3,520,000.00 forthwith to the JC as partial satisfaction of the final judgment; ii) RM5,000.00 per month until full and final settlement of the judgment; and iii) RM4,000.00 as the costs, with a default clause that, in the event the JD failed to comply with the terms of the JDS order, enforcement proceedings may be taken against the JD (hereinafter referred to as “the JDS Order”). 6. The JD appealed against the JDS Order to the Judge in Chambers. 4 7. On 9.12.2014, in the Appeal before the Judge in Chambers, the learned High Court Judge allowed the appeal in part with costs of RM4,000.00 and ordered that: i) the JDS Order ordering the JD to pay the sum of RM3,520,000.00 forthwith to the JC is set aside; ii) the JDS Order ordering the JD to pay the monthly installment of RM5,000.00 until full settlement and costs of RM4,000.00 to the JC, remain unchanged. (hereinafter referred to as “the JDS Appeal Order”) 8. In complying with the JDS Appeal Order, the JD made payments to the JC in the following manner: i) on 12.1.2015, the JD paid RM13,000.00 being payment for costs and monthly installment payment for one month starting from 13.11.2014; ii) on 29.1.2015 the JD paid RM15,000.00 being the monthly installment payment for 3 months starting from 13.12.2014; and 5 iii) on 31.3.2015 the JD paid RM15,000.00 being the monthly installment payment for 3 months starting from 13.3.2015. 9. It was contended by the JC that the JD failed to comply with the monthly installment due on 13.3.2015 thereby breaching the terms of the JDS Order. 10. As a result, on 31.3.2015, the JC filed a Bankruptcy Notice (BN) against the JD pursuant to the Bankruptcy Act 1967 and Bankruptcy Rules 1969. 11. On 27.4.2015, the JD filed an application to set aside the BN vide Summons in Chambers (Enclosure 4) premised on the following grounds: i) The JC is estopped from commencing with bankruptcy proceedings on grounds that the JD had moved the Court and obtained the JDS Order in the JDS proceedings which orders the JD to pay a monthly installment of RM5,000.00 to the JC until full and final settlement of the judgment; ii) The JD had and still, complies with the terms of the JDS Order and JDS Appeal Order by making monthly installment payments; 6 iii) The BN is void ab initio for non compliance with the Final Judgment; and iv) The BN is void ab initio as the amount claimed is inaccurate and excessive. 12. The application in Enclosure 4 was dismissed by the SAR on 26.8.2015. 13. The JD appealed to the Judge in Chambers and it was dismissed by the learned judge on 28.1.2016. The basis of the dismissal by the learned Judge in his grounds are namely: i) That the JD had initiated the wrong mode to challenge the Bankruptcy Notice. As the JD’s challenge was premised on the sum claimed in the BN, the JD should have filed an affidavit under Rule 95 of the Bankruptcy Rules 1969 and not vide Summons in Chambers under Rule 18 of the same. (This constitutes preliminary issues raised by the JC in its written submission, however, since the Appeal on the matter is already before us, we decided to hear the Appeal on its merits rather than on preliminary points and/or procedural grounds.) ii) Although the JDS was already in place, the BN is valid. 7 iii) The JD had breached the JDS Order when he failed to make monthly installment payments as agreed pursuant to the JDS Order. iv) The BN reflects the terms of the Judgment which was obtained against the JD. The sum as in the BN is correct as at the date of the BN. The BN is thus valid. JD’s contention: 14. We noted that the main ground of Appeal relied on by learned counsel for the JD in the arguments before us are as follows:- 15. Firstly, it was contended that the learned Judge had erred in allowing the JC to commence bankruptcy proceedings when the JDS is in place and which Order the JD purportedly complied with. 16. It was submitted that the JC is estopped from initiating the bankruptcy proceedings against the JD since the final judgment was modified by the JDS Order and the parties are bound and subject to the terms of the JDS Order. 17. In support of this contention, the case of Re H.A. Pereira, ex parte Pagor Singh (Bhagat Singh) [1932] MLJ 12 was referred to us wherein Mudie J had the occasion to consider whether the judgment 8 was modified by the order for the payment by installments and that whether a bankruptcy notice which was founded on the judgment as it originally stood was invalidated. It was submitted by learned counsel for the JD that Re H.A. Pereira (supra) is a case which is almost on all fours with our present Appeal. Mudie J referred to the judgment in Montgomery & Co v De Blumes [1898] 2 Q.B. 420 where he said that: “The ground of the judgment in Montgomery & Co v De Blumes is that the judgment was modified by the order for payment by installments. Chitty L.J. in the course of his judgment says: “It seems to me that so long as the County Court Judge’s order stands here there is a modification of the order of the High Court; and it would involve a great injustice to a defendant if it were not so. The defendant is told that he is to pay by installments, and the installments in such a case is generally small….A man in such a position exerts himself in order to get the money together for the purpose of complying with the order. He does so under stress of a liability to imprisonment if he makes default, but I think he would likely to be misled, and it would put him in a hard position if he were told that he was still liable, in spite of that, to pay the whole debt, and that what goods he had could be taken in execution.” In my view the same principle is applicable to a Bankruptcy Notice. The judgment is modified by the order for payment by installments, and it seems to me that the Bankruptcy Notice, which is founded on the judgment as it originally stood, thereby invalidated.” 9 Learned counsel for the JD also referred to us, the judgment of Gun Chit Tuan CSJ in the Supreme Court of Datuk Mohd Sari bin Datuk Haji Nuar v Norwich Winterthur Insurance (M) Sdn Bhd [1992] 2 MLJ 344 which had made reference to Re H.A. Pereira (supra). Learned counsel for the JD concluded that the facts in our present appeal are more cogent than Re H.A. Pereira (supra) and Datuk Mohd Sari (supra) because the bankruptcy proceedings was initiated after the JC had obtained the JDS Order. 18. Coming back to our present Appeal, in compliance with the JDS Order (read together with the JDS Appeal Order) at the material time when the BN was filed, the JD has made monthly installment payments until 12.6.2015. The JD contended that at no time had the JD defaulted in making monthly installments under the JDS Order (read together with the JDS Appeal Order) as the JDS Order does not specify when the JD is required to make payments of monthly installments to the JC. 19. Even if there is a default in the payment of any installment under the JDS Order (which was denied by the JD), the only remedy available for the JC, is to commence committal proceedings against the JD as the JDS Order contains a default clause as to enforcement. 20. The JDS Order (read together with the JDS Appeal Order) is governed by section 4(7) of the Debtors Act 1957 where the JD is subjected to committal proceedings in the event of default of the JDS Order and the JDA Appeal Order. Section 4(7) of the same reads: 10 “ If the judgment debtor makes default in payment according to any such order, a notice in the form prescribed by rules of court may be issued, on the request of the judgment creditor, calling upon judgment debtor to attend before the court at a time therein stated and show cause why he should not be committed to prison for such default.” It is explicit that if there is default in the payment of installments the only remedy is to commence committal proceedings as provided under section 4(7) of the same. 21. Therefore it was contended that the JC is estopped from filing the BN against the JD because the JDS Order and the JDS Appeal Order are still in force and there has not been any default on the part of the JD in making the monthly installments. 22. Further, it was contended that, the learned Judge had erred when he concluded that the BN was valid when the BN reflects a sum which is allegedly excessive. The BN is void as the amount is inaccurate and excessive namely: i) On 31.3.2015 (i.e the date when the BN was filed) the JD had made payment of RM1,500.00 pursuant to the JDS Order to JC’s solicitors by a bank draft. This payment is not reflected at all in the BN. ii) The BN also demanded in excess RM54.53 which is the interest calculated at the rate of 5% from 11.8.2011 to 11 31.3.2015 on the costs of RM300.00, although the Final Judgment does not provide for the same. Counsel for the JD referred to us the case of J. Raju M. Kerpaya v Commerce International Merchant Bankers Bhd [2000] 3 CLJ 104, where the final judgment made no mention of penalty interest or stamp duty but the BN had included the same. It was held by this Court that a bankruptcy notice that requires a debtor to pay a judgment debt that is otherwise in accordance with the terms of the judgment is null and void ab initio. 23. Similarly in our present Appeal, the claim is not what was awarded by the final Judgment. The final judgment makes no mention of an interest rate of 5% on the costs of RM300.00, nonetheless the BN had included a claim for the same starting from 11.8.2011 until 31.3.2015. This, according to the JD, is clearly contravening the Bankruptcy Act 1967 which mandates that the demand made in the BN must be in accordance with the terms of the judgment or order. 24. Hence, the JD contended that the above defects in the BN are not mere irregularities which could be cured and strict compliance of the procedures must be adhered to. Following thereto, the JD concluded that, any defects ought to be decided in favor of the JD. 12 FINDINGS: Whether the JC can commence bankruptcy proceedings as the JDS was already in place against the JD 25. The learned High Court Judge found that the JC can proceed to issue the BN for bankruptcy proceedings as under section 3(1) of the Bankruptcy Act 1967, it provides that, a judgment creditor who has obtained a final order against a judgment debtor for any amount and execution thereon had not been stayed, was entitled to commence a bankruptcy proceeding against the judgment. He relied on a High Court case of re Chen Sing Chew; Ex parte : Oriental Tin Smelters Sdn Bhd [1974] 2 MLJ 69, where it was held that earlier orders directing payment by installments did not invalidate the bankruptcy proceedings. In that case, despite there being an order of payment by installments, a subsequent bankruptcy proceeding taken was held to be valid. 26. We are of the view that the learned JC had not erred when he held as such, for the following reasons. 27. Firstly, the JDS is no bar to proceedings in execution. The JDS Order is made pursuant to the Debtors Act 1957. It is a law promulgated by Parliament to consolidate the laws in relation to debtors which are to be found in the Debtors Ordinance of the Straits Settlements and the Civil Procedure Codes and Rules of Court and to ensure uniformity 13 throughout the Federation. The JDS Order was made pursuant to section 4 (1) and 4 (6) of the Debtors Act 1957 which provides that: “(1) Where the judgment of a court is for the recovery or payment of money….the party entitled to enforce it….may, subject to and in accordance with any rules of court, summon the judgment debtor,….to be orally examined before the court respecting the judgment debtor’s ability to pay or satisfy the judgment debt….” ….. (6) Upon such examination or non appearance….the court may order the judgment debtor to pay the judgment debt either- (a) in one sum whether forthwith or within such period as the court may fix; or (b) by such installments payable at such times as the court may fix.” 28. Accordingly, the JDS Order prescribes that the JD is required to pay monthly installments of RM5,000.00 to the JC until full and final settlement of the judgment debt. 29. Further section 8 of the Debtors Act 1957 provides that: “Subject to any rules of court, an order for the payment of installments of a judgment debt under this Part (of which section 4 of the same Act falls under) shall not be a bar to proceedings in execution unless and except to the extent that the court shall so direct.” 14 30. Horne J had occasion to consider the effect of the predecessor to section 8 of the Debtors Act 1957, i.e section 6(2) of the Debtors Ordinance in the Singapore case of Ahna Moona Muthuraman Chettiar v K.N. Nair & Ors [1938] 1 MLJ 177 when he was comparing the effect of an installment order made under the Debtors Ordinance and one made under O 40 r 30(3) Civil Procedure Code then. He was of the view that an order under O 40 r 30 (3) Civil Procedure Code clearly falls within the proviso of O 40 r 16 of the same and there is no statutory procedure leaving other forms of execution open to the judgment creditor while the installment order is in force. O 40 r 16 provides that, “every person to whom a sum of money or any costs are payable, shall as soon as the money or costs are payable, be entitled to sue out one or more writ or writs of seizure and sale subject nevertheless as follows: (a) If the judgment or order is for payment within a period therein mentioned, no such writ as aforesaid shall be issued until after the expiration of such period; (b) The Court or Judge may at any time after the time of giving judgment or making the order stay execution until such time as it or he thinks fit. The right to sue out the writ depends upon something being payable under the judgment or order and if a time is fixed for payment then 15 by proviso (a) the writ cannot issue until the time expires.” However, an installment order under the Debtors Ordinance requires a statutory authority to keep other forms of execution alive. Horne J further acknowledged that: “Section 6(2) (Of the Debtors Ordinance provides that an installment order under Pt 1 of the Debtors Ordinance shall not be a bar to proceedings in execution….” 31. Similarly, the effect of section 8 of the Debtors Act 1957 is that it is a statutory authority that keeps other forms of execution alive. Following thereto, an order to pay by installments of a judgment debt does not prevent the execution of a judgment. 32. The facts of the present case show that the JD had defaulted in his installment payments which were in breach of the JDS Order. In this respect: a. the monthly payment (RM1,500.00 for Sim Kok Beng [Appeal No. W-03(IM)(NCC)-21-2016] and RM5,000.00 for Azlin) which was due on 13.3.2015 was not paid until after the BN was filed on 31.3.2015 at 11.40 a.m.; b. the cheque for the monthly installment was then received by the JD’s solicitors on 31.3.2015 at 4.15 p.m. but could only be cashed in on 1.4.2015. 16 33. Bankruptcy proceedings are commenced and premised upon an act of bankruptcy committed by the debtor. Section 3(1)(i) of the Bankruptcy Act 1967 provides that: “(i) If a creditor has obtained a final judgment or final order against him for any amount and execution thereon not having been stayed has served on him in the federation….a bankruptcy notice under this Act requiring him to pay the judgment debt or sum ordered to be paid in accordance with the terms of the judgment or order with interest quantified up to the date of issue of the bankruptcy notice….and he does not within seven days after service of the notice in case the service is effected in Malaysia either comply with the requirements of the notice or satisfy the court that he has a counterclaim, set off or cross demand which equals or exceeds the amount of the judgment debt or sum ordered to be paid and which he could not set up in the action in which the judgment was obtained or in the proceedings in which the order was obtained.” As far as our present Appeal is concerned, the fact shows that: i) the JC has obtained final judgment against the JD; ii) there has been no stay of execution of the final judgment; iii) the JD has not complied with the BN within 7 days of the service of the notice. 17 34. In respect of the requirement of paragraph (a), i.e. there was a final judgment, there is no dispute that there was one against the JD. What is perhaps an issue would be the requirement in para (b), i.e. whether JDS Proceeding amounted to a stay of execution of the judgment. We are of the view that it is not. 35. The very same issue as to whether a JDS constituted an implied stay of execution and hence prevented the issuance of a bankruptcy notice was duly considered in the New Zealand High Court case of Re Sturdee (a debtor) [1985] 2 NZLR 627 which was referred to us by counsel for the JC. Although the decision therein was against the backdrop of the New Zealand Insolvency Act 1967, the principle which can be distilled therefrom is applicable to the present Appeal as section 19(1)(d) of the New Zealand Insolvency Act 1967 bears resemblance to section 3(1)(i) of our Bankruptcy Act 1967. There, the judgment debtor argued that another mode of execution, which the judgment summons is, and which had been commenced and remained incomplete, constituted an implied stay. The Court considered section 19(1)(d) of the New Zealand Insolvency Act 1967 which permits the issuance of a bankruptcy notice if a creditor has obtained a final judgment upon which execution has not been stayed. It was held that: “….the issue of a judgment summons, without more, does not give rise to any implied stay. The mere presence of a judgment summons does not prevent the debtor from complying with a bankruptcy notice. Accordingly, I hold the debtor on this head of argument.” 18 The Court in Re Sturdee (supra) was of the view that there was no implied stay of execution by the mere presence of a judgment summons and held that the judgment debtor must comply with the bankruptcy notice. 36. Coming back to the Appeal that is before us, since execution is not prevented nor stayed with the issuance of the JDS Order, then the JC has met the requirements for the committal of an act of bankruptcy under section 3(1)(i) of the Bankruptcy Act 1967 namely, the Judgment is a final one, the JD had failed to comply with the BN and more pertinently, the execution of the Judgment is not stayed. 37. Since the JD has committed an act of bankruptcy, therefore, it follows that the BN is valid and there are no merits in the application by the JD to set aside the BN. 38. As section 8 of the Debtors Act 1957 provides that an order for the payment of installment payments shall not be a bar to proceedings in execution save and except to the extent that the court shall so direct, it is to be noted that, when the Court granted the JDS order, there was no direction from the Court as to the extent of any permissible execution proceedings pursuant to this said section, i.e. there was no limitation nor conditions set out on execution in the JDS Order. 19 Whether there has been a modification or variation of the original judgment: 39. Learned counsel for the JD submitted that, there has been a modification and a variation of the original judgment by the order of the JDS. It was contended that the BN cannot be founded on the original judgment but should be premised on the second varied order i.e. the JDS Order. The case of Re H.A. Pereira Ex parte Pagor Singh (Bhagat Singh) (supra) relied on by the JD concerned an application to set aside a bankruptcy notice on the ground that an order was subsequently made for payment of the judgment debt by installments. Mudie J was of the view that the judgment was modified by the order for payment of installments and therefore it followed that the Bankruptcy Notice which was founded on the judgment as it originally stood, was thereby invalidated. As a result, the Bankruptcy Notice was subsequently set aside. Later cases of Ahna Lana Velathan v Vina Chinniah & Anor [1939] 8 MLJ 36 and Kuna Sockalingam Mudaliar v Yong Saripah & Another [1954] 20 MLJ 11 were also referred to us, to establish the fact that an order for the manner of payment in installments amounts to a variation of the decree. 40. Counsel for the JC referred to us, the rationale of Lord Esher in Re Watson Ex parte Johnston [1893] 1 QB 21 wherein he opined that the power of ordering the debtor to pay by installment is not “execution” but are decrees or judgments themselves, which was 20 followed subsequently in our local cases in Ahna Lana Velathan v Viva Chinniah and S Sithambaram [1939] 1 MLJ 34 and Kuna Sockalingam Mudaliar v Yang Saripah & Anor (supra) where Wilson J said in his judgment that: “It remains only to consider whether or not an order to satisfy a decree by paying in installments is execution. In my opinion it is not and it is merely a variation of the decree which is, in effect, an order for a defendant to satisfy the amount of the decree with interest and costs by one lump sum payment forthwith. That order, in my opinion, cannot be regarded as execution of the decree nor do I think that a subsequent variation of that order for payment by installments can be regarded as execution.” 41. We are of the view that those cases cited by the JD (Re H.A. Pereira (supra), Ahna Lana Velathan v Viva Chinniah and S Sithambaram (supra), Kuna Sockalingam Mudaliar v Yang Saripah & Anor (supra) were cited primarily for the proposition that such orders under a JDS are decrees or judgments in themselves and that these cases precede our current Debtors Act 1957. The facts in the case of Datuk Mohd Sari bin Datuk Haji Nuar v Norwich Winterthur Insurance (M) Sdn Bhd (supra) which was referred to us by counsel of the JD, was decided premised on facts which are different to the present Appeal that is before us. 21 In Datuk Mohd Sari bin Datuk Haji Nuar v Norwich Winterthur Insurance (M) Sdn Bhd (supra), there was a consent judgment obtained against the appellant and subsequently the appellant offered to pay the said judgment by way of monthly installments. The offer was accepted by the respondent and the respondent issued receipts for seven installments. There was no term nor condition stipulated to provide for eventuality of a default in any payment of any installment. The appellant subsequently defaulted for the months of August to December 1989. This resulted in the respondent issuing a bankruptcy notice. The appellant applied to set aside the bankruptcy notice which was dismissed by the High Court. The appellant appealed to the Supreme Court where he contended that the respondent was estopped from issuing out the bankruptcy notice as there was already an agreement for settlement of the judgment sum by way of installments payments and there was no default provision in the agreement between the appellant and the respondent. The Supreme Court allowed the appeal premised on the grounds that there was nothing in the agreement between the appellant and the respondent of any default provision in the payment of any installment that in the event of any default, the judgment creditor was entitled to proceed to issue the bankruptcy notice in respect of the balance due on the judgment debt. It was also held that the terms of the consent judgment was controlled by an outside agreement between the judgment creditor and the judgment debtor and non compliance with the judgment is not an act of bankruptcy. Further the Supreme Court held that the demand 22 for payment in the bankruptcy notice was not in accordance to the terms of the consent judgment as was required by section 3(1)(i) of the Bankruptcy Act 1967. The demand for payment was regulated by the terms of the agreement between the parties and therefore the non compliance with such notice could not constitute an act of bankruptcy on strict construction of the Bankruptcy Act 1967. Clearly, Datuk Mohd Sari bin Datuk Haji Nuar v Norwich Winterthur Insurance (M) Sdn Bhd (supra) can be distinguished from our present Appeal on its facts. The facts in our present Appeal does not concern a consent judgment and agreement between parties as was the case with Datuk Mohd Sari bin Datuk Haji Nuar v Norwich Winterthur Insurance (M) Sdn Bhd (supra) 42. On the issue whether JDS is an execution proceeding, it is clear that, from the reading of section 3 of the Debtors Act 1957, the same is an execution proceeding. 43. Hence the net result is that there is no modification or variation of the original judgment by virtue of the JDS Order. 44. Further, section 8 of the Debtors Act 1957 provides that an order for the payment of installments of a judgment debt shall not be a bar to proceedings in execution. 23 45. On the presupposition that a bankruptcy proceeding is another mode of execution; the Federal court case of Dr Shamsul Bahar Abdul Kadir & anor Appeal v RHB Bank Berhad [2015] 4 CLJ (supra) held that the JC’s right to issue a BN is pegged to its right to proceed with execution. As execution was not barred at the time when the BN was issued, then the right to issue the BN must be upheld. 46. In addition, the JC is entitled to concurrently pursue all and any execution proceedings on the final judgment (Refer to Low Lee Lian v Ban Hin Lee Bank Bhd [1997] 1 MLJ 77, Moscow Narodny Bank v Ngan Chin Wen [2005] 3 MLJ 693). 47. Therefore based on the above authorities, the JC is entitled to commence bankruptcy proceedings against the JD concurrently with the JDS Order. Whether the JD had been in breach of the JDS Order. 48. It was the finding of the learned Judge that the JD had defaulted in the monthly installment that ought to have been paid to the JC, therefore the JD was in breach of the JDS Order. 49. From the evidence that was before the court, the JD had made payment after the BN was issued against the JD on 31.3.2015. The cheque for the installment payment was received by the JC’s solicitor 24 on 31.3.2015 at 4.15 pm after the BN was filed. The cheque could only be cashed in on 1.4.2015. Effectively, there had not been any payment made before the BN was filed. The Supreme Court in Re Chen Sing Chew; Ex parte: Oriental Tin Smelters Sdn Bhd [1974] 2 MLJ 69 held that bankruptcy proceedings can be commenced where there was a default in the installment payments which was in breach of an order to pay by installments (i.e. a JDS). The Court had held that: “…I hold that the bankruptcy proceedings have not been rendered invalid by the orders for payment of the judgment-debt by installments.” Whether the original judgment was nullified by the JDS Order: 50. It was submitted by the JD that the JDS Order allows the JD to make payment of the judgment debt by monthly installments and not one lump sum payment forthwith as was decreed by the original judgment. Therefore the JD contends that he no longer needs to comply with the original judgment. 51. However, we disagree with the submission by the JD. The original judgment has never been set aside nor overturned on appeal and thus it remains valid and enforceable. The JDS Order which allows for installment payments does not mean that it nullified the original judgment. 25 52. As section 8 of the Debtors Act 1957 provides that the JDS order is no bar to proceedings in execution, the JC is at liberty to commence bankruptcy proceedings although there is a JDS order. In the light of the JD’s default in his payment under the terms of the JDS Order, it is all the more reason for the JC to do so. Whether the BN is valid in the light of the different amount claimed: 53. The JD essentially claimed that the amount claimed in the BN was more excessive than the original judgment. As a result the BN is invalid, null and void ab initio. The JD raised the issue that the BN: i) demanded in excess RM54.53 (which is the interest calculated at the rate of 5% from 11.8.2011 to 31.3.2015 on the costs of RM300.00, although the Final Judgment does not provide for the same); ii) does not include the maturity dates for the Performance Guarantees (PG) and Financial Guarantee (FG) banking facilities; iii) failed to reflect payment already made by the JD i.e. on 31.3.2015 (i.e. the date when the BN was filed) the JD had made payment of RM1,500.00 pursuant to the JDS Order to JC’s solicitors by a bank draft. This payment is not reflected at all in the BN. 26 54. On the interest issue we agree with the learned Judge that interest on costs is claimable from the date of judgment pursuant to O 42 r 12 of the Rules of Court 2012. 55. Counsel for the JD contended that the BN is vague and confusing as the JC failed to state the maturity dates of the PG Facility and the FG Facility. We found that the learned Judge had not erred in this respect. The judgment clearly states the amount payable for the PG Facility which is RM5,300,000.00 as at 28.2.2011 and interest chargeable on the sum thereon shall be at the rate of 3.5% above the JC’s base lending rate calculated on monthly rests from 1.3.2011 until the date of full payment. As for the FG facility, the judgment provides for the interest rate of 3.5% above the JC’ c base lending rate calculated on monthly rests from 31.3.2009 (i.e. the maturity date of FG Facility) until the date of full payment. 56. Further the BN and the statement of accounts (which was attached to the BN) reflected the computation of the outstanding amount due under both PG and FG facilities and show that it is in accordance with the judgment. 57. In any event, a BN shall not be invalidated by the fact that the sum specified in the notice as the amount due, exceeds the amount actually due, unless the JD had given notice to the JC that he disputed the 27 validity of the notice on ground of such mistake (refer to section 3(2) of the Bankruptcy Act 1967). 58. Essentially the JD is challenging the amount specified in the BN, hence a notice as stipulated under section 3(2) of the Bankruptcy Act 1967 is required, which the JD failed to issue, which was one of the preliminary points raised by the JC. 59. On the contention by the JD that the claim in the BN is excessive as it failed to take into account the payment already made by the JD on 31.3.2015, it is the finding of the learned Judge that the JD only paid the monthly payment which was due on 13.3.2015 to the JC after the issuance of the BN. 60. The learned Judge had correctly stated in his judgment that the acceptance of payment by the JC does not nullify the BN as the outstanding amount due is over and above the statutory limit as provided under section 5(1) of the Bankruptcy Act 1967. The decision of the Federal Court in Moscow Narodny Bank Ltd v Ngan Chin Wen [2005] 3 MLJ 693 held that even if the amount claimed in the BN is excessive, the bankruptcy proceedings are not invalidated so long as the amount exceeds the statutory minimum sum of RM30,000.00 under section 5(1)(a) of the Bankruptcy Act 1967. 28 Hence the BN is not invalidated even if it failed to take into account the part payment, as long as the balance sum claimed is above the statutory limit set by the Bankruptcy Act 1967, as in the present Appeal that is before us. It is to be noted that the judgment sum is RM80 million and the payment received is RM5,000.00, leaving a balance far above the RM30,000.00 statutory limit. Conclusion: 61. Therefore, the bankruptcy jurisdiction under section 3(1)(i) of the Bankruptcy Act 1967 is validly invoked. 62. We therefore dismissed the 3 appeals with costs of RM15,000.00 for the 3 appeals subject to allocator and deposit refunded. Signed by: Zabariah Mohd Yusof Judge Court of Appeal Malaysia Putrajaya. Date: 12.7.2017 29 COUNSEL: Bastian Pius Vendargon, Wong Rhen Yen, Hanif bin Idris, Mohamed Fadzil bin Abdul Rahman, Afdhilani binti Jusof @ Alias for the Appellant (Messrs. Hanif Idris & Associates) Ng Sai Yeang, Lim Siew Ming, Loh Kah Hey for the Respondent (Messrs. Raja Darryl & Loh)

Tika 2.6.0

WA-24NCVC-1572-10/2016

PLAINTIF Meka Automotive Industries Sdn Bhd DEFENDAN TCM Stamping Products Sdn Bhd

12/07/2017

YA DATUK S. NANTHA BALAN

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=4f3b9d5c-c4f4-4d6e-9ae7-277cfcb4e4d6&Inline=true

DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR DIDALAM WILAYAH PERSEKUTUAN SAMAN PEMULA NO: \‘(/A—2ANcvc-L572-1012016 Dalum Pukau M4hkm\al1>csxe1 ‘ .1. Km Iumpur mam". m V Pexsckunnn. Gmmn sml Nu \~< V B%2lwCV(‘—‘>7(>—08 2016, Amam us: bIAMl’iI\(i I’R(_)DL(.'l> DDN UHD (T’lnumfE) Dan MEK\ Al T(lM(!Tl\ E I.\Dl'.~‘TRI1'..\ srm arm VD:-Icndant‘ mu Dnlarn Pcrkm 037 1 (1* dnn r 62) 'a) 1z(\<;2u12 mu Dnhrn Perkara 0 ‘ 1 2 R05 2012 \.\TAJLA MEKA AUTOMOTIVE INDUSTRIES SDN BHD ....PLAlNTlFF DAN’ TCM STAMPING PRODUCTS SDN BHD EFENDAN 9391 OF UDGMENT wk 1 ms Irnmduct-ion 1. 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Frnm EM [2005] a CL] 5: HC 12m» Mam Cbrpomnan 1.1.12/nt 1/ MW Hing 121105] 7 CL} 352 PIC Budd}! Pnvguntmrr Bmm MEDA Kumpkk: 1 BHL Pmpery Caaruknnr; [2016] 3 111.1211 341 HC ->;..n..1u 3 The mental’) yunxdlzuon uftllc Susmns Court .5 m be found m sccunn (»S(l)(b) Sulmxdnnnlc Conn; Act 1942: (llcvxscd 1‘I‘2) (“scan and :1 provides .1“: 2 Srssxons Court shall have juusdlcuon .0 uy all acuons and suns or 1 CW1] nnlurc when me zmonnt m dzsputc 01 mg Valuz of an subgecbnmttx does not uczzd RM1 0 Mdlxon mm. Secuon 65(l)(b) SCA ma‘ “- ~55. cam iufudizvion ul Sm-In-I cuum uy Sums! In the lirmlllinm chm-mrd m lhn Au. . Snmom (‘mm mm um» rm m.»a.m.x. m Iry .n olhnncllanx and suns nfn cvvwl ...u...¢ when m znmum ... dispute in nu ma: ofm: xubjecl nuuu am no| excced nu: rmlllnu nnggll. ...a~ NEEKNI counterclaim 4. MEKA's coumu—<:Izim 15 based on "rerun: alleged bunch of Contact [0 rnznufactule and supply maul sun-Apmg puts exclusively m MEK.-\ According to MEKA, TCM l-ml breached rhcu duty or obllgannn as Lhe§ ma unlawfiully ma wxrhout pnon \vnncn authnnnnon. supplied mm: pm m and paints which ulnrnntcly ramrd dclrixncnl ma mamvc loss or buslnns rm MEKA muam 5 E»cnuz.I.ly, MEKA zllegcs lhnl Tc.\l had allowed me (Mid may to Icpllcatc um. pmpncury nglus m [hr design, fabncauun, assembly, and aupply of From End Mndulcs (FLM) mlgctcd solely fur Pmlon's lzxm Prev: and supmm motor vehicle modcls. Accotdulg m MF.K\, (h: am Inrllng ID TCM’s clmm 15 closely mtcrtwmtd wnh Lh: facts of .VlE.KA‘s counlerclnm, The Iranllcx zpplicalion 5 In um or the an llm MIEKA'< cuunlcrzlznm cxczcdcrl me montrazy lunsdlcuun of the slons Cuun, (MI 4 Oclobu 2015, MEkA and mg 05 for an man am Sun 376 b: uznsfentd to me Hlgh Court TCM I5 opposmg MEKA's npphcauon to. me Innsfcr ofsull 37:; [0 "K High Court. The crux ofrhc oblccuon by TCM IS that before Lhe application for transfcr can he consldend by rhls High Court. M'F.KA mun fim fulfil the (undmun cummncd m sccunn 65(3) null: SCr\ and together ml. sccuon 65(4) sax Scctwns 65(5) and cam) SCA\ ma sls:— Sctuon 55(3) ~wm pnrucs m In ullon or ml «mm. mm mm...“ m fllspult or value nflh: s..l.,.u ....u« lllmoram um ax-::¢d lhc lmm nflht jurisdicllon, would nu mpmul. :1, a Snsmikfi Cwn. um «lured la .n Iglvenunl m Mnllng mu I'll.’ Stslnnx cm mull hav: lurisdic ’an m II'_\ the nclum nr ml. UK Snsions Conn shall luv: lmismc on to In Ah: sanlz, :JLhmg)I um amclml n[ on sunml mum mm.» ma) L‘)({$¢d mc um Illllll nr,..ma.l~l....l~ v...n.m Sctunn 45(4) "Emry such agxeemenl mu be (M '3 gr gum: Calm and when in so rum, the pink: Io Iv mu he xnmmna In uh: mm 2 um um: Snniunu Cunr1" xn support of his argumem, counsel for -rcu zrfcurd to an deunnn nfrhc Htgh Cour * n FIrI(fimd.\1mmgmmIr [1993] .1 cu :7 wl-nth r.-nunnarcd rlmr me case nf Cmrltgy Hexghu Markcnng bum nn :\ppL\<nL|cn for unn.-m can be man]: to the mgr. Conn, an alwmpt to much nn Ag-Kctmcnt lo have the mm med m Lhc Sessions Court must 1» made between the parties Accornlmg Lo the case. n 15 only when nn agreement cannot 1;: zmchezl, Lhat nn Ippbcauon can be nude fox transfer of Lh: nut to Ln: High Court It was further and .n um use man man is no zutcmznc Eight of transfer n-. ma Hxgh cnnn merely bzcause . counrcrchim excreds nn» nnnn Ilnut |\msd.Acnon of an 5: Ian: cnnn The cnnn ma unn sccuons as and an sc.\ nu mcmu .n prevent dcfendanls from dehbcuuzly dclzvmg zcnuns or suns wind: am commenced in me bcssmns (joun through an fling of couxilerdmms beyond an \'z.luc hmn of ]\|rIsdJcdon of an Sessions Conn 'nn.., lh: Couxt held m (hm case am an apphtauon fox knnsftr wag dcficlem .n fallmg .n stat: whexhu the dcfendnm was zgreeable to pmcccd nmdfl section 63(3) sca. van 5.; u 10. Th: (as: or Cmallrj H4./nu; was fnllnxwd by vht Ilxgh Conn m D:/mt/c 1‘!/I/I/V Cnrpamliwv Id»: am y. Mm Fm [2005] 7 CL] 332 when (Inc noun denh wnh {he xssue of wllcthcx L1! not the Ipphcaunn [or uansfu no me Hugh Conn W33 pxemanlrc m new of me me Lhzt Lh: defendant Ind not wumen In the plannuff to seek the): consent for che mm: to be med m the sessions Conn The Cnun hald that rhc an that the plmnuff was olnecung to the I[Ip1I4:nunn In tnnxfer shmmd that rhrv were wlllmg to have the cuunrzrclnsm med |n she Sessions cnnn, As eneh. .he Court condudud um xhc dcfmdm-1!‘: zpplicnuon the Lnnsfer was hnld to he pxenuumc. The Court reasoned that with sccuon osu) SCA confers me Sessions Cuun wuh un.Lun|(ed yunsdlcnon to try all acuons and sum of a <1vI.\ mnue in Inspect of mom: vehicle 1cc1dmvs,IAndlord and Imam, and d.\swxess.:u1d.yunsd1cuon to Ixy MI nthn actions and nuts of a em: namxv when .he nmounl in dxspulc or Ih: value of .he enhnennnnex doc< nor exceed RM1,aoo,ooo 00, therefore mm .. mcogruunn wmnn iccuun 55(1) SCA vlmt (xi pnxriks zgrte) Lhe bcuiom Cuun would have nnhmned junsdlcnon and Lhzt me monrlar} Lumt datum 15 not nn mwolnbl: bar n. so far as yunsdzcuon .5 concenned Anuthzx me whxch followed the same approach .5 summmm Pamrnwman 1/ .un¢.;nn Fimruz m.1[200s| 8 CL} 52 HC. Fuefianl 11. .\. such, .. was c.....¢..a¢a by m.....e1 fox '1' V an. m ....m... ......rc. apphuuan WIS .15.. ,..c.......m ... .1... then ..-..s .... attunpx on MEK:\'s pm .... me}. agrrcmcnt wu.h '1cu on yemnxng .... c.........,.:1...... ... ...: Sessxons Conn. Howcvct, . dmrm... approach was mm. by .... High Court ... Ham Ptrtgumran Bemma MEDA Ka...pu.. . El-IL. 1-mm. cmmm [zom 3 MLRH 36! when dcspnt ...: pmposluon ma dmvn ... .... abovc 1...: of cans. I...-. Chang Fang JC (as he ...... was) ac.-...“: ... mmsfcr me ......“ ... 4.. Hugh r,....... 1.. .1... (ac, ...: court held .h...,~ ma. [he declsiun ... lvnnsffl was . disrmfimur) .....=. Mlhough was pemussvblc rm ...: pm .0 agx: ... wnnng, ,....s..a... .o 5 5541. ...... Au, m expand .... ............. ....-.;.1.=..o.. offln: Seuinns Conn ... me. [or ...: npplmnnls caumerclaml, um wu .... =.»a=...¢ Imam ...'....,. ...... ..g.ee.uz............m. ... ...: pvrzmises. .... .........~c afjunhce lnvmrad ...: .....1.u.... .... .... “...... .......=. h: mnsfmed ... .1... High Court, omerwvs: .... .pp..c.... would ¢.r.c...=|y ... prqudnced by bcmg ...... 0... from nrmcriug .... ca.....em....u ... ennrny -- Analysis and conclusion 12 11.. smrung pom! .5 um ma.-<.»\'s co.....:..c1..... clearly mad. ...: monetary junsdscuan of ...: Sessions <;.....-. '11.. issue as I sue .., .5 whether, .. cwntendtd by counsel {... TCM, mm .5 .. lupl xtquinmenl .... .... pm of MEK.-\ under ...: SCA ... snusfy ...; Court .1... i. has ammyltd .0 me. am ... agretmznt ma. TCM ... have MEKAR :......m..cI..... d:.m.....=d by (I1: s=s.=.....s com. .1»... u... .1... counlcr-claim exceeds ...: manual‘), ]unsd1c(ioII of the Scsslons Cnun I::uaIu I3, 14 Having lnnkcd Rt all 11.: mmm mmm prnwslunv. the concluxunn Ihm 1 hm zezzhcd ,. am where the counlu-clznn cxcceda mu moncury |u.nsd.\::uon of me bculum Cuuu, mm parues an no doubt, it um.-nv to enter me an Lgveemcul (0 allow me Stssxons Conn m hm mg cans: aldmugh n exccnd: ms junsdxctlon At my me.w1me mm 1; such an zgttemenr. Lhen 1: must be filcd m Conn But cven (hm I am not con nced am by an; murc pamcs can give 0: counts: yunsdlctlon on an Srssmns Cnun u. hear and dercrxnmc and deliver mdgmcnr rm a sum cxctcdlng mm Mdhon T1115 1: lwrcnusc of the \\'ordmg m aecuun 63(4) sc.«\ wluch mmz. "flux mc pamt: seuimu Cunvl o :1 mm ha; suhjkked 1.. the Jurlsdiuhrn M was [emphuss added] 1: ... rclcvnm m Ilsa consider sccuun 55(1) ma (2) sc/\ wlwzh gm: pow: w the High com to uansfu 2 maurz m me lllgh Court. Seam:-ns com and (2) or am acn ruzds .5 , "Section as Suhurdmu: oounsAcI mu <1: mm H. any nclmn of sun of: my ...mm mm . Sessmns Court my defence orcounuxclalm nfm: «=r.~...1u.n |n\'oL\'u minus bqund lhc1ux|sdn:mm nflht (‘cum lhn delcn-2: ur nulls’! shall nu! mm m: wmxxlrmx orlh: am ofxhe Sexsmns Cnun m dlspuse 0! me \~IuI|u1Im|\crm controversy, so m u mum m the demand uf the vVflIImfl‘and m, dcflrnu: lhcmo. um nu rtl rumanng «nu mm. In: Conn ms juri mm In nwnni mu 5. gjvrn In an a.r...a...: ...,.u. the mu.-.m..... mum“ m. (2) In my my. use In: High Cnurl my, urn llunlu ru, nn -1.. appllulion of my plfly. mm um uh: man. on suil 5: In-nlulcrrlxl In Ilne mg. Conn am] Hi: ...~uo.. Mwlnhall n nb: uurred 1n um calm wk or mguler omwx “ms nfmt High Cmrl. and pmnéflfii mm as yr um Iclmn m sun ma hcnn nngmally ummulcn1|hclcin“ 1.. my wtw. (hue .5 no smumx; obllgallon on mu pm on paxly wl-u:h has film! 1| cnuntcr-tlann mun. cxcccds -1.: muuelary y\.Lus«hc1|on of |h: Sessions Com m snusfy a: ». swcnllud statutory p1c—n:qI||:1(c mm H has altunptod to cum: Into an Lgrcvrncnt mm me oppum side my hm me mu heard by the bcssums Couu notw|Lhs(and\ng Lha! me countcbdalm txcacds the monetary |unsd.|cuon oft}-A: Ses ions Court. No doubt the S-:s<mnk Cnurl docs I-mv: unlxmned mrmtlary yunsdlcuou when u mm m rumung down Or 1and~lnxd and Iunam mum for exmnplu, Eu! ,2 .3 L1u¢-.<uoIml)lc \.1.mm m ugm of xhr; wmdmg of section 65(4) SCA. parltcs can by zgrcnmcnl, (0115:: 2 monemry yunsdacuon on an Sessums Court which cxczeds RMLO milhan. In rm, wnnsal for Tcu took {kc posxuon am evzn 1,, agtetmtnt ofpramts me Srssluns Cour! Cannot award more than RM! 0 nullion Hence, an zgrctmmt, tven xfxeaclued, mu be useless as the count:-rclalmant mu haw: m forage any turn m was of Rim 0 mxlhon u... ya! u 15. 1.. so m as the mic: mrmea .0 art mnczrntd. for (I-us reasons Lhnt I have ducnnscd abovu, I do not £hn.n: the \‘n:w.K that have bran exprzsscd by me High Court m Cnunlg l>l:Igl:1.rMurA::Img v I7r3!1and.\rlwvug:nrn1 [1992] 3 CL) 17 and m: cases \\'h1rJI Lock me same sppxonch mum, Lhcy m decisions of mg High Court and are not binding on ms Court I prefcr Lhe zppmch mm by me Hxgh Com! m am. Pruumran smm MED/1 Kmp/e/u L‘ BHL Pmm Ca/mvlta/Mr [zmq 3 .\l'[.RH m. In mg ulumalt mum, 1 m. not convmtcd um MEK‘-\'x zpphcnuun no umsfcr sun we a. me Hugh com .5 “pre.|nzluxc’. Smce M.EK.\': :oumr.H;\zAm of mm; M.Il|.|on exccals me monemry junsdscuon of the Snslons Conn. by vinuc of scctian 66(2) SCA ma together wnh Orda 51 ml: (1) and (Z)(a) of me Rulrs of Court 2012. Sun 376 .5 hereby mnsfelred m the Hxgh Court I also ordex the defendant, TCM to pa} casts of nM1,m>o.ua to me phunuff (MEKA) wmn. mu be suh|ecr I'D 4% nlloutur Th: plamuff are also mmlcd m the miller com ur RM1,uoo.oo dated 6 March 2017, whxch W2: oxdued m mm of enclosun 8 wluch was costs m the cans: ofd-Ac 05. um. ncconimglg Pm me» u

Pytesseract-0.3.10

45A-78-08/2014

PENDAKWARAYA PENDAKWA RAYA TERTUDUH LIANG YOU MEI

11/07/2017

YA DATO' SURAYA BINTI OTHMAN

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=3be09888-6ba4-41d3-8807-e78032b359a6&Inline=true

1 DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN PERBICARAAN JENAYAH NO: 45A-78-08/2014 ANTARA PENDAKWA RAYA LWN LIANG YOU MEI JUDGMENT INTRODUCTION [1] The Accused in this case, Liang You Mei (Passport No. E02139854) faces a charge of trafficking in drugs, to wit, 1,529.7 grams of Methamphetamine which is an offence punishable under section 39B(1)(a) of the Dangerous Drugs Act 1952 (Act 234) (“DDA”) that carries the mandatory death sentence. She is said to have committed the offence on 16.12.2013, at or about 2.30am at the Cawangan Pemeriksaan Penumpang 2 (CPP2), Low Cost Carrier Terminal 2 (LCCT), Balai Ketibaan Antarabangsa, Lapangan Terbang Antarabangsa Kuala Lumpur. THE AMENDED CHARGE “Bahawa kamu pada 16 Disember 2013, lebih kurang jam 2.30 pagi di Cawangan Pemeriksaan Penumpang 2 (CPP2), Low Cost Carrier Terminal (LCCT), Balai Ketibaan Antarabangsa, Lapangan Terbang Antarabangsa Kuala Lumpur, di dalam daerah Sepang di dalam negeri Selangor Darul Ehsan telah mengedar dadah berbahaya iaitu Methamphetamine berat bersih 1,529.7 gram dan dengan itu kamu telah melakukan satu kesalahan di bawah Seksyen 39B(1)(a) Akta Dadah Berbahaya 1952 yang boleh dihukum di bawah Seksyen 39B(2) Akta yang sama.” THE PROSECUTION’S CASE [2] The prosecution called a total of fourteen (14) witnesses in support of its case against the Accused. The evidence led by the prosecution was briefly this; the Accused arrived in Malaysia on 16th December 3 2013 using Air Asia flight AK 1655 from Hong Kong to Kuala Lumpur and was instructed by Custom Officer, Mohd Zamri bin Shafi (PW11) to carry her Louewe luggage (P29) together with her green hand luggage (P30) to a scan machine numbered as 3 in CPP2, LCCT. [3] From the scan results, it was found that there was some suspicious green image in P29. Subsequently PW11 instructed the Accused to open the Louewe luggage at Kaunter Pemeriksaan 3. After the luggage was opened, PW11 saw a few articles of clothing. The Accused was told to remove all clothings from the luggage. When the luggage was emptied, PW11 prodded the whole luggage and found that there was something at the bottom of it. The Accused was told to put the empty luggage through the scanner again. When this was done, a suspicious green image showed up. [4] Thereafter, the Accused was told to repack the items removed from the luggage and she and the luggage were brought to the CPP2 customs office by PW11 and customs officer Azhar bin Ishak (PW10) for further inspection. 4 [5] At the CPP2 customs office, PW11 instructed the Accused to open the luggage and removed everything in it. Then PW11 cut and pried open the bottom of the luggage where he found a grey package wrapped in transparent plastic. Inside the package and plastic was another yellow package. When PW11 made a small tear on the package, he found it to contain some white crystalline substance. [6] The Chemist (PW6) was called as a witness and from his evidence and his Chemist Report after analysis confirmed the exhibits seized from the Accused contains 1529.7 grams of Methamphetamine which was listed in the First Schedule of the DDA. The Court’s Finding at the Close of the Prosecution Case [7] At the close of the Prosecution’s case, I had carefully perused the evidence adduced by the prosecution through its fourteen witnesses and examined the documentary evidence in support of the case. Section 180 of the Criminal Procedure Code (Act 593) (“CPC”) which sets out the procedure to be followed at the conclusion of the Prosecution’s case, reads as follows; 5 1) When the case for the prosecution is concluded, the Court shall consider whether the prosecution has made out a prima facie case against the Accused. (2) If the Court finds that the prosecution has not made out a prima facie case against the Accused, the Court shall record an order of acquittal. (3) If the Court finds that a prima facie case has been made out against the Accused on the offence charged the Court shall call upon the Accused to enter on his defense. (4) For the purpose of this section, a prima facie case is made out against the Accused where the prosecution has adduced credible evidence proving each ingredient of the offence which if unrebutted or unexplained would warrant a conviction. 6 [8] What is a prima facie case has been clearly spelt out in the Court of Appeal case of Looi Kow Chai & Anor v PP [2003] 1 CLJ 734 where at page 749, Gopal Sri Ram, JCA, has held as follows; “[3] Under s.180 of the Criminal Procedure Code (Revised 1999), the duty of a judge, sitting alone, at the close of the case for the prosecution, is to determine, as a trier of fact, whether the prosecution has made out a prima facie case against the Accused. The judge has only one exercise to undertake; he must subject the evidence of the prosecution to a maximum evaluation and then ask himself the question; If I decide to call the Accused to enter on his defence, and he elects to remain silent, am I prepared to convict him on the totality of the evidence contained in the prosecution’s case? If the answer is in the negative, then no prima facie case has been made out, and the Accused is entitled to an acquittal. (subjecting the prosecution’s evidence to a maximum 7 evaluation to determine if the defence is to be called does not mean that the prosecution has to prove its case beyond a reasonable doubt at the intermediate stage? [3a] Consequently, a judge is not to undertake an initial minimum evaluation of the prosecution’s evidence (followed by a maximum evaluation if the Accused elects to remain silent) under s.180 of the CPC (Revised 1999)” [9] The case of Looi Kow Chai & Anor (supra) was referred to in the more recent Federal Court Case of Magendran Mohan v PP [2011] 1 CLJ 805 where at page 824, His Lordship Alauddin Mohd Sheriff, PCA held as follows; “The test at the end of the prosecution’s case is a prima facie case based on a maximum evaluation of evidence. The evidence has to be scrutinized properly and not perfunctorily, cursorily or superficially. If the evaluation of the evidence results 8 in doubts in the prosecution’s case, then a prima facie case has not been made out. The defence ought not to be called merely to clear or clarity such doubts.” [10] It is trite law that in order to prove that the Accused was found in mens rea possession of the dangerous drugs the prosecution must prove 2 elements. [11] The first element is the body element. The prosecution must prove that the Accused was in custody and control of the dangerous drugs and that he had the power of disposal over the dangerous drugs (see the cases of Balachandran v. PP [2005] 1 CLJ 85 and PP v. Ouseng Sama Ae [2008] 1 CLJ 337. [12] In order to prove custody and control and the power of disposal over the dangerous drugs the prosecution must prove that the substances were in the Accused possession, for example, found on his body such as in his hand, in his pocket, in a luggage held by him or slung over his shoulder or strapped onto his body or tucked into his javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2750153217&SearchId=7perpm12A','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2821719043&SearchId=7perpm12A','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2821719043&SearchId=7perpm12A','_DisplayCase','');DispCase.focus() 9 trousers at the waist, etc. or found in a car driven and owned or hired or borrowed by him or in a house owned or rented from one of the prosecution witnesses and occupied by him or in a room rented by him which is in a house owned or rented by one of the prosecution witnesses (see the cases of Chan Pean Leon v. Public Prosecutor [1956] 22 MLJ 237; Parlan Bin Dadeh v. Public Prosecutor [2009] 1 CLJ 717; [2008] 6 MLJ 19; P.P. v. Abdul Rahman bin Akif [2007] 4 CLJ 337; [2007] 5 MLJ 1; P.P. v. Abdul Manaf Muhammad Hassan [2006] 2 CLJ 129; and Muhammad Bin Hassan v. PP [1998] 2 MLJ 273). [13] Moving to the next element; the second element is the mental element. The prosecution must prove that the Accused had knowledge that the substances were dangerous drugs. The reason is that without knowledge there cannot be possession (see the cases of Wong Nam Loi v. PP [1998] 1 CLJ 37; [1997] 3 MLJ 795, Balachandran v. PP [2005] 1 CLJ 85, supra, and PP v. Ouseng Sama Ae [2008] 1 CLJ 337, supra ). javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2841641473&SearchId=7perpm12A','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2841641473&SearchId=7perpm12A','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2811822593&SearchId=7perpm12A','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2811822593&SearchId=7perpm12A','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2780889601&SearchId=7perpm12A','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2780889601&SearchId=7perpm12A','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2577925121&SearchId=7perpm12A','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2750153217&SearchId=7perpm12A','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2821719043&SearchId=7perpm12A','_DisplayCase','');DispCase.focus() javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2821719043&SearchId=7perpm12A','_DisplayCase','');DispCase.focus() 10 [14] Since it is impossible for the prosecution to prove knowledge by direct evidence the prosecution can prove the nature of the conduct of the Accused at the material time and the circumstances surrounding the discovery of the substances at the material time from which an irresistible inference can be drawn that the Accused had the requisite knowledge that the substances were dangerous drugs (see the case of Parlan Bin Dadeh v. Public Prosecutor [2009] 1 CLJ 717; [2008] 6 MLJ 19). [15] Reverting back to our case, PW11 was the complainant. He informed the court that when he ordered the Accused to have P29 opened for inspection, she had no qualms about it and heeded to his instruction. [16] After P29 and P31B was scanned by PW10, PW11 requested the Accused to open up P29 and P31B and to clear its contents. She heeded to his instruction and there was nothing to suggest that the luggage was not hers to begin with. [17] PW11 also told the court that when he was instructed to physically inspect P29, he found that there is a secret compartment beneath the javascript:DispCase=window.open('/Members/DisplayCase.aspx?CaseId=2841641473&SearchId=7perpm12A','_DisplayCase','');DispCase.focus() 11 bottom of P29 as he found that the thickness of the bottom of P29 is unusual (luar biasa). This shows that the Accused must have known that there is something else inside P29. [18] The Chemist, Dr. Saravana Kumar A/L Jayaram, (PW6) was called as a witness and from his evidence and his Chemist Report after analysis, confirmed the exhibits seized from the Accused contain 1529.7 grams of Methamphetamine which was listed in the First Schedule of the DDA. [19] I believed his sworn oral testimony and accepted his findings on the basis that he was qualified and competent to examine and analyze the substance and to testify in court. [20] From the evidence elicited from the prosecution witnesses as set out briefly above, I found that the prosecution had proved a prima facie case. This is based on the fact that the Accused was found in possession of 1529.7 grams of Methamphetamine since it was found in the luggage carried by the Accused. The Accused clearly had custody and control over the 1529.7 grams of Methamphetamine. 12 [21] I am also satisfied that the Accused has mens rea possession of the drugs since it was in her luggage. This is so when one applies the principle of “willful blindness” which I will elaborate at the end of this Judgment. [22] At the close of the Prosecution’s case I have to determine, as a trier of facts, whether the prosecution has made out a prima facie case against the Accused. The question I need to answer after subjecting all the evidence of the prosecution to a maximum evaluation is : If I decide to call the Accused to enter on his defence, and he elects to remain silent, am I prepared to convict him on the totality of the evidence presented by the Prosecution’s? My answer is in the affirmative. I therefore ordered the Accused to enter his defence. THE DEFENCE CASE [23] The Accused testified that it was her first time travelling on an airplane and out of China. In her sworn testimony, the Accused stated that she was told that there is work in Malaysia and it was her 13 friend, one Chai Hong, who made the arrangements for the Accused to work as a masseuse in Malaysia. [24] The Accused further testified that she had known Chai Hong for about 6 to 7 months and it was Chai Hong who gave her the luggage (P29) the night before she departed for Malaysia. The Accused explained that before she put in her clothes, she saw that the luggage was empty and it did not occur to her to examine the luggage nor did she notice that it was heavy because this was her first time travelling out of China. The Accused further stated that she accepted the luggage because it had a trolley and was easier for her to handle. [25] Learned Counsel for the Accused, Mr Sreekanth Pillai submits that since PW10 and PW11 have stated that there was nothing suspicious about the luggage when seen with the naked eyes, this shows that the Accused had no knowledge of the drugs inserted under the layers of the luggage which had to be cut out by the custom officers. 14 [26] The Accused claims that during the statement-taking process, she did inform the officer that P29 was given to her by Chai Hong but this was not stated in her cautioned statement (D35). [27] Mr. Sreekanth Pillai further submits that the Accused has been prejudiced by the investigation against her which was incomplete and poorly done. He argued that in a case involving the death penalty, the investigation must be thorough to remove all doubts before charging the Accused. BURDEN OF PROOF AT THE END OF THE DEFENCE CASE [28] The issue before the court now is whether the Accused has successfully raise a reasonable doubt on the Prosecution’s case through her evidence. If this has not been done, then the Prosecution is said to have proven its case against the Accused beyond reasonable doubt. [29] This rule is enshrined in s. 182A of the CPC which states: 15 “(1) At the conclusion of the trial, the Court shall consider all the evidence adduced before it and shall decide whether the prosecution has proved its case beyond reasonable doubt. (2) If the Court finds that the prosecution has proved its case beyond reasonable doubt, the Court shall find the Accused guilty and he may be convicted on it. (3) If the Court finds that the prosecution has not proved its case beyond reasonable doubt, the Court shall record an order o acquittal.” [30] Regarding proof beyond reasonable doubt, the Federal Court in Balachandran v PP [2005] 2 MLJ 301 had this to say at p.316 para 23: “Proof beyond reasonable doubt involves two aspects. While one is the legal burden on the prosecution to prove its case beyond reasonable doubt the other is the evidential burden on the Accused to raise a reasonable doubt. Both these burdens can only be fully discharged at the end of the whole case when the defence has closed 16 its case. Therefore a case can be said to have been proved beyond reasonable doubt only at the conclusion of the trial upon a consideration of all the evidence adduced as provided by s. 182A(1) of the Criminal Procedure Code. That would normally be the position where the Accused has given evidence. However, where the Accused remains silent there will be no necessity to reevaluate the evidence in order to determine whether there is a reasonable doubt in the absence of any further evidence for such a consideration. The prima facie evidence which was capable of supporting a conviction beyond reasonable doubt will constitute proof beyond reasonable doubt.” [31] Since the Prosecution in this case is relying on one of the statutory presumptions under the DDA to prove its case namely s. 37(d) of the DDA, Mohd Radhi bin Yaakob v PP [1991] 3 MLJ 169 is instructive. As explained in great detail by His Lordship Mohamed Azmi SCJ at 171: 17 “In the course of the prosecution case, the prosecution may of course rely on available statutory presumptions to prove one or more of the essential ingredients of the charge. When that occurs, the particular burden of proof as opposed to the general burden, shifts to the defence to rebut such presumptions on the balance of probabilities which from the defence point of view is heavier than the burden of casting a reasonable doubt, but it is certainly lighter than the burden of the prosecution to prove beyond reasonable doubt. To earn an acquittal at the close of the case for the prosecution under s 173(f) or s 180 of the Criminal Procedure Code, the court must be satisfied that no case against the Accused has been made out which if unrebutted would warrant his conviction (Munusamy v PP [1987] 1 MLJ 492). If defence is called, the duty of the Accused is only to cast a reasonable doubt in the prosecution case. He is not required to prove his innocence beyond reasonable doubt.” 18 [32] In other words, when it comes to rebutting a statutory presumption the burden on the Accused is heavier than merely casting a reasonable doubt. The defence has to rebut such presumptions on a balance of probabilities. [33] The determination of whether the defence has successfully cast a reasonable doubt on the Prosecution’s case requires a consideration of the evidence given by the Accused which I shall now turn to. The Court’s Finding at the End of Defence Case [34] In the case of Wong Swee Chin v PP [1981] 1 MLJ 212; Tan Kim Ho & Anor v PP [2009] 3 CLJ 236 it is stated that; “Although there is no burden on the Accused to prove his innocence, it is trite that the Accused ought to put his line of defence during the prosecution’s case. Failure to do so will render the 19 defence being labelled as one of a recent invention or an afterthought” See also the case of Megat Halim Megat Omar v PP [2009] 1 CLJ 154. [35] The courts duty at this stage was to evaluate on any plausible explanation given by the Accused as laid down in the case of PP v Oo Boon Khim [2013] 1 LNS 986; “As long as the story of the Accused is not inherently incredible, the court has to test the story with that of the prosecution and if it creates a reasonable doubt in the mind of the judge, it is sufficient to earn an acquittal. The test where the story is capable of being accepted as not being inherently incredible must necessarily be one that demonstrates ‘plausible explanation’ to earn an acquittal. The ‘plausible explanation’ proposition was advocated as early as 1981, in the Privy 20 Council decision of Ong Ah Chuang v PP [1981] 1 MLJ 64…” The white crystalline substance [36 ] In my opinion, there is no question that the substance found in the Accused’s luggage is Methamphetamine based on the analysis and findings of Dr Saravana Kumar A/L Jayaram, PW6 , the chemist. I find that the Prosecution has successfully proven the identity of the drugs as confirmed by PW6. I can see no reason why I should not accept the results of the tests conducted to identify them. I also conclude that the storage and movement of said drugs are in order. Custody and control [37] We have the evidence of PW11 who saw the Accused placing the luggage P29 in the customs scanning machine. Looking at the tag attached to P29 (P34), there is no question that P29 was registered under the Accused’s name. 21 [38] The defence has not managed to raise any meaningful challenge with regard to the Accused’s custody and control of the drugs. It is not disputed that the Accused has physical possession of the luggage where the drugs were found. In fact, the Accused herself agreed that she was the only one to handle the luggage after Chai Hong gave it to her. [39] It follows therefore that there cannot be any question that P29 was at all material times in custody and control of the Accused, making the presumption of knowledge under s. 37(d) DDA invocable. Knowledge [40] The next course of inquiry is to determine whether the Accused was a mere innocent carrier. There is established authority for the proposition that where a defence of innocent carrier is led, it necessarily raises the issue of "wilful blindness". [41] In the case of PP v. Klong K'Djoanh & Another Appeal [2016] 5 CLJ 533, it was held; 22 "It is the principle of the law that the defence of innocent carrier should be taken into account with the principle of wilful blindness." [42] See also Unegbe Azuka Sunday v. PP [2016] 1 LNS 423, to similar effect. [43] The concept of 'wilful blindness' originates from the dissenting judgement of Yong Pung How CJ (Singapore) in the case of Public Prosecutor v. Hla Win [1995] 2 SLR 424 where his Lordship said as follows : "At this juncture, I emphasize that where the Accused, who is not an innocent custodian in the sense that the drugs were planted in his luggage without his being aware of them, accepted the goods in circumstances which rendered the taking of the precaution of satisfying himself that the goods were what they purported to be and were not drugs 23 an imperative, then, if he did not take the trouble to inspect them, but merely relied on another person's assurance, he would not rebut the statutory presumption of knowledge. In fact, he would be guilty of wilful blindness to the obvious truth of the matter. In the end, the finding of the mental state of knowledge, or the rebuttal of it, is an inference to be drawn by a trial Judge from all the facts and circumstances of the particular case, giving due weight to the credibility of the witnesses." [44] From the foregoing, the doctrine of 'willful blindness' can be summarised to be applicable to a situation where the circumstances are such as to raise suspicion sufficient for a reasonable person to be put on inquiry as to the legitimacy of a particular transaction. To put it another way, if the circumstances are such as to arouse suspicion, then it is incumbent for a person to make the necessary inquiries in 24 order to satisfy herself as to the genuineness of what was informed to her. [45] Should the Accused failed to embark upon this course of action, then she will be guilty of 'willful blindness' to what can be said to be fairly obvious. In other words she is then taken to know what the contents are. She then cannot be said to have either rebutted the presumption of knowledge or have raised a reasonable doubt as to her knowledge of the drugs in question. It will be also observed that depending on the precise factual matrix of the case, where it is shown that the Accused does make inquiries, it is necessary to consider whether the inquiries are merely token or whether further inquiries ought to have been made given the circumstances. [46] An examination of the circumstances in which the Accused came to be in physical possession of the Luggage according to the evidence of the Accused herself was that she received the luggage from Chai Hong the night before she departed for Malaysia. The Accused explained that before she put in her clothes, she saw that the luggage was empty and it did not occur to her to examine the luggage nor did 25 she notice that it was heavy because this was her first time travelling out of China. The Accused further stated that she accepted the luggage because it had a trolley and was easier for her to handle. [47] According to the Accused, she knew Chai Hong for about 6 to 7 months before she was offered a job by Chai Hong in Malaysia. I therefore do not find it reasonable under the circumstances for the Accused to accept this rather strange job offer from Chai Hong whom she is not well acquainted by her own admission. She didn’t know where the workplace is located and had no idea who will fetch her once she landed in Malaysia. [48] Further, It is improbable that the Accused who had only met Chai Hong a few times in 6-7 months would have without further inquiry accept the luggage without examining it. The relationship between the Accused and Chai Hong can in no way be described as close by any standards. Any reasonable person similarly circumstanced would be most hesitant to accept the luggage and be suspicious why such a luggage was given in the first place. The drugs weight about 1,529.7 grams and it is unreasonable that the Accused is unaware that the 26 luggage is “heavy”. Her testimony that she did not notice that the bag was heavy is unacceptable in the circumstance. [49] Apart from that, although it is true that PW11 confirmed that the Accused did not seem nervous or try to leave or escape in any way cannot be taken to show a lack of knowledge on her part. One must bear in mind the surroundings in which the Accused was detained was a highly-monitored area where escape was virtually impossible. [50] As was pointed out by the Federal Court in Teh Hock Leong v PP [2010] 1 MLJ 741: “ …in order to draw a favourable inference from the appellant's contemporaneous conduct, his action or inaction must be examined in the light of the situation at the material time. The area where the appellant was confronted by PW5 was the arrival gate of an incoming flight in the KLIA. This was the only exit point where passengers disembarking the plane can enter the KLIA terminal. It is common knowledge that the area was tight and restricted 27 with hardly any room for the appellant to make a successful escape even if he had tried. From here the appellant was then taken by PW5 and his men to PW5's office in the KLIA. The approximate walking distance was 600–800 metres. Here again the appellant's chances of a quick getaway were minimal since he was escorted and was within the restricted vicinity of the KLIA building. And, if the appellant were to attempt to throw away or disassociate himself with the backpack during this entire duration described it would evidently be noticeable. Of course, since the drugs were so cunningly concealed, there could be no necessity to take such drastic actions which may attract instant suspicion. So against these circumstances, the appellant's docile conduct throughout the period described could not have inferred an absence of knowledge of the said drugs. For this reason there is no misdirection by the courts below.” 28 [51] In short, the Accused’s inaction must be tested against the facts and circumstances as a whole. Mere passive conduct on her part cannot per se amount to lack of knowledge as to the contents of P29. [52] Even without relying on the s. 37(d) DDA presumption, I am satisfied that going by the evidence adduced, it is unlikely that the Accused did not know that there were drugs in her luggage. [53] I think it apt to note here that ignorance can only be a defence when there is no reason for suspicion and no right and opportunity of examination, and ignorance simpliciter is not enough. [54] At this juncture it is pertinent to refer to the following passage laid down by the Court of Appeal in Hoh Bon Tong v PP [2010] 5 CLJ 240 at 272 which in my opinion serves to fortify the Prosecution’s case in relation to the element of knowledge: “[73] The defence of innocent carrier must necessarily bring into the picture the concept of willful blindness. And according to Yong Pung How CJ (Singapore) in Public Prosecutor v. Hla Win 29 (supra) at p. 438, "the concept of wilful blindness qualifies the requirement of knowledge." And his Lordship continued further by saying (at the same page): As Professor Glanville Williams aptly remarked in his Textbook on Criminal Law, at p. 125: ... the strict requirement of knowledge is qualified by the doctrine of wilful blindness. This is meant to deal with those whose philosophy is: 'Where ignorance is bliss, 'tis folly to be wise.' To argue away inconvenient truths is a human failing. If a person deliberately 'shuts his eyes' to the obvious, because he 'doesn't want to know,' he is taken to know'. [74] Continuing at the same page, his Lordship said: In Ubaka v. PP [1995] 1 SLR 267, the principles laid down in Warner v. Metropolitan Police Commissioner [1968] 2 All ER 356; [1968] 2 WLR 1303 and modified in Tan Ah Tee v. PP [1978] 1 LNS 193; [1980] 1 MLJ 49 were applied by the trial 30 judge. In its grounds of judgment, this court quoted the following passage by the trial judge: Ignorance is a defence when there is no reason for suspicion and no right and opportunity of examination, and ignorance simpliciter is not enough. [75] Here, we have evidence that the drugs were placed inside transparent plastic packets and the contents can be seen from outside. It was mere folly on the part of the Accused not to examine what he carried in his pockets. It is a classic case of willful blindness.” [55] So too in the present case. It simply makes no sense that a lady would be willing to travel abroad alone to a foreign country hitherto unvisited by her merely on a promise that she will get a job as a masseuse from a friend whom she admits she is “not close” to and has only known for a few months. 31 [56] Also illogical is her explanation that the luggage was given to her as a gift by Chai Hong and that she did not inspect the luggage before putting her clothes in it. Even if the luggage was a gift from Chai Hong, this would have raised a reason for suspicion as to why Chai Hong would have given her the luggage. I do not think that it is a tenable foundation to set up a defence of no knowledge seeing as how at all material times the Accused could have availed herself of the opportunity to examine P29. Trafficking [57] The ingredients of custody, control and possession have been established by the Prosecution. Moving on to the element of trafficking, there is the unchallenged testimony of PW11, that the Accused was indeed carrying P29 and P31B from Hong Kong to Kuala Lumpur, an act which falls under one of the various examples of trafficking as defined in s. 2 of the DDA. 32 [58] Before I proceed to deliver my verdict, I would like to remark upon other aspects of the Accused’s evidence which had the cumulative effect of further undermining her defence. [59] Firstly, the Accused testified that she came to Malaysia to work as a masseuse, but she admitted having no knowledge of the job. She also said that she never applied for a work permit. This is starkly different from her explanation in her cautioned statement (D35), in which she mentioned that she came to Malaysia because she was offered a free holiday by a friend who bought her free flight tickets. However, during cross- examination by the Prosecution, she then denied that the purpose of her visit to Malaysia was for a holiday. [60] The Accused has also in her evidence stated that Chai Hong had two telephone numbers. But when cross-examined and shown that there were three telephone numbers of Chai Hong in the Digital Forensic Report (P18), she then said Chai Hong had three numbers. The court finds it suspicious that no satisfactory explanation was offered by the Accused to explain this discrepancy. 33 [61] Further as stated earlier, the drugs which weight 1529.7 grams concealed beneath the bottom of the luggage have made the luggage heavy. The Accused received the luggage when it was empty. She had the opportunity to examine the luggage and discovered that it was heavy for an empty luggage. She should have embarked to examine the luggage and her failure to do so makes her guilty of willful blindness, to what can be said to be fairly obvious, that drugs was hidden beneath the bottom of the luggage. In other words, she is then taken to know the existence of the drugs. She then cannot be said to have either rebutted the presumption of knowledge or have raised a reasonable doubt as to her knowledge of the drugs in question. CONCLUSION [62] In light of the above, I do not accept or believe the Accused explanation (defence) nor does her explanation (defence) cast a reasonable doubt on the Prosecutions Case. I find that the Prosecution has proved its case against the Accused beyond 34 reasonable doubt. I hereby convict the Accused of the charge against her and sentence her to death by hanging. Dated 11th July 2017, (SURAYA OTHMAN) Judge, Criminal Court, High Court of Malaya, Shah Alam, Selangor. Cases(s) referred to: 1. Looi Kow Chai & Anor v PP [2003] 1 CLJ 734; 2. Magendran Mohan v PP [2011] 1 CLJ 805; 3. Balachandran v PP [2005] 2 MLJ 301; 4. PP v. Ouseng Sama Ae [2008] 1 CLJ 337. 5. Chan Pean Leon v. Public Prosecutor [1956] 22 MLJ 237; 6. Parlan Bin Dadeh v. Public Prosecutor [2009] 1 CLJ 717; [2008] 6 MLJ 19; 7. P.P. v. Abdul Rahman bin Akif [2007] 4 CLJ 337; [2007] 5 MLJ 1; 8. P.P. v. Abdul Manaf Muhammad Hassan [2006] 2 CLJ 129; 9. Wong Nam Loi v. PP [1998] 1 CLJ 37; 35 10. Munusamy v PP [1987] 1 MLJ 492; 11. Wong Swee Chin v PP [1981] 1 MLJ 212; 12. Tan Kim Ho & Anor v PP [2009] 3 CLJ 236; 13. Megat Halim Megat Omar v PP [2009] 1 CLJ 154; 14. PP v Oo Boon Khim [2013] 1 LNS 986; 15. PP v. Klong K'Djoanh & Another Appeal [2016] 5 CLJ 533; 16. Unegbe Azuka Sunday v. PP [2016] 1 LNS 423; 17. Public Prosecutor v. Hla Win [1995] 2 SLR 424; 18. Teh Hock Leong v PP [2010] 1 MLJ 741; 19. Hoh Bon Tong v PP [2010] 5 CLJ 240 20. Muhammad Bin Hassan v. PP [1998] 2 MLJ 273). 21. Mohd Radhi bin Yaakob v PP [1991] 3 MLJ 169; 22. Teh Hock Leong v PP [2010] 1 MLJ 741; 23. Hoh Bon Tong v PP [2010] 5 CLJ 240 at 272. Legislation referred to: 1. Sections 180 and 182A of the Criminal Procedure Code (Act 593); 2. Sections 2 and 37(d) Dangerous Drugs Act 1952 (Act 234). 36 Solicitors: 1. Mr Sreekant Pillai [Tetuan Sreekant Pillai] for the Accused. 2. Madam Syamimi Farhana binti Muhammad A. Aziz, Deputy Public Prosecutor, Royal Customs of Malaysia.

Tika 2.6.0

BA-12ANCVC-71-08/2016

PERAYU KONG AH CHOO RESPONDEN 1. DATO’ KAMAL Y.P. TAN 2. MICHAEL GUNALAN BENEDICT

10/07/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=5ff39c38-c239-4b7c-b181-8eec962def9a&Inline=true

DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA RAYUAN SIVIL NO: BA-12ANCVC-71-08/2016 ANTARA KONG AH CHOO ….. PERAYU DAN 1. DATO’ KAMAL Y.P. TAN 2. MICHAEL GUNALAN BENEDICT ….. RESPONDEN- RESPONDEN (DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN GUAMAN SIVIL NO: B52NCVC-155-07/2015 ANTARA KONG AH CHOO ….. PLAINTIF DAN 1. EASY SUN SDN BHD (NO. SYARIKAT: 459820-A) 2. EUROCERAMIC TECHNOLOGIES COMPANY LIMITED (NO. SYARIKAT: 0905544001121) 3. DATO’ KAMAL Y.P.TAN 4. MICHAEL GUNALAN BENEDICT 5. LAW SEE HAW 6. EDWARD MOSSES JULIUS JOSEPHATH ….. DEFENDAN- DEFENDAN) GROUNDS OF JUDGMENT Introduction [1] This is an appeal by the Appellant who is the Plaintiff against the decision of the Sessions Court which allowed the Respondent, the 3RD and 4th Defendants’ application, to strike out the Appellant’s Writ and Statement of Claim on 1.8.2016. [2] This matter was heard together with the case number BA-12ANCVC-70-08/2016 as they involved the same litigants pertaining to one Sale and Purchase of Shares Agreement. [3] At the hearing of the appeal, the counsel for the 3rd and 4th Defendants who is also representing the 1st and 2nd Defendants, raised a preliminary objection against the appeal. [4] For ease of reference, in this judgment, the parties will be referred to as they were in the Sessions Court. Factual Background [5] The Plaintiff brought a suit against six Defendants at the Sessions Court where the Plaintiff filed a Writ of 24.7.2015 and Statement of Claim of 27.11.2015. The facts of the case are similar to the facts of the case number BA-12ANCVC-70-08/2016 and I do not wish to repeat them here. [6] At the Sessions Court, the 3rd and 4th Defendants, applied for a striking out of the Plaintiff’s Writ and Statement of Claim under Order 18 r.19(1)(a), (b) and (d) of the Rules of Court 2012. [7] The grounds in support of the application are as follows: (a) there is no reasonable cause of action against the 3rd and 4th Defendants; (b) the Plaintiff’s action is frivolous and vexatious; (c) the Plaintiff’s action is an abuse of the process of court; and (d) alternatively, the Plaintiff’s cause of action against the 3rd and 4th Defendants is time barred following section 6 of the Limitation Act 1953. [8] Based on the written submission of the counsel for the Plaintiff, the Sessions Court allowed the 3rd and 4th Defendants’ application on 1.8.2016 to strike out Plaintiff’s Writ and Statement of Claim on the following grounds: “(a) The Appellant’s cause of action against the Respondents based on the Share Sale Agreement was barred by limitation pursuant to Section 6 of the Limitation Act 1953; (b) There was no evidence to show that the Respondents were the employer of the Appellant nor there was any service agreement between the Respondents and the Appellant. Therefore the Appellant has no reasonable cause of action against the Respondents. (c) The Respondents have forwarded the Service Agreement to the Appellant. Therefore the Respondents had discharged their obligation fully under Clause 11.1(a) of the Share Sale Agreement; and (d) The Appellant had rejected the service agreement forwarded to him, this was a breach of the terms and conditions of the Share Sale Agreement and as the Appellant cannot benefit from his own breach, the Appellant’s action was frivolous and vexatious and was an abuse of the process of Court.” [9] The Plaintiff appealed to this Court on the Sessions Court’s decision in allowing the striking out application by the 3rd and 4th Defendants. [10] At the hearing of the appeal, the 3rd and 4th Defendants’ counsel raised a preliminary objection against the appeal. The objection is as the same submitted in the case number BA-12ANCVC-70-08/2016 is that the Plaintiff failed to follow Order 55 rule 5(3) of the Rules of Court 2012 (ROC 2012) without taking into consideration the 3rd and 4th Defendants’ counsel’s objections to the inclusion of the 5th and 6th Defendants’ Defence into the Record of Appeal. THE COURT’S FINDING [11] The Court had the benefit of hearing both counsels on the preliminary objections raised. Before I go to the merits of the appeal, I shall depose the preliminary objection first. If the preliminary objection is upheld, then there is no need to consider the merits of the appeal. [12] As to the preliminary objection, the 3rd and 4th Defendants’ counsel submitted that the non-compliance of Order 55 rule 5(3) of the ROC 2012 in the preparation of the appeal record is fatal and cited two cases, Chuah Tim Lan v. RHB Bank Bhd & Anor [2008] 6 MLJ 793 and Owners of the Ship or Vessel Sasacom I v. Bank Pembangunan Malaysia Bhd [2015] 4 MLJ 841. [13] For this purpose, Order 55 rule 5(3) of the ROC 2012 is referred which stated that, “(3) Within one month after the filing of the notice of appeal under this rule, the appellant shall file the record of appeal in the High Court, and the record shall contain copies of— (a) the application for the decision; (b) all pleadings filed; (c) all affidavits filed in support or in opposition to the application; and (d) the order or draft order of the decision appealed from: Provided that the record of appeal shall not include the notes of evidence, the grounds of judgment or any memorandum of appeal.” The Defendant’s counsel contention was the inclusion of the 5th and 6th Defendant’s Defence that were not served on the 3rd and 4th Defendants’ counsel for this appeal. [14] I am of the view that in relation to an appeal after trial involving documents that is to be included or excluded from the record of appeal, Order 55 of the ROC 2012 must be read in whole as it embodies all the rules of appeals to the High Court from the subordinate courts. Pertinent to the objection raised, we look at rule 4 before we approach rule 5. Order 55 rule 4(1) of the ROC 2012 clearly stated that, “4(1) In the case of an appeal from a decision after trial, the appellant shall within one month from the date of filing of notice of appeal prepare and file the requisite number of copies of the record of appeal and the record shall contain copies of— (a) the relevant pleadings; (b) the notes of evidence, including witness statements, if available, recorded wholly or partly by mechanical means; (c) the grounds of judgment, if available; (d) the memorandum of appeal; (e) the decision, order or judgment; (f) a duplicate copy of the notice of appeal; (g) a duplicate copy of the notice of cross appeal, if any; (h) all such documentary exhibits and other documents the parties shall consider relevant for the purposes of the appeal: Provided that the record of appeal shall be filed notwithstanding that the notes of evidence and/or grounds of judgment are not ready or that the sealed decision, order or judgment has not been extracted.” [15] The objection raised is the inclusion of the 5th and 6th Defendant’s Defence and that they were not served on the 3rd and 4th Defendants’ counsel. This Court is of the view that the primary issue is whether by allowing the documents not relevant to the appeal in the appeal record will be contrary to the procedural requirement of the ROC 2012. There is also an issue of whether it will be prejudicial to the 3rd and 4th Defendants’ case. [16] In reference to part (a) of rule 4(1) above, the set of documents referred to are, “the relevant pleadings” which this Court is of the view that it would mean the pleadings that is relevant to the decision that is appealed against in its literal meaning. This is consistent with part (h) of rule 4(1) which refers to the documents or exhibits that are relevant for the purposes of the appeal. [17] This explain the wordings used in rule 4(1) that is “the relevant pleadings” as opposed to “all pleadings filed” under Order 55 rule 5(3) of the ROC 2012. The steps governing the procedural requirement can be found in the ROC 2012 Annotation, Volume 2, 2012 where a draft index of the documents must be included in the record of appeal and sent by the appellant’s solicitors to the solicitors for the respondent. It explained that the solicitors for the respondent may object to the inclusion or exclusion of any document. The parties are allowed if there is no agreement reached, to the inclusion or exclusion of any of the documents and they may refer the matter to the registrar of the High Court. It also explained that if no agreement can be reached with regards the documents to be included in the record of appeal, the registrar may require parties to appear before the Judge under Order 55 rule 5(5) which the 3rd and 4th Defendants’ counsel had rightly objected before this Court. [18] Reverting to the facts, the striking out application was made by the 3rd and 4th Defendants’ counsel, who is representing all 1st, 2nd, 3rd and 4th Defendants, on the Plaintiff’s Writ and Statement of Claim. The striking application was allowed by the Sessions Court after the trial. The Plaintiff appealed against the whole of the Sessions Court’s decision on the striking out application between the 1st Defendant and the Plaintiff. This is not a matter where failure to include documents listed that is crucial to an appeal as decided in the case of Koh Teck Yew v Kok Ying Huat [1997] MLJU 351 (unreported, 29 September 1997) which resulted the appeal being dismissed. This is a matter for the Court to decide whether the irrelevant or as the counsel for the 3rd and 4th Defendants puts it, objected documents, should be included in the appeal record before this Court. [19] This Court is of the view that there is merits to the preliminary objection. In appeal hearing, this Court may exercise its powers and duties as necessary to do justice in the case. The Court must exercise its discretion to ensure procedural requirements as provided in the ROC 2012 are adhered to as the consequential effect would be detrimental so as to misdirect this Court on facts and law. All relevant documents filed are referred by the Court. The burden is on the Plaintiff as the appellant in this case, to supply the relevant documents following Order 55 rule 4(1) and rule 5(3) of the ROC 2012. In addition, based on the case of Maranatha Tours & Travel Sdn Bhd v Ampang Specialist Centre Sdn Bhd [1997] MLJU 181 (unreported, 24 March 1997), it is the duty of the appellant to prepare a proper record of appeal. [20] The procedural requirement is a statutory requirement for compliance in its strict sense and therefore is mandatory for parties to adhere to. The Plaintiff did not offer any explanation on the inclusion of the objected documents except to submit that they complied with Order 55 rule 5(3) of the ROC 2012. The counsel for the 3rd and 4th Defendants had made its objection of the documents by indicating on the record to the registrar and for this Court to take the matter into consideration for the purpose of costs and incidental to the documents. [21] This Court also viewed that the non-service of the documents (5th and 6th Defendant’s Defence) to the 3rd and 4th Defendants’ counsel will be prejudicial as to blatantly put them at a disadvantage. The fact that the counsel for the 3rd and 4th Defendants was not served with all the relevant pleadings would mean that he was not fully informed particularly when the this case is heard together with case number BA-12ANCVC-70-08/2016, Plaintiff’s action will be prejudicial against the three Defendants. I agree with the two cases attributed by the counsel for the 1st Defendant. However the case of Owners of the Ship or Vessel Sasacom I (supra) was specifically on rule 18 of the Rules of the Court of Appeal but I do agree that both cases cited relate to compliance issue. [22] Borrowing the words from the case Chuah Tim Lan v RHB Bank Bhd. (supra), by allowing the Plaintiff’s action will be amplifying the Plaintiff’s nonchalance in complying with the ROC 2012. This Court viewed that the Plaintiff’s non-compliance is a breach of the ROC 2012 and the consequences of the breach is serious and is not curable. I dismissed the appeal with cost. Dated: 10 July 2017 (DATIN ZALITA BINTI DATO’ ZAIDAN) Judicial Commissioner Shah Alam High Court SOLICITORS: APPELLANT : JUSTIN CHIN Tetuan Justin Chin Suite E-06-19, Plaza Mont Kiara 2 Jalan Kiara, Mont Kiara 50480 Kuala Lumpur [Ref: 15/1103/KAC/J/JL] Tel : 03-6211 3877 Fax : 03-6201 4877 RESPONDENT : YEE TECK FAH Tetuan Yee Teck Fah & Co. Unit 705, Blok E Pusat Dagangan Phileo Damansara 1 Jalan 16/11, Section 16 46350 Petaling Jaya Selangor Darul Ehsan [Ref: YTF/4297/ESSB/001/G] Tel : 03-7660 9028 Fax : 03-7660 9032 2

Tika 2.6.0

BA-12ANCVC-71-08/2016

PERAYU KONG AH CHOO RESPONDEN 1. DATO’ KAMAL Y.P. TAN 2. MICHAEL GUNALAN BENEDICT

10/07/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

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DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA RAYUAN SIVIL NO: BA-12ANCVC-71-08/2016 ANTARA KONG AH CHOO ….. PERAYU DAN 1. DATO’ KAMAL Y.P. TAN 2. MICHAEL GUNALAN BENEDICT ….. RESPONDEN- RESPONDEN (DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN GUAMAN SIVIL NO: B52NCVC-155-07/2015 ANTARA KONG AH CHOO ….. PLAINTIF DAN 1. EASY SUN SDN BHD (NO. SYARIKAT: 459820-A) 2. EUROCERAMIC TECHNOLOGIES COMPANY LIMITED (NO. SYARIKAT: 0905544001121) 3. DATO’ KAMAL Y.P.TAN 4. MICHAEL GUNALAN BENEDICT 5. LAW SEE HAW 6. EDWARD MOSSES JULIUS JOSEPHATH ….. DEFENDAN- DEFENDAN) GROUNDS OF JUDGMENT Introduction [1] This is an appeal by the Appellant who is the Plaintiff against the decision of the Sessions Court which allowed the Respondent, the 3RD and 4th Defendants’ application, to strike out the Appellant’s Writ and Statement of Claim on 1.8.2016. [2] This matter was heard together with the case number BA-12ANCVC-70-08/2016 as they involved the same litigants pertaining to one Sale and Purchase of Shares Agreement. [3] At the hearing of the appeal, the counsel for the 3rd and 4th Defendants who is also representing the 1st and 2nd Defendants, raised a preliminary objection against the appeal. [4] For ease of reference, in this judgment, the parties will be referred to as they were in the Sessions Court. Factual Background [5] The Plaintiff brought a suit against six Defendants at the Sessions Court where the Plaintiff filed a Writ of 24.7.2015 and Statement of Claim of 27.11.2015. The facts of the case are similar to the facts of the case number BA-12ANCVC-70-08/2016 and I do not wish to repeat them here. [6] At the Sessions Court, the 3rd and 4th Defendants, applied for a striking out of the Plaintiff’s Writ and Statement of Claim under Order 18 r.19(1)(a), (b) and (d) of the Rules of Court 2012. [7] The grounds in support of the application are as follows: (a) there is no reasonable cause of action against the 3rd and 4th Defendants; (b) the Plaintiff’s action is frivolous and vexatious; (c) the Plaintiff’s action is an abuse of the process of court; and (d) alternatively, the Plaintiff’s cause of action against the 3rd and 4th Defendants is time barred following section 6 of the Limitation Act 1953. [8] Based on the written submission of the counsel for the Plaintiff, the Sessions Court allowed the 3rd and 4th Defendants’ application on 1.8.2016 to strike out Plaintiff’s Writ and Statement of Claim on the following grounds: “(a) The Appellant’s cause of action against the Respondents based on the Share Sale Agreement was barred by limitation pursuant to Section 6 of the Limitation Act 1953; (b) There was no evidence to show that the Respondents were the employer of the Appellant nor there was any service agreement between the Respondents and the Appellant. Therefore the Appellant has no reasonable cause of action against the Respondents. (c) The Respondents have forwarded the Service Agreement to the Appellant. Therefore the Respondents had discharged their obligation fully under Clause 11.1(a) of the Share Sale Agreement; and (d) The Appellant had rejected the service agreement forwarded to him, this was a breach of the terms and conditions of the Share Sale Agreement and as the Appellant cannot benefit from his own breach, the Appellant’s action was frivolous and vexatious and was an abuse of the process of Court.” [9] The Plaintiff appealed to this Court on the Sessions Court’s decision in allowing the striking out application by the 3rd and 4th Defendants. [10] At the hearing of the appeal, the 3rd and 4th Defendants’ counsel raised a preliminary objection against the appeal. The objection is as the same submitted in the case number BA-12ANCVC-70-08/2016 is that the Plaintiff failed to follow Order 55 rule 5(3) of the Rules of Court 2012 (ROC 2012) without taking into consideration the 3rd and 4th Defendants’ counsel’s objections to the inclusion of the 5th and 6th Defendants’ Defence into the Record of Appeal. THE COURT’S FINDING [11] The Court had the benefit of hearing both counsels on the preliminary objections raised. Before I go to the merits of the appeal, I shall depose the preliminary objection first. If the preliminary objection is upheld, then there is no need to consider the merits of the appeal. [12] As to the preliminary objection, the 3rd and 4th Defendants’ counsel submitted that the non-compliance of Order 55 rule 5(3) of the ROC 2012 in the preparation of the appeal record is fatal and cited two cases, Chuah Tim Lan v. RHB Bank Bhd & Anor [2008] 6 MLJ 793 and Owners of the Ship or Vessel Sasacom I v. Bank Pembangunan Malaysia Bhd [2015] 4 MLJ 841. [13] For this purpose, Order 55 rule 5(3) of the ROC 2012 is referred which stated that, “(3) Within one month after the filing of the notice of appeal under this rule, the appellant shall file the record of appeal in the High Court, and the record shall contain copies of— (a) the application for the decision; (b) all pleadings filed; (c) all affidavits filed in support or in opposition to the application; and (d) the order or draft order of the decision appealed from: Provided that the record of appeal shall not include the notes of evidence, the grounds of judgment or any memorandum of appeal.” The Defendant’s counsel contention was the inclusion of the 5th and 6th Defendant’s Defence that were not served on the 3rd and 4th Defendants’ counsel for this appeal. [14] I am of the view that in relation to an appeal after trial involving documents that is to be included or excluded from the record of appeal, Order 55 of the ROC 2012 must be read in whole as it embodies all the rules of appeals to the High Court from the subordinate courts. Pertinent to the objection raised, we look at rule 4 before we approach rule 5. Order 55 rule 4(1) of the ROC 2012 clearly stated that, “4(1) In the case of an appeal from a decision after trial, the appellant shall within one month from the date of filing of notice of appeal prepare and file the requisite number of copies of the record of appeal and the record shall contain copies of— (a) the relevant pleadings; (b) the notes of evidence, including witness statements, if available, recorded wholly or partly by mechanical means; (c) the grounds of judgment, if available; (d) the memorandum of appeal; (e) the decision, order or judgment; (f) a duplicate copy of the notice of appeal; (g) a duplicate copy of the notice of cross appeal, if any; (h) all such documentary exhibits and other documents the parties shall consider relevant for the purposes of the appeal: Provided that the record of appeal shall be filed notwithstanding that the notes of evidence and/or grounds of judgment are not ready or that the sealed decision, order or judgment has not been extracted.” [15] The objection raised is the inclusion of the 5th and 6th Defendant’s Defence and that they were not served on the 3rd and 4th Defendants’ counsel. This Court is of the view that the primary issue is whether by allowing the documents not relevant to the appeal in the appeal record will be contrary to the procedural requirement of the ROC 2012. There is also an issue of whether it will be prejudicial to the 3rd and 4th Defendants’ case. [16] In reference to part (a) of rule 4(1) above, the set of documents referred to are, “the relevant pleadings” which this Court is of the view that it would mean the pleadings that is relevant to the decision that is appealed against in its literal meaning. This is consistent with part (h) of rule 4(1) which refers to the documents or exhibits that are relevant for the purposes of the appeal. [17] This explain the wordings used in rule 4(1) that is “the relevant pleadings” as opposed to “all pleadings filed” under Order 55 rule 5(3) of the ROC 2012. The steps governing the procedural requirement can be found in the ROC 2012 Annotation, Volume 2, 2012 where a draft index of the documents must be included in the record of appeal and sent by the appellant’s solicitors to the solicitors for the respondent. It explained that the solicitors for the respondent may object to the inclusion or exclusion of any document. The parties are allowed if there is no agreement reached, to the inclusion or exclusion of any of the documents and they may refer the matter to the registrar of the High Court. It also explained that if no agreement can be reached with regards the documents to be included in the record of appeal, the registrar may require parties to appear before the Judge under Order 55 rule 5(5) which the 3rd and 4th Defendants’ counsel had rightly objected before this Court. [18] Reverting to the facts, the striking out application was made by the 3rd and 4th Defendants’ counsel, who is representing all 1st, 2nd, 3rd and 4th Defendants, on the Plaintiff’s Writ and Statement of Claim. The striking application was allowed by the Sessions Court after the trial. The Plaintiff appealed against the whole of the Sessions Court’s decision on the striking out application between the 1st Defendant and the Plaintiff. This is not a matter where failure to include documents listed that is crucial to an appeal as decided in the case of Koh Teck Yew v Kok Ying Huat [1997] MLJU 351 (unreported, 29 September 1997) which resulted the appeal being dismissed. This is a matter for the Court to decide whether the irrelevant or as the counsel for the 3rd and 4th Defendants puts it, objected documents, should be included in the appeal record before this Court. [19] This Court is of the view that there is merits to the preliminary objection. In appeal hearing, this Court may exercise its powers and duties as necessary to do justice in the case. The Court must exercise its discretion to ensure procedural requirements as provided in the ROC 2012 are adhered to as the consequential effect would be detrimental so as to misdirect this Court on facts and law. All relevant documents filed are referred by the Court. The burden is on the Plaintiff as the appellant in this case, to supply the relevant documents following Order 55 rule 4(1) and rule 5(3) of the ROC 2012. In addition, based on the case of Maranatha Tours & Travel Sdn Bhd v Ampang Specialist Centre Sdn Bhd [1997] MLJU 181 (unreported, 24 March 1997), it is the duty of the appellant to prepare a proper record of appeal. [20] The procedural requirement is a statutory requirement for compliance in its strict sense and therefore is mandatory for parties to adhere to. The Plaintiff did not offer any explanation on the inclusion of the objected documents except to submit that they complied with Order 55 rule 5(3) of the ROC 2012. The counsel for the 3rd and 4th Defendants had made its objection of the documents by indicating on the record to the registrar and for this Court to take the matter into consideration for the purpose of costs and incidental to the documents. [21] This Court also viewed that the non-service of the documents (5th and 6th Defendant’s Defence) to the 3rd and 4th Defendants’ counsel will be prejudicial as to blatantly put them at a disadvantage. The fact that the counsel for the 3rd and 4th Defendants was not served with all the relevant pleadings would mean that he was not fully informed particularly when the this case is heard together with case number BA-12ANCVC-70-08/2016, Plaintiff’s action will be prejudicial against the three Defendants. I agree with the two cases attributed by the counsel for the 1st Defendant. However the case of Owners of the Ship or Vessel Sasacom I (supra) was specifically on rule 18 of the Rules of the Court of Appeal but I do agree that both cases cited relate to compliance issue. [22] Borrowing the words from the case Chuah Tim Lan v RHB Bank Bhd. (supra), by allowing the Plaintiff’s action will be amplifying the Plaintiff’s nonchalance in complying with the ROC 2012. This Court viewed that the Plaintiff’s non-compliance is a breach of the ROC 2012 and the consequences of the breach is serious and is not curable. I dismissed the appeal with cost. Dated: 10 July 2017 (DATIN ZALITA BINTI DATO’ ZAIDAN) Judicial Commissioner Shah Alam High Court SOLICITORS: APPELLANT : JUSTIN CHIN Tetuan Justin Chin Suite E-06-19, Plaza Mont Kiara 2 Jalan Kiara, Mont Kiara 50480 Kuala Lumpur [Ref: 15/1103/KAC/J/JL] Tel : 03-6211 3877 Fax : 03-6201 4877 RESPONDENT : YEE TECK FAH Tetuan Yee Teck Fah & Co. Unit 705, Blok E Pusat Dagangan Phileo Damansara 1 Jalan 16/11, Section 16 46350 Petaling Jaya Selangor Darul Ehsan [Ref: YTF/4297/ESSB/001/G] Tel : 03-7660 9028 Fax : 03-7660 9032 2

Tika 2.6.0

JA-22NCVC-25-02/2017

PLAINTIF Create Fortune Enterprise Sdn Bhd (No. Syarikat: 604170-W) DEFENDAN Pelabuhan Tanjung Pelepas Sdn Bhd

10/07/2017

YA DATO' DR. CHOO KAH SING

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Page 1 of 15 DALAM MAHKAMAH TINGGI MALAYA DI JOHOR BAHRU GUAMAN NO. JA-22NCVC-25-02/2017 Antara Create Fortune Enterprise Sdn. Bhd. (No. Syarikat: 604170-W) Plaintif Dan Pelabuhan Tanjung Pelepas Sdn. Bhd. Defendan DECISION (Enclosure 4) CHOO KAH SING Judicial Commissioner High Court Johor Bahru Date: 10.7.2017 Page 2 of 15 Introduction [1] This is an application (encl. 4) filed by the defendant to stay proceedings pending arbitration pursuant to s.10 of the Arbitration Act 2005 (the Act). On 31.5.2017, this Court allowed the defendant‟s application. The reasons for the decision are set down as below. Background Facts [2] Pursuant to a Project Development Agreement entered into between the plaintiff and defendant, the plaintiff was to develop construct and complete construction of a Facility on a premises which was identified as an area totalling approximately 40.13 acres or approximately 1,748,062.8 square feet at Port Tanjung Pelepas, Johor; and then, the plaintiff was to lease the Facility to the defendant upon completion. [3] Following from the above arrangement, the plaintiff and the defendant entered into an Agreement For Lease dated 11.1.2006 (the impugned lease agreement) for the leasing of the Facility for a term of ten (10) years on the terms and conditions stated therein. In the impugned lease agreement, the plaintiff was the lessor and the defendant was the lessee. The consideration for the lease was stipulated in Clause 2 in the impugned lease agreement as follows: “(1) Pursuant to the Project Development Agreement and in consideration of the Lessor having agreed to construct the Facility at its sole cost and expense on the Demised Premises and the Lessee having agreed Page 3 of 15 to assign the Monthly Rental to the Lenders throughout the duration of the Lease Period in such manner and at such terms and conditions to be determined and agreed by the parties hereto, the parties hereto agree that the Lessee shall pay to the Lessor for this Lease a once-off lease rental calculated at Ringgit Malaysia Ten (RM10.00) only through out the Lease Period.” [4] In the impugned lease agreement, the plaintiff acknowledged that the defendant and one Flextronics Technology (M) Sdn Bhd (hereinafter referred to as „Flextronics‟) had entered into a sub-lease agreement known as „Agreement for Sub-Lease‟ dated 13.7.2005, wherein the defendant desired to sub-lease the Facility to Flextronics for a term of ten (10) years (the “Flextronics Term”). [5] In the impugned lease agreement, Clause 3(2) states as follows: “In the event Flextronics shall exercise its option to extend the sub-lease of the Facility beyond the term of the Agreement for Sub-Lease by one (1) year or more successive contract years (each a “Subsequent Terms(s)”), the Lessee may, by serving written notice to the Lessor no later than two (2) months prior to the expiry of the Flextronics Term, extend the term for a period required by Flextronics and, unless terminated earlier pursuant to Clause 9 or extended by a further Subsequent Term by the Lessee serving written notice to the Lessor prior to the expiry of the relevant Page 4 of 15 Subsequent Term, this Agreement will terminate at the end of the relevant Subsequent Term.” [6] Sometime in September 2015, the defendant served a letter to the plaintiff informing the plaintiff that the defendant intended to extend the impugned lease agreement for another 10 years upon expiry of the impugned lease agreement, i.e. on 30.4.2016. The ten years extension was to commence on 1.5.2016 and end on 30.4.2026. The plaintiff replied to the defendant saying it had no objection to the defendant‟s request subject to further negotiation of the relevant commercial terms, including but not limited to the consideration sum to be mutually agreed upon by the parties for the extended 10 years lease period. [7] The parties met on numerous occasions to discuss the commercial terms for the renewal of the impugned lease agreement before the expiry of the lease on 30.4.2016. The discussion came to a stalemate when the defendant refused to offer any increase of the consideration sum for another 10 years lease. Upon the expiry of the impugned lease agreement on 30.4.2016, the defendant continued to occupy the said premises. As such, the plaintiff took out this civil suit against the defendant. The plaintiff prays for, inter alia, a declaration that the impugned lease agreement had ceased to take effect on 30.4.2016 and that the plaintiff is entitled to claim damages for loss of use and other ancillary reliefs against the defendant. Enclosure 4 [8] The defendant avers that Flextronics had exercised its option to extend the sub-lease of the Facility. Pursuant to Clause 3 of the Page 5 of 15 impugned lease agreement, the defendant may, by serving a written notice to the plaintiff, extend the term of the impugned lease agreement for a period as required by Flextronics. The defendant avers that the extension of the impugned lease agreement ought to be based on the same terms and conditions without any modification of the terms. The plaintiff objected to such averment. [9] The defendant further avers that a dispute has arisen in relation to the impugned lease agreement, therefore, in accordance with Clause 10 of the impugned lease agreement, the parties ought to comply with the said Clause to resolve their differences. [10] Clause 10 of the impugned lease agreement states as follows: “(1) The parties hereto that any matter, dispute or claim (“Dispute”) between the parties hereto arising out of or relating to this Lease shall first be referred to a dispute resolution committee which shall comprise of one representative of each party, each of whom must be authorised to settle the dispute (“Dispute Resolution Committee”). (2) The Dispute Resolution Committee shall endeavour to achieve an amicable settlement of the Dispute and, for this purpose, may conduct discussions in such manner and at such times as it deems fit. Page 6 of 15 (3) The objective of the Dispute Resolution Committee shall be to resolve Disputes promptly with the intent of avoiding litigation. (4) If the Dispute Resolution Committee fails to resolve the Dispute within sixty (60) days from the date on which such Dispute was referred to it, or such other period as may be agreed in writing by the parties hereto, then either party may refer the Dispute for final resolution by arbitration to be held in Kuala Lumpur at the Kuala Lumpur Regional Centre for Commercial Arbitration in accordance with the Arbitration Act 1952 (Revised 1972) or any statutory modification or re- enactment thereof for the time being in force. (5) The number of arbitrators shall be three (3), one (1) each to be nominated by the parties in dispute and the third (3rd) arbitrator shall be appointed by the arbitrators nominated by the parties as aforesaid. English language shall be the language of the arbitration proceedings. (6) The arbitration award shall be final and binding on both parties.” [11] The defendant‟s application is premised on the above Clause 10 for an order of the court to stay this proceeding. The defendant avers that the plaintiff did not comply with Clause 10 to resolve the difference of the rental rate for the extension of the impugned lease agreement. Page 7 of 15 [12] The plaintiff opposes the defendant‟s application. In essence, the plaintiff argues that (i) no dispute has arisen between the parties from the impugned lease agreement because the plaintiff‟s claim is outside the impugned lease agreement, and furthermore, the impugned lease agreement has expired; and (ii) the purported arbitration clause was ambiguous and uncertain, therefore, it is null and void, inoperative or incapable of being performed. [13] The plaintiff‟s counsel submitted that the difference (rental rate) between the parties does not fall within the ambit of a „dispute‟ as envisaged in the arbitration clause. The learned counsel for the plaintiff submitted that the impugned lease agreement did not mention about the consideration for a subsequent lease period, therefore, leaving the issue of consideration at large. The impugned lease agreement had expired on 30.4.2015, the difference over the rental rate concerns the consideration of the subsequent period, i.e. after the 10 years lease. Hence, it is outside the impugned lease agreement. The Findings of this Court [14] The relevant parts of s.10 of the Act states as follows: (1) A court before which proceedings are brought in respect of a matter which is the subject of an arbitration agreement shall, where a party makes an application before taking any other steps in the proceedings, stay those proceedings and refer the parties to arbitration unless it finds that the Page 8 of 15 agreement is null and void, inoperative or incapable of being performed; (2) The court, in granting a stay of proceedings pursuant to subsection (1), may impose any conditions as it deems fit. (2A)…. (2B)…. (2C)…. (3) Where the proceedings referred to in subsection (1) have been brought, arbitral proceedings may be commenced or continued, and an award may be made, while the issue is pending before the court. (4) …. [15] In Press Metal Sarawak Sdn. Bhd. v Etiqa Takaful Bhd [2016] 9 CLJ 1, the apex court has lucidly laid down the principles for the application of s.10(1) of the Act. The Federal Court held at p. 17 as follows: “[32] The clear effect of the present s.10(1) of the 2005 Act is to render a stay mandatory if the court finds that all the relevant requirements have been fulfilled; while under s.6 of the repealed 1952 Act, the court had a discretion whether to order a stay or otherwise. [33] What the court needs to consider in determining whether to grant a stay order under the Page 9 of 15 present s.10(1) (after the 2011 Amendment) is whether there is in existence a binding arbitration agreement or clause between the parties, which agreement is not null and void, in operative or incapable of being performed. The court is no longer required to delve into the details of the dispute or difference. (see TNB Fuel Services Sdn Bhd (supra)). In fact the question as to whether there is a dispute in existence or not is no longer a requirement to be considered in granting a stay under s.10(1). It is an issue to be decided by the arbitral tribunal.” [16] What constitute a binding arbitration agreement or clause is explained and defined in s. 9 of the Act which states as follows: (1) In this Act, "arbitration agreement" means an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not. (2) An arbitration agreement may be in the form of an arbitration clause in an agreement or in the form of a separate agreement. (3) An arbitration agreement shall be in writing. (4) An arbitration agreement is in writing where it is contained- javascript:DispDef=window.open('/Members/DisplayActDefinitions.aspx?TermDef=arbitration%20agreement%20&SearchId=','_DisplayDef','');DispDef.focus(); Page 10 of 15 (a) a document signed by the parties; (b) an exchange of letters, telex, facsimile or other means of communication which provide a record of the agreement; or (c) an exchange of statement of claim and defence in which the existence of an agreement is alleged by one party and not denied by the other. (5) A reference in an agreement to a document containing an arbitration clause shall constitute an arbitration agreement, provided that the agreement is in writing and the reference is such as to make that clause part of the agreement. [17] In this instant case, Clause 10 clearly satisfied the definition of an arbitration agreement. Clause 10 is part of the impugned lease agreement which is in writing and is signed by both parties. The critical issue is, as submitted by the plaintiff‟s counsel, whether the difference/dispute which have arisen is arising out of or in relation to the impugned lease agreement. [18] This Court is of the considered view that the parties‟ differences in relation to the rental rate for the extension period of the lease of the Facility has sprung from Clause 3 of the impugned lease agreement. Clearly, the „dispute‟ as to how much is the consideration for the extension period is a matter arising out of the impugned lease agreement. Page 11 of 15 [19] The fact that the impugned lease agreement is silent on the rental rate for the extension period of the lease, this itself could not sustain the argument that the „dispute‟ is outside the ambit of the impugned lease agreement. When an issue in hand is not specifically provided in an impugned document that does not necessarily mean the issue is outside the ambit of the impugned document. As long as the issue in hand arises out of the impugned document, such an issue is within the domain of the impugned document. It necessarily follows that the difference between the parties does fall within the scope of the arbitration clause of the impugned lease agreement. [20] Clause 3(2) of the impugned lease agreement has envisaged the situation in the event the sub-lessee intends to extend the sub-lease, the defendant may serve a notice in writing to the plaintiff for the extension of the lease. The question is whether the plaintiff could or could not request for a consideration for the extension of the lease would be a question to be determined by the mechanism which the parties have elected to submit to. The mechanism to resolve the parties‟ dispute has been provided for in Clause 10 of the impugned lease agreement. [21] The next consideration is whether the arbitration clause could be null and void, inoperative or incapable of being performed? The plaintiff‟s counsel submits that Clause 10 is ambiguous and uncertain because it did not clearly state that the parties have agreed to the mechanism of resolving the dispute. Page 12 of 15 [22] The plaintiff‟s counsel submitted that Clause 10 begins as follows: “(1) The parties hereto that any matter, dispute or claim („Dispute‟)….” [23] The word „agree‟ is missing after the word „hereto‟ in the sentence. The plaintiff‟s counsel submits that the sentence appears to be incomplete and hanging. He further submits as follows: “It cannot be said for certain that the parties have either agree or disagree to refer disputes relating to the Agreement for Lease to the dispute resolution mechanism (“DRM”) as evinced under the arbitration clause. Clause 10 is tainted with ambiguity.” [24] This Court is of the considered view that the submission advanced by the learned counsel for the plaintiff is rather misconceived. The agreement was entered on 11.1.2006, and after 10 years later, the plaintiff argues that it is not sure whether it has agreed or it has not agreed to the dispute resolution mechanism. The plaintiff had sat on Clause 10 for 10 years, and now the plaintiff is not so sure whether it has agreed to the contents. This argument seems incoherent with the plaintiff‟s past action, or rather inaction. This argument is clearly an afterthought when the negotiation between the parties have reached a deadlock. [25] The impugned lease agreement was drafted by a firm of solicitors, and the contents in Clause 10 are comprehensive, and it has detailed the two stage dispute resolution process to resolve the parties‟ differences Page 13 of 15 with clarity. The only noticeable clanger is the missing word „agree‟ in the first sentence. However, the intention of the parties in that they have intended to submit to a dispute resolution mechanism could be inferred from the reading of the contents of Clause 10 in which was drafted with such breadth. It is the considered view of this Court that the parties clearly have intended to abide by and agreed with the contents of Clause 10, notwithstanding the word „agree‟ was missing in the first sentence. [26] It is also the considered view of this Court that the contents in Clause 10 is not ambiguous or uncertain, the dispute resolution mechanism has been clearly spelled out. The intention of the parties to submit to the dispute resolution mechanism could not be undermined merely because a word is missing in the first sentence. Hence, the impugned lease agreement and Clause 10 could not be said as null and void, inoperative or incapable of being performed. [27] This Court has scrutinized Clause 10 of the impugned lease agreement and found that Clause 10 is indeed a valid and binding arbitration agreement that has fulfilled all the requirements stated in s.9 of the Act. [28] This Court is of the considered view that the difference between the parties does fall within the scope of Clause 10 of the impugned lease agreement which has been explicated earlier. [29] Having said that, this Court observed that the plaintiff‟s claim essentially premised on the facts that the defendant refuses to offer the consideration sum as requested by plaintiff and also refuses to surrender vacant possession of the Facility back to the plaintiff, as such, the Page 14 of 15 plaintiff seeks, inter alia, for a declaration that the impugned lease agreement has ended on 30.4.2016 and also damages. [30] This Court is of the considered view that the remedies the plaintiff is seeking in the court proceeding are remedies stemming from the difference / dispute of the parties. As such, it is also the considered view of this Court that the claims made in this proceeding are within the scope of the arbitration clause and the remedies sought are within the powers of an arbitral tribunal, and the plaintiff‟s claim could be fully determined and disposed by the appropriate arbitrator(s) in an arbitration proceeding (see paras 94-101 of the judgment of Press Metal Sarawak Sdn. Bhd. (supra)). [31] This Court observes that there is no time frame stipulated in the impugned lease agreement for a party to refer the difference/dispute to a dispute resolution committee. As such, it is not too late for either party to exercise its right to invoke Clause 10 of the impugned lease agreement. [32] The counsel for the defendant has indicated to this Court that the defendant is ready and willing to resolve the difference/dispute through the means of arbitration proceedings. However, the counsel for the plaintiff was not keen with the idea, because he orally submitted that the impugned lease agreement had ceased to have effect upon the expiry date, i.e. 30.4.2016, therefore, any consequent action based on Clause 10 shall cease to have effect, including any appointment of arbitrators at a later stage. [33] This Court is of the considered view that any jurisdictional issue and the validity of the appointment of arbitrators could be raised in the Page 15 of 15 arbitration proceedings and could be determined by the arbitrators. In the event, any party not satisfied with the decision(s) or ruling(s) of the arbitrators, such party could always come back to the court. Conclusion [34] For the reasons discussed above, this Court allowed the defendant‟s application and ordered costs of RM2,000.00 to be paid to the defendant by the plaintiff. -Signed- …………………………………….. (CHOO KAH SING) Judicial Commissioner High Court, Johor Bahru Plaintiff‟s Counsel : Syed Faisal B. Syed Abdullah Messrs. Syed Faisal & Company Defendant‟s Counsel : Lambert Rasa Ratnam Messrs. Lee Hishammuddin Allen & Gledhil

Tika 2.6.0

BA-12ANCVC-70-08/2016

PERAYU KONG AH CHOO RESPONDEN EASY SUN SDN BHD (NO. SYARIKAT: 459820-A)

10/07/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=896f32df-c178-4372-a565-18935eec5fb4&Inline=true

DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA RAYUAN SIVIL NO: BA-12ANCVC-70-08/2016 ANTARA KONG AH CHOO ….. PERAYU DAN EASY SUN SDN BHD (NO. SYARIKAT: 459820-A) ….. RESPONDEN (DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN GUAMAN SIVIL NO: B52NCVC-155-07/2015 ANTARA KONG AH CHOO ….. PLAINTIF DAN 1. EASY SUN SDN BHD (NO. SYARIKAT: 459820-A) 2. EUROCERAMIC TECHNOLOGIES COMPANY LIMITED (NO. SYARIKAT: 0905544001121) 3. DATO’ KAMAL Y.P.TAN 4. MICHAEL GUNALAN BENEDICT 5. LAW SEE HAW 6. EDWARD MOSSES JULIUS JOSEPHATH ….. DEFENDAN- DEFENDAN) GROUND OF JUDGMENT Introduction [1] This is an appeal by the Appellant who is the Plaintiff against the decision of the Sessions Court which allowed the Respondent, the 1st Defendant’s application, to strike out the Appellant’s Writ and Statement of Claim on 1.8.2016. [2] This matter was heard together with the case number BA-12ANCVC-71-08/2016 as they involved the same litigants pertaining to one Sale and Purchase of Shares Agreement. [3] At the hearing of the appeal, the counsel for the 1st Defendant who is also representing the 2nd Defendant, 3rd Defendant and the 4th Defendant (1st – 4th Defendants) raised a preliminary objection against the appeal. The terms 1st Defendant and 1st – 4th Defendants may be used interchangeably. [4] For ease of reference, in this judgment, the parties will be referred to as they were in the Sessions Court. Factual Background [5] The Plaintiff brought a suit against six Defendants at the Sessions Court where the Plaintiff filed a Writ of 24.7.2015 and Statement of Claim of 27.11.2015. [6] Based on the Plaintiff’s Statement of Claim, the Plaintiff was a production manager and was working for a leading German ceramic formers manufacturing company since 1993. The 4th Defendant had introduced the Plaintiff to one Robin Ong who was interested to set up a ceramic formers plant in Thailand for his own use and to supply other glove making factories. [7] The Plaintiff claimed that he had invested RM100,000.00 to set up the 2nd Defendant, Euroceramic Technologies Company Limited with other individuals based in Sadao, Thailand, to produce ceramic formers for examination, surgical and household use. The Plaintiff was designated as the manufacturing director and was given shares in the 2nd Defendant together with the 5th and 6th Defendants although the two did not invest any monies and the Plaintiff together with the 4th, 5th and 6th Defendants were tasked to run the factory. [8] In September 2006, the 3rd Defendant took over the majority shareholder of the 2nd Defendant. In April 2008, the 4th Defendant took up the job offer to join a European multinational company. The Plaintiff claimed that the 3rd and 4th Defendants negotiated a deal to sell all the shares in the 2nd Defendant to ES Ceramics Technology Berhad which the Plaintiff claimed that he did not take part. [9] Pursuant to a Share Sale Agreement dated 13.6.2008 (“Share Sale Agreement”), the Plaintiff together with the 3rd, 4th, 5th and 6th Defendants agreed to sell their shares in the 2nd Defendant to ES Ceramics Technology Bhd. The Plaintiff claimed that unlike for the other shareholders, there was a term in Clause 11.1(a) of the Agreement for the other vendors to procure the Plaintiff to enter into a service agreement with the 2nd Defendant for the period of 3 years which will be renewable for a further period, an option for renewal exercisable by the 2nd Defendant. [10] The Plaintiff claimed that he was assured that he would enjoy the same terms and conditions on salary and allowances as previously received. The Plaintiff was paid the agreed sum of RM4,000.00 and in Thai Bhat the salary of THB 100,000.00 per month respectively from July 2008 to December 2008. [11] One Wong Fook Lin, the Chief Executive Officer of ES Ceramics Technology Bhd had forwarded a draft copy of the proposed service agreement to the Plaintiff and this was apparently the only service agreement. It was found that the terms were not the same as previously agreed between Wong Fook Lin and the Plaintiff including the unilateral reduction of the Plaintiff’s salary from THB 100,000.00 to THB 71,000.00 and the Plaintiff refused to sign the service agreement and continued working with the 1st and 2nd Defendant. [12] The Plaintiff claimed that as Wong Fook Lin did not revert on a revised service agreement, the Plaintiff sent a letter dated 1.6.2009 to him sometime in June 2009 to assert the terms based on what had been agreed as claimed by the Plaintiff. [13] The Plaintiff claimed that he was forced to resign from the 1st and 2nd Defendants. He claimed that he was coerced into signing the Termination Letter of 27.7.2009 and an agreement following termination and argued that he has a reasonable cause of action against the 1st Defendant and 2nd Defendant for breach of his employment terms. [14] At the Sessions Court, the 1st Defendant, Easy Sun Sdn Bhd had applied for a striking out of the Plaintiff’s Writ and Statement of Claim under Order 18 r.19(1)(a), (b) and (c) of the Rules of Court 2012. [15] The 1st Defendant’s ground of application were as follows: (a) there is no reasonable cause of action against the Respondents; (b) the Plaintiff’s action is frivolous and vexatious; (c) the Plaintiff’s action is an abuse of the process of court; and (d) alternatively, the Plaintiff’s cause of action against the Defendants is time barred following section 6 of the Limitation Act 1953. [16] The Sessions Court allowed the 1st Defendant’s application on 1.8.2016 to strike out Plaintiff’s Writ and Statement of Claim on the following grounds: (a) The Plaintiff’s cause of action against the Defendant was barred by limitation pursuant to Section 6 of the Limitation Act 1953; (b) The Plaintiff did not enter into any contract of employment with the Respondent nor work at any office or factory of the Respondent. The Plaintiff had admitted that the Plaintiff was an employee of the 2nd Defendant. Therefore there was no contract of employment existed between the Appellant and the Respondent; and (c) The Plaintiff has no reasonable cause of action against the Defendant, the Plaintiff’s action as frivolous and vexatious and was an abuse of the process of Court. [17] The Plaintiff appealed to this Court on the Sessions Court’s decision in allowing the striking out application by the 1st Defendant. [18] At the hearing of the appeal, the 1st Defendant’s counsel representing 1st – 4th Defendants raised a preliminary objection against the appeal. The objection is that the Plaintiff failed to follow Order 55 rule 5 of the Rules of Court 2012 (ROC 2012) without taking into consideration the 1st Defendant’s counsel’s objections to the inclusion of the 5th and 6th Defendants’ Defence into the Record of Appeal. 1st Defendant’s Submission [19] The learned counsel for the 1st Defendant objected to the pleadings of 6th and 7th Defendant as they were never served on the counsel representing the 1st – 4th Defendants. It was argued that it will be in breach of Order 55 rule 5(3) of the ROC 2012 and the Plaintiff failed and/or neglected to refer the 1st Defendant’s objection to the registrar of the High Court for determination whether the objected documents should be excluded from the Record of Appeal. [20] The counsel for the 1st Defendant submitted that the wording “all pleadings filed” under Order 55 rule 5(3)(b) ROC 2012 would mean those pleadings filed for Plaintiff and 1st Defendant’s case. In addition, the counsel for the 1st Defendant also argued that by filing 6th and 7th Defendant’s Defence is an attempt by the Plaintiff to file in fresh evidence without the leave of this Court. [21] The counsel submitted that by filing a Record of Appeal not in accordance with the court procedure, will not be a proper appeal record and relied on two cases: Chuah Tim Lan v. RHB Bank Bhd & Anor [2008] 6 MLJ 793 and Owners of the Ship or Vessel Sasacom I v. Bank Pembangunan Malaysia Bhd [2015] 4 MLJ 841. Plaintiff’s Submission [22] The counsel for the Plaintiff submitted that they are in compliance with Order 55 rule 5(3) ROC 2012. The counsel submitted that the preliminary objection was raised simply because there was an application to set aside the writ and argued that the 1st Defendant’s counsel also did the same by putting all the pleadings in the Additional Appeal Record before this Court. [23] The counsel for the Plaintiff further argued that although the 1st Defendant’s counsel asking for this Court that the 6th and 7th Defendants’ Defence to be excluded, there was however no preliminary objection notice made to the Court. 1st Defendant’s Submission In Reply [24] The counsel for the 1st Defendant submitted that based on the minutes of the meeting dated 19.9.2015 with the Senior Assistant Registrar of the High Court (Civil), they were advised to raise the preliminary objection before this Court and the contention that no prior notice given is untrue. [25] The counsel for the 1st Defendant prayed for the dismissal of the appeal. THE COURT’S FINDING [26] The Court had the benefit of hearing both counsels on the preliminary objections raised. Before I go to the merits of the appeal, I shall depose the preliminary objection first. If the preliminary objection is upheld, then there is no need to consider the merits of the appeal. [27] As to the preliminary objection, the 1st Defendant’s counsel submitted that the non-compliance of Order 55 rule 5(3) of the ROC 2012 in the preparation of the appeal record is fatal and cited two cases, Chuah Tim Lan v. RHB Bank Bhd & Anor [2008] 6 MLJ 793 and Owners of the Ship or Vessel Sasacom I v. Bank Pembangunan Malaysia Bhd [2015] 4 MLJ 841. [28] For this purpose, Order 55 rule 5(3) of the ROC 2012 is referred which stated that, “(3) Within one month after the filing of the notice of appeal under this rule, the appellant shall file the record of appeal in the High Court, and the record shall contain copies of— (a) the application for the decision; (b) all pleadings filed; (c) all affidavits filed in support or in opposition to the application; and (d) the order or draft order of the decision appealed from: Provided that the record of appeal shall not include the notes of evidence, the grounds of judgment or any memorandum of appeal.” The Defendant’s counsel contention was the inclusion of the 5th and 6th Defendant’s Defence that were not served on the 1st Defendant’s counsel for this appeal. [29] I am of the view that in relation to an appeal after trial involving documents that is to be included or excluded from the record of appeal, Order 55 of the ROC 2012 must be read in whole as it embodies all the rules of appeals to the High Court from the subordinate courts. Pertinent to the objection raised, we look at rule 4 before we approach rule 5. Order 55 rule 4(1) of the ROC 2012 clearly stated that, “4(1) In the case of an appeal from a decision after trial, the appellant shall within one month from the date of filing of notice of appeal prepare and file the requisite number of copies of the record of appeal and the record shall contain copies of— (a) the relevant pleadings; (b) the notes of evidence, including witness statements, if available, recorded wholly or partly by mechanical means; (c) the grounds of judgment, if available; (d) the memorandum of appeal; (e) the decision, order or judgment; (f) a duplicate copy of the notice of appeal; (g) a duplicate copy of the notice of cross appeal, if any; (h) all such documentary exhibits and other documents the parties shall consider relevant for the purposes of the appeal: Provided that the record of appeal shall be filed notwithstanding that the notes of evidence and/or grounds of judgment are not ready or that the sealed decision, order or judgment has not been extracted.” [30] The objection raised is the inclusion of the 5th and 6th Defendant’s Defence and that they were not served on the 1st Defendant’s counsel. This Court is of the view that the primary issue is whether by allowing the documents not relevant to the appeal in the appeal record will be contrary to the procedural requirement of the ROC 2012. There is also an issue of whether it will be prejudicial to the 1st Defendant’s case. [31] In reference to part (a) of rule 4(1) above, the set of documents referred to are, “the relevant pleadings” which this Court is of the view that it would mean the pleadings that is relevant to the decision that is appealed against in its literal meaning. This is consistent with part (h) of rule 4(1) which refers to the documents or exhibits that are relevant for the purposes of the appeal. [32] This explain the wordings used in rule 4(1) that is “the relevant pleadings” as opposed to “all pleadings filed” under Order 55 rule 5(3) of the ROC 2012. The steps governing the procedural requirement can be found in the ROC 2012 Annotation, Volume 2, 2012 where a draft index of the documents must be included in the record of appeal and sent by the appellant’s solicitors to the solicitors for the respondent. It explained that the solicitors for the respondent may object to the inclusion or exclusion of any document. The parties are allowed if there is no agreement reached, to the inclusion or exclusion of any of the documents and they may refer the matter to the registrar of the High Court. It also explained that if no agreement can be reached with regards the documents to be included in the record of appeal, the registrar may require parties to appear before the Judge under Order 55 rule 5(5) which the 1st Defendant’s counsel had rightly objected before this Court. [33] Reverting to the facts, the striking out application was made by the 1st Defendant’s counsel, representing the 1st – 4th Defendants, on the Plaintiff’s Writ and Statement of Claim. The striking application was allowed by the Sessions Court after the trial. The Plaintiff appealed against the whole of the Sessions Court’s decision on the striking out application between the 1st Defendant and the Plaintiff. This is not a matter where failure to include documents listed that is crucial to an appeal as decided in the case of Koh Teck Yew v Kok Ying Huat [1997] MLJU 351 (unreported, 29 September 1997) which resulted the appeal being dismissed. This is a matter for the Court to decide whether the irrelevant or as the counsel for the 1st Defendant puts it, objected documents, should be included in the appeal record before this Court. [34] This Court is of the view that there is merits to the preliminary objection. In appeal hearing, this Court may exercise its powers and duties as necessary to do justice in the case. The Court must exercise its discretion to ensure procedural requirements as provided in the ROC 2012 are adhered to as the consequential effect would be detrimental so as to misdirect this Court on facts and law. All relevant documents filed are referred by the Court. The burden is on the Plaintiff as the appellant in this case, to supply the relevant documents following Order 55 rule 4(1) and rule 5(3) of the ROC 2012. In addition, based on the case of Maranatha Tours & Travel Sdn Bhd v Ampang Specialist Centre Sdn Bhd [1997] MLJU 181 (unreported, 24 March 1997), it is the duty of the appellant to prepare a proper record of appeal. [35] The procedural requirement is a statutory requirement for compliance in its strict sense and therefore is mandatory for parties to adhere to. The Plaintiff did not offer any explanation on the inclusion of the objected documents except to submit that they complied with Order 55 rule 5(3) of the ROC 2012. The counsel for the 1st Defendant had made its objection of the documents by indicating on the record to the registrar and for this Court to take the matter into consideration for the purpose of costs and incidental to the documents. [36] This Court also viewed that the non-service of the documents (5th and 6th Defendant’s Defence) to the 1st Defendant’s counsel will be prejudicial to the 1st Defendant as to blatantly put him at a disadvantage. The fact that the 1st counsel for the Defendant was not served with all the relevant pleadings would mean that he was not fully informed. I agree with the two cases attributed by the counsel for the 1st Defendant. However the case of Owners of the Ship or Vessel SasacomI (supra) was specifically on rule 18 of the Rules of the Court of Appeal but I do agree that both cases cited relate to compliance issue. [37] Borrowing the words from the case Chuah Tim Lan v RHB Bank Bhd. (supra), by allowing the Plaintiff’s action will be amplifying the Plaintiff’s nonchalance in complying with the ROC 2012. This Court viewed that the Plaintiff’s non-compliance is a breach of the ROC 2012 and the consequences of the breach is serious and is not curable. I dismissed the appeal with cost. Dated: 10 July 2017 (DATIN ZALITA BINTI DATO’ ZAIDAN) Judicial Commissioner Shah Alam High Court SOLICITORS: APPELLANT : JUSTIN CHIN Tetuan Justin Chin Suite E-06-19, Plaza Mont Kiara 2 Jalan Kiara, Mont Kiara 50480 Kuala Lumpur [Ref: 15/1103/KAC/J/JL] Tel : 03-6211 3877 Fax : 03-6201 4877 RESPONDENT : YEE TECK FAH Tetuan Yee Teck Fah & Co. Unit 705, Blok E Pusat Dagangan Phileo Damansara 1 Jalan 16/11, Section 16 46350 Petaling Jaya Selangor Darul Ehsan [Ref: YTF/4297/ESSB/001/G] Tel : 03-7660 9028 Fax : 03-7660 9032 5

Tika 2.6.0

BA-12ANCVC-70-08/2016

PERAYU KONG AH CHOO RESPONDEN EASY SUN SDN BHD (NO. SYARIKAT: 459820-A)

10/07/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=896f32df-c178-4372-a565-18935eec5fb4&Inline=true

DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA RAYUAN SIVIL NO: BA-12ANCVC-70-08/2016 ANTARA KONG AH CHOO ….. PERAYU DAN EASY SUN SDN BHD (NO. SYARIKAT: 459820-A) ….. RESPONDEN (DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN GUAMAN SIVIL NO: B52NCVC-155-07/2015 ANTARA KONG AH CHOO ….. PLAINTIF DAN 1. EASY SUN SDN BHD (NO. SYARIKAT: 459820-A) 2. EUROCERAMIC TECHNOLOGIES COMPANY LIMITED (NO. SYARIKAT: 0905544001121) 3. DATO’ KAMAL Y.P.TAN 4. MICHAEL GUNALAN BENEDICT 5. LAW SEE HAW 6. EDWARD MOSSES JULIUS JOSEPHATH ….. DEFENDAN- DEFENDAN) GROUND OF JUDGMENT Introduction [1] This is an appeal by the Appellant who is the Plaintiff against the decision of the Sessions Court which allowed the Respondent, the 1st Defendant’s application, to strike out the Appellant’s Writ and Statement of Claim on 1.8.2016. [2] This matter was heard together with the case number BA-12ANCVC-71-08/2016 as they involved the same litigants pertaining to one Sale and Purchase of Shares Agreement. [3] At the hearing of the appeal, the counsel for the 1st Defendant who is also representing the 2nd Defendant, 3rd Defendant and the 4th Defendant (1st – 4th Defendants) raised a preliminary objection against the appeal. The terms 1st Defendant and 1st – 4th Defendants may be used interchangeably. [4] For ease of reference, in this judgment, the parties will be referred to as they were in the Sessions Court. Factual Background [5] The Plaintiff brought a suit against six Defendants at the Sessions Court where the Plaintiff filed a Writ of 24.7.2015 and Statement of Claim of 27.11.2015. [6] Based on the Plaintiff’s Statement of Claim, the Plaintiff was a production manager and was working for a leading German ceramic formers manufacturing company since 1993. The 4th Defendant had introduced the Plaintiff to one Robin Ong who was interested to set up a ceramic formers plant in Thailand for his own use and to supply other glove making factories. [7] The Plaintiff claimed that he had invested RM100,000.00 to set up the 2nd Defendant, Euroceramic Technologies Company Limited with other individuals based in Sadao, Thailand, to produce ceramic formers for examination, surgical and household use. The Plaintiff was designated as the manufacturing director and was given shares in the 2nd Defendant together with the 5th and 6th Defendants although the two did not invest any monies and the Plaintiff together with the 4th, 5th and 6th Defendants were tasked to run the factory. [8] In September 2006, the 3rd Defendant took over the majority shareholder of the 2nd Defendant. In April 2008, the 4th Defendant took up the job offer to join a European multinational company. The Plaintiff claimed that the 3rd and 4th Defendants negotiated a deal to sell all the shares in the 2nd Defendant to ES Ceramics Technology Berhad which the Plaintiff claimed that he did not take part. [9] Pursuant to a Share Sale Agreement dated 13.6.2008 (“Share Sale Agreement”), the Plaintiff together with the 3rd, 4th, 5th and 6th Defendants agreed to sell their shares in the 2nd Defendant to ES Ceramics Technology Bhd. The Plaintiff claimed that unlike for the other shareholders, there was a term in Clause 11.1(a) of the Agreement for the other vendors to procure the Plaintiff to enter into a service agreement with the 2nd Defendant for the period of 3 years which will be renewable for a further period, an option for renewal exercisable by the 2nd Defendant. [10] The Plaintiff claimed that he was assured that he would enjoy the same terms and conditions on salary and allowances as previously received. The Plaintiff was paid the agreed sum of RM4,000.00 and in Thai Bhat the salary of THB 100,000.00 per month respectively from July 2008 to December 2008. [11] One Wong Fook Lin, the Chief Executive Officer of ES Ceramics Technology Bhd had forwarded a draft copy of the proposed service agreement to the Plaintiff and this was apparently the only service agreement. It was found that the terms were not the same as previously agreed between Wong Fook Lin and the Plaintiff including the unilateral reduction of the Plaintiff’s salary from THB 100,000.00 to THB 71,000.00 and the Plaintiff refused to sign the service agreement and continued working with the 1st and 2nd Defendant. [12] The Plaintiff claimed that as Wong Fook Lin did not revert on a revised service agreement, the Plaintiff sent a letter dated 1.6.2009 to him sometime in June 2009 to assert the terms based on what had been agreed as claimed by the Plaintiff. [13] The Plaintiff claimed that he was forced to resign from the 1st and 2nd Defendants. He claimed that he was coerced into signing the Termination Letter of 27.7.2009 and an agreement following termination and argued that he has a reasonable cause of action against the 1st Defendant and 2nd Defendant for breach of his employment terms. [14] At the Sessions Court, the 1st Defendant, Easy Sun Sdn Bhd had applied for a striking out of the Plaintiff’s Writ and Statement of Claim under Order 18 r.19(1)(a), (b) and (c) of the Rules of Court 2012. [15] The 1st Defendant’s ground of application were as follows: (a) there is no reasonable cause of action against the Respondents; (b) the Plaintiff’s action is frivolous and vexatious; (c) the Plaintiff’s action is an abuse of the process of court; and (d) alternatively, the Plaintiff’s cause of action against the Defendants is time barred following section 6 of the Limitation Act 1953. [16] The Sessions Court allowed the 1st Defendant’s application on 1.8.2016 to strike out Plaintiff’s Writ and Statement of Claim on the following grounds: (a) The Plaintiff’s cause of action against the Defendant was barred by limitation pursuant to Section 6 of the Limitation Act 1953; (b) The Plaintiff did not enter into any contract of employment with the Respondent nor work at any office or factory of the Respondent. The Plaintiff had admitted that the Plaintiff was an employee of the 2nd Defendant. Therefore there was no contract of employment existed between the Appellant and the Respondent; and (c) The Plaintiff has no reasonable cause of action against the Defendant, the Plaintiff’s action as frivolous and vexatious and was an abuse of the process of Court. [17] The Plaintiff appealed to this Court on the Sessions Court’s decision in allowing the striking out application by the 1st Defendant. [18] At the hearing of the appeal, the 1st Defendant’s counsel representing 1st – 4th Defendants raised a preliminary objection against the appeal. The objection is that the Plaintiff failed to follow Order 55 rule 5 of the Rules of Court 2012 (ROC 2012) without taking into consideration the 1st Defendant’s counsel’s objections to the inclusion of the 5th and 6th Defendants’ Defence into the Record of Appeal. 1st Defendant’s Submission [19] The learned counsel for the 1st Defendant objected to the pleadings of 6th and 7th Defendant as they were never served on the counsel representing the 1st – 4th Defendants. It was argued that it will be in breach of Order 55 rule 5(3) of the ROC 2012 and the Plaintiff failed and/or neglected to refer the 1st Defendant’s objection to the registrar of the High Court for determination whether the objected documents should be excluded from the Record of Appeal. [20] The counsel for the 1st Defendant submitted that the wording “all pleadings filed” under Order 55 rule 5(3)(b) ROC 2012 would mean those pleadings filed for Plaintiff and 1st Defendant’s case. In addition, the counsel for the 1st Defendant also argued that by filing 6th and 7th Defendant’s Defence is an attempt by the Plaintiff to file in fresh evidence without the leave of this Court. [21] The counsel submitted that by filing a Record of Appeal not in accordance with the court procedure, will not be a proper appeal record and relied on two cases: Chuah Tim Lan v. RHB Bank Bhd & Anor [2008] 6 MLJ 793 and Owners of the Ship or Vessel Sasacom I v. Bank Pembangunan Malaysia Bhd [2015] 4 MLJ 841. Plaintiff’s Submission [22] The counsel for the Plaintiff submitted that they are in compliance with Order 55 rule 5(3) ROC 2012. The counsel submitted that the preliminary objection was raised simply because there was an application to set aside the writ and argued that the 1st Defendant’s counsel also did the same by putting all the pleadings in the Additional Appeal Record before this Court. [23] The counsel for the Plaintiff further argued that although the 1st Defendant’s counsel asking for this Court that the 6th and 7th Defendants’ Defence to be excluded, there was however no preliminary objection notice made to the Court. 1st Defendant’s Submission In Reply [24] The counsel for the 1st Defendant submitted that based on the minutes of the meeting dated 19.9.2015 with the Senior Assistant Registrar of the High Court (Civil), they were advised to raise the preliminary objection before this Court and the contention that no prior notice given is untrue. [25] The counsel for the 1st Defendant prayed for the dismissal of the appeal. THE COURT’S FINDING [26] The Court had the benefit of hearing both counsels on the preliminary objections raised. Before I go to the merits of the appeal, I shall depose the preliminary objection first. If the preliminary objection is upheld, then there is no need to consider the merits of the appeal. [27] As to the preliminary objection, the 1st Defendant’s counsel submitted that the non-compliance of Order 55 rule 5(3) of the ROC 2012 in the preparation of the appeal record is fatal and cited two cases, Chuah Tim Lan v. RHB Bank Bhd & Anor [2008] 6 MLJ 793 and Owners of the Ship or Vessel Sasacom I v. Bank Pembangunan Malaysia Bhd [2015] 4 MLJ 841. [28] For this purpose, Order 55 rule 5(3) of the ROC 2012 is referred which stated that, “(3) Within one month after the filing of the notice of appeal under this rule, the appellant shall file the record of appeal in the High Court, and the record shall contain copies of— (a) the application for the decision; (b) all pleadings filed; (c) all affidavits filed in support or in opposition to the application; and (d) the order or draft order of the decision appealed from: Provided that the record of appeal shall not include the notes of evidence, the grounds of judgment or any memorandum of appeal.” The Defendant’s counsel contention was the inclusion of the 5th and 6th Defendant’s Defence that were not served on the 1st Defendant’s counsel for this appeal. [29] I am of the view that in relation to an appeal after trial involving documents that is to be included or excluded from the record of appeal, Order 55 of the ROC 2012 must be read in whole as it embodies all the rules of appeals to the High Court from the subordinate courts. Pertinent to the objection raised, we look at rule 4 before we approach rule 5. Order 55 rule 4(1) of the ROC 2012 clearly stated that, “4(1) In the case of an appeal from a decision after trial, the appellant shall within one month from the date of filing of notice of appeal prepare and file the requisite number of copies of the record of appeal and the record shall contain copies of— (a) the relevant pleadings; (b) the notes of evidence, including witness statements, if available, recorded wholly or partly by mechanical means; (c) the grounds of judgment, if available; (d) the memorandum of appeal; (e) the decision, order or judgment; (f) a duplicate copy of the notice of appeal; (g) a duplicate copy of the notice of cross appeal, if any; (h) all such documentary exhibits and other documents the parties shall consider relevant for the purposes of the appeal: Provided that the record of appeal shall be filed notwithstanding that the notes of evidence and/or grounds of judgment are not ready or that the sealed decision, order or judgment has not been extracted.” [30] The objection raised is the inclusion of the 5th and 6th Defendant’s Defence and that they were not served on the 1st Defendant’s counsel. This Court is of the view that the primary issue is whether by allowing the documents not relevant to the appeal in the appeal record will be contrary to the procedural requirement of the ROC 2012. There is also an issue of whether it will be prejudicial to the 1st Defendant’s case. [31] In reference to part (a) of rule 4(1) above, the set of documents referred to are, “the relevant pleadings” which this Court is of the view that it would mean the pleadings that is relevant to the decision that is appealed against in its literal meaning. This is consistent with part (h) of rule 4(1) which refers to the documents or exhibits that are relevant for the purposes of the appeal. [32] This explain the wordings used in rule 4(1) that is “the relevant pleadings” as opposed to “all pleadings filed” under Order 55 rule 5(3) of the ROC 2012. The steps governing the procedural requirement can be found in the ROC 2012 Annotation, Volume 2, 2012 where a draft index of the documents must be included in the record of appeal and sent by the appellant’s solicitors to the solicitors for the respondent. It explained that the solicitors for the respondent may object to the inclusion or exclusion of any document. The parties are allowed if there is no agreement reached, to the inclusion or exclusion of any of the documents and they may refer the matter to the registrar of the High Court. It also explained that if no agreement can be reached with regards the documents to be included in the record of appeal, the registrar may require parties to appear before the Judge under Order 55 rule 5(5) which the 1st Defendant’s counsel had rightly objected before this Court. [33] Reverting to the facts, the striking out application was made by the 1st Defendant’s counsel, representing the 1st – 4th Defendants, on the Plaintiff’s Writ and Statement of Claim. The striking application was allowed by the Sessions Court after the trial. The Plaintiff appealed against the whole of the Sessions Court’s decision on the striking out application between the 1st Defendant and the Plaintiff. This is not a matter where failure to include documents listed that is crucial to an appeal as decided in the case of Koh Teck Yew v Kok Ying Huat [1997] MLJU 351 (unreported, 29 September 1997) which resulted the appeal being dismissed. This is a matter for the Court to decide whether the irrelevant or as the counsel for the 1st Defendant puts it, objected documents, should be included in the appeal record before this Court. [34] This Court is of the view that there is merits to the preliminary objection. In appeal hearing, this Court may exercise its powers and duties as necessary to do justice in the case. The Court must exercise its discretion to ensure procedural requirements as provided in the ROC 2012 are adhered to as the consequential effect would be detrimental so as to misdirect this Court on facts and law. All relevant documents filed are referred by the Court. The burden is on the Plaintiff as the appellant in this case, to supply the relevant documents following Order 55 rule 4(1) and rule 5(3) of the ROC 2012. In addition, based on the case of Maranatha Tours & Travel Sdn Bhd v Ampang Specialist Centre Sdn Bhd [1997] MLJU 181 (unreported, 24 March 1997), it is the duty of the appellant to prepare a proper record of appeal. [35] The procedural requirement is a statutory requirement for compliance in its strict sense and therefore is mandatory for parties to adhere to. The Plaintiff did not offer any explanation on the inclusion of the objected documents except to submit that they complied with Order 55 rule 5(3) of the ROC 2012. The counsel for the 1st Defendant had made its objection of the documents by indicating on the record to the registrar and for this Court to take the matter into consideration for the purpose of costs and incidental to the documents. [36] This Court also viewed that the non-service of the documents (5th and 6th Defendant’s Defence) to the 1st Defendant’s counsel will be prejudicial to the 1st Defendant as to blatantly put him at a disadvantage. The fact that the 1st counsel for the Defendant was not served with all the relevant pleadings would mean that he was not fully informed. I agree with the two cases attributed by the counsel for the 1st Defendant. However the case of Owners of the Ship or Vessel SasacomI (supra) was specifically on rule 18 of the Rules of the Court of Appeal but I do agree that both cases cited relate to compliance issue. [37] Borrowing the words from the case Chuah Tim Lan v RHB Bank Bhd. (supra), by allowing the Plaintiff’s action will be amplifying the Plaintiff’s nonchalance in complying with the ROC 2012. This Court viewed that the Plaintiff’s non-compliance is a breach of the ROC 2012 and the consequences of the breach is serious and is not curable. I dismissed the appeal with cost. Dated: 10 July 2017 (DATIN ZALITA BINTI DATO’ ZAIDAN) Judicial Commissioner Shah Alam High Court SOLICITORS: APPELLANT : JUSTIN CHIN Tetuan Justin Chin Suite E-06-19, Plaza Mont Kiara 2 Jalan Kiara, Mont Kiara 50480 Kuala Lumpur [Ref: 15/1103/KAC/J/JL] Tel : 03-6211 3877 Fax : 03-6201 4877 RESPONDENT : YEE TECK FAH Tetuan Yee Teck Fah & Co. Unit 705, Blok E Pusat Dagangan Phileo Damansara 1 Jalan 16/11, Section 16 46350 Petaling Jaya Selangor Darul Ehsan [Ref: YTF/4297/ESSB/001/G] Tel : 03-7660 9028 Fax : 03-7660 9032 5

Tika 2.6.0

A52M-251-11/2016 DEF 1

PLAINTIF OCBC AL-AMIN BANK BERHAD DEFENDAN 1. ELECTEST SDN BHD

06/07/2017

DATO' ISHAK BAKRI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=ae8e0c46-0c15-4a43-8683-19285a6f7116&Inline=true

Dalam Mahkamah Sesyen di Shah Alam Dalam Negeri Selangor Darul Ehsan, Malaysia Guaman No.BA-A52M-251-11/2016 antara ocbc al-amin bank berhad ... Plaintif dan 1. ELECTEST Sdn Bhd 2. MAI JASMINA BINTI JALALUDDIN 3. HARYATEY BINTI HANAPI ... Defendan ALASAN KEPUTUSAN (Aturan 14, Kaedah-Kaedah Mahkamah 2012) Pendahuluan 1. Ini adalah permohonan plaintif di bawah Aturan 14 Kaedah-Kaedah Mahkamah 2012 yang memohon perintah satu penghakiman terus dimasukkan terhadap defendan pertama. 2. Pada 27.4.2017 mahkamah memutuskan permohonan plaintif untuk merekodkan penghakiman terus terhadap defendan pertama dibenarkan dengan kos. Seterusnya pada 8.5.2017 defendan pertama telah memfailkan satu notis rayuan ke Mahkamah Tinggi Shah Alam kerana tidak berpuas hati dengan keputusan mahkamah yang mebenarkan penghakiman terus direkodkan terhadap defendan pertama. Fakta Ringkas Kes 3. Fakta ringkas kes adalah seperti berikut: Defendan pertama telah memohon kepada plaintif untuk kemudahan perbankan Islam di bawah prinsip Komoditi Murabahah untuk dana perniagaan dan permohonan tersebut diluluskan melalui surat tawaran bertarikh 12.11.2014 dan lampirannya (ekhsibit A-1 afidavit sokongan plaintif) . Dana perniagaan tersebut iaitu kemudahan Biayaan Berjangka (Term Financing-i (Term-i)) adalah sebanyak RM200,000.00 diluluskan kepada defendan pertama tertakluk kepada terma dan syarat yang terkandung di dalamnya. 4. Defendan pertama telah menerima terma dan syarat tersebut dengan menandatangani surat tawaran yang antara lain seperti yang dibutirkan di dalam perenggan 7(i)-(xiv) afidavit sokongan plaintif. 5. Plaintif dan defendan pertama kemudiannya memasuki Perjanjian Jualan Aset bertarikh 19.11.2014 di mana plaintif telah menjual komoditi bernilai RM200,000.00 di bawah sijil CPO19NOV2014-00012-000 dan defendan pertama telah membeli komoditi tersebut pada harga jualan plaintif sebagaimana yang diperuntukkan di dalam surat tawaran. Defendan pertama juga berjanji untuk membayar harga jualan plaintif tersebut melalui ansuran bulanan dalam tempoh seperti yang dipersetujui di dalam surat tawaran. 6. Susulan itu, plaintif telah menjual komoditi tersebut bagi pihak defendan pertama di pasaran pada harga jualan defendan pertama dan hasilnya telah disalurkan kepada defendan pertama sebagaimana yang dipersetujui di dalam surat tawaran. 7. Tidak boleh dipertikaikan bahawa defendan pertama juga telah memasuki Terma Produk Plaintif bertarikh 13.11.2014 (ekhsibit A-3 afidavit sokongan plaintif). 8. Defendan pertama kemudiannya didapati gagal, membayar bayaran ansuran-ansuran bulanan di bawah kemudahan Term-i. 9. Plaintif telah melalui surat peguamnya kepada defendan pertama bertarikh 4.7.2016 membatalkan kemudahan yang diberikan dan menuntut bayaran keseluruhan jumlah terhutang setelah ditolak dengan ibra' dalam tempoh masa 7 hari dari tarikh surat tersebut sebanyak RM167,900.60 setakat 11.7.2016. Defendan pertama gagal mematuhi tuntutan tersebut. 10. Melalui suatu surat jaminan berkuatkuasa mulai 19.11.2014 defendan ke-2 dan ke-3 telah secara bersesama dan berasingan bersetuju untuk diikat bukan sahaja sebagai penjamin tetapi sebagai penghutang utama untuk pembayaran ke semua wang yang terhutang dan kena dibayar oleh defendan pertama kepada plaintif bila dituntut, termasuk yuran peguam atas dasar peguamcara-anakguam. KES PLAINTIF 11. Defendan pertama gagal untuk menunjukkan apa-apa isu untuk dibicarakan dan hutang tersebut masih lagi terhutang dan kena dibayar oleh defendan pertama. 12. Sijil Keberhutangan yang diekhsibitkan sebagai ekhsibit A-7 di dalam afidavit sokongan plaintif mengesahkan ketepatan jumlah keberhutangan defendan pertama kepada plaintif. ISU-ISU YANG DIBANGKITKAN OLEH DEFENDAN PERTAMA 13. Defendan pertama mendakwa terdapat kelakuan fraud antara plaintif, defendan ke-2 dan ke-3 terhadap defendan pertama. Oleh itu jumlah yang dituntut oleh plaintif terhadap defendan pertama merupakan hasil dari fraud tersebut. 14. Defendan pertama tidak menerima writ saman terpinda bertarikh 15.12.2016 yang dikatakan diserah oleh plaintif kepada defendan pertama. 15. Terdapat perintah injunksi Mahkamah Tinggi Shah Alam melalui writ saman No. 22NCVC-304-06/2014 yang menghalang defendan ke-2 dan ke-3 daripada memerolehi sebarang kemudahan pinjaman daripada mana-mana pihak. 16. Kemudahan pembiayaan Islam dibawah pinsip komoditi murabahah yang ditandatangani antara plaintif dan defendan pertama adalah tidak sah memandangkan ianya bercanggah dengan Memorandum & Article of Association defendan pertama. 17. Defendan pertama tidak bertanggungjawab untuk membayar jumlah yang dituntut oleh plaintif KEPUTUSAN MAHKAMAH Fraud 18. Defendan pertama mendakwa terdapat fraud dalam kemudahan pembiyaan yang ditawarkan oleh plaintif kepada defendan pertama. Beban bukti adalah terletak kepada defendan pertama yang mendakwa terdapat fraud dalam transaksi antara plaintif dan defendan. 19. Mahkamah telah meneliti afidavit defendan pertama untuk mempertimbangkan kemungkinan terdapatnya fraud sepertimana yang didakwa oleh defendan pertama. Walau bagaimanapun, ekhsibit A-1 afidavit sokongan plaintif adalah jelas bahawa defendan pertama telah memohon untuk kemudahan pembiayaan daripada plaintif dan berdasarkan Resolusi Pengarah Defendan Pertama (ekhsibit A-8), defendan ke-2 dan ke-3 telah diberi kebenaran dan kuasa oleh defendan pertama untuk menandatangani apa-apa dokumen berkaitan dengan kemudahan pembiayaan yang dipohon. 20. Defendan pertama mendakwa plaintif telah meluluskan satu kemudahan perbankan Islam kepada defendan pertama yang bertindak di luar Memorandum & Articles of Association kepunyaan defendan pertama. Oleh itu defendan pertama tidak mempunyai tanggungan untuk menyelesaikan apa-apa hutang kepada plaintif. 21. Defendan pertama juga mendakwa bahawa jumlah yang dituntut oleh plaintif seharusnya ditanggung oleh defendan ke-2 dan ke-3 sahaja. 22. Begitupun, plaintif berhujah bahawa pada kesemua waktu material defendan ke-2 dan ke-3 merupakan pengarah-pengarah dan penjamin kepada defendan pertama. Oleh itu tidak ada kelakuan fraud dari mana-mana pihak seperti yang didakwa oleh defendan pertama. Oleh itu dakwaan defendan pertama berkenaan fraud oleh plaintif adalah sesuatu yang tidak berasas. 23. Defendan pertama turut bersetuju dengan terma-terma di dalam Surat Tawaran tersebut apabila pengarah-pengarah defendan pertama pada waktu material menandatangani acceptance page surat tawaran tersebut. Mahkamah bersetuju dengan plaintif bahawa elemen fraud tidak wujud kerana defendan pertama dengan relanya telah memohon untuk kemudahan pembiayaan daripada plaintif dan sehingga kini tidak membuat apa-apa bayaran. Perintah Injunksi Mahkamah Tinggi Shah Alam 24. Berkenaan dengan perintah injunksi Mahkamah Tinggi Shah Alam, plaintif berhujah bahawa plaintif bukanlah pihak yang dinamakan didalam prosiding writ saman No. 22NCVC-304-06/2014 dan plaintif tidak mempunyai pengetahuan berkenaan dengan perintah injunksi tersebut. 25. Meneliti kepada perintah injunksi tersebut, mahkamah bersetuju bahawa plaintif bukanlah pihak yang dinamakan dalam perintah injunksi tersebut dan wajarlah plaintif mendakwa bahawa plaintif tidak mempunyai pengetahuan tentang perintah injunksi tersebut. 26. Oleh itu mahkamah beersetuju dengan hujahan plaintif bahawa perintah injunksi tersebut tidak mengikat plaintif. Perintah Injunksi tersebut hanya di bawa ke perhatian plaintif melalui afidavit jawapan defendan pertama. 27. Sekirannya benar defendan ke-2 dan ke-3 dilarang untuk memohon sebarang pinjaman kerana terdapat perintah larangan dari Mahkamah Tinggi Shah Alam, mengapa defendan pertama mengeluarkan resolusi dan memberi kebenaran dan kuasa kepada defendan ke-2 dan ke-3 untuk memohon kemudahan pembiayaan daripada plaintif? Resolusi oleh defendan pertama sendiri nampaknya bertentangan dengan perintah injunksi tersebut. 28. Plaintif berhujah walaupun defendan pertama membangkitkan isu berkenaan perintah injunksi Mahkamah Tinggi Shah Alam, terma-terma di dalamnya tidak mengikat plaintif atau menjejaskan tuntutan plaintif. Defendan pertama adalah diestop daripada menafikan yang sebaliknya. Plaintif menegaskan defendan pertama merupakan peminjam utama dan defendan ke-2 dan ke-3 adalah penjamin. Selaku peminjam utama defendan pertama bertanggungjawab untuk membuat pembayaran. 29. Ekhsibit A-1 afidavit sokongan plaintif jelas menunjukkan defendan pertama telah memohon untuk kemudahan pembiayaan daripada plaintif. Berdasarkan kepada ekhsibit A-8, defendan ke-2 dan ke-3 telah diberi kebenaran dan kuasa oleh defendan pertama untuk menandatangani apa-apa dokumen berkaitan dengan kemudahan pembiayaan yang dipohon. 30. Oleh itu isu berkenaan dengan perintah injunksi Mahkamah Tinggi Shah Alam yang dibangkitkan oleh defendan pertama bukanlah satu isu untuk dibicarakan. Defendan Pertama Tidak Menerima Writ Saman 31. Mahkamah memutuskan dakwaan bahawa defendan pertama tidak menerima writ saman juga bukanlah satu isu untuk dibicarakan. Memang benar terdapat kesilapan pada nama defendan ke-2 pada writ saman tersebut. Nama defendan ke-2 adalah Mai Jasmina Binti Jalaluddin dan bukannya Muhammed Yasin Bin Abdul Karim. Selepas menyedari kesilapan tersebut, peguamcara plaintif terus memfailkan writ saman terpinda untuk meminda nama defendan ke-2 sebelum menyerahkan writ saman tersebut kepada defendan ke-2. 32. Malah selepas menerima writ saman bertarikh 15.11.2016, defendan pertama tidak membangkitkan apa-apa bantahan melainkan hanya membangkitkan isu ini selepas plaintif memfailkan permohonan di bawah Aturan 14. 33. Mahkamah bersetuju bahawa isu yang dibangkitkan oleh defendan adalah satu afterthought dan tidak harus dipertimbangkan oleh mahkamah. Isu ini juga adalah isu yang remeh dan bukan satu isu untuk dibicarakan. Kemudahan Pembiyaan Islam Komoditi Murabahah Tidak Sah 34. Defendan pertama mendakwa kemudahan pembiyaan islam di bawah prinsip Komoditi Murabahah tidak sah kerana bercanggah dengan Memorandum & Articles of Association defendan pertama. Berkenaan isu ini, mahkamah berpendapat dakwaan defendan pertama tidak berasas. Malahan, kemudahan pembiayaan tersebut tidak salah atau bercanggahan dengan mana-mana undang-undang atau illegal seperti yang didakwa oleh defendan pertama. 35. Berkaitan dengan produk Komoditi Murabahah tersebut, mahkamah ingin merujuk kepada kes Kuwait Finanace House (Msia) Bhd v Vesta Energy Sdn Bhd & Ors [2012] 9 CLJ di mana Yang Arif Mohd Zawawi Salleh telah menerangkan dengan jelas bagaimana produk Komoditi Murabahah atau juga dikenali sebagai Murabahah Tawarruq ini dijalankan:- “Murabahah Tawarruq” [39] I begin with Murabahah Tawarruq facility. Murabahah Tawarruq is a transaction that involves purchasing an asset or good with deferred price on the basis of Murabahah, then selling it to a third party to obtain cash. (see Shariah Resolutions In Islamic Finance, Central Bank of Malaysia, 2010, 2nd edn, p. 224). [40] Murabahah comes from the word ribh which means increase. Technically, Murabahah is the mark-up disclosed to the purchaser as per the seller’s purchase price for a trust-sale of a certain specified asset, excluding monetary assets such as cash and receivables. (see The Principles and Practices of Shariah in Islamic Finance, Shariah Parameter Reference 1: Murabahah, Central Bank of Malaysia, p. 4). [41] Relying on the aforesaid meanings, one can come to a logical and simple conclusion that Murabahah Tawarruq based transaction allows the imposition of profit rate or profit margin. Meaning that, the bank will expressly mentions the cost of the sold goods it has incurred, and sells it to the customer by adding some profit or mark-up on the payment. So long it was accepted by the customer, the term will accordingly binds him/her. [42] In this instant case, the first defendant will initiate the deal. It will apply via purchase request for the plaintiff to purchase certain goods from vendors/suppliers. Upon receipt of the purchase request, the plaintiff will issue a “Letter Of Offer To Sell The Goods” specifying, inter alia, the deferred sale price which comprises of the purchase price of the goods, the Murabahah Profit imposed and the commodity transaction fee and the first defendant is at liberty to accept it. Once accepted, the first defendant is bound by the terms. (see cl. 2.4 of the Murabahah Tawarruq 2 Facility Agreement dated 26 June 2007). [43] In respect of this kind of transaction, the customer is not interested in owning the asset or goods that the bank acquired, but the instrument is used to facilitate cash advances to him who is in need of cash to pay various needs. (see Shariah Resolutions In Islamic Finance, Central Bank of Malaysia, 2010, 2nd edn., p. 224, Shariah Resolutions In Islamic Finance, Central Bank of Malaysia, 2007, 1st edn., p. 62, RHB Islamic Bank Berhad v. Veheng Global Trader Sdn Bhd & Ors [2011] 1 LNS 684 and cl. 2.2 of the Murabahah Tawarruq 2 Facility Agreement dated 26 June 2007). [44] So too here. The purpose of the facility was to finance the first defendant’s general working capital requirements only. That is why, subsequent to the sale between the plaintiff and the first defendant, the latter will appoint the former as its agent to sell the goods so purchased to a third party. (see cl. 2.4 (d) of the Murabahah Tawarruq 2 Facility Agreement dated 26 June 2007). 36. Berdasarkan kepada kes Kuwait Finance House (supra) secara ringkasnya, kemudahan pembiayaan Islam dibawah prinsip Komoditi Murabahah melibatkan pembelian dan penjualan komoditi yang diluluskan oleh syariah. Komoditi yang terlibat di dalam kes ini adalah minyak sawit mentah “(Crude Palm Oil (CPO) seperti yang telah diplidkan oleh plaintif didalam pernyataan tuntutan plaintif bertarikh 15.11.2016 dan juga seperti yang tertera didalam dokumen-dokumen kemudahan pembiayaan yang telah diekhsibitkan oleh plaintif. 37. Plaintif turut berhujah bahawa segala transaksi berkenaan dengan kemudahan pembiayaan di bawah prinsip Komoditi Murabahah yang telah diberikan kepada defendan pertama adalah mematuhi syariah dan diketahui oleh Bank Negara Malaysia. Tidak ada unsur illegal dan/atau tainted with fraud dalam transaksi tersebut sepertimana dakwaan defendan pertama. Malahan, kemudahan pembiayaan yang diluluskan juga tidak bercanggah dengan jenis perniagaaan yang dijalankan oleh defendan pertama. 38. Apa yang jelas defendan pertama telah memohon untuk kemudahan pembiayaan tersebut sejak tahun 2014 dan tidak pernah sesekali pun membangkitkan apa-apa isu berkenaan dengan produk pembiayaan yang telah diluluskan. Plaintif berhujah defendan pertama telah menikmati kemudahan pembiayaan tersebut selama ini dan tidak membuat bayaran. Hanya setelah plaintif memfailkan tindakan undang-undang ini, defendan pertama membangkitkan pelbagai isu-isu yang tidak berasas. 39. Plaintif seterusnya berhujah sekiranya defendan pertama tidak berpuas hati dengan konsep kemudahan pembiayaan Islam dibawah prinsip Komoditi Murabahah ini, defendan pertama seharusnya membuat aduan kepada Syariah Advisory Council Bank Negara Malaysia. Mahkamah bersetuju dengan hujahan plaintif dan isu yang dibangkitkan oleh defendan pertama bahawa transaksi antara plaintif dan defendan pertama tidak sah tidak wajar untuk dipertimbangkan oleh mahkamah. Adalah jelas juga isu ini bukanlah satu isu untuk dibicarakan. Defendan Pertama Tidak Bertanggungjawab 40. Mahkamah berpendapat dakwaan defendan pertama bahawa defendan pertama tidak bertanggungjawab langsung tidak berasas. Defendan pertama tidak boleh melarikan diri daripada liabiliti membuat bayaran. Defendan pertama merupakan peminjam utama dan defendan ke-2 dan ke-3 pula merupakan penjamin defendan pertama. 41. Plaintif berhujah apa-apa permasalahan yang wujud antara defendan pertama dan defendan ke-2 dan ke-3 tidak ada kena mengena dengan plaintif. Tuntutan plaintif juga tidak terjejas hanya kerana defendan ke-2 dan ke-3 bukan lagi pengarah-pengarah defendan pertama. Apa yang jelas dan penting adalah defendan pertama telah memohon untuk kemudahan pembiayaan daripada plaintif dan defendan ke-2 dan ke-3 telah bersetuju untuk menjadi penjamin. Sijil Keberhutangan 42. Plaintif telah melampirkan Sijil Keberhutangan sebagai ekhsibit “A-7” dalam afidavit sokongan plaintif yang mengesahkan ketepatan dan jumlah keberhutangan defendan pertama. 43. Meneliti kepada afidavit defendan pertama, mahkamah bersetuju dengan plaintif bahawa defendan pertama telah gagal untuk menunjukkan apa-apa manifest error di dalamnya dan oleh yang demikian sijil tersebut adalah bukti konklusif tentang keberhutangan defendan pertama. 44. Klausa 15 pada pada Lampiran Surat Tawaran bertarikh 12.11.2014 di Ekhsibit “A-1” afidavit sokongan plaintif khususnya muka surat 16 menyatakan seperti berikut:- “15. In any legal action or proceedings relating to te Facility(ies), our certificate as to any amount due to us under the Facility(ies) shall, in the absence of manifest error, be conclusive evidence that such amount is in fact due and payable.” 45. Dalam kes Cempaka Finance Berhad v Ho Lai Ying [2006] 3 CLJ 544 Mahkamah Agung memutuskan seperti berikut:- “The Court of Appeal’s position that the conclusiveness of the certificate of indebtedness was binding only upon the parties and that the court would still have to determine whether sufficient evidence had been adduced to prove quantum and the correctness of the amount claimed, went against the entrenched principles enunciated in Citibank N.A v. Ooi Boon Leong & Ors, which established firmly the conclusive nature and extent of a certificate of indebtedness. A certificate of indebtedness operates in the field of adjectival law, excusing the plaintiff from adducing the proof of debt and shifting the burden onto the defendant to disprove the amount claimed. In the instant case, the relevant cls. 27 and 7.03 of the loan agreement and guarantee agreement respectively were sufficiently clear. A clause of this nature has been described as a conclusive evidence clause and has been held to be binding and valid by courts in Australia and England. The certificate of indebtedness, issued in accordance with the aforesaid cls. 27 and 7.03, was lucid enough. There was nothing to indicate or suggest any manifest error on the face of the said certificate nor was any fraud shown..: 46. Berdasarkan kepada kes Cempaka Finance (supra) adalah jelas menyatakan bahawa sijil keberhutangan plaintif adalah bukti konklusif akan keberhutangan defendan pertama melainkan jika defendan pertama dapat menunjukkan apa-apa manifest error. Mahkamah bersetuju dengan plaintif bahawa defendan pertama gagal menunjukkan apa-apa manifest error. Defendan pertama hanya menafikan tuntutan plaintif dan menyatakan bahawa ia adalah tanggungan defendan ke-2 dan ke-3. Oleh yang demikian, isu ini tidak wajar diberi perrtimbangan oleh mahkamah. Surat Tuntutan Plaintif Tidak Diterima 47. Defendan pertama juga membangkitkan isu bahawa surat tuntutan daripada peguamcara plaintif bertarikh 4.7.2016 eksibit A-4 afidavit sokongan plaintif tidak diterima oleh defendan pertama. 48. Plaintif berhujah bahawa peguamcara plaintif telah menghantar surat tuntutan tersebut kepada defendan pertama secara pos berdaftar (perakuan mengepos pada 4.7.2016) dan bukti pengeposan tersebut diekhsibitkan sebagai ekhsibit A-4. Adalah terbukti defendan pertama telah menerima surat tuntutan daripada peguamcara plaintif dan defendan pertama hanya membuat penafian kosong berkenaan dengan penerimaan surat tuntutan tersebut. Oleh itu, isu keenam juga bukanlah satu isu untuk dibicarakan dan tidak harus diberi pertimbangan oleh mahkamah. 49. Berdasarkan kepada alasan-alasan yang dinyatakan di atas, adalah jelas bahawa isu-isu yang dibangkitkan oleh defendan pertama tidak mempunyai merit. Defendan pertama juga gagal untuk menunjukkan terdapat isu-isu yang harus dibicarakan. Oleh itu mahkamah memutuskan penghakiman terus direkodkan terhadap defendan pertama dengan kos. Bertarikh pada 6 haribulan Julai, 2014 tt (ISHAK BAKRI) Hakim Mahkamah Sesyen Shah Alam Selangor 23

Tika 2.6.0

A52M-251-11/2016 DEF 1

PLAINTIF OCBC AL-AMIN BANK BERHAD DEFENDAN 1. ELECTEST SDN BHD

06/07/2017

DATO' ISHAK BAKRI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=ae8e0c46-0c15-4a43-8683-19285a6f7116&Inline=true

Dalam Mahkamah Sesyen di Shah Alam Dalam Negeri Selangor Darul Ehsan, Malaysia Guaman No.BA-A52M-251-11/2016 antara ocbc al-amin bank berhad ... Plaintif dan 1. ELECTEST Sdn Bhd 2. MAI JASMINA BINTI JALALUDDIN 3. HARYATEY BINTI HANAPI ... Defendan ALASAN KEPUTUSAN (Aturan 14, Kaedah-Kaedah Mahkamah 2012) Pendahuluan 1. Ini adalah permohonan plaintif di bawah Aturan 14 Kaedah-Kaedah Mahkamah 2012 yang memohon perintah satu penghakiman terus dimasukkan terhadap defendan pertama. 2. Pada 27.4.2017 mahkamah memutuskan permohonan plaintif untuk merekodkan penghakiman terus terhadap defendan pertama dibenarkan dengan kos. Seterusnya pada 8.5.2017 defendan pertama telah memfailkan satu notis rayuan ke Mahkamah Tinggi Shah Alam kerana tidak berpuas hati dengan keputusan mahkamah yang mebenarkan penghakiman terus direkodkan terhadap defendan pertama. Fakta Ringkas Kes 3. Fakta ringkas kes adalah seperti berikut: Defendan pertama telah memohon kepada plaintif untuk kemudahan perbankan Islam di bawah prinsip Komoditi Murabahah untuk dana perniagaan dan permohonan tersebut diluluskan melalui surat tawaran bertarikh 12.11.2014 dan lampirannya (ekhsibit A-1 afidavit sokongan plaintif) . Dana perniagaan tersebut iaitu kemudahan Biayaan Berjangka (Term Financing-i (Term-i)) adalah sebanyak RM200,000.00 diluluskan kepada defendan pertama tertakluk kepada terma dan syarat yang terkandung di dalamnya. 4. Defendan pertama telah menerima terma dan syarat tersebut dengan menandatangani surat tawaran yang antara lain seperti yang dibutirkan di dalam perenggan 7(i)-(xiv) afidavit sokongan plaintif. 5. Plaintif dan defendan pertama kemudiannya memasuki Perjanjian Jualan Aset bertarikh 19.11.2014 di mana plaintif telah menjual komoditi bernilai RM200,000.00 di bawah sijil CPO19NOV2014-00012-000 dan defendan pertama telah membeli komoditi tersebut pada harga jualan plaintif sebagaimana yang diperuntukkan di dalam surat tawaran. Defendan pertama juga berjanji untuk membayar harga jualan plaintif tersebut melalui ansuran bulanan dalam tempoh seperti yang dipersetujui di dalam surat tawaran. 6. Susulan itu, plaintif telah menjual komoditi tersebut bagi pihak defendan pertama di pasaran pada harga jualan defendan pertama dan hasilnya telah disalurkan kepada defendan pertama sebagaimana yang dipersetujui di dalam surat tawaran. 7. Tidak boleh dipertikaikan bahawa defendan pertama juga telah memasuki Terma Produk Plaintif bertarikh 13.11.2014 (ekhsibit A-3 afidavit sokongan plaintif). 8. Defendan pertama kemudiannya didapati gagal, membayar bayaran ansuran-ansuran bulanan di bawah kemudahan Term-i. 9. Plaintif telah melalui surat peguamnya kepada defendan pertama bertarikh 4.7.2016 membatalkan kemudahan yang diberikan dan menuntut bayaran keseluruhan jumlah terhutang setelah ditolak dengan ibra' dalam tempoh masa 7 hari dari tarikh surat tersebut sebanyak RM167,900.60 setakat 11.7.2016. Defendan pertama gagal mematuhi tuntutan tersebut. 10. Melalui suatu surat jaminan berkuatkuasa mulai 19.11.2014 defendan ke-2 dan ke-3 telah secara bersesama dan berasingan bersetuju untuk diikat bukan sahaja sebagai penjamin tetapi sebagai penghutang utama untuk pembayaran ke semua wang yang terhutang dan kena dibayar oleh defendan pertama kepada plaintif bila dituntut, termasuk yuran peguam atas dasar peguamcara-anakguam. KES PLAINTIF 11. Defendan pertama gagal untuk menunjukkan apa-apa isu untuk dibicarakan dan hutang tersebut masih lagi terhutang dan kena dibayar oleh defendan pertama. 12. Sijil Keberhutangan yang diekhsibitkan sebagai ekhsibit A-7 di dalam afidavit sokongan plaintif mengesahkan ketepatan jumlah keberhutangan defendan pertama kepada plaintif. ISU-ISU YANG DIBANGKITKAN OLEH DEFENDAN PERTAMA 13. Defendan pertama mendakwa terdapat kelakuan fraud antara plaintif, defendan ke-2 dan ke-3 terhadap defendan pertama. Oleh itu jumlah yang dituntut oleh plaintif terhadap defendan pertama merupakan hasil dari fraud tersebut. 14. Defendan pertama tidak menerima writ saman terpinda bertarikh 15.12.2016 yang dikatakan diserah oleh plaintif kepada defendan pertama. 15. Terdapat perintah injunksi Mahkamah Tinggi Shah Alam melalui writ saman No. 22NCVC-304-06/2014 yang menghalang defendan ke-2 dan ke-3 daripada memerolehi sebarang kemudahan pinjaman daripada mana-mana pihak. 16. Kemudahan pembiayaan Islam dibawah pinsip komoditi murabahah yang ditandatangani antara plaintif dan defendan pertama adalah tidak sah memandangkan ianya bercanggah dengan Memorandum & Article of Association defendan pertama. 17. Defendan pertama tidak bertanggungjawab untuk membayar jumlah yang dituntut oleh plaintif KEPUTUSAN MAHKAMAH Fraud 18. Defendan pertama mendakwa terdapat fraud dalam kemudahan pembiyaan yang ditawarkan oleh plaintif kepada defendan pertama. Beban bukti adalah terletak kepada defendan pertama yang mendakwa terdapat fraud dalam transaksi antara plaintif dan defendan. 19. Mahkamah telah meneliti afidavit defendan pertama untuk mempertimbangkan kemungkinan terdapatnya fraud sepertimana yang didakwa oleh defendan pertama. Walau bagaimanapun, ekhsibit A-1 afidavit sokongan plaintif adalah jelas bahawa defendan pertama telah memohon untuk kemudahan pembiayaan daripada plaintif dan berdasarkan Resolusi Pengarah Defendan Pertama (ekhsibit A-8), defendan ke-2 dan ke-3 telah diberi kebenaran dan kuasa oleh defendan pertama untuk menandatangani apa-apa dokumen berkaitan dengan kemudahan pembiayaan yang dipohon. 20. Defendan pertama mendakwa plaintif telah meluluskan satu kemudahan perbankan Islam kepada defendan pertama yang bertindak di luar Memorandum & Articles of Association kepunyaan defendan pertama. Oleh itu defendan pertama tidak mempunyai tanggungan untuk menyelesaikan apa-apa hutang kepada plaintif. 21. Defendan pertama juga mendakwa bahawa jumlah yang dituntut oleh plaintif seharusnya ditanggung oleh defendan ke-2 dan ke-3 sahaja. 22. Begitupun, plaintif berhujah bahawa pada kesemua waktu material defendan ke-2 dan ke-3 merupakan pengarah-pengarah dan penjamin kepada defendan pertama. Oleh itu tidak ada kelakuan fraud dari mana-mana pihak seperti yang didakwa oleh defendan pertama. Oleh itu dakwaan defendan pertama berkenaan fraud oleh plaintif adalah sesuatu yang tidak berasas. 23. Defendan pertama turut bersetuju dengan terma-terma di dalam Surat Tawaran tersebut apabila pengarah-pengarah defendan pertama pada waktu material menandatangani acceptance page surat tawaran tersebut. Mahkamah bersetuju dengan plaintif bahawa elemen fraud tidak wujud kerana defendan pertama dengan relanya telah memohon untuk kemudahan pembiayaan daripada plaintif dan sehingga kini tidak membuat apa-apa bayaran. Perintah Injunksi Mahkamah Tinggi Shah Alam 24. Berkenaan dengan perintah injunksi Mahkamah Tinggi Shah Alam, plaintif berhujah bahawa plaintif bukanlah pihak yang dinamakan didalam prosiding writ saman No. 22NCVC-304-06/2014 dan plaintif tidak mempunyai pengetahuan berkenaan dengan perintah injunksi tersebut. 25. Meneliti kepada perintah injunksi tersebut, mahkamah bersetuju bahawa plaintif bukanlah pihak yang dinamakan dalam perintah injunksi tersebut dan wajarlah plaintif mendakwa bahawa plaintif tidak mempunyai pengetahuan tentang perintah injunksi tersebut. 26. Oleh itu mahkamah beersetuju dengan hujahan plaintif bahawa perintah injunksi tersebut tidak mengikat plaintif. Perintah Injunksi tersebut hanya di bawa ke perhatian plaintif melalui afidavit jawapan defendan pertama. 27. Sekirannya benar defendan ke-2 dan ke-3 dilarang untuk memohon sebarang pinjaman kerana terdapat perintah larangan dari Mahkamah Tinggi Shah Alam, mengapa defendan pertama mengeluarkan resolusi dan memberi kebenaran dan kuasa kepada defendan ke-2 dan ke-3 untuk memohon kemudahan pembiayaan daripada plaintif? Resolusi oleh defendan pertama sendiri nampaknya bertentangan dengan perintah injunksi tersebut. 28. Plaintif berhujah walaupun defendan pertama membangkitkan isu berkenaan perintah injunksi Mahkamah Tinggi Shah Alam, terma-terma di dalamnya tidak mengikat plaintif atau menjejaskan tuntutan plaintif. Defendan pertama adalah diestop daripada menafikan yang sebaliknya. Plaintif menegaskan defendan pertama merupakan peminjam utama dan defendan ke-2 dan ke-3 adalah penjamin. Selaku peminjam utama defendan pertama bertanggungjawab untuk membuat pembayaran. 29. Ekhsibit A-1 afidavit sokongan plaintif jelas menunjukkan defendan pertama telah memohon untuk kemudahan pembiayaan daripada plaintif. Berdasarkan kepada ekhsibit A-8, defendan ke-2 dan ke-3 telah diberi kebenaran dan kuasa oleh defendan pertama untuk menandatangani apa-apa dokumen berkaitan dengan kemudahan pembiayaan yang dipohon. 30. Oleh itu isu berkenaan dengan perintah injunksi Mahkamah Tinggi Shah Alam yang dibangkitkan oleh defendan pertama bukanlah satu isu untuk dibicarakan. Defendan Pertama Tidak Menerima Writ Saman 31. Mahkamah memutuskan dakwaan bahawa defendan pertama tidak menerima writ saman juga bukanlah satu isu untuk dibicarakan. Memang benar terdapat kesilapan pada nama defendan ke-2 pada writ saman tersebut. Nama defendan ke-2 adalah Mai Jasmina Binti Jalaluddin dan bukannya Muhammed Yasin Bin Abdul Karim. Selepas menyedari kesilapan tersebut, peguamcara plaintif terus memfailkan writ saman terpinda untuk meminda nama defendan ke-2 sebelum menyerahkan writ saman tersebut kepada defendan ke-2. 32. Malah selepas menerima writ saman bertarikh 15.11.2016, defendan pertama tidak membangkitkan apa-apa bantahan melainkan hanya membangkitkan isu ini selepas plaintif memfailkan permohonan di bawah Aturan 14. 33. Mahkamah bersetuju bahawa isu yang dibangkitkan oleh defendan adalah satu afterthought dan tidak harus dipertimbangkan oleh mahkamah. Isu ini juga adalah isu yang remeh dan bukan satu isu untuk dibicarakan. Kemudahan Pembiyaan Islam Komoditi Murabahah Tidak Sah 34. Defendan pertama mendakwa kemudahan pembiyaan islam di bawah prinsip Komoditi Murabahah tidak sah kerana bercanggah dengan Memorandum & Articles of Association defendan pertama. Berkenaan isu ini, mahkamah berpendapat dakwaan defendan pertama tidak berasas. Malahan, kemudahan pembiayaan tersebut tidak salah atau bercanggahan dengan mana-mana undang-undang atau illegal seperti yang didakwa oleh defendan pertama. 35. Berkaitan dengan produk Komoditi Murabahah tersebut, mahkamah ingin merujuk kepada kes Kuwait Finanace House (Msia) Bhd v Vesta Energy Sdn Bhd & Ors [2012] 9 CLJ di mana Yang Arif Mohd Zawawi Salleh telah menerangkan dengan jelas bagaimana produk Komoditi Murabahah atau juga dikenali sebagai Murabahah Tawarruq ini dijalankan:- “Murabahah Tawarruq” [39] I begin with Murabahah Tawarruq facility. Murabahah Tawarruq is a transaction that involves purchasing an asset or good with deferred price on the basis of Murabahah, then selling it to a third party to obtain cash. (see Shariah Resolutions In Islamic Finance, Central Bank of Malaysia, 2010, 2nd edn, p. 224). [40] Murabahah comes from the word ribh which means increase. Technically, Murabahah is the mark-up disclosed to the purchaser as per the seller’s purchase price for a trust-sale of a certain specified asset, excluding monetary assets such as cash and receivables. (see The Principles and Practices of Shariah in Islamic Finance, Shariah Parameter Reference 1: Murabahah, Central Bank of Malaysia, p. 4). [41] Relying on the aforesaid meanings, one can come to a logical and simple conclusion that Murabahah Tawarruq based transaction allows the imposition of profit rate or profit margin. Meaning that, the bank will expressly mentions the cost of the sold goods it has incurred, and sells it to the customer by adding some profit or mark-up on the payment. So long it was accepted by the customer, the term will accordingly binds him/her. [42] In this instant case, the first defendant will initiate the deal. It will apply via purchase request for the plaintiff to purchase certain goods from vendors/suppliers. Upon receipt of the purchase request, the plaintiff will issue a “Letter Of Offer To Sell The Goods” specifying, inter alia, the deferred sale price which comprises of the purchase price of the goods, the Murabahah Profit imposed and the commodity transaction fee and the first defendant is at liberty to accept it. Once accepted, the first defendant is bound by the terms. (see cl. 2.4 of the Murabahah Tawarruq 2 Facility Agreement dated 26 June 2007). [43] In respect of this kind of transaction, the customer is not interested in owning the asset or goods that the bank acquired, but the instrument is used to facilitate cash advances to him who is in need of cash to pay various needs. (see Shariah Resolutions In Islamic Finance, Central Bank of Malaysia, 2010, 2nd edn., p. 224, Shariah Resolutions In Islamic Finance, Central Bank of Malaysia, 2007, 1st edn., p. 62, RHB Islamic Bank Berhad v. Veheng Global Trader Sdn Bhd & Ors [2011] 1 LNS 684 and cl. 2.2 of the Murabahah Tawarruq 2 Facility Agreement dated 26 June 2007). [44] So too here. The purpose of the facility was to finance the first defendant’s general working capital requirements only. That is why, subsequent to the sale between the plaintiff and the first defendant, the latter will appoint the former as its agent to sell the goods so purchased to a third party. (see cl. 2.4 (d) of the Murabahah Tawarruq 2 Facility Agreement dated 26 June 2007). 36. Berdasarkan kepada kes Kuwait Finance House (supra) secara ringkasnya, kemudahan pembiayaan Islam dibawah prinsip Komoditi Murabahah melibatkan pembelian dan penjualan komoditi yang diluluskan oleh syariah. Komoditi yang terlibat di dalam kes ini adalah minyak sawit mentah “(Crude Palm Oil (CPO) seperti yang telah diplidkan oleh plaintif didalam pernyataan tuntutan plaintif bertarikh 15.11.2016 dan juga seperti yang tertera didalam dokumen-dokumen kemudahan pembiayaan yang telah diekhsibitkan oleh plaintif. 37. Plaintif turut berhujah bahawa segala transaksi berkenaan dengan kemudahan pembiayaan di bawah prinsip Komoditi Murabahah yang telah diberikan kepada defendan pertama adalah mematuhi syariah dan diketahui oleh Bank Negara Malaysia. Tidak ada unsur illegal dan/atau tainted with fraud dalam transaksi tersebut sepertimana dakwaan defendan pertama. Malahan, kemudahan pembiayaan yang diluluskan juga tidak bercanggah dengan jenis perniagaaan yang dijalankan oleh defendan pertama. 38. Apa yang jelas defendan pertama telah memohon untuk kemudahan pembiayaan tersebut sejak tahun 2014 dan tidak pernah sesekali pun membangkitkan apa-apa isu berkenaan dengan produk pembiayaan yang telah diluluskan. Plaintif berhujah defendan pertama telah menikmati kemudahan pembiayaan tersebut selama ini dan tidak membuat bayaran. Hanya setelah plaintif memfailkan tindakan undang-undang ini, defendan pertama membangkitkan pelbagai isu-isu yang tidak berasas. 39. Plaintif seterusnya berhujah sekiranya defendan pertama tidak berpuas hati dengan konsep kemudahan pembiayaan Islam dibawah prinsip Komoditi Murabahah ini, defendan pertama seharusnya membuat aduan kepada Syariah Advisory Council Bank Negara Malaysia. Mahkamah bersetuju dengan hujahan plaintif dan isu yang dibangkitkan oleh defendan pertama bahawa transaksi antara plaintif dan defendan pertama tidak sah tidak wajar untuk dipertimbangkan oleh mahkamah. Adalah jelas juga isu ini bukanlah satu isu untuk dibicarakan. Defendan Pertama Tidak Bertanggungjawab 40. Mahkamah berpendapat dakwaan defendan pertama bahawa defendan pertama tidak bertanggungjawab langsung tidak berasas. Defendan pertama tidak boleh melarikan diri daripada liabiliti membuat bayaran. Defendan pertama merupakan peminjam utama dan defendan ke-2 dan ke-3 pula merupakan penjamin defendan pertama. 41. Plaintif berhujah apa-apa permasalahan yang wujud antara defendan pertama dan defendan ke-2 dan ke-3 tidak ada kena mengena dengan plaintif. Tuntutan plaintif juga tidak terjejas hanya kerana defendan ke-2 dan ke-3 bukan lagi pengarah-pengarah defendan pertama. Apa yang jelas dan penting adalah defendan pertama telah memohon untuk kemudahan pembiayaan daripada plaintif dan defendan ke-2 dan ke-3 telah bersetuju untuk menjadi penjamin. Sijil Keberhutangan 42. Plaintif telah melampirkan Sijil Keberhutangan sebagai ekhsibit “A-7” dalam afidavit sokongan plaintif yang mengesahkan ketepatan dan jumlah keberhutangan defendan pertama. 43. Meneliti kepada afidavit defendan pertama, mahkamah bersetuju dengan plaintif bahawa defendan pertama telah gagal untuk menunjukkan apa-apa manifest error di dalamnya dan oleh yang demikian sijil tersebut adalah bukti konklusif tentang keberhutangan defendan pertama. 44. Klausa 15 pada pada Lampiran Surat Tawaran bertarikh 12.11.2014 di Ekhsibit “A-1” afidavit sokongan plaintif khususnya muka surat 16 menyatakan seperti berikut:- “15. In any legal action or proceedings relating to te Facility(ies), our certificate as to any amount due to us under the Facility(ies) shall, in the absence of manifest error, be conclusive evidence that such amount is in fact due and payable.” 45. Dalam kes Cempaka Finance Berhad v Ho Lai Ying [2006] 3 CLJ 544 Mahkamah Agung memutuskan seperti berikut:- “The Court of Appeal’s position that the conclusiveness of the certificate of indebtedness was binding only upon the parties and that the court would still have to determine whether sufficient evidence had been adduced to prove quantum and the correctness of the amount claimed, went against the entrenched principles enunciated in Citibank N.A v. Ooi Boon Leong & Ors, which established firmly the conclusive nature and extent of a certificate of indebtedness. A certificate of indebtedness operates in the field of adjectival law, excusing the plaintiff from adducing the proof of debt and shifting the burden onto the defendant to disprove the amount claimed. In the instant case, the relevant cls. 27 and 7.03 of the loan agreement and guarantee agreement respectively were sufficiently clear. A clause of this nature has been described as a conclusive evidence clause and has been held to be binding and valid by courts in Australia and England. The certificate of indebtedness, issued in accordance with the aforesaid cls. 27 and 7.03, was lucid enough. There was nothing to indicate or suggest any manifest error on the face of the said certificate nor was any fraud shown..: 46. Berdasarkan kepada kes Cempaka Finance (supra) adalah jelas menyatakan bahawa sijil keberhutangan plaintif adalah bukti konklusif akan keberhutangan defendan pertama melainkan jika defendan pertama dapat menunjukkan apa-apa manifest error. Mahkamah bersetuju dengan plaintif bahawa defendan pertama gagal menunjukkan apa-apa manifest error. Defendan pertama hanya menafikan tuntutan plaintif dan menyatakan bahawa ia adalah tanggungan defendan ke-2 dan ke-3. Oleh yang demikian, isu ini tidak wajar diberi perrtimbangan oleh mahkamah. Surat Tuntutan Plaintif Tidak Diterima 47. Defendan pertama juga membangkitkan isu bahawa surat tuntutan daripada peguamcara plaintif bertarikh 4.7.2016 eksibit A-4 afidavit sokongan plaintif tidak diterima oleh defendan pertama. 48. Plaintif berhujah bahawa peguamcara plaintif telah menghantar surat tuntutan tersebut kepada defendan pertama secara pos berdaftar (perakuan mengepos pada 4.7.2016) dan bukti pengeposan tersebut diekhsibitkan sebagai ekhsibit A-4. Adalah terbukti defendan pertama telah menerima surat tuntutan daripada peguamcara plaintif dan defendan pertama hanya membuat penafian kosong berkenaan dengan penerimaan surat tuntutan tersebut. Oleh itu, isu keenam juga bukanlah satu isu untuk dibicarakan dan tidak harus diberi pertimbangan oleh mahkamah. 49. Berdasarkan kepada alasan-alasan yang dinyatakan di atas, adalah jelas bahawa isu-isu yang dibangkitkan oleh defendan pertama tidak mempunyai merit. Defendan pertama juga gagal untuk menunjukkan terdapat isu-isu yang harus dibicarakan. Oleh itu mahkamah memutuskan penghakiman terus direkodkan terhadap defendan pertama dengan kos. Bertarikh pada 6 haribulan Julai, 2014 tt (ISHAK BAKRI) Hakim Mahkamah Sesyen Shah Alam Selangor 23

Tika 2.6.0

A52M-251-11/2016 DEF 2 DAN DEF 3

PLAINTIF OCBC AL-AMIN BANK BERHAD DEFENDAN 2. MAI JASMINA BINTI JALALUDDIN 3. HARYATEY BINTI HANAP

04/07/2017

DATO' ISHAK BAKRI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=c0d0b68e-e442-4343-8f60-dd95249c4260&Inline=true

DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA GUAMAN NO.BA-A52M-251-11/2016 ANTARA OCBC AL-AMIN BANK BERHAD ... PLAINTIF DAN 1. ELECTEST SDN BHD 2. MAI JASMINA BINTI JALALUDDIN 3. HARYATEY BINTI HANAPI ... DEFENDAN-DEFENDAN ALASAN KEPUTUSAN (Aturan 14 Kaedah-Kaedah Mahkamah 2012) (terhadap defendan ke-2 dan ke-3) Fakta Ringkas Kes 1. Ini adalah permohonan plaintif untuk penghakiman terus direkodkan terhadap defendan ke 2 dan ke 3 bawah Aturan 14 Kaedah-Kaedah Mahkamah 2012. 2. Fakta ringkas kes adalah seperti berikut. Defendan pertama telah memohon kepada plaintif untuk kemudahan perbankan Islam di bawah prinsip Komoditi Murabahah untuk dana perniagaan (working capital) dan plaintif telah meluluskan permohonan tersebut melalui surat tawaran bertarikh 12.11.2014 untuk jumlah sebanyak RM200,000 tertakluk kepada terma dan syarat yang terkandung di dalamnya. 3. Defendan pertama telah menerima terma dan syarat tersebut dengan menandatangani surat tawaran sepertimana yang dilampirkan dalam affidavit sokongan plaintif. 4. Seterusnya Perjanjian Jualan Aset bertarikh 19.11.2014 telah ditandatangi antara plaintif dan defendan pertama di mana plaintif telah menjual komoditi bernilai RM200,000.00 di bawah sijil CPO19NOV2014-00012-000 dan defendan pertama telah membeli komoditi tersebut pada harga jualan plaintif sebagaimana yang diperuntukkan di dalam surat tawaran. Defendan pertama juga telah bersetuju untuk membayar harga jualan plaintif tersebut melalui ansuran bulanan dalam tempoh yang dipersetujui. 5. Berikutnya, plaintif telah menjual komoditi tersebut bagi pihak defendan pertama di pasaran pada harga jualan defendan pertama dan hasilnya telah disalurkan kepada defendan pertama sebagaimana yang dipersetujui di dalam surat tawaran. 6. Defendan pertama juga telah memasuki Terma Produk Plaintif bertarikh 13.11.2014 (Rujuk ekhsibit A-3 afidavit sokongan plaintif). 7. Defendan pertama telah gagal membayar bayran bulanan di bawah kemudahan tersebut 8. Akibat kegagalan defendan pertama membayar ansuran bulanan, plaintif telah menghantar surat bertarikh 4.7.2016 kepada defendan pertama melalui peguamnya membatalkan kemudahan yang diberikan dan mengakibatkan keseluruhan keberhutangan di bawah kemudahan tersebut menjadi segera terhutang dan kena dibayar. Plaintif juga telah menuntut untuk bayaran keseluruhan jumlah terhutang setelah ditolak dengan ibra' dalam tempoh masa 7 hari dari tarikh surat tersebut sebanyak RM167,900.60 setakat 11.7.2016. 9. Defendan pertama telah gagal mematuhi tuntutan plaintif supaya membayar keseluruhan jumlah yang terhutang. 10. Melalui surat jaminan bertarikh 19.11.2014 defendan ke-2 dan ke-3 telah secara bersesama dan berasingan bersetuju untuk diikat bukan sahaja sebagai penjamin tetapi sebagai penghutang utama untuk pembayaran kesemua wang yang terhutang dan kena dibayar oleh defendan pertama kepada plaintif bila dituntut. Ini termasuk yuran peguam atas dasar peguamcara-anakguam. 11. Plaintif telah menghantar surat tuntutan bertarikh 4.7.2016 kepada defendan ke-2 dan ke-3 bertarikh 4.7.2016 secara pos berdaftar dan perakuan mengepos menuntut bayaran keseluruhan jumlah terhutang di bawah kemudahan tersebut dalam tempoh masa 7 hari dari tarikh surat tersebut. KES PLANTIFF 12. Defendan pertama, defendan ke 2 dan defendan ke 3 masih gagal menyelesaikan keseluruhan jumlah yang dituntut dalam tempoh yang ditetapkan. 13. Defendan ke-2 dan ke-3 gagal menunjukkan apa-apa isu untuk dibicarakan. 14. Sijil Keberhutangan ekhsibitkan A-7 dalam afidavit sokongan plaintif mengesahkan ketepatan jumlah keberhutangan defendan ke-2 dan ke-3 kepada plaintif. ISU-ISU DEFENDAN 15. Terdapat perintah Mahkamah Shah Alam bertarikh 14.1.2015 yang bersifat retrospective menghalang tuntutan plaintif terhadap defendan ke 2 dan ke 3. Perintah tersebut diperolehi dibawah Guaman No. 22NCVC-304-06/2016. 16. Plaintif gagal mengemukakan sebarang bukti tentang penjualan komoditi berjumlah RM200,000 tersebut. 17. Terdapat indemniti terhadap defendan pertama dan/atau Kengadharan a/l Ramasamy dan Thanapalan a/l Gopalan di mana defendan ke-2 dan ke-3 akan menuntut secara indemniti terhadap defendan pertama dan/atau Kengadharan a/l Ramasamy dan Thanapalan a/l Gopalan sekiranya Defendan ke-2 dan ke-3 didapati bertanggungjawab. KEPUTUSAN MAHKAMAH 18. Defendan ke-2 dan ke-3 mendakwa perintah mahkamah bertarikh 14.1.2015 bertindak secara retrospective yang mana menghalang tuntutan plaintif terhadap mereka. Begitupun, apa yang jelas ialah perintah tersebut tidak bersifat retrospective dan plaintif bukanlah pihak yang dinamakan dalam prosiding Mahkamah Tinggi Shah Alam tersebut. Perintah tersebut langsung tidak ada kena mengena dengan plaintif. Begitu juga terma-terma di dalam perintah mahkamah tersebut langsung tidak mengikat plaintif. 19. Perintah Mahkamah Tinggi Shah Alam tersebut yang dieksibitkan dalam affidavit jawapan defendan-defendan gagal menunjukkan sebarang bukti dalam mana-mana perenggan pun bahawa perintah tersebut bersifat retrospective. 20. Mahkamah bersetuju dengan plaintif bahawa apa jua terma di dalam perintah tersebut tidak menjejaskan tuntutan plaintif terhadap defendan ke-2 dan ke-3. Apa yang jelas adalah defendan ke-2 dan ke-3 selaku penjamin dan berdasarkan kepada Klausa 24 Surat Jaminan bertarikh 19.11.2014 telah memberi indemniti kepada plaintif untuk kesemua kerugian, tuntutan, kos dan perbelanjaan (termasuk fee peguamcara-anakguam atas indemiti penuh termasuk cukai perkhidmatan) yang berpunca dari kemudahan tersebut. 21. Walaupun defendan ke-2 dan ke-3 mengatakan mereka bukan pengarah-pengarah dalam defendan pertama lagi, ia tidak mengubah hakikat bahawa defendan ke-2 dan ke-3 adalah penjamin kepada defendan pertama. 22. Dalam kes Ocbc Bank (Malaysia) Bhd v Unimasco Sdn Bhd & Ors [2004] 6 CLJ 484 Mahkamah Tinggi menyatakan seperti berikut:- “…………………..The second defendant being the guarantor has the obligation to answer for the inability of or the default by the first defendant in making repayments under the credit facilities. See eg, Malayan Banking Bhd v Edaran Pit Stop Sdn Bhd & Ors [2000] 1 CLJ 234 HC.” 23. Seterusnya, dalam kes Andrew Siew Ling v United Overseas Bank (Malaysia) Bhd [2013] 1 CLJ 24 Mahkamah Persekutuan menyatakan seperti berikut:- “[23] It is our considered view that in the present case the appellant, being a person who has given a guarantee and more importantly an indemnity, is primarily liable for losses which the principal borrower could not have been made liable. His liability is not dependent or secondary to the liability of the principal borrower. He is a principal debtor himself. The liability under a contract of indemnity does not depend on whether the principal debt is enforceable. It has no reference in law to the obligation of any third person. In essence, the liability of the person who has given an indemnity can be more extensive than that of the liability of the principal borrower. (See the cases of (1) Yeoman Credit Ltd v. Latter & Anor [1961] 2 All ER 294 and (2) Chung Khiaw Bank Ltd v. Soi Huan & Ors [1985] 1 LNS 71].” 24. Berpandukan kepada otoriti yang dinyatakan di atas, adalah jelas bahawa defendan ke-2 dan ke-3 selaku penjamin kepada defendan pertama bertanggungjawab untuk membuat bayaran kepada plaintif. Undang-undang berkenaan dengan penjamin adalah bahawa sekiranya peminjam utama, gagal untuk membuat bayaran, penjamin-penjamin mempunyai tanggungjawab untuk membuat bayaran. 25. Berkenaan dengan isu komoditi yang dibangkitkan oleh defendan-defendan, mereka mendakwa plaintif tidak mengemukakan sebarang bukti berkenaan penjualan komoditi bernilai RM200,000.00. Dakwaan defendan-defendan nampaknya tidak berasas kerana ekhsibit “A-2” adalah bukti bahawa plaintif telah menjual komoditi bernilai RM200,000.00 dan defendan pertama telah membeli komoditi tersebut pada harga jualan sebagaimana yang diperuntukkan di dalam surat tawaran plaintif ekhsibit “A-1”. 26. Konsep produk komoditi murabahah telah dijelaskan dalam kes Kuwait Finance House (Malaysia) Berhad v Vesta Enegy Sdn Bhd [2012] 9 CLJ 516 di mana Yang Arif Mohd Zawawi Salleh telah menerangkan dengan jelas bagaimana produk Komoditi Murabahah atau juga dikenali sebagai Murabahah Tawarruq ini dijalankan:- “Murabahah Tawarruq [39] I begin with Murabahah Tawarruq facility. Murabahah Tawarruq is a transaction that involves purchasing an asset or good with deferred price on the basis of Murabahah, then selling it to a third party to obtain cash. (see Shariah Resolutions In Islamic Finance, Central Bank of Malaysia, 2010, 2nd edn, p. 224). [40] Murabahah comes from the word ribh which means increase. Technically, Murabahah is the mark-up disclosed to the purchaser as per the seller’s purchase price for a trust-sale of a certain specified asset, excluding monetary assets such as cash and receivables. (see The Principles and Practices of Shariah in Islamic Finance, Shariah Parameter Reference 1: Murabahah, Central Bank of Malaysia, p. 4). [41] Relying on the aforesaid meanings, one can come to a logical and simple conclusion that Murabahah Tawarruq based transaction allows the imposition of profit rate or profit margin. Meaning that, the bank will expressly mentions the cost of the sold goods it has incurred, and sells it to the customer by adding some profit or mark-up on the payment. So long it was accepted by the customer, the term will accordingly binds him/her. [42] In this instant case, the first defendant will initiate the deal. It will apply via purchase request for the plaintiff to purchase certain goods from vendors/suppliers. Upon receipt of the purchase request, the plaintiff will issue a “Letter Of Offer To Sell The Goods” specifying, inter alia, the deferred sale price which comprises of the purchase price of the goods, the Murabahah Profit imposed and the commodity transaction fee and the first defendant is at liberty to accept it. Once accepted, the first defendant is bound by the terms. (see cl. 2.4 of the Murabahah Tawarruq 2 Facility Agreement dated 26 June 2007). [43] In respect of this kind of transaction, the customer is not interested in owning the asset or goods that the bank acquired, but the instrument is used to facilitate cash advances to him who is in need of cash to pay various needs. (see Shariah Resolutions In Islamic Finance, Central Bank of Malaysia, 2010, 2nd edn., p. 224, Shariah Resolutions In Islamic Finance, Central Bank of Malaysia, 2007, 1st edn., p. 62, RHB Islamic Bank Berhad v. Veheng Global Trader Sdn Bhd & Ors [2011] 1 LNS 684 and cl. 2.2 of the Murabahah Tawarruq 2 Facility Agreement dated 26 June 2007). [44] So too here. The purpose of the facility was to finance the first defendant’s general working capital requirements only. That is why, subsequent to the sale between the plaintiff and the first defendant, the latter will appoint the former as its agent to sell the goods so purchased to a third party. (see cl. 2.4 (d) of the Murabahah Tawarruq 2 Facility Agreement dated 26 June 2007). 27. Berdasarkan kepada kes Kuwait Finance House diatas, secara ringkasnya, kemudahan pembiayaan Islam di bawah prinsip Komoditi Murabahah melibatkan pembelian dan penjualan komoditi yang diluluskan oleh syariah. Komoditi yang terlibat di dalam kes ini adalah minyak sawit mentah (Crude Palm Oil) seperti yang telah diplidkan oleh plaintif di dalam pernyataan tuntutan plaintif bertarikh 15.11.2016 dan juga seperti yang tertera didalam dokumen-dokumen kemudahan pembiayaan yang telah diekhsibitkan oleh plaintif. 28. Transaksi berkenaan kemudahan pembiayaan di bawah prinsip Komoditi Murabahah yang telah diberikan kepada defendan pertama adalah mematuhi syariah dan diketahui oleh Bank Negara Malaysia. Defendan ke-2 dan ke-3 selaku penjamin telah menandatangani surat jaminan. Ekhsibit “A-5” adalah bukti bahawa plaintif boleh menuntut pembayaran daripada defendan ke-2 dan ke-3. 29. Sekiranya defendan ke-2 dan ke-3 ingin menuntut apa-apa indemniti daripada defendan pertama dan juga pengarah-pengarah terkini, itu adalah hak defendan ke 2 dan ke 3 yang tidak ada kena mengena dengan tuntutan plaintif. Defendan ke-2 dan ke-3 selaku penjamin adalah bertanggungjawab ke atas tuntutan plaintif. 30. Sekiranya terdapat permasalahan antara plaintif dan defendan ke-2 dan ke-3 ianya tidak ada kena mengena dengan plaintif. Tuntutan plaintif juga tidak terjejas hanya kerana defendan ke-2 dan ke-3 bukan lagi pengarah-pengarah defendan pertama. Apa yang jelas dan penting adalah defendan pertama telah memohon untuk kemudahan pembiayaan daripada plaintif dan defendan ke-2 dan ke-3 telah bersetuju untuk menjadi penjamin. 31. Plaintif telah mengemukakan Sijil Keberhutangan eksibit A7 yang mengesahkan 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. ketepatan dan jumlah keberhutangan defendan ke-2 dan ke-3. Defendan ke-2 dan ke-3 telah gagal untuk menunjukkan apa-apa manifest error dalam sijil keberhutangan dan oleh yang demikian sijil tersebut adalah bukti konklusif tentang keberhutangan defendan ke-2 dan ke-3. 32. Klausa 21 surat jaminan ekhsibit “A-5” adalah bukti berkenaan sijil keberhutangan tersebut. Dalam kes Cempaka Finance Berhad v Ho Laiying & Anor [2006] 3 CLJ 544 Mahkamah Agung menyatakan seperti berkata:- “The Court of Appeal’s position that the conclusiveness of the certificate of indebtedness was binding only upon the parties and that the court would still have to determine whether sufficient evidence had been adduced to prove quantum and the correctness of the amount claimed, went against the entrenched principles enunciated in Citibank N.A v. Ooi Boon Leong & Ors, which established firmly the conclusive nature and extent of a certificate of indebtedness. A certificate of indebtedness operates in the field of adjectival law, excusing the plaintiff from adducing the proof of debt and shifting the burden onto the defendant to disprove the amount claimed. In the instant case, the relevant cls. 27 and 7.03 of the loan agreement and guarantee agreement respectively were sufficiently clear. A clause of this nature has been described as a conclusive evidence clause and has been held to be binding and valid by courts in Australia and England. The certificate of indebtedness, issued in accordance with the aforesaid cls. 27 and 7.03, was lucid enough. There was nothing to indicate or suggest any manifest error on the face of the said certificate nor was any fraud shown.” 33. Klausa 21 pada surat jaminan bertarikh 19.11.2014 tersebut dan kes Cempaka Finance yang dirujuk diatas jelas menyatakan bahawa sijil keberhutangan yang dikemukakan oleh Pplaintif adalah bukti konklusif akan keberhutangan defendan ke-2 dan ke-3 melainkan jika defendan ke-2 dan ke-3 dapat menunjukkan apa-apa manifest error. 34. Meneliti kepada hujahan defendan-defendan, mereka gagal untuk menunjukkan apa-apa “manifest error”. Defendan ke-2 dan ke-3 hanya menafikan tuntutan plaintif dan menyatakan bahawa ia adalah tanggungjawab defendan pertama dan/atau pengarah-pengarah baru defendan pertama untuk membuat bayaran. 35. Defendan ke-2 dan ke-3 hanya perlu menunjukkan isu-isu bona fide yang harus dibicarakan. Dalam kes Bank Negara Malaysia v Mohd Ismail Ali Johor & Ors [1992] 1 CLJ (REP) 14 Mahkamah Agung telah menyatakan seperti berikut: “[1] Under O. 14, when a fact is asserted by one party and denied by another, and such denial is equivocal or lacking in precision or is inconsistent with undisputed contemporary documents or other statements by the same deponent or is inherently improbable in itself the Judge has a duty to reject such assertion or denial, thereby rendering the issue as not triable.” 36. Defendan ke-2 dan ke-3 telah gagal menunjukkan sebarang isu-isu yang harus dibicarakan. Defenan-defendan hanya sekadar membuat penafian kosong semata-mata dan isu-isu yang dibangkitkan oleh defendan-defendan langsung tidak bermerit. 37. Berdasarkan kepada alasan-alasan yang diperjelaskan di atas, mahkamah memutuskan permohonan plaintif untuk penghakiman terus direkodkan terhadap defendan ke 2 dan ke 3 dibenarkan dengan kos. Bertarikh pada 4 haribulan Julai 2017. tt (ISHAK BAKRI) Hakim Mahkamah Sesyen Shah Alam Selangor 18

Tika 2.6.0

A52M-251-11/2016 DEF 2 DAN DEF 3

PLAINTIF OCBC AL-AMIN BANK BERHAD DEFENDAN 2. MAI JASMINA BINTI JALALUDDIN 3. HARYATEY BINTI HANAP

04/07/2017

DATO' ISHAK BAKRI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=c0d0b68e-e442-4343-8f60-dd95249c4260&Inline=true

DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA GUAMAN NO.BA-A52M-251-11/2016 ANTARA OCBC AL-AMIN BANK BERHAD ... PLAINTIF DAN 1. ELECTEST SDN BHD 2. MAI JASMINA BINTI JALALUDDIN 3. HARYATEY BINTI HANAPI ... DEFENDAN-DEFENDAN ALASAN KEPUTUSAN (Aturan 14 Kaedah-Kaedah Mahkamah 2012) (terhadap defendan ke-2 dan ke-3) Fakta Ringkas Kes 1. Ini adalah permohonan plaintif untuk penghakiman terus direkodkan terhadap defendan ke 2 dan ke 3 bawah Aturan 14 Kaedah-Kaedah Mahkamah 2012. 2. Fakta ringkas kes adalah seperti berikut. Defendan pertama telah memohon kepada plaintif untuk kemudahan perbankan Islam di bawah prinsip Komoditi Murabahah untuk dana perniagaan (working capital) dan plaintif telah meluluskan permohonan tersebut melalui surat tawaran bertarikh 12.11.2014 untuk jumlah sebanyak RM200,000 tertakluk kepada terma dan syarat yang terkandung di dalamnya. 3. Defendan pertama telah menerima terma dan syarat tersebut dengan menandatangani surat tawaran sepertimana yang dilampirkan dalam affidavit sokongan plaintif. 4. Seterusnya Perjanjian Jualan Aset bertarikh 19.11.2014 telah ditandatangi antara plaintif dan defendan pertama di mana plaintif telah menjual komoditi bernilai RM200,000.00 di bawah sijil CPO19NOV2014-00012-000 dan defendan pertama telah membeli komoditi tersebut pada harga jualan plaintif sebagaimana yang diperuntukkan di dalam surat tawaran. Defendan pertama juga telah bersetuju untuk membayar harga jualan plaintif tersebut melalui ansuran bulanan dalam tempoh yang dipersetujui. 5. Berikutnya, plaintif telah menjual komoditi tersebut bagi pihak defendan pertama di pasaran pada harga jualan defendan pertama dan hasilnya telah disalurkan kepada defendan pertama sebagaimana yang dipersetujui di dalam surat tawaran. 6. Defendan pertama juga telah memasuki Terma Produk Plaintif bertarikh 13.11.2014 (Rujuk ekhsibit A-3 afidavit sokongan plaintif). 7. Defendan pertama telah gagal membayar bayran bulanan di bawah kemudahan tersebut 8. Akibat kegagalan defendan pertama membayar ansuran bulanan, plaintif telah menghantar surat bertarikh 4.7.2016 kepada defendan pertama melalui peguamnya membatalkan kemudahan yang diberikan dan mengakibatkan keseluruhan keberhutangan di bawah kemudahan tersebut menjadi segera terhutang dan kena dibayar. Plaintif juga telah menuntut untuk bayaran keseluruhan jumlah terhutang setelah ditolak dengan ibra' dalam tempoh masa 7 hari dari tarikh surat tersebut sebanyak RM167,900.60 setakat 11.7.2016. 9. Defendan pertama telah gagal mematuhi tuntutan plaintif supaya membayar keseluruhan jumlah yang terhutang. 10. Melalui surat jaminan bertarikh 19.11.2014 defendan ke-2 dan ke-3 telah secara bersesama dan berasingan bersetuju untuk diikat bukan sahaja sebagai penjamin tetapi sebagai penghutang utama untuk pembayaran kesemua wang yang terhutang dan kena dibayar oleh defendan pertama kepada plaintif bila dituntut. Ini termasuk yuran peguam atas dasar peguamcara-anakguam. 11. Plaintif telah menghantar surat tuntutan bertarikh 4.7.2016 kepada defendan ke-2 dan ke-3 bertarikh 4.7.2016 secara pos berdaftar dan perakuan mengepos menuntut bayaran keseluruhan jumlah terhutang di bawah kemudahan tersebut dalam tempoh masa 7 hari dari tarikh surat tersebut. KES PLANTIFF 12. Defendan pertama, defendan ke 2 dan defendan ke 3 masih gagal menyelesaikan keseluruhan jumlah yang dituntut dalam tempoh yang ditetapkan. 13. Defendan ke-2 dan ke-3 gagal menunjukkan apa-apa isu untuk dibicarakan. 14. Sijil Keberhutangan ekhsibitkan A-7 dalam afidavit sokongan plaintif mengesahkan ketepatan jumlah keberhutangan defendan ke-2 dan ke-3 kepada plaintif. ISU-ISU DEFENDAN 15. Terdapat perintah Mahkamah Shah Alam bertarikh 14.1.2015 yang bersifat retrospective menghalang tuntutan plaintif terhadap defendan ke 2 dan ke 3. Perintah tersebut diperolehi dibawah Guaman No. 22NCVC-304-06/2016. 16. Plaintif gagal mengemukakan sebarang bukti tentang penjualan komoditi berjumlah RM200,000 tersebut. 17. Terdapat indemniti terhadap defendan pertama dan/atau Kengadharan a/l Ramasamy dan Thanapalan a/l Gopalan di mana defendan ke-2 dan ke-3 akan menuntut secara indemniti terhadap defendan pertama dan/atau Kengadharan a/l Ramasamy dan Thanapalan a/l Gopalan sekiranya Defendan ke-2 dan ke-3 didapati bertanggungjawab. KEPUTUSAN MAHKAMAH 18. Defendan ke-2 dan ke-3 mendakwa perintah mahkamah bertarikh 14.1.2015 bertindak secara retrospective yang mana menghalang tuntutan plaintif terhadap mereka. Begitupun, apa yang jelas ialah perintah tersebut tidak bersifat retrospective dan plaintif bukanlah pihak yang dinamakan dalam prosiding Mahkamah Tinggi Shah Alam tersebut. Perintah tersebut langsung tidak ada kena mengena dengan plaintif. Begitu juga terma-terma di dalam perintah mahkamah tersebut langsung tidak mengikat plaintif. 19. Perintah Mahkamah Tinggi Shah Alam tersebut yang dieksibitkan dalam affidavit jawapan defendan-defendan gagal menunjukkan sebarang bukti dalam mana-mana perenggan pun bahawa perintah tersebut bersifat retrospective. 20. Mahkamah bersetuju dengan plaintif bahawa apa jua terma di dalam perintah tersebut tidak menjejaskan tuntutan plaintif terhadap defendan ke-2 dan ke-3. Apa yang jelas adalah defendan ke-2 dan ke-3 selaku penjamin dan berdasarkan kepada Klausa 24 Surat Jaminan bertarikh 19.11.2014 telah memberi indemniti kepada plaintif untuk kesemua kerugian, tuntutan, kos dan perbelanjaan (termasuk fee peguamcara-anakguam atas indemiti penuh termasuk cukai perkhidmatan) yang berpunca dari kemudahan tersebut. 21. Walaupun defendan ke-2 dan ke-3 mengatakan mereka bukan pengarah-pengarah dalam defendan pertama lagi, ia tidak mengubah hakikat bahawa defendan ke-2 dan ke-3 adalah penjamin kepada defendan pertama. 22. Dalam kes Ocbc Bank (Malaysia) Bhd v Unimasco Sdn Bhd & Ors [2004] 6 CLJ 484 Mahkamah Tinggi menyatakan seperti berikut:- “…………………..The second defendant being the guarantor has the obligation to answer for the inability of or the default by the first defendant in making repayments under the credit facilities. See eg, Malayan Banking Bhd v Edaran Pit Stop Sdn Bhd & Ors [2000] 1 CLJ 234 HC.” 23. Seterusnya, dalam kes Andrew Siew Ling v United Overseas Bank (Malaysia) Bhd [2013] 1 CLJ 24 Mahkamah Persekutuan menyatakan seperti berikut:- “[23] It is our considered view that in the present case the appellant, being a person who has given a guarantee and more importantly an indemnity, is primarily liable for losses which the principal borrower could not have been made liable. His liability is not dependent or secondary to the liability of the principal borrower. He is a principal debtor himself. The liability under a contract of indemnity does not depend on whether the principal debt is enforceable. It has no reference in law to the obligation of any third person. In essence, the liability of the person who has given an indemnity can be more extensive than that of the liability of the principal borrower. (See the cases of (1) Yeoman Credit Ltd v. Latter & Anor [1961] 2 All ER 294 and (2) Chung Khiaw Bank Ltd v. Soi Huan & Ors [1985] 1 LNS 71].” 24. Berpandukan kepada otoriti yang dinyatakan di atas, adalah jelas bahawa defendan ke-2 dan ke-3 selaku penjamin kepada defendan pertama bertanggungjawab untuk membuat bayaran kepada plaintif. Undang-undang berkenaan dengan penjamin adalah bahawa sekiranya peminjam utama, gagal untuk membuat bayaran, penjamin-penjamin mempunyai tanggungjawab untuk membuat bayaran. 25. Berkenaan dengan isu komoditi yang dibangkitkan oleh defendan-defendan, mereka mendakwa plaintif tidak mengemukakan sebarang bukti berkenaan penjualan komoditi bernilai RM200,000.00. Dakwaan defendan-defendan nampaknya tidak berasas kerana ekhsibit “A-2” adalah bukti bahawa plaintif telah menjual komoditi bernilai RM200,000.00 dan defendan pertama telah membeli komoditi tersebut pada harga jualan sebagaimana yang diperuntukkan di dalam surat tawaran plaintif ekhsibit “A-1”. 26. Konsep produk komoditi murabahah telah dijelaskan dalam kes Kuwait Finance House (Malaysia) Berhad v Vesta Enegy Sdn Bhd [2012] 9 CLJ 516 di mana Yang Arif Mohd Zawawi Salleh telah menerangkan dengan jelas bagaimana produk Komoditi Murabahah atau juga dikenali sebagai Murabahah Tawarruq ini dijalankan:- “Murabahah Tawarruq [39] I begin with Murabahah Tawarruq facility. Murabahah Tawarruq is a transaction that involves purchasing an asset or good with deferred price on the basis of Murabahah, then selling it to a third party to obtain cash. (see Shariah Resolutions In Islamic Finance, Central Bank of Malaysia, 2010, 2nd edn, p. 224). [40] Murabahah comes from the word ribh which means increase. Technically, Murabahah is the mark-up disclosed to the purchaser as per the seller’s purchase price for a trust-sale of a certain specified asset, excluding monetary assets such as cash and receivables. (see The Principles and Practices of Shariah in Islamic Finance, Shariah Parameter Reference 1: Murabahah, Central Bank of Malaysia, p. 4). [41] Relying on the aforesaid meanings, one can come to a logical and simple conclusion that Murabahah Tawarruq based transaction allows the imposition of profit rate or profit margin. Meaning that, the bank will expressly mentions the cost of the sold goods it has incurred, and sells it to the customer by adding some profit or mark-up on the payment. So long it was accepted by the customer, the term will accordingly binds him/her. [42] In this instant case, the first defendant will initiate the deal. It will apply via purchase request for the plaintiff to purchase certain goods from vendors/suppliers. Upon receipt of the purchase request, the plaintiff will issue a “Letter Of Offer To Sell The Goods” specifying, inter alia, the deferred sale price which comprises of the purchase price of the goods, the Murabahah Profit imposed and the commodity transaction fee and the first defendant is at liberty to accept it. Once accepted, the first defendant is bound by the terms. (see cl. 2.4 of the Murabahah Tawarruq 2 Facility Agreement dated 26 June 2007). [43] In respect of this kind of transaction, the customer is not interested in owning the asset or goods that the bank acquired, but the instrument is used to facilitate cash advances to him who is in need of cash to pay various needs. (see Shariah Resolutions In Islamic Finance, Central Bank of Malaysia, 2010, 2nd edn., p. 224, Shariah Resolutions In Islamic Finance, Central Bank of Malaysia, 2007, 1st edn., p. 62, RHB Islamic Bank Berhad v. Veheng Global Trader Sdn Bhd & Ors [2011] 1 LNS 684 and cl. 2.2 of the Murabahah Tawarruq 2 Facility Agreement dated 26 June 2007). [44] So too here. The purpose of the facility was to finance the first defendant’s general working capital requirements only. That is why, subsequent to the sale between the plaintiff and the first defendant, the latter will appoint the former as its agent to sell the goods so purchased to a third party. (see cl. 2.4 (d) of the Murabahah Tawarruq 2 Facility Agreement dated 26 June 2007). 27. Berdasarkan kepada kes Kuwait Finance House diatas, secara ringkasnya, kemudahan pembiayaan Islam di bawah prinsip Komoditi Murabahah melibatkan pembelian dan penjualan komoditi yang diluluskan oleh syariah. Komoditi yang terlibat di dalam kes ini adalah minyak sawit mentah (Crude Palm Oil) seperti yang telah diplidkan oleh plaintif di dalam pernyataan tuntutan plaintif bertarikh 15.11.2016 dan juga seperti yang tertera didalam dokumen-dokumen kemudahan pembiayaan yang telah diekhsibitkan oleh plaintif. 28. Transaksi berkenaan kemudahan pembiayaan di bawah prinsip Komoditi Murabahah yang telah diberikan kepada defendan pertama adalah mematuhi syariah dan diketahui oleh Bank Negara Malaysia. Defendan ke-2 dan ke-3 selaku penjamin telah menandatangani surat jaminan. Ekhsibit “A-5” adalah bukti bahawa plaintif boleh menuntut pembayaran daripada defendan ke-2 dan ke-3. 29. Sekiranya defendan ke-2 dan ke-3 ingin menuntut apa-apa indemniti daripada defendan pertama dan juga pengarah-pengarah terkini, itu adalah hak defendan ke 2 dan ke 3 yang tidak ada kena mengena dengan tuntutan plaintif. Defendan ke-2 dan ke-3 selaku penjamin adalah bertanggungjawab ke atas tuntutan plaintif. 30. Sekiranya terdapat permasalahan antara plaintif dan defendan ke-2 dan ke-3 ianya tidak ada kena mengena dengan plaintif. Tuntutan plaintif juga tidak terjejas hanya kerana defendan ke-2 dan ke-3 bukan lagi pengarah-pengarah defendan pertama. Apa yang jelas dan penting adalah defendan pertama telah memohon untuk kemudahan pembiayaan daripada plaintif dan defendan ke-2 dan ke-3 telah bersetuju untuk menjadi penjamin. 31. Plaintif telah mengemukakan Sijil Keberhutangan eksibit A7 yang mengesahkan 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. ketepatan dan jumlah keberhutangan defendan ke-2 dan ke-3. Defendan ke-2 dan ke-3 telah gagal untuk menunjukkan apa-apa manifest error dalam sijil keberhutangan dan oleh yang demikian sijil tersebut adalah bukti konklusif tentang keberhutangan defendan ke-2 dan ke-3. 32. Klausa 21 surat jaminan ekhsibit “A-5” adalah bukti berkenaan sijil keberhutangan tersebut. Dalam kes Cempaka Finance Berhad v Ho Laiying & Anor [2006] 3 CLJ 544 Mahkamah Agung menyatakan seperti berkata:- “The Court of Appeal’s position that the conclusiveness of the certificate of indebtedness was binding only upon the parties and that the court would still have to determine whether sufficient evidence had been adduced to prove quantum and the correctness of the amount claimed, went against the entrenched principles enunciated in Citibank N.A v. Ooi Boon Leong & Ors, which established firmly the conclusive nature and extent of a certificate of indebtedness. A certificate of indebtedness operates in the field of adjectival law, excusing the plaintiff from adducing the proof of debt and shifting the burden onto the defendant to disprove the amount claimed. In the instant case, the relevant cls. 27 and 7.03 of the loan agreement and guarantee agreement respectively were sufficiently clear. A clause of this nature has been described as a conclusive evidence clause and has been held to be binding and valid by courts in Australia and England. The certificate of indebtedness, issued in accordance with the aforesaid cls. 27 and 7.03, was lucid enough. There was nothing to indicate or suggest any manifest error on the face of the said certificate nor was any fraud shown.” 33. Klausa 21 pada surat jaminan bertarikh 19.11.2014 tersebut dan kes Cempaka Finance yang dirujuk diatas jelas menyatakan bahawa sijil keberhutangan yang dikemukakan oleh Pplaintif adalah bukti konklusif akan keberhutangan defendan ke-2 dan ke-3 melainkan jika defendan ke-2 dan ke-3 dapat menunjukkan apa-apa manifest error. 34. Meneliti kepada hujahan defendan-defendan, mereka gagal untuk menunjukkan apa-apa “manifest error”. Defendan ke-2 dan ke-3 hanya menafikan tuntutan plaintif dan menyatakan bahawa ia adalah tanggungjawab defendan pertama dan/atau pengarah-pengarah baru defendan pertama untuk membuat bayaran. 35. Defendan ke-2 dan ke-3 hanya perlu menunjukkan isu-isu bona fide yang harus dibicarakan. Dalam kes Bank Negara Malaysia v Mohd Ismail Ali Johor & Ors [1992] 1 CLJ (REP) 14 Mahkamah Agung telah menyatakan seperti berikut: “[1] Under O. 14, when a fact is asserted by one party and denied by another, and such denial is equivocal or lacking in precision or is inconsistent with undisputed contemporary documents or other statements by the same deponent or is inherently improbable in itself the Judge has a duty to reject such assertion or denial, thereby rendering the issue as not triable.” 36. Defendan ke-2 dan ke-3 telah gagal menunjukkan sebarang isu-isu yang harus dibicarakan. Defenan-defendan hanya sekadar membuat penafian kosong semata-mata dan isu-isu yang dibangkitkan oleh defendan-defendan langsung tidak bermerit. 37. Berdasarkan kepada alasan-alasan yang diperjelaskan di atas, mahkamah memutuskan permohonan plaintif untuk penghakiman terus direkodkan terhadap defendan ke 2 dan ke 3 dibenarkan dengan kos. Bertarikh pada 4 haribulan Julai 2017. tt (ISHAK BAKRI) Hakim Mahkamah Sesyen Shah Alam Selangor 18

Tika 2.6.0

A52NCC-306-11/2016

PLAINTIF LAFARGE CONCRETE (M) SDN BHD DEFENDAN TAN NGEE HONG CONSTRUCTION SDN BHD TAI KOK KEONG @ TAY KOK KEONG

04/07/2017

DATO' ISHAK BAKRI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=7a0d688d-a33d-4700-a1e0-a0458cdafdb2&Inline=true

DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN GUAMAN NO BA-A52NCC-306-11/2016 ANTARA LAFARGE CONCRETE (M) SDN BHD …PLAINTIF DAN TAN NGEE HONG CONSTRUCTION SDN BHD TAI KOK KEONG @ TAY KOK KEONG …DEFENDAN-DEFENDAN GROUNDS OF DECISION INTRODUCTION 1. This is an application by the plaintiff for summary judgment under Order 14 rule 1 of the Rules of Court 2012 against the defendants. 2. On 9.5.2016 the court made a decision and allowed the plaintiff’s application for summary judgment against the defendants with costs in the amount of RM1,500 to be paid by the defendants to the plaintiff. 3. Dissatisfied with the decision of the court, the defendants filed an appeal to the High Court. BACKGROUND FACTS 4. Pursuant to an agreement entered between the plaintiff and the 1st defendant (“agreement”), the plaintiff had upon the request of the 1st defendant agreed to sell and deliver goods to the 1st defendant subject to the terms and conditions as stated in the agreement. 5. The salient terms and conditions of the agreement inter alia, were as follows:- a. “8. We shall have the right to charge late payment interest at the rate of 1.5% per month (or any other rate as may be prescribed by us without notice to you) on the outstanding sum still due by you to us before as well as after judgment”; b. “10. We shall be deemed to have delivered the products to you if… the delivery order is endorsed by any person who collects the same from us or by any person present at the said address without the need of your company chop…. Any certification made by any of our officer that the products have been properly delivered to your said address on a specified date shall be sufficient proof of delivery”; c. “16. Any statement of indebtedness certified by any of our officer as to the balance of monies still outstanding and due from you to us shall be binding and conclusive evidence against you in any legal proceedings”; and d. “21. Any invoice, statement of account, notice and/or other documents to be sent to you shall be sent through ordinary prepaid post… and the same shall be deemed to have been received by you within two (2) days after the date of posting.” 6. As security or in consideration of the plaintiff agreeing to sell and deliver goods to the 1st defendant, by a ‘Joint and Several Personal Guarantee’ between the 2nd and 3rd defendants and the plaintiff (“letter of indemnity”)[footnoteRef:1], the 2nd and 3rd defendants had jointly and severally guaranteed to indemnify and pay all sum due and owing by the 1st defendant together with interest and all losses suffered by the plaintiff. [1: ] 7. The letter of indemnity provides inter alia, for the following:- a. “1. … I/We the undersigned HEREBY JOINTLY AND SEVERALLY GUARANTEE to you as principal/s and not merely as surety/ies…”; b. “9. … A certificate/statement signed by your officer as to the sums and liabilities for the time being due or incurred to you from or by the Customer shall be conclusive evidence for the purposes of this Guarantee and in any legal proceedings against me/us”; and c. “15. Any notice or demand hereunder shall be deemed to have been sufficiently given if sent by prepaid post letter… and shall be assumed to have reached the address within two (2) days after the date of posting.” 8. It is not in dispute that goods had been sold and delivered by the plaintiff to the 1st defendant and/or for the benefit of the 1st defendant. 9. It is unrebutted that pursuant to a demand made by the plaintiff via its ‘Statement of Accounts For the Month of November 2014’[footnoteRef:2], the 1st defendant had made part payment through MBB Cheque No.: 368948[footnoteRef:3] for a sum of RM29,506.54 leaving the balance principle sum of RM103,510.79 as claimed in this suit. [2: ] [3: ] PLAINTIFF’S CASE 10. The 1st defendant has breached the terms and conditions of the agreement in failing to make payment for a sum of RM148,871.01 (i.e. principle sum of RM103,510.79 + % as at 11.11.2016 of RM45,360.22) to the plaintiff, full particulars of which are stated in the affidavit in support. 11. Letters of demand dated 14.11.2016 to the defendants had been sent to the defendants. However, the defendants have refused, failed and/or neglected in paying the same. 12. Though the agreement and letter of indemnity are unstamped, that does not provide a triable issue under the summary judgment application. 13. Part payment had been made by the 1st defendant to the plaintiff without any protest. ISSUES RAISED BY THE DEFENDANTS 14. The defendants raised the following issues:- a. that both the agreement and the letter of indemnity are unstamped; b. that the 1st defendant did not receive the goods. There is no proof of acknowledgement on the invoice/debit notes and delivery orders by the 1st defendant; and c. that the defendants deny receiving the letters of demand dated 14.11.2016. DECISION OF THE COURT That both the agreement and letter of indemnity are unstamped 15. The court find that although the agreement and the letter of indemnity are unstamped, that is not a triable issue to be considered by the court. In reference to the case of of American Express International Banking Corp v Tan Loon Swan [1992] 1 CLJ (Rep) 1 the Supreme Court had in allowing a summary judgment application held that “the non-stamping of documents concerned (guarantee document) does not provide a triable issue”. That the 1st defendant did not receive the goods. There is no proof of acknowledgement on the invoice/debit notes and delivery orders by the 1st defendant. 16. Under the agreement, it clearly stated that any statement of indebtedness certified by any officer of the plaintiff and certificate signed by the plaintiff’s officer as to the sums and liabilities for the time being due shall be conclusive evidence in a legal proceeding against the defendants. Clause 16 of the agreement and Clause 9 of the letter of indemnity provides as follows:- a. Clause 16 of the agreement provides:- “Any statement of indebtedness certified by any of our officer as to the balance of monies still outstanding and due from you to us shall be binding and conclusive evidence against you in any legal proceedings”; and b. Clause 9 of the letter of indemnity provides:- “A certificate/statement signed by your officer as to the sums and liabilities for the time being due or incurred to you from or by the Customer shall be conclusive evidence for the purposes of this Guarantee and in any legal proceedings against me/us.” 17. In the case of Cempaka Finance Bhd v Ho Lai Ying & Anor [2006] 3 CLJ 544 the Federal Court had in allowing for summary judgment to be entered based on a certificate of indebtedness held that:- “A certificate of indebtedness operates in the field of adjectival law, excusing the Plaintiff from adducing the proof of debt and shifting the burden onto the defendant to disprove the amount claimed. …A clause of this nature has been described as a conclusive evidence clause and has been held to be binding and valid by courts in Australia and England. The certificate of indebtedness, issued in accordance with the aforesaid cls. 27 and 7.03, was lucid enough. There was nothing to indicate or suggest any manifest error on the fact of the said certificate nor was any fraud shown.” 18. The above principle as enunciated in Cempaka Finance Bhd (supra) has been cited with approval in the recent Federal Court case of Hong Leong Bank Bhd v M Muthiah & Anor and Another Appeal [2014] 1 CLJ 1. 19. Since the burden of proof has shifted to the defendants, it is incumbent upon the defendants in their affidavit showing cause to condescend into the particulars as to how the amount claim in this suit is without basis failing which the defendant’s defence is a bare denial and cannot be a triable issue. This, the defendants have clearly fail. 20. Further, Clause 10 of the agreement provides that:- “Any certification made by any of our officer that the products have been properly delivered to your said address on a specified date shall be sufficient proof of delivery.” 21. In Bumiputra Commerce Leasing Bhd v Tax-Win Industries Sdn Bhd & 2 Ors [2003] 1 LNS 94 the High Court had in relying upon the ‘Delivery Certificate’ to support proof of delivery, allowed for summary judgment to be entered. 22. I agree with the submission by the plaintiff that the acknowledgement of delivery can be seen clearly on all the Delivery Orders. In fact, the 1st defendant has even made part payment on the sum outstanding then and the 1st defendant has never once disputed nor raised any issue in regards to the goods delivered or the amount claimed in the Invoice/Debit Notes and Delivery Orders. 23. In the case of National Panasonic (M) Sdn Bhd v Lem The Sem & Anor [2003] 8 CLJ 408 , Low Hop Bing J (as he then was) referred with approval to Lek Chuan (M) Sdn Bhd v Shahpadu Properties Sdn Bhd [1995] 1 LNS 110 wherein Haidar J (as he then was) had entered summary judgment for the plaintiff when the statement of account were presented to the defendants who duly made some payments to the plaintiff. 24. I find that the submission by the defendants defies logic and common sense. If at all there had been no delivery of goods, why did the defendants make part payments? The allegation that there was a discrepancy in the amount claimed by the plaintiff clearly run counter to contemporaneous documents such as invoices, delivery orders and statement of account which have been duly delivered to the first defendant who had not disputed them but had made part payments thereon. 25. The 1st defendant had made part payment to the plaintiff when statement of account was presented leaving the balance sum as claimed in this suit. The submission presented by the defendants is somewhat naïve besides being inherently improbable. If at all the defendant had not received the goods, what was the need for the defendant to make part payment thereof?. 26. In the case of Gold Coin (Malaysia) Bhd v First Dragon Sdn Bhd [1994] 1 LNS 52 Abdul Malik Ishak J (as he then was) has held as follows:- “Against these formidable evidence, the defendant simply denied receiving the goods. This kind of defence is not enough. In an action for the price of goods sold and delivered, the defendant must not (as here) merely plead a denial of the debt or a denial that the goods were received; but he must go further - he must plead any facts which negative its existence or which show that the action is not maintainable on other grounds … The defendants deny receiving the Letters of Demand dated 14.11.2016 27. It is admitted by both the 2nd and 3rd defendants that they jointly and severally undertook the obligation of a principal debtor to pay the sum due and owing by the 1st defendant together with interest and all losses suffered by the plaintiff. 28. In discussing the relevant authorities for the proposition of a principal debtor clause, Lau Bee Lan J in Ambank (M) Sdn Bhd v E-Cenit Systems Sdn Bhd [2015] 1 LNS 1159 at para 13 held that:- “... the authorities which I shall refer hereafter recognize that the existence of a principal debtor clause in the Guarantees obviates the Plaintiff from issuing a demand to the 2nd- 4th Defendants and the service of the Writ of Summons and the Statement of Claim is sufficient notice.” 29. By reason of the foregoing, the existence of the principal debtor clause in the Letter of Indemnity and the fact that the 1st defendant itself is the principal debtor obviates the plaintiff from issuing letter of demand to the defendants. The service of the Writ Terpinda dan Pernyataan Tuntutan Terpinda dated 2.2.2017 itself is sufficient notice. 30. Be that as it may, I agree with the submission by the plaintiff that the Letters of Demand dated 14.11.2016 had been effectively served on the defendants as provided under Clause 21 of the agreement and Clause 15 of the Letter of Indemnity respectively which reads as follows:- a. Clause 21 of the Agreement provides:- “Any invoice, statement of account, notice and/or other documents to be sent by us to you shall be sent through ordinary prepaid post at your address… and the same shall be deemed to have been received by you within two (2) days after the date of posting.”; and b. Clause 15 of the Letter of Indemnity provides:- “Any notice or demand hereunder shall be deemed to have been sufficiently given if sent by prepaid post letter to my/our address in Malaysia last known to you or stated hereon and shall be assumed to have reached the address within two (2) days after the date of posting.” 31. In the Supreme Court case of Amanah Merchant Bank Bhd (Formerly Known As Amanah-Chase Merchant Bank Bhd) v Lim Tow Choon (Through Official Assignee) [1994] 2 CLJ 1 the court at page 5 held that:- “… It is sufficient for the appellant to show that the notice was correctly addressed, prepaid and delivered to the post office and acknowledged for service by the postal authority. Once these facts have been established, the deeming provision will inevitably apply.” 32 Relying upon the conclusiveness of the Certificate of Indebtedness and Certificate of Delivery, issue raised by the defendants is untenable and cannot be a triable issue. 33. Based on the reasons stated above, I find that this is a fit and proper case for the summary judgment to be entered against the defendants with costs. Dated this 4th day of July, 2017 sgd (ISHAK BAKRI) Judge Sessions Court Shah Alam Selangor 15

Tika 2.6.0

A52NCC-306-11/2016

PLAINTIF LAFARGE CONCRETE (M) SDN BHD DEFENDAN TAN NGEE HONG CONSTRUCTION SDN BHD TAI KOK KEONG @ TAY KOK KEONG

04/07/2017

DATO' ISHAK BAKRI

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=7a0d688d-a33d-4700-a1e0-a0458cdafdb2&Inline=true

DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN GUAMAN NO BA-A52NCC-306-11/2016 ANTARA LAFARGE CONCRETE (M) SDN BHD …PLAINTIF DAN TAN NGEE HONG CONSTRUCTION SDN BHD TAI KOK KEONG @ TAY KOK KEONG …DEFENDAN-DEFENDAN GROUNDS OF DECISION INTRODUCTION 1. This is an application by the plaintiff for summary judgment under Order 14 rule 1 of the Rules of Court 2012 against the defendants. 2. On 9.5.2016 the court made a decision and allowed the plaintiff’s application for summary judgment against the defendants with costs in the amount of RM1,500 to be paid by the defendants to the plaintiff. 3. Dissatisfied with the decision of the court, the defendants filed an appeal to the High Court. BACKGROUND FACTS 4. Pursuant to an agreement entered between the plaintiff and the 1st defendant (“agreement”), the plaintiff had upon the request of the 1st defendant agreed to sell and deliver goods to the 1st defendant subject to the terms and conditions as stated in the agreement. 5. The salient terms and conditions of the agreement inter alia, were as follows:- a. “8. We shall have the right to charge late payment interest at the rate of 1.5% per month (or any other rate as may be prescribed by us without notice to you) on the outstanding sum still due by you to us before as well as after judgment”; b. “10. We shall be deemed to have delivered the products to you if… the delivery order is endorsed by any person who collects the same from us or by any person present at the said address without the need of your company chop…. Any certification made by any of our officer that the products have been properly delivered to your said address on a specified date shall be sufficient proof of delivery”; c. “16. Any statement of indebtedness certified by any of our officer as to the balance of monies still outstanding and due from you to us shall be binding and conclusive evidence against you in any legal proceedings”; and d. “21. Any invoice, statement of account, notice and/or other documents to be sent to you shall be sent through ordinary prepaid post… and the same shall be deemed to have been received by you within two (2) days after the date of posting.” 6. As security or in consideration of the plaintiff agreeing to sell and deliver goods to the 1st defendant, by a ‘Joint and Several Personal Guarantee’ between the 2nd and 3rd defendants and the plaintiff (“letter of indemnity”)[footnoteRef:1], the 2nd and 3rd defendants had jointly and severally guaranteed to indemnify and pay all sum due and owing by the 1st defendant together with interest and all losses suffered by the plaintiff. [1: ] 7. The letter of indemnity provides inter alia, for the following:- a. “1. … I/We the undersigned HEREBY JOINTLY AND SEVERALLY GUARANTEE to you as principal/s and not merely as surety/ies…”; b. “9. … A certificate/statement signed by your officer as to the sums and liabilities for the time being due or incurred to you from or by the Customer shall be conclusive evidence for the purposes of this Guarantee and in any legal proceedings against me/us”; and c. “15. Any notice or demand hereunder shall be deemed to have been sufficiently given if sent by prepaid post letter… and shall be assumed to have reached the address within two (2) days after the date of posting.” 8. It is not in dispute that goods had been sold and delivered by the plaintiff to the 1st defendant and/or for the benefit of the 1st defendant. 9. It is unrebutted that pursuant to a demand made by the plaintiff via its ‘Statement of Accounts For the Month of November 2014’[footnoteRef:2], the 1st defendant had made part payment through MBB Cheque No.: 368948[footnoteRef:3] for a sum of RM29,506.54 leaving the balance principle sum of RM103,510.79 as claimed in this suit. [2: ] [3: ] PLAINTIFF’S CASE 10. The 1st defendant has breached the terms and conditions of the agreement in failing to make payment for a sum of RM148,871.01 (i.e. principle sum of RM103,510.79 + % as at 11.11.2016 of RM45,360.22) to the plaintiff, full particulars of which are stated in the affidavit in support. 11. Letters of demand dated 14.11.2016 to the defendants had been sent to the defendants. However, the defendants have refused, failed and/or neglected in paying the same. 12. Though the agreement and letter of indemnity are unstamped, that does not provide a triable issue under the summary judgment application. 13. Part payment had been made by the 1st defendant to the plaintiff without any protest. ISSUES RAISED BY THE DEFENDANTS 14. The defendants raised the following issues:- a. that both the agreement and the letter of indemnity are unstamped; b. that the 1st defendant did not receive the goods. There is no proof of acknowledgement on the invoice/debit notes and delivery orders by the 1st defendant; and c. that the defendants deny receiving the letters of demand dated 14.11.2016. DECISION OF THE COURT That both the agreement and letter of indemnity are unstamped 15. The court find that although the agreement and the letter of indemnity are unstamped, that is not a triable issue to be considered by the court. In reference to the case of of American Express International Banking Corp v Tan Loon Swan [1992] 1 CLJ (Rep) 1 the Supreme Court had in allowing a summary judgment application held that “the non-stamping of documents concerned (guarantee document) does not provide a triable issue”. That the 1st defendant did not receive the goods. There is no proof of acknowledgement on the invoice/debit notes and delivery orders by the 1st defendant. 16. Under the agreement, it clearly stated that any statement of indebtedness certified by any officer of the plaintiff and certificate signed by the plaintiff’s officer as to the sums and liabilities for the time being due shall be conclusive evidence in a legal proceeding against the defendants. Clause 16 of the agreement and Clause 9 of the letter of indemnity provides as follows:- a. Clause 16 of the agreement provides:- “Any statement of indebtedness certified by any of our officer as to the balance of monies still outstanding and due from you to us shall be binding and conclusive evidence against you in any legal proceedings”; and b. Clause 9 of the letter of indemnity provides:- “A certificate/statement signed by your officer as to the sums and liabilities for the time being due or incurred to you from or by the Customer shall be conclusive evidence for the purposes of this Guarantee and in any legal proceedings against me/us.” 17. In the case of Cempaka Finance Bhd v Ho Lai Ying & Anor [2006] 3 CLJ 544 the Federal Court had in allowing for summary judgment to be entered based on a certificate of indebtedness held that:- “A certificate of indebtedness operates in the field of adjectival law, excusing the Plaintiff from adducing the proof of debt and shifting the burden onto the defendant to disprove the amount claimed. …A clause of this nature has been described as a conclusive evidence clause and has been held to be binding and valid by courts in Australia and England. The certificate of indebtedness, issued in accordance with the aforesaid cls. 27 and 7.03, was lucid enough. There was nothing to indicate or suggest any manifest error on the fact of the said certificate nor was any fraud shown.” 18. The above principle as enunciated in Cempaka Finance Bhd (supra) has been cited with approval in the recent Federal Court case of Hong Leong Bank Bhd v M Muthiah & Anor and Another Appeal [2014] 1 CLJ 1. 19. Since the burden of proof has shifted to the defendants, it is incumbent upon the defendants in their affidavit showing cause to condescend into the particulars as to how the amount claim in this suit is without basis failing which the defendant’s defence is a bare denial and cannot be a triable issue. This, the defendants have clearly fail. 20. Further, Clause 10 of the agreement provides that:- “Any certification made by any of our officer that the products have been properly delivered to your said address on a specified date shall be sufficient proof of delivery.” 21. In Bumiputra Commerce Leasing Bhd v Tax-Win Industries Sdn Bhd & 2 Ors [2003] 1 LNS 94 the High Court had in relying upon the ‘Delivery Certificate’ to support proof of delivery, allowed for summary judgment to be entered. 22. I agree with the submission by the plaintiff that the acknowledgement of delivery can be seen clearly on all the Delivery Orders. In fact, the 1st defendant has even made part payment on the sum outstanding then and the 1st defendant has never once disputed nor raised any issue in regards to the goods delivered or the amount claimed in the Invoice/Debit Notes and Delivery Orders. 23. In the case of National Panasonic (M) Sdn Bhd v Lem The Sem & Anor [2003] 8 CLJ 408 , Low Hop Bing J (as he then was) referred with approval to Lek Chuan (M) Sdn Bhd v Shahpadu Properties Sdn Bhd [1995] 1 LNS 110 wherein Haidar J (as he then was) had entered summary judgment for the plaintiff when the statement of account were presented to the defendants who duly made some payments to the plaintiff. 24. I find that the submission by the defendants defies logic and common sense. If at all there had been no delivery of goods, why did the defendants make part payments? The allegation that there was a discrepancy in the amount claimed by the plaintiff clearly run counter to contemporaneous documents such as invoices, delivery orders and statement of account which have been duly delivered to the first defendant who had not disputed them but had made part payments thereon. 25. The 1st defendant had made part payment to the plaintiff when statement of account was presented leaving the balance sum as claimed in this suit. The submission presented by the defendants is somewhat naïve besides being inherently improbable. If at all the defendant had not received the goods, what was the need for the defendant to make part payment thereof?. 26. In the case of Gold Coin (Malaysia) Bhd v First Dragon Sdn Bhd [1994] 1 LNS 52 Abdul Malik Ishak J (as he then was) has held as follows:- “Against these formidable evidence, the defendant simply denied receiving the goods. This kind of defence is not enough. In an action for the price of goods sold and delivered, the defendant must not (as here) merely plead a denial of the debt or a denial that the goods were received; but he must go further - he must plead any facts which negative its existence or which show that the action is not maintainable on other grounds … The defendants deny receiving the Letters of Demand dated 14.11.2016 27. It is admitted by both the 2nd and 3rd defendants that they jointly and severally undertook the obligation of a principal debtor to pay the sum due and owing by the 1st defendant together with interest and all losses suffered by the plaintiff. 28. In discussing the relevant authorities for the proposition of a principal debtor clause, Lau Bee Lan J in Ambank (M) Sdn Bhd v E-Cenit Systems Sdn Bhd [2015] 1 LNS 1159 at para 13 held that:- “... the authorities which I shall refer hereafter recognize that the existence of a principal debtor clause in the Guarantees obviates the Plaintiff from issuing a demand to the 2nd- 4th Defendants and the service of the Writ of Summons and the Statement of Claim is sufficient notice.” 29. By reason of the foregoing, the existence of the principal debtor clause in the Letter of Indemnity and the fact that the 1st defendant itself is the principal debtor obviates the plaintiff from issuing letter of demand to the defendants. The service of the Writ Terpinda dan Pernyataan Tuntutan Terpinda dated 2.2.2017 itself is sufficient notice. 30. Be that as it may, I agree with the submission by the plaintiff that the Letters of Demand dated 14.11.2016 had been effectively served on the defendants as provided under Clause 21 of the agreement and Clause 15 of the Letter of Indemnity respectively which reads as follows:- a. Clause 21 of the Agreement provides:- “Any invoice, statement of account, notice and/or other documents to be sent by us to you shall be sent through ordinary prepaid post at your address… and the same shall be deemed to have been received by you within two (2) days after the date of posting.”; and b. Clause 15 of the Letter of Indemnity provides:- “Any notice or demand hereunder shall be deemed to have been sufficiently given if sent by prepaid post letter to my/our address in Malaysia last known to you or stated hereon and shall be assumed to have reached the address within two (2) days after the date of posting.” 31. In the Supreme Court case of Amanah Merchant Bank Bhd (Formerly Known As Amanah-Chase Merchant Bank Bhd) v Lim Tow Choon (Through Official Assignee) [1994] 2 CLJ 1 the court at page 5 held that:- “… It is sufficient for the appellant to show that the notice was correctly addressed, prepaid and delivered to the post office and acknowledged for service by the postal authority. Once these facts have been established, the deeming provision will inevitably apply.” 32 Relying upon the conclusiveness of the Certificate of Indebtedness and Certificate of Delivery, issue raised by the defendants is untenable and cannot be a triable issue. 33. Based on the reasons stated above, I find that this is a fit and proper case for the summary judgment to be entered against the defendants with costs. Dated this 4th day of July, 2017 sgd (ISHAK BAKRI) Judge Sessions Court Shah Alam Selangor 15

Tika 2.6.0

02(f)-22-04/2015(W)

PLAINTIF 1. EVEREST POINT SDN BHD 2. AMANAHRAYA DEVELOPMENT SDN BHD DEFENDAN 1. LIM PECK SIM 2. VICTOR CHIAH SOON WENG 3. JINNY CHIAH SU MEI 4 JUSTIN CHIAH SOON AUN

Contract - Sale and purchase of property - Liquidated ascertained damages - cut-off dates for the calculation of LAD - notice of vacant possession - when is vacant possession delivered in cases of invalid notice of vacant possession - when was vacant possession deemed delivered - delay to take delivery of vacant possession - whether buyer can unjustly enrich themselves by refusing to take vacant possession after CFO had been issued to obtain larger amount of LAD

03/07/2017

YA TAN SRI DATUK RAMLY BIN HAJI ALIKorumYAA TUN MD RAUS BIN SHARIFYAA TAN SRI DATUK SERI PANGLIMA RICHARD MALANJUMYA TAN SRI HASAN BIN LAHYA TAN SRI DATUK RAMLY BIN HAJI ALIYAA TAN SRI ZAHARAH BINTI IBRAHIM

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=0af7deac-9ad5-4928-a0ad-30d2cae4d717&Inline=true

DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR CA NO 02(f)-33-04/2015(W) EVEREST POINT SDN BHD & 1 LAGI –V- LIM PECK SIM & 3 LAGI IN THE FEDERAL COURT OF MALAYSIA (APPELLATE JURISDICTION) CIVIL APPEAL NO.: 02(f)-33-04/2015(W) _______________________________________________ BETWEEN 1. EVEREST POINT SDN BHD 2. AMANAHRAYA DEVELOPMENT SDN BHD .. APPELLANTS AND 1. LIM PECK SIM 2. VICTOR CHIAH SOON WENG 3. JINNY CHIAH SU MEI 4. JUSTIN CHIAH SOON AUN .. RESPONDENTS [In the Civil Appeal No.: W-02-(NVCV)(W)-741-04/2014 in the Court of Appeal at Putrajaya _____________________________________________ Between 1. LIM PECK SIM 2. VICTOR CHIAH SOON WENG 3. JINNY CHIAH SU MEI 4. JUSTIN CHIAH SOON AUN .. APPELLANTS And 1. EVEREST POINT SDN BHD 2. AMANAHRAYA DEVELOPMENT SDN BHD .. RESPONDENTS] CORUM RAUS SHARIF, PCA RICHARD MALANJUM, CJSS HASAN LAH, FCJ RAMLY ALI, FCJ ZAHARAH IBRAHIM, FCJ JUDGMENT OF THE COURT Introduction 1. This is an appeal by the appellants against the decision of the Court of Appeal given on 27 October 2014 which inter alia allowed the respondents’ appeal on the issue of the respondents’ claim for Liquidated Ascertained Damages (LAD) in respect of an apartment unit up to a cut-off date of 16 April 2014 (being the date the respondents were deemed to have taken actual vacant possession of the apartment unit). 2. For ease of reference we shall refer to the appellants herein as the defendants and the respondents as the plaintiffs as they were respectively referred to in the High Court. 3. The High Court had earlier allowed the plaintiffs’ claim for LAD against the 1st defendant up to 30 May 2011 (being the date of the notification by the 1st defendant to the plaintiffs of the issuance of the Certificate of Fitness for Occupation (CFO) by the Appropriate Authority). On appeal by the plaintiffs on the cut-off date for the calculation of the LAD, the Court of Appeal on 27 October 2014 reversed the decision of the High Court on that issue, and ordered that the cut-off date for the plaintiffs’ claim for the LAD be extended to 16 April 2014 (being the date when the plaintiffs wrote to the 1st defendant indicating their intention to take possession). Dissatisfied with the said order of the Court of Appeal the defendants then appealed to this Court. 4. We heard the appeal on 21 March 2017 and allowed it with costs. We set aside the decision of the Court of Appeal and reinstated the decision of the High Court. We now give our reasons for doing so. Background Facts 5. The plaintiffs were joint purchasers of an apartment in a project developed by the 1st defendant which was known as Subang Olive Residence, Unit No. J1-K-13-1 (the Unit). For that purpose a sale and purchase agreement dated 29 June 2005 was entered into by the parties (the SPA). 6. Clause 24.1 of the SPA provides that the Unit shall be completed and vacant possession shall be delivered to the plaintiffs within thirty six (36) months from the date of the SPA. (i.e. on or before 28 June 2008). Under clause 24.2, if the 1st defendant fails to deliver vacant possession of the Unit as stipulated in the SPA, the 1st defendant shall be liable to pay the plaintiffs LAD calculated from day to day at the rate of ten per centum (10%) per annum of the purchase price from the expiry date for delivery of vacant possession until the date the plaintiffs take delivery of vacant possession of the Unit. 7. The 1st defendant was unable to deliver vacant possession within the stipulated period of thirty-six (36) months. The Unit was only completed some 2 1/2 years later. 8. In an attempt to deliver vacant possession the 1st defendant issued a notice of delivery of vacant possession dated 16 November 2010 to the plaintiffs. However it is not in dispute that the said notice was invalid on the ground that it was not supported by a letter of confirmation from the Appropriate Authority certifying that Form E as prescribed under the Second Schedule to the Uniform Building By-Laws 1984 had been duly submitted and checked and accepted by the Appropriate Authority, as required in clause 25.2 of the SPA. It also not in dispute that the 1st defendant only submitted the relevant Form E to the relevant authority on 13 May 2011. The CFO in respect of the Unit was duly issued by the Appropriate Authority on 25 May 2011. The 1st defendant did not issue a new notice of delivery of vacant possession upon issuance of the CFO. 9. On 30 May 2011, the 1st defendant notified the plaintiffs about the issuance of the CFO for the Unit. On 16 April 2014, the plaintiffs wrote to the 1st defendant indicating their intention of taking vacant possession of the Unit. However the plaintiffs only took actual vacant possession of the Unit on 20 September 2016. 10. The plaintiffs commenced an action against the 1st defendant at the High Court on 26 April 2012 inter alia for an order that the plaintiffs be allowed to claim continuous LAD from 28 June 2008 until the date they took actual vacant possession (on 20 September 2016). 11. The 1st defendant filed its counter-claim against the plaintiffs for an amount of RM105,199.76 for miscellaneous charges such as maintenance charges, sinking fund and late payment interest. 12. On 21 March 2014, the High Court allowed the plaintiffs’ claim for LAD but only up to 30 May 2011 being the date of the notification of the issuance of the CFO for the Unit. The 1st defendant’s counter-claim was dismissed. At paragraph 5 of the grounds of judgment the learned judge ruled- “5. Tempoh pembayaran ganti rugi jumlah tertentu yang boleh dituntut oleh plaintif-plaintif, pada pandangan saya, adalah dari 28.6.2008 sehingga 30.5.2011 iaitu tarikh plaintif-plaintif dimaklumkan tentang pengeluaran Sijil Layak Menduduki (ekshibit P13), iaitu selama 1067 hari. Pada tarikh pengeluaran mengikut perkiraan dalam klausa 24.2, RM141.23 sehari X 1067 = RM150,692.41. Amaun ini adalah terakru untuk dibayar pada 30.5.2011 di mana plaintif disifatkan telah mengambil milikan kosong (sila rujuk kes Mahkamah Rayuan Soon Teik Development Sdn Bhd v Liew Tuo Chee & Ors [2011] 6 MLJ 350).” 13. At paragraph 22 of the grounds of judgment, the learned judge stressed that “Adalah penghakiman saya bahawa milikan kosong telah disifatkan diberikan kepada plaintif pada 30 May 2011 iaitu tarikh plaintif dimaklumkan tentang pengeluaran sijil layak menduduki.” 14. Dissatisfied with the above decision, the plaintiffs appealed to the Court of Appeal only on the issue of the cut-off date for the calculation of LAD. The Court of Appeal allowed the plaintiffs’ appeal in that their claim for continuous LAD be extended up to 16 April 2014, being the date of the plaintiffs’ letter to the 1st defendant indicating their intention to take vacant possession of the Unit. At the Federal Court 15. On 21 April 2015, this Court granted the defendants leave to appeal on the following questions of law, namely- (i) in cases of an invalid notice of vacant possession, when is vacant possession delivered: (a) the date of certificate of fitness for occupation (CFO); or (b) the date when the purchaser took possession of the keys to the Unit; and (ii) in cases of an invalid notice of vacant possession, can there be 2 different vacant possession dates in the sale and purchase agreement? 16. In the instant case, it is not in dispute that there was delay in the completion and delivery of vacant possession of the Unit to the plaintiffs. The delivery period of (36) months as stipulated in clause 24.1 of the SPA had lapsed, and pursuant to clause 24.2 of the SPA the 1st defendant as the developer was liable to pay LAD as a result of the delay. 17. It is also not in dispute that the notice of delivery of vacant possession dated 16 November 2010 issued by the 1st defendant to the plaintiff was invalid for non-compliance with the requirement in clause 25.2 of the SPA as the 1st defendant had not submitted the relevant Form E as prescribed in the Second Schedule to the Uniform Building By-Laws 1984 to the relevant authority. It is also not in dispute that the CFO to the Unit was issued on 25 May 2011 and the plaintiffs were duly notified by the 1st defendant about it on 30 May 2011; and the plaintiffs only took actual vacant possession by taking the keys to the Unit on 20 September 2016, after the commencement of this case at the High Court. 18. The only issue in dispute relates to the cut-off date for the computation of the LAD to be paid by the 1st defendant to the plaintiffs. The question is when was vacant possession deemed delivered? Was it on the date the plaintiffs were notified of the issuance of the CFO for the Unit or the date when the plaintiffs took actual possession by taking the keys to the Unit? 19. Learned counsel for the defendants contended that the cut-off date should be the date the plaintiffs were notified that had been issued; while learned counsel for the plaintiffs contended that the cut-off date was the date when they took possession of the keys to the Unit on 20 September 2016. 20. The 1st defendant notified the plaintiffs about the issuance of the CFO for the Unit on 30 May 2011. In the said notification the 1st defendant informed the plaintiffs “that all the above approvals from the authorities to enable you to occupy your property have been obtained. The approval is available for your inspection at our officer. Please be reminded that you have yet to pay/settle the progressive payment and miscellaneous charges amount of RM92,312.26 as per statement enclosed. Kindly make good of the said payment soonest possible.” 21. The manner of delivery of vacant possession of the Unit to the plaintiffs is governed by clause 25 of the SPA. Under clause 25.1, the 1st defendant shall let the plaintiffs into possession of the Unit inter alia after the plaintiffs “having paid all monies payable under clause 4 in accordance with the Third Schedule and all monies due under this Agreement and the Purchaser having performed and observed all the terms and covenants on his part under this Agreement.” 22. The Third Schedule to the SPA deals with the schedule of payment of the purchase price. Item 3 of the Schedule provides that “on the date the Purchaser takes possession of the said Parcel with water and electricity supply ready for connection to the Parcel”, the plaintiffs as purchasers need to pay (12.5%) of the purchase price. Item 4, provides that “within twenty-one (21) working days after receipt by the Purchaser of the written confirmation of the Vendor’s submission to and acceptance by the Appropriate Authority of the application for subdivision of the said Building”, the purchasers need to pay 2.5% of the purchase price; and item 5. 23. Clause 25.2 of the SPA reads- “25.2 The delivery of vacant possession by the Vendor shall be supported by: (a) a certificate signed by the Vendor’s architect certifying that the said Building has been duly constructed and completed in accordance with the relevant Acts, by-laws and regulations and that all conditions imposed by the Appropriate Authority in respect of the issuance of the Certificate of Fitness for Occupation have been duly complied with; and (b) a letter of confirmation from the Appropriate Authority certifying that the Form E as prescribed under the Second Schedule to the Uniform Building By-Laws 1984 has been duly submitted by the Vendor and checked and accepted by the Appropriate Authority.” 24. Clause 25.3 of the SPA reads- “25.3 Such possession shall not give the Purchaser the right to occupy and the Purchaser shall not occupy the Parcel until such time as the Certificate of Fitness for Occupation for the said Building is issued.” 25. To fulfill the requirement prescribed in clause 25.2(a) of the SPA, a certificate of practical completion of the Unit in question signed by the 1st defendants’ Architect was issued on 9 November 2010; and the CFO in respect thereof was issued by the Majlis Perbandaran Subang Jaya, as the Appropriate Authority, on 25 May 2011. With the issuance of both certificates we can conclusively conclude that all conditions required for the issuance have been duly complied with. The CFO clearly certified that the said Unit (apartment) in question “telah siap dibina …. mengikut pelan kelulusan No. A1 286/9/2 dan bahawa bangunan itu adalah layak untuk diduduki seperti yang diperakui oleh Arkitek.” 26. In the certificate of practical completion, the Architect had certified that: “….. in our opinion … the works are practically completed and the contractor has performed and completed all the necessary works specified in the Contract on the day named 9 November 2010.” 27. As required by clause 25.2(b) of the SPA, a letter of confirmation from the Majlis Perbandaran Subang Jaya as the Appropriate Authority dated 13 May 2011, certifying that the Form E as prescribed in the Second Schedule to the Uniform Building By-Laws 1984 had been submitted by the 1st defendant and checked and accepted by the Majlis, was issued. 28. Pursuant to clause 25.3 of the SPA, the plaintiffs have the right to occupy the Unit after the CFO was issued but not before that. As required by clause 25.1 of the SPA, in order to take vacant possession of the Unit the plaintiffs inter alia need to pay all monies due and payable under the SPA, the amount of which as stated in the 1st defendant’s notification dated 30 May 2011 was RM92,312.26. 29. According to the evidence of SD1, the General Manager of the 1st defendant, the 1st defendant wanted to deliver vacant possession after the issuance of the CFO, but the plaintiffs refused to take it. The plaintiff insisted that they were entitled to LAD and they did not need to pay the balance of the purchase price of the Unit at all. The plaintiffs only took physical possession of the Unit when they took the keys to the Unit from the 1st defendant on 20 September 2016. 30. The learned judge had made her findings that “keterangan menunjukkan bahawa plaintif mengikat penyerahan milikan kosong kepada dua syarat. Pertamanya, plaintif mahu baki bersih ganti rugi tertentu diberikan bersekali dengan milikan kosong. Keduanya, penyerahan milikan kosong mesti diiringi dengan unit tersebut dilengkapi dengan peralatan yang dikatakannya telah dijanjikan oleh defendan pertama sebagaimana yang terkandung dalam surat plaintif pertama di ekshibit P16 yang antara lain menyebut – “Therefore, what LAD we have claimed so far is only an interim amount, for the final quantum of LAD can only be determined when you actually deliver Vacant Possession of the unit installed with all the items and fixtures as pledged in your letters (one dated 31.5.2005 and two dated 29.06-2005) copies enclosed. We await your instruction when we can take delivery of Vacant Possession of the unit together with the balance of LAD we are legally entitled to.” 31. After going through all the evidence in this case, we were satisfied that the 1st defendant as the developer was willing and ready to deliver vacant possession of the Unit when the CFO was issued. All the relevant requirements for delivery of vacant possession as stipulated in clause 25.2 of the SPA were fulfilled by the 1st defendant. The plaintiffs have failed to perform their part of the SPA by tendering the balance purchase price and other monies due and payable in respect of the Unit, which had been clearly notified in the notification from the 1st defendant dated 30 May 2011. The installation of all the items and fixtures as requested in the plaintiffs’ letter is something not included in the SPA. It is also not a term of the SPA that vacant possession of the Unit must be delivered together with the balance of the LAD payment that the plaintiffs claimed to be entitled to. The requests were clearly unreasonable. 32. In holding that the cut-off date for the payment of LAD by the 1st defendant would be the date the plaintiffs took actual vacant possession of the Unit, the Court of Appeal was relying on the decision in Sentul Raya Sdn Bhd v Hariram Jayaram & Ors [2008] 4 CLJ 618 where it was held that as the notice of delivery of vacant possession was invalid (as in the instant case), the purchasers were entitled to continue to claim LAD until they took actual possession of their apartments. 33. With respect, we are of the view that the decision in Sentul Raya cannot be applied to the facts of the instant case. The factual matrix in that case is different from the factual matrix in this case. In that case there was no CFO issued at the time the LAD claim was filed in court as the project in question had not been completed yet. Thus the question of the cut-off date for the LAD claim was still open. However, in the instant case, the construction the Unit in question was completed and the CFO was duly issued and the plaintiffs as purchasers were duly informed about the issuance, before the LAD claim was filed in court. 34. Our view is that when the CFO to the Unit was issued and its issuance notified to the plaintiffs, the plaintiffs could no longer resist vacant possession by refusing to fulfil their obligation to make payment of the balance purchase price in the manner as stipulated in the SPA and making unreasonable demands. When the CFO was issued, the Unit was certified to be safe for occupation. In the circumstances the plaintiffs are not entitled to claim for LAD until the date when they took actual vacant possession by taking the keys to the Unit. This may amount to an inflated claim for LAD which is prejudicial to the 1st defendant. It also amounts to unjust enrichment of the plaintiffs. 35. The plaintiffs must realise that the 1st defendant’s obligation to deliver vacant possession of the Unit to the plaintiffs is governed by clause 25 of the SPA. The 1st defendant had done all that needed to be done under the SPA, i.e. to deliver vacant possession of the Unit which was certified to be safe for occupation. The fact that the earlier delivery notice dated 16 November 2010 issued by the 1st defendant to the plaintiffs was invalid does not mean that the 1st defendant has failed in its obligations under the SPA to deliver vacant possession. 36. On this issue, we agree with the dictum of Nallini Pathmanathan J. in Golden Quantum Acres Sdn Bhd v SSU Management Services Sdn Bhd [2014] 10 CLJ 320 when her Ladyship said: “It does not follow from the foregoing that the plaintiffs are entitled to choose a date which they deem fit to ‘take’ or ‘claim’ vacant possession. To allow such a construction of cls. 26 and 27 would give rise to a vastly exaggerated claim, as it would then theoretically be open to the plaintiffs to take possession some ten years after the practical completion of the building and make claim for LAD.” 37. By such delay in exercising their right to take delivery of vacant possession, the plaintiffs are taking advantage of a more attractive benefit set out in the artificial formula for computation of LAD for late delivery of vacant possession. 38. We also agree with the Court of Appeal in Soon Teik Development Sdn Bhd v Liew Tuo Chee & Ors [2011] 6 MLJ 350, in affirming the High Court decision to the effect that “in the absence of a proper certificate of practical completion pursuant to clause 25 of the Agreement being issued, the shop lots must be presumed to have not been completed until the issuance of the certificate of fitness for occupation (CF) or anytime before.” In other words, the shop lots in that case were deemed or presumed to be completed upon the issuance of the CFO. 39. To allow the plaintiffs to take their own “sweet time” in taking delivery of vacant possession of the Unit consequently seeking to enjoy a higher amount of LAD (despite the issuance of CFO being notified to them), is clearly unjustified and unfair to the 1st defendant as the developer. The 1st defendant may be prejudiced and suffer damages for loss and damage to the Unit and/or to fixtures and fittings therein if the plaintiffs took too long to take vacant possession; more so if the plaintiffs are allowed to claim LAD for the extended period. This may not be good for the housing industry. The imposition of LAD is not to enrich the plaintiffs by refusing or delaying to take delivery of vacant possession even though the Unit was certified to be safe for occupation and they were duly notified about that. Conclusion 40. For the above reasons and based on the facts and circumstances of the instant case, it was our finding that the Unit in question had been completed and was safe for occupation as certified in the CFO which was issued on 25 May 2011 and notified to the plaintiffs on 30 May 2011. As the earlier notification by the 1st defendant dated 16 September 2010 was invalid, we were of the view that the effective date of delivery of vacant possession in this case was the date when the issuance of the CFO by the Appropriate Authority was notified to the plaintiffs which was on 30 May 2011. Therefore the cut-off date for calculation of LAD relating to the late delivery of vacant possession of the Unit was 30 May 2011, as earlier decided by the High Court. 41. We therefore allowed the appeal with costs. We set aside the decision of the Court of Appeal and reinstated the decision of the High Court. 42. In the circumstances of this case we found it unnecessary to answer the two questions posed in this appeal. Dated this 24th day of May 2017 sgd RAMLY ALI FEDERAL COURT JUDGE MALAYSIA Solicitors 1. Ong Chee Kwan (with Han Li Meng) Messrs Christopher & Lee Ong .. for the Appellants 2. NV Sree Harry Messrs Sree Harry & Co .. for the Respondents Cases Referred to: 1. Sentul Raya Sdn Bhd v Hariram Jayaram & Ors [2008] 4 CLJ 618 2. Golden Quantum Acres Sdn Bhd v SSU Management Services Sdn Bhd [2014] 10 CLJ 320 3. Soon Teik Development Sdn Bhd v Liew Tuo Chee & Ors [2011] 6 MLJ 350 20

Tika 2.6.0

02(f)-22-04/2015(W)

PLAINTIF 1. EVEREST POINT SDN BHD 2. AMANAHRAYA DEVELOPMENT SDN BHD DEFENDAN 1. LIM PECK SIM 2. VICTOR CHIAH SOON WENG 3. JINNY CHIAH SU MEI 4 JUSTIN CHIAH SOON AUN

Contract - Sale and purchase of property - Liquidated ascertained damages - cut-off dates for the calculation of LAD - notice of vacant possession - when is vacant possession delivered in cases of invalid notice of vacant possession - when was vacant possession deemed delivered - delay to take delivery of vacant possession - whether buyer can unjustly enrich themselves by refusing to take vacant possession after CFO had been issued to obtain larger amount of LAD

03/07/2017

YA TAN SRI DATUK RAMLY BIN HAJI ALIKorumYAA TUN MD RAUS BIN SHARIFYAA TAN SRI DATUK SERI PANGLIMA RICHARD MALANJUMYA TAN SRI HASAN BIN LAHYA TAN SRI DATUK RAMLY BIN HAJI ALIYAA TAN SRI ZAHARAH BINTI IBRAHIM

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DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR CA NO 02(f)-33-04/2015(W) EVEREST POINT SDN BHD & 1 LAGI –V- LIM PECK SIM & 3 LAGI IN THE FEDERAL COURT OF MALAYSIA (APPELLATE JURISDICTION) CIVIL APPEAL NO.: 02(f)-33-04/2015(W) _______________________________________________ BETWEEN 1. EVEREST POINT SDN BHD 2. AMANAHRAYA DEVELOPMENT SDN BHD .. APPELLANTS AND 1. LIM PECK SIM 2. VICTOR CHIAH SOON WENG 3. JINNY CHIAH SU MEI 4. JUSTIN CHIAH SOON AUN .. RESPONDENTS [In the Civil Appeal No.: W-02-(NVCV)(W)-741-04/2014 in the Court of Appeal at Putrajaya _____________________________________________ Between 1. LIM PECK SIM 2. VICTOR CHIAH SOON WENG 3. JINNY CHIAH SU MEI 4. JUSTIN CHIAH SOON AUN .. APPELLANTS And 1. EVEREST POINT SDN BHD 2. AMANAHRAYA DEVELOPMENT SDN BHD .. RESPONDENTS] CORUM RAUS SHARIF, PCA RICHARD MALANJUM, CJSS HASAN LAH, FCJ RAMLY ALI, FCJ ZAHARAH IBRAHIM, FCJ JUDGMENT OF THE COURT Introduction 1. This is an appeal by the appellants against the decision of the Court of Appeal given on 27 October 2014 which inter alia allowed the respondents’ appeal on the issue of the respondents’ claim for Liquidated Ascertained Damages (LAD) in respect of an apartment unit up to a cut-off date of 16 April 2014 (being the date the respondents were deemed to have taken actual vacant possession of the apartment unit). 2. For ease of reference we shall refer to the appellants herein as the defendants and the respondents as the plaintiffs as they were respectively referred to in the High Court. 3. The High Court had earlier allowed the plaintiffs’ claim for LAD against the 1st defendant up to 30 May 2011 (being the date of the notification by the 1st defendant to the plaintiffs of the issuance of the Certificate of Fitness for Occupation (CFO) by the Appropriate Authority). On appeal by the plaintiffs on the cut-off date for the calculation of the LAD, the Court of Appeal on 27 October 2014 reversed the decision of the High Court on that issue, and ordered that the cut-off date for the plaintiffs’ claim for the LAD be extended to 16 April 2014 (being the date when the plaintiffs wrote to the 1st defendant indicating their intention to take possession). Dissatisfied with the said order of the Court of Appeal the defendants then appealed to this Court. 4. We heard the appeal on 21 March 2017 and allowed it with costs. We set aside the decision of the Court of Appeal and reinstated the decision of the High Court. We now give our reasons for doing so. Background Facts 5. The plaintiffs were joint purchasers of an apartment in a project developed by the 1st defendant which was known as Subang Olive Residence, Unit No. J1-K-13-1 (the Unit). For that purpose a sale and purchase agreement dated 29 June 2005 was entered into by the parties (the SPA). 6. Clause 24.1 of the SPA provides that the Unit shall be completed and vacant possession shall be delivered to the plaintiffs within thirty six (36) months from the date of the SPA. (i.e. on or before 28 June 2008). Under clause 24.2, if the 1st defendant fails to deliver vacant possession of the Unit as stipulated in the SPA, the 1st defendant shall be liable to pay the plaintiffs LAD calculated from day to day at the rate of ten per centum (10%) per annum of the purchase price from the expiry date for delivery of vacant possession until the date the plaintiffs take delivery of vacant possession of the Unit. 7. The 1st defendant was unable to deliver vacant possession within the stipulated period of thirty-six (36) months. The Unit was only completed some 2 1/2 years later. 8. In an attempt to deliver vacant possession the 1st defendant issued a notice of delivery of vacant possession dated 16 November 2010 to the plaintiffs. However it is not in dispute that the said notice was invalid on the ground that it was not supported by a letter of confirmation from the Appropriate Authority certifying that Form E as prescribed under the Second Schedule to the Uniform Building By-Laws 1984 had been duly submitted and checked and accepted by the Appropriate Authority, as required in clause 25.2 of the SPA. It also not in dispute that the 1st defendant only submitted the relevant Form E to the relevant authority on 13 May 2011. The CFO in respect of the Unit was duly issued by the Appropriate Authority on 25 May 2011. The 1st defendant did not issue a new notice of delivery of vacant possession upon issuance of the CFO. 9. On 30 May 2011, the 1st defendant notified the plaintiffs about the issuance of the CFO for the Unit. On 16 April 2014, the plaintiffs wrote to the 1st defendant indicating their intention of taking vacant possession of the Unit. However the plaintiffs only took actual vacant possession of the Unit on 20 September 2016. 10. The plaintiffs commenced an action against the 1st defendant at the High Court on 26 April 2012 inter alia for an order that the plaintiffs be allowed to claim continuous LAD from 28 June 2008 until the date they took actual vacant possession (on 20 September 2016). 11. The 1st defendant filed its counter-claim against the plaintiffs for an amount of RM105,199.76 for miscellaneous charges such as maintenance charges, sinking fund and late payment interest. 12. On 21 March 2014, the High Court allowed the plaintiffs’ claim for LAD but only up to 30 May 2011 being the date of the notification of the issuance of the CFO for the Unit. The 1st defendant’s counter-claim was dismissed. At paragraph 5 of the grounds of judgment the learned judge ruled- “5. Tempoh pembayaran ganti rugi jumlah tertentu yang boleh dituntut oleh plaintif-plaintif, pada pandangan saya, adalah dari 28.6.2008 sehingga 30.5.2011 iaitu tarikh plaintif-plaintif dimaklumkan tentang pengeluaran Sijil Layak Menduduki (ekshibit P13), iaitu selama 1067 hari. Pada tarikh pengeluaran mengikut perkiraan dalam klausa 24.2, RM141.23 sehari X 1067 = RM150,692.41. Amaun ini adalah terakru untuk dibayar pada 30.5.2011 di mana plaintif disifatkan telah mengambil milikan kosong (sila rujuk kes Mahkamah Rayuan Soon Teik Development Sdn Bhd v Liew Tuo Chee & Ors [2011] 6 MLJ 350).” 13. At paragraph 22 of the grounds of judgment, the learned judge stressed that “Adalah penghakiman saya bahawa milikan kosong telah disifatkan diberikan kepada plaintif pada 30 May 2011 iaitu tarikh plaintif dimaklumkan tentang pengeluaran sijil layak menduduki.” 14. Dissatisfied with the above decision, the plaintiffs appealed to the Court of Appeal only on the issue of the cut-off date for the calculation of LAD. The Court of Appeal allowed the plaintiffs’ appeal in that their claim for continuous LAD be extended up to 16 April 2014, being the date of the plaintiffs’ letter to the 1st defendant indicating their intention to take vacant possession of the Unit. At the Federal Court 15. On 21 April 2015, this Court granted the defendants leave to appeal on the following questions of law, namely- (i) in cases of an invalid notice of vacant possession, when is vacant possession delivered: (a) the date of certificate of fitness for occupation (CFO); or (b) the date when the purchaser took possession of the keys to the Unit; and (ii) in cases of an invalid notice of vacant possession, can there be 2 different vacant possession dates in the sale and purchase agreement? 16. In the instant case, it is not in dispute that there was delay in the completion and delivery of vacant possession of the Unit to the plaintiffs. The delivery period of (36) months as stipulated in clause 24.1 of the SPA had lapsed, and pursuant to clause 24.2 of the SPA the 1st defendant as the developer was liable to pay LAD as a result of the delay. 17. It is also not in dispute that the notice of delivery of vacant possession dated 16 November 2010 issued by the 1st defendant to the plaintiff was invalid for non-compliance with the requirement in clause 25.2 of the SPA as the 1st defendant had not submitted the relevant Form E as prescribed in the Second Schedule to the Uniform Building By-Laws 1984 to the relevant authority. It is also not in dispute that the CFO to the Unit was issued on 25 May 2011 and the plaintiffs were duly notified by the 1st defendant about it on 30 May 2011; and the plaintiffs only took actual vacant possession by taking the keys to the Unit on 20 September 2016, after the commencement of this case at the High Court. 18. The only issue in dispute relates to the cut-off date for the computation of the LAD to be paid by the 1st defendant to the plaintiffs. The question is when was vacant possession deemed delivered? Was it on the date the plaintiffs were notified of the issuance of the CFO for the Unit or the date when the plaintiffs took actual possession by taking the keys to the Unit? 19. Learned counsel for the defendants contended that the cut-off date should be the date the plaintiffs were notified that had been issued; while learned counsel for the plaintiffs contended that the cut-off date was the date when they took possession of the keys to the Unit on 20 September 2016. 20. The 1st defendant notified the plaintiffs about the issuance of the CFO for the Unit on 30 May 2011. In the said notification the 1st defendant informed the plaintiffs “that all the above approvals from the authorities to enable you to occupy your property have been obtained. The approval is available for your inspection at our officer. Please be reminded that you have yet to pay/settle the progressive payment and miscellaneous charges amount of RM92,312.26 as per statement enclosed. Kindly make good of the said payment soonest possible.” 21. The manner of delivery of vacant possession of the Unit to the plaintiffs is governed by clause 25 of the SPA. Under clause 25.1, the 1st defendant shall let the plaintiffs into possession of the Unit inter alia after the plaintiffs “having paid all monies payable under clause 4 in accordance with the Third Schedule and all monies due under this Agreement and the Purchaser having performed and observed all the terms and covenants on his part under this Agreement.” 22. The Third Schedule to the SPA deals with the schedule of payment of the purchase price. Item 3 of the Schedule provides that “on the date the Purchaser takes possession of the said Parcel with water and electricity supply ready for connection to the Parcel”, the plaintiffs as purchasers need to pay (12.5%) of the purchase price. Item 4, provides that “within twenty-one (21) working days after receipt by the Purchaser of the written confirmation of the Vendor’s submission to and acceptance by the Appropriate Authority of the application for subdivision of the said Building”, the purchasers need to pay 2.5% of the purchase price; and item 5. 23. Clause 25.2 of the SPA reads- “25.2 The delivery of vacant possession by the Vendor shall be supported by: (a) a certificate signed by the Vendor’s architect certifying that the said Building has been duly constructed and completed in accordance with the relevant Acts, by-laws and regulations and that all conditions imposed by the Appropriate Authority in respect of the issuance of the Certificate of Fitness for Occupation have been duly complied with; and (b) a letter of confirmation from the Appropriate Authority certifying that the Form E as prescribed under the Second Schedule to the Uniform Building By-Laws 1984 has been duly submitted by the Vendor and checked and accepted by the Appropriate Authority.” 24. Clause 25.3 of the SPA reads- “25.3 Such possession shall not give the Purchaser the right to occupy and the Purchaser shall not occupy the Parcel until such time as the Certificate of Fitness for Occupation for the said Building is issued.” 25. To fulfill the requirement prescribed in clause 25.2(a) of the SPA, a certificate of practical completion of the Unit in question signed by the 1st defendants’ Architect was issued on 9 November 2010; and the CFO in respect thereof was issued by the Majlis Perbandaran Subang Jaya, as the Appropriate Authority, on 25 May 2011. With the issuance of both certificates we can conclusively conclude that all conditions required for the issuance have been duly complied with. The CFO clearly certified that the said Unit (apartment) in question “telah siap dibina …. mengikut pelan kelulusan No. A1 286/9/2 dan bahawa bangunan itu adalah layak untuk diduduki seperti yang diperakui oleh Arkitek.” 26. In the certificate of practical completion, the Architect had certified that: “….. in our opinion … the works are practically completed and the contractor has performed and completed all the necessary works specified in the Contract on the day named 9 November 2010.” 27. As required by clause 25.2(b) of the SPA, a letter of confirmation from the Majlis Perbandaran Subang Jaya as the Appropriate Authority dated 13 May 2011, certifying that the Form E as prescribed in the Second Schedule to the Uniform Building By-Laws 1984 had been submitted by the 1st defendant and checked and accepted by the Majlis, was issued. 28. Pursuant to clause 25.3 of the SPA, the plaintiffs have the right to occupy the Unit after the CFO was issued but not before that. As required by clause 25.1 of the SPA, in order to take vacant possession of the Unit the plaintiffs inter alia need to pay all monies due and payable under the SPA, the amount of which as stated in the 1st defendant’s notification dated 30 May 2011 was RM92,312.26. 29. According to the evidence of SD1, the General Manager of the 1st defendant, the 1st defendant wanted to deliver vacant possession after the issuance of the CFO, but the plaintiffs refused to take it. The plaintiff insisted that they were entitled to LAD and they did not need to pay the balance of the purchase price of the Unit at all. The plaintiffs only took physical possession of the Unit when they took the keys to the Unit from the 1st defendant on 20 September 2016. 30. The learned judge had made her findings that “keterangan menunjukkan bahawa plaintif mengikat penyerahan milikan kosong kepada dua syarat. Pertamanya, plaintif mahu baki bersih ganti rugi tertentu diberikan bersekali dengan milikan kosong. Keduanya, penyerahan milikan kosong mesti diiringi dengan unit tersebut dilengkapi dengan peralatan yang dikatakannya telah dijanjikan oleh defendan pertama sebagaimana yang terkandung dalam surat plaintif pertama di ekshibit P16 yang antara lain menyebut – “Therefore, what LAD we have claimed so far is only an interim amount, for the final quantum of LAD can only be determined when you actually deliver Vacant Possession of the unit installed with all the items and fixtures as pledged in your letters (one dated 31.5.2005 and two dated 29.06-2005) copies enclosed. We await your instruction when we can take delivery of Vacant Possession of the unit together with the balance of LAD we are legally entitled to.” 31. After going through all the evidence in this case, we were satisfied that the 1st defendant as the developer was willing and ready to deliver vacant possession of the Unit when the CFO was issued. All the relevant requirements for delivery of vacant possession as stipulated in clause 25.2 of the SPA were fulfilled by the 1st defendant. The plaintiffs have failed to perform their part of the SPA by tendering the balance purchase price and other monies due and payable in respect of the Unit, which had been clearly notified in the notification from the 1st defendant dated 30 May 2011. The installation of all the items and fixtures as requested in the plaintiffs’ letter is something not included in the SPA. It is also not a term of the SPA that vacant possession of the Unit must be delivered together with the balance of the LAD payment that the plaintiffs claimed to be entitled to. The requests were clearly unreasonable. 32. In holding that the cut-off date for the payment of LAD by the 1st defendant would be the date the plaintiffs took actual vacant possession of the Unit, the Court of Appeal was relying on the decision in Sentul Raya Sdn Bhd v Hariram Jayaram & Ors [2008] 4 CLJ 618 where it was held that as the notice of delivery of vacant possession was invalid (as in the instant case), the purchasers were entitled to continue to claim LAD until they took actual possession of their apartments. 33. With respect, we are of the view that the decision in Sentul Raya cannot be applied to the facts of the instant case. The factual matrix in that case is different from the factual matrix in this case. In that case there was no CFO issued at the time the LAD claim was filed in court as the project in question had not been completed yet. Thus the question of the cut-off date for the LAD claim was still open. However, in the instant case, the construction the Unit in question was completed and the CFO was duly issued and the plaintiffs as purchasers were duly informed about the issuance, before the LAD claim was filed in court. 34. Our view is that when the CFO to the Unit was issued and its issuance notified to the plaintiffs, the plaintiffs could no longer resist vacant possession by refusing to fulfil their obligation to make payment of the balance purchase price in the manner as stipulated in the SPA and making unreasonable demands. When the CFO was issued, the Unit was certified to be safe for occupation. In the circumstances the plaintiffs are not entitled to claim for LAD until the date when they took actual vacant possession by taking the keys to the Unit. This may amount to an inflated claim for LAD which is prejudicial to the 1st defendant. It also amounts to unjust enrichment of the plaintiffs. 35. The plaintiffs must realise that the 1st defendant’s obligation to deliver vacant possession of the Unit to the plaintiffs is governed by clause 25 of the SPA. The 1st defendant had done all that needed to be done under the SPA, i.e. to deliver vacant possession of the Unit which was certified to be safe for occupation. The fact that the earlier delivery notice dated 16 November 2010 issued by the 1st defendant to the plaintiffs was invalid does not mean that the 1st defendant has failed in its obligations under the SPA to deliver vacant possession. 36. On this issue, we agree with the dictum of Nallini Pathmanathan J. in Golden Quantum Acres Sdn Bhd v SSU Management Services Sdn Bhd [2014] 10 CLJ 320 when her Ladyship said: “It does not follow from the foregoing that the plaintiffs are entitled to choose a date which they deem fit to ‘take’ or ‘claim’ vacant possession. To allow such a construction of cls. 26 and 27 would give rise to a vastly exaggerated claim, as it would then theoretically be open to the plaintiffs to take possession some ten years after the practical completion of the building and make claim for LAD.” 37. By such delay in exercising their right to take delivery of vacant possession, the plaintiffs are taking advantage of a more attractive benefit set out in the artificial formula for computation of LAD for late delivery of vacant possession. 38. We also agree with the Court of Appeal in Soon Teik Development Sdn Bhd v Liew Tuo Chee & Ors [2011] 6 MLJ 350, in affirming the High Court decision to the effect that “in the absence of a proper certificate of practical completion pursuant to clause 25 of the Agreement being issued, the shop lots must be presumed to have not been completed until the issuance of the certificate of fitness for occupation (CF) or anytime before.” In other words, the shop lots in that case were deemed or presumed to be completed upon the issuance of the CFO. 39. To allow the plaintiffs to take their own “sweet time” in taking delivery of vacant possession of the Unit consequently seeking to enjoy a higher amount of LAD (despite the issuance of CFO being notified to them), is clearly unjustified and unfair to the 1st defendant as the developer. The 1st defendant may be prejudiced and suffer damages for loss and damage to the Unit and/or to fixtures and fittings therein if the plaintiffs took too long to take vacant possession; more so if the plaintiffs are allowed to claim LAD for the extended period. This may not be good for the housing industry. The imposition of LAD is not to enrich the plaintiffs by refusing or delaying to take delivery of vacant possession even though the Unit was certified to be safe for occupation and they were duly notified about that. Conclusion 40. For the above reasons and based on the facts and circumstances of the instant case, it was our finding that the Unit in question had been completed and was safe for occupation as certified in the CFO which was issued on 25 May 2011 and notified to the plaintiffs on 30 May 2011. As the earlier notification by the 1st defendant dated 16 September 2010 was invalid, we were of the view that the effective date of delivery of vacant possession in this case was the date when the issuance of the CFO by the Appropriate Authority was notified to the plaintiffs which was on 30 May 2011. Therefore the cut-off date for calculation of LAD relating to the late delivery of vacant possession of the Unit was 30 May 2011, as earlier decided by the High Court. 41. We therefore allowed the appeal with costs. We set aside the decision of the Court of Appeal and reinstated the decision of the High Court. 42. In the circumstances of this case we found it unnecessary to answer the two questions posed in this appeal. Dated this 24th day of May 2017 sgd RAMLY ALI FEDERAL COURT JUDGE MALAYSIA Solicitors 1. Ong Chee Kwan (with Han Li Meng) Messrs Christopher & Lee Ong .. for the Appellants 2. NV Sree Harry Messrs Sree Harry & Co .. for the Respondents Cases Referred to: 1. Sentul Raya Sdn Bhd v Hariram Jayaram & Ors [2008] 4 CLJ 618 2. Golden Quantum Acres Sdn Bhd v SSU Management Services Sdn Bhd [2014] 10 CLJ 320 3. Soon Teik Development Sdn Bhd v Liew Tuo Chee & Ors [2011] 6 MLJ 350 20

Tika 2.6.0

BA-12B-164-09/2016

PERAYU ZI PRODUCTIONS SDN. BHD. RESPONDEN SACC CONVEC SDN. BHD.

03/07/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

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DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA (DALAM BIDANG KUASA RAYUAN) RAYUAN SIVIL NO: BA-12B-164-09/2016 ANTARA ZI PRODUCTIONS SDN. BHD. (NO PENDAFTARAN SYARIKAT: 701484-U) ....PERAYU DAN SACC CONVEC SDN. BHD. (NO PENDAFTARAN SYARIKAT: 861880-W) …RESPONDEN (DALAM MAHKAMAH SYESEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA GUAMAN NO: B52-43-03/2015) ANTARA ZI PRODUCTIONS SDN. BHD. (NO PENDAFTARAN SYARIKAT: 701484-U) …PLAINTIF DAN SACC CONVEC SDN. BHD. (NO PENDAFTARAN SYARIKAT: 861880-W) …DEFENDAN GROUNDS OF JUDGMENT Introduction [1] This is an appeal against the decision of the Session Judge which dismissed the Plaintiff’s claim on 7.9.2016. The parties in this appeal are the Appellant who was the Plaintiff and the Respondent who was the Defendant. [2] For ease of reference, in this judgment, the parties will be referred to as they were in the Sessions Court. Background Facts [3] The dispute before me is between the Plaintiff, an event management company and the Defendant who operates and manages the convention centre in Shah Alam regarding two events to be organized by the Defendant for ASTRO. The relevant factual background based on the written submission of the counsels may be stated as follows: (a) The Plaintiff is a company incorporated under the Companies Act 1965 and was registered on 4.7.2005 is owned by two Directors and carries a business of event management, advertising and promotional services. (b) The Defendant is a company established under the Companies Act 1965 was registered on 24 June 2009 and is wholly owned by Perbadanan Kemajuan Negeri Selangor (PKNS). The Defendant has four Directors and its conduct of business is operating and managing the Shah Alam Convention Centre. (c) Plaintiff pleaded that the cause of action against Defendant is for breach of contract of 5.9.2011. (d) Plaintiff claimed that by a Letter of Award of 5.9.2011, the Defendant appointed the Plaintiff as an Event Management Panel for SACC Sdn Bhd for a Business Associates Programme (BAP). (e) The Letter of Award signed by the Chief Executive Officer of the Defendant, Dato’ Zulkifli Bin Mohamad was received by the Plaintiff’s Director Datuk Zulkifli Bin Ishak on 12.9.2011 where the Plaintiff is appointed as a member of BAP for a period of two years from 5 September 2011 until 30 September 2013. (f) The Plaintiff claimed that both parties agreed that until a formal contract is signed, the said Letter of Award will be the valid and binding document on both parties. (g) The Plaintiff claimed that based on the appointment of Plaintiff as BAP member, the Defendant had directed the Plaintiff to manage the two events to be organised by the Defendant: (i) “Pementasan Dewa Kencana”; and (ii) “Maharaja Lawak Mega” (h) The Plaintiff claimed that the Defendant had agreed without condition to pay all expenses incurred by the Plaintiff in managing the two events. (i) The Plaintiff claimed that the theatre performance of Dewa Kencana was held on 23.12.2011 until 25.12.2011 where Plaintiff was the event manager appointed to carry out the tasks successfully in coordinating, security control and supervising. (j) The Plaintiff submitted the invoice for the management fee dated 26.12.2011 amounting to RM45,000.00 to the Defendant. (k) The Plaintiff claimed it had successfully managed another event “Maharaja Lawak” from October 2011 until December 2011 for the Defendant where the Plaintiff was acting as the Event Manager and had carried out the tasks successfully. The Plaintiff then submitted 5 invoices for the expenses incurred and the management fee, altogether totaled at RM238,000.00 to the Defendant. (l) The Plaintiff claimed that the Defendant had received the payment RM500,000.00 from Astro on 5.4.2012 and all suppliers including Plaintiff, claimed to be paid upon the Selangor State Government’s EXCO’s approval. (m) The Plaintiff claimed that Yang Berhormat Rodziah Binti Ismail who is an EXCO member of the Selangor State Government, the Chairman of Welfare, Woman Affairs, Science, Technology and Innovation had asked the Defendant to pay the contractor, the event manager that is the Plaintiff in organizing the ‘Program Maharaja Lawak Mega Astro’ that was aired on 28.10.2011 considering that it had been organized well and under the responsibility of the Defendant. (n) The Plaintiff claimed that the Defendant had breached the Letter of Award when the Defendant failed, refused and/or negligent to pay the expenses incurred and the management fee amounting to RM283,000.00. (o) Plaintiff claimed that it suffered loss of RM283,000.00 due to Defendant’s breach to pay for the management and the expenses incurred on the two events that is, RM45,000 for the management fee of Dewa Kencana and RM238,000 for the management fee and expenses incurred, and prayed for general damages and exemplary damages. The Plaintiff served one Letter of Demand dated 23.1.2014 to the Defendant demanding for the RM283,000.00 as special damages. (p) The Session Judge dismissed all Plaintiff’s claims for Special Damages of RM283,000.00, General Damages, Exemplary Damages, interests and cost. (q) Being dissatisfied with the said decision, the Plaintiff appealed to this Court. Session Court’s Decision [4] The Session Judge’s decision is reproduced here as follows: “DAPATAN MAHKAMAH Berdasarkan keterangan saksi Plaintiff dan Defendan, dokumen yang dikemukakan dan hujahan pihak. Tuntutan Plaintif adalah berdasarkan i) Surat Panel Business Associate Program bertarikh 5.9.2011 (Surat Anugerah/BAP) ii) Lima Invois bertarikh 18.12.2011 dan satu invois bertarikh 28.12.2011 Kausa tindakan Plaintif dalam kes ini adalah bahawa Defendan mungkir surat Anugerah dengan Plaintif bila gagal membayar perbelanjaan dan yuran pengurusan yang dilakukan Plaintif dalam dua acara iaitu Pementasan Dewa Kencana dan Maharaja Lawak Mega. …… Surat BAP tersebut bukan dikeluarkan oleh Defendan, sebaliknya merupakan surat dari SACC (Pusat Konvensyen Shah Alam). Surat BAP adalah surat bersyarat di mana panel yang dilantik hendaklah menandatangani perjanjian kontrak dalam tempoh 30 hari dari tarikh lantikan. Dalam kes ini tiada apa-apa kontrak antara Plaintif dan Defendan. Keterangan SP1, Dato Zulkifli Mohamad, Ketua Pegawai Eksekutif Defendan. Beliau akui bahawa tiada surat tawaran perkhidmatan diberi kepada Plaintif. Pihak SACC sebagai ‘event manager’ diminta memberikan cadangan syarikat yang berkebolehan dan berkeupayaan membantu melaksanakan projek tersebut. Di bawah Business Associate Programme (BAP) syarikat Plaintif didapati mempunyai kebolehan dalam bidang kerja yang diperlukan. Sebab itu Plaintif dicadangkan diberi projek ini. Saksi SP2 sendiri mengakui, Letter of Award (BAP) di mukasurat 13 ikatan Dokumen itu bukan kontrak sebaliknya surat lantikan sahaja. Saksi SP3, seorang akauntan pula menyatakan bahawa beliau menyediakan invois-invois kepada SACC berdasarkan arahan bertulis dari majikannya tanpa apa-apa dokumen sokongan. Beliau sendiri tidak pasti invois yang dibuat untuk tujuan apa dan hanya berdasarkan apa yang dimaklumkan oleh majikan kepadanya sahaja. Mahkamah turut dimaklumkan oleh saksi SP1 bahawa sesuatu kontrak pembekalan barangan dan perkhidmatan perlu wujud melalui dokumentasi dan perlu dapatkan kelulusan exco SACC kerana tanpa kelulusan, pembayaran tidak boleh dilakukan. Dalam kes ini, pelantikan Plaintif untuk menguruskan kedua-dua program yang dituntut tidak mendapat kelulusan dari EXCO Defendan. Fakta ini dijelaskan oleh SP1 dalam keterangan beliau semasa disoalbalas. …… Kertas kerja yang mencadangkan kelulusan pembayaran kepada Plaintif yang dikemukakan kepada Bahagian Kewangan Defendan bersama invois didapati tidak mempunyai tandatangan kelulusan CEO. …. Atas sebab itu invois yang dihantar itu diterima tanpa pengakuan liability. Mahkamah juga mendapati kertas kerja tersebut jika pun sahih adalah bertarikh 30.12.2011 manakala invois-invois yang dihantar adalah bertarikh 18.12.2011, 26.11.2011 dan 28.11.2011. Timbul anggapan pada Mahkamah bahawa kertas kerja itu hanya wujud terkemudian untuk menyokong invois bagi mendapatkan bayaran dan oleh itu tidak boleh diterima sebagai bukti perkhidmatan telah diberikan oleh Plaintif kepada Defendan. Secara keseluruhannya, atas imbangan kebarangkalian, Mahkamah dapati Plaintif gagal membuktikan tuntutannya terhadap Defendan. Tidak wujud sebarang kontrak antara Plaintif dan Defendan untuk Defendan menguruskan kedua program Pementasan Dewa Kencana dan Maharaja Lawak Mega. Tidak ada sebarang Purchase Order atau Surat Lantikan atau Delivery of Service melibatkan Defendan dalam kes ini. Kertas kerja yang dikemukakan adalah pemikiran semula selepas invois disediakan dan ianya tidak dibuktikan mendapat kelulusan dari pihak Defendan sendiri. Atas alasan itu, adalah wajar untuk Mahkamah menolak tuntutan laintif dengan kos mengikut skala.” Plaintiff’s Submission [5] The learned counsel for the Plaintiff advanced a number of grounds that can be manifestly summarized as follows: (a) The Plaintiff’s main contention is that the Defendant had breached the contract where the Plaintiff had carried out its services for the two programmes and submitted invoices for payment but Defendant refused to pay the Plaintiff for the reason the Plaintiff was not appointed according to the normal process under SACC; (b) the Session Judge had erred in facts and law to dismiss Plaintiff’s claim against the Defendant and submitted that this Court should intervene with the decision of the trial court based on a number of decisions of the Federal Court, the case of Gan Yook Chin v Lee Ing Chin [2004] 4 CLJ 309; UEM Group Bhd v Genisys Integrated Engineers Pte Ltd [2010] 9 CLJ 785; Dream Property Sdn Bhd v Atlas Housing Sdn Bhd [2015] 2 CLJ 453; (c) the Session Judge had erred in facts and law in deciding that the Plaintiff was not appointed to manage the two programmes and in deciding that the Plaintiff as a member of Defendant’s BAP Panel, was not offered by the Defendant to manage the two programmes on behalf of the Defendant for the management fee of RM280,000.00. (d) the Session Judge failed to consider the witness statement PW-1 the Chief Executive Officer of the Defendant that the Plaintiff managed the two programmes on the Defendant’s request; (e) the Plaintiff was at all material time managed the two events on Defendant’s request and that the Defendant had promised to pay all the management fees due. The Plaintiff’s counsel referred the Court to the Plaintiff’s witness statement from the record: “S : Untuk soalan daripada rakan bijaksana saya, ada tak surat tawaran perkhidmatan yang telah diberikan kepada plaintif dan Dato telah kata surat tawaran tak ada yang adanya company profile. So apabila beliau telah bertanyakan bahawa adakah terdapat sebarang surat mengenai khususnya kepada barang yang ditawarkan Dato kata taka da. Boleh Dato terangkan bagaimana plaintif telah diminta untuk melakukan projek ini tanpa satu surat tawaran? J : Bila projek ini dilaksanakan di Royal Theatre Shah Alam ia sebenarnya ialah untuk menguji lari juga satu asset kerajaan negeri yang tak digunakan. Oleh kerana itu pihak SACC ini sebenarnya adalah event manager yang mana diminta untuk memberikan cadangan syarikat-syarikat yang mana boleh dan mempunyai keupayaan untuk membantu dari segi pelaksanaan projek. Jadi kita lihat dari segi program business associate program yang kita ada terdapat syarikat plaintif ini yang mempunyai kebolehan dalam bidang kerja yang kita perlukan. Oleh kerana itu kita cadangkan supaya syarikat ini diberikan peluang untuk projek ini.” (f) the Plaintiff submitted the invoices for the scope of works carried out by the Plaintiff, invoices No. ZIP 0047/12/2011, No. ZIP 0048/12/2011, No. ZIP 0049/12/2011, No. ZIP 0052/12/2011, No. ZIP 0053/12/2011, No. ZIP 0054/12/2011 and No. ZIP 0058/12/2011 amounting to RM280,000.00, sent to the Defendant on 28.12.2011. Defendant’s failure in paying the Plaintiff amounted to a breach of contract. (g) Plaintiff submitted that there was a working paper prepared which had been approved by the Defendant for payment to be made to the Plaintiff by the Defendant. (h) It was argued by the Plaintiff that the Defendant had been estopped from denying the invoices or objecting to any money owing to the Plaintiff as the Defendant did not object to the invoices submitted which was to be communicated on any discrepancies within seven days of receipt. (i) Counsel for the Plaintiff submitted that there was an oral contract after the letter on BAP. Defendant’s Submission [6] The learned counsel for the Defendant pointed to the Court that the Plaintiff’s claim is only based on the Letter of Award and the invoices. The Defendant submitted that the Panel Letter of Business Associate Programme, the Letter of Award was not a contract between Plaintiff and Defendant for the management ‘Projek Maharaja Lawak Mega dan Dewan Kencana’ as claimed by the Plaintiff. [7] The counsel for the Defendant submitted in its Defence (at pages 29 - 42 of Appeal Record Bahagian A), that there were no nexus between Plaintiff and Defendant as there was no offer made, therefore there was no acceptance, no consideration and no intention to create legal relations between the parties: “6. (i) Merujuk kepada perenggan 6 Pernyataan Tuntutan, Pihak Defendan ingin menafikan sekeras-kerasnya kenyataan bahawa Plaintif pernah dilantik untuk menguruskan dua (2) Majlis khusus seperti yang didakwa secara salah oleh Plaintif. Surat panel BAP tersebut bukan merupakan surat lantikan dari Defendan untuk menguruskan dua majlis khusus ……. (ii) Defendan secara tegas menegaskan bahawa Defendan tidak pernah sama sekali melantik Plaintif untuk kerja-kerja di para 6 i)(a) dan (b) tersebut di atas. Tidak ada perhubungan (“nexus”) di antara Plaintif dan Defendan berkaitan dua skop kerja tersebut di (a) dan (b) tersebut. Tidak ada atwaran dari Defendan, penerimaan dari Plaintiff, Nota tempahan (Purchase Order), Nota serahan kerja (Job Delivery Order), dan/atau melantik Plaintif untuk event Pementasan Dewa Kencana seperti yang didakwa. Tuntutan Plaintif adalah tidak berasas sama sekali. 9. (i) Merujuk kepada Para 9 Pernyataan Tuntutan, Defendan tidak pernah meminta apa-apa sebut harga dari Plaintif, defendan juga tidak pernah mengeluarkan Nota Tempahan (“Purchase Order”), tidak juga wujud surat lantikan dan juga tidak pernah wujud apa-apa pengesahan pengesahan perlaksanaan kerja yang dilakukan oleh Defendan. ….” [8] The Defendant submitted that the Letter of Award was only an appointment letter for Plaintiff to be a panel for the BAP, an initiative programme organized by the Shah Alam Convention Centre. It was submitted in the written submission that the BAP provides the incentives and it was not an appointment letter to organize events as claimed by the Plaintiff: [9] On this basis, the Defendant directed the Court’s attention to the procedural requirement in obtaining services where there is an approval process by the EXCO to be followed and made reference to some of the examples of the approval process (at pages 70 – 71 of the Appeal Record Bahagian B). Therefore, as submitted by the Defendant, the Plaintiff’s services nor the appointment was never approved by the Defendant. [10] The counsel for the Defendant also submitted to this Court that there was no quotation, Purchase Order nor Delivery Order and the only document produced by the Plaintiff was just the invoices. The Defendant had replied its objection via email to the Plaintiff’s claim of a purchase order and delivery of services (as in page 520 paragraph 3, Appeal Record Bahagian C). [11] The counsel for the Defendant submitted the evidence on contractual relationship based on the testimony given by Plaintiff’s witness SP2 (Datuk Zulkifli Bin Ishak) (at pages 120-121 of the Appeal Record Bahagian B) that the document referred to which was the Letter of Award was not a contract but an appointment letter in general. The counsel for the Defendant relied on the authority which makes a contract under section 3 and section 10 of the Contracts Act 1950 and based on one article of 2012, 5 MLJ CXLVII, “Only agreements enforceable by law are legally binding contracts. An offer or proposal is one of the essential elements for the formation of contract. The contracts cannot be entered into without one of the parties offering or proposing and the other accepting.” [12] The Defendant’s solicitors replied to the Plaintiff on 11.2.2014 denying of any money owing to the Plaintiff. [13] In relation to the contention that there was an oral contract, the counsel for the Defendant submitted that such statement by Plaintiff’s witness SP2 was an afterthought and it was not pleaded by the Plaintiff and invited the Court to expunge the statement from the record. [14] In relation to the working paper claimed prepared by the Plaintiff for the purposes of managing the two events, the learned counsel for the Defendant informed this Court that the working paper by Plaintiff was not the original copy. The working paper which was provided by the Defendant as tendered in court, marked as exhibit D23 – D30 (at pages 460-504 Appeal Record Bahagian C). The copy by the Plaintiff did not have the Financial Controller’s and the Chief Executive’s approval of the Defendant and were marked as ID at the Sessions Court. [15] The invoices as submitted by the Plaintiff to the Defendant (at pages 379-385, Appeal Record Bahagian C), had been objected by the Defendant by putting a note “acknowledge receipt of this Invoice without admission of liability”, on each invoices handwritten by the Defendant’s CFO (Financial Controller). THE COURT’S FINDING [16] There were three issues raised at the trial court which are as follows: (i) Whether the Defendant’s Letter of Award of 5.9.2011 to the Plaintiff was a Contract between the Plaintiff and the Defendant to manage the two events that is Dewa Kencana Theatre and ‘Maharajalawak Mega’; and (ii) Whether Defendant has to pay Plaintiff for the expenses and management fee in managing the two theatre performances Dewa Kencana and ‘Maharajalawak Mega’ as demanded in the invoices issued by the Plaintiff. (iii) whether the Defendant was estopped from raising objection on the invoices that had been submitted by the Plaintiff. Whether Letter of Award was a Contract? [17] The heart of the matter revolves around the Letter of Award of 5.9.2011 which is also known as the BAP Letter between the Plaintiff and the Defendant (at pages 351-353 of the Appeal Record Bahagian C). The Letter of Award was signed by the Defendant’s Chief Executive Officer and some of the salient provisions are reproduced here, as follows: “APPOINTMENT AS PANEL OF EVENT MANAGERS FOR SHAH ALAM CONVENTION CENTRE – BUSINESS ASSOCIATE PROGRAM (BAP) 1. SACC Convec Sdn Bhd (“SACC”) are please to inform you that ZI Production Sdn Bhd is hereby appointed as a panel of Event Managers for Shah Alam Convention Centre, placed under our Business Associate Program (BAP). 2. Your appointment is hereby acknowledged, subject to paragraph 3 and 4 herein below, the Terms and Conditions of Contract, Specifications, Price Schedule, this Letter of Award and other Documents of the Contract. 3. You are required to execute in due course the formal Contract between SACC Convec Sdn Bhd and ZI Production Sdn Bhd within 30 days from date of this Letter of Award. Pending the execution of the formal Contract, this letter, as clarified and amended by the Terms and Conditions of Contract and this Letter of Award shall constitute a binding agreement between ZI Production Sdn Bhd and SACC Convec Sdn Bhd. 4. Your benefits as a BAP member (as specified in the formal Contract will comprise as follows: ….. …… 5. The provision of the incentives and benefits in accordance with paragraph 2 and 3 herein above are subject to the terms and conditions determined in the Contract and shall be a condition precedent to the validity of this Letter of Award. 6. The effective date of the Contract shall be the date of this Letter of Award. The Contract Period shall be for two (2) years commencing from 5 September 2011 to 30 September 2011 (both dates inclusive), with an option for an extension for a further period of two (2) years subject to a mutual agreement. 7. This Letter of Award shall be subject to the matters contained in Terms and Conditions of the Agreement. This Letter of Award is sent to you in duplicate. Kindly return the original copy, duly signed and witnessed where indicated to this office and retains the duplicate copy. …” [18] The learned counsel for the Plaintiff submitted that the Plaintiff was offered as a member of Defendant’s BAP to manage two events on behalf of the Defendant with the offered payment of RM280,000.00 which Plaintiff accepted. The Plaintiff’s counsel relied on section 2 of the Contracts Act 1950 and cases, Kumpulan A Besik Sdn Bhd v Araman Jaya Sdn Bhd [2011] 8 MLJ 77; Charles Grenier Sdn Bhd v Lau Wing Hong [1996] 3 MLJ 327 and Wing Fah Enterprise Sdn Bhd v Matsushita Electronic Components (M) Sdn Bhd [2011] 9 MLJ 320. [19] In ascertaining the language of the letter of award or whether there was an agreement, Chesire, Fifoot & Furmston’s Law of Contract, Sixteen Edition, stated that the task of the courts is to extract the intention of the parties both from the terms of their correspondence and from the circumstances which surround it and the interpretation that may be provided. This had been pointed out in the case of Esso Standard Malaya Bhd v Southern Cross Airways (Malaysia) Bhd [1972] 1 MLJ 168 by Raja Azlan Shah J (as he then was) that if the agreement is made subject to certain conditions to be specified in a formal contract, then until those conditions are thus specified, there is no final agreement such as the court will enforce. [20] After a careful perusal of the Letter of Award, this Court finds that the pertinent statements in relation to the Plaintiff’s contractual status with the Defendant can be found in paragraphs 2, 3 and 5. Paragraph 2 stated that the Plaintiff’s appointment is acknowledged and is made subjected to paragraphs 3 and 4 of the Letter of Award which is conditional upon formalizing a contract. At paragraph 2, it mentioned the other conditions to a contract that is, “the Terms and Conditions of Contract, Specifications, Price Schedule, this Letter of Award and other Documents of the Contract”. [21] At paragraph 3, the Plaintiff is required to execute the formal Contract within 30 days and “Pending the execution of the formal Contract, this letter, as clarified and amended by the Terms and Conditions of Contract and this Letter of Award shall constitute a binding agreement between ZI Production Sdn Bhd and SACC Convec Sdn Bhd.” Whereas paragraph 5 stated that the incentives and benefits are subject to the terms and conditions determined in the Contract, “and shall be a condition precedent to the validity of this Letter of Award.” [22] The Letter of Award clearly stated that the Defendant is appointing Plaintiff as a member of the Panel BAP and Plaintiff’s performance in sealing the agreement is still subjected to the terms and conditions of a formal contract. Borrowing the words in the said Letter of Award, “pending the formalization of a contract”, the Letter of Award will “be clarified and amended by the Terms and Conditions of Contract” as stipulated in paragraph 3. In addition, the incentives and benefits for the Plaintiff is still subjected to the terms and conditions to be determined and must be a conditional precedent to the validity of the Letter of Award. [23] As a general rule, when an acceptance to a contract is ‘subject to contract’, there is an apparent lack of intention to enter into a legally binding contract. The counsel for the Defendant submitted the Singapore Court of Appeal case of Compaq Computer Asia Pte Lyd v Computer Interface (S) Pte Ltd [2004] 3 SLR (R) 316. In that case, a written agreement could not be concluded and signed between Compaq and CIS and Compaq issued to CIS a letter of award (LOA) which enclosed various schedules setting out the services to be rendered and the charges. [24] The Court found that not all the essential terms had been set out in that LOA for instance payment terms, exclusion of liability and insurance which are vital for a contractual arrangement. It was held that the LOA was conditional upon the final terms and conditions being agreed, “It seemed clear from the LOA that although CIS had been selected to be the subcontractor, there were terms on which the parties had yet to agree, and only upon the execution of a written agreement would there be a contract between the parties.” [25] The counsel for the Defendant also submitted a legal article, “Offer” and Its Significance For Formation Of Contract: The Malaysian Perspective” [2012] 5 MLJ cxlvii by Dr. Adnan Trakic, which emphasized on formation of contract in the case of George Trollope & Sons v Martyn Brothers [1934] 2 KB 436 and as explained in the case of Storer v Manchester City Council [1974] 3 All ER 824 by Lord Denning, ‘that there is no binding contract until the contracts of sale have been formally exchanged’ [26] This Court had also the benefit of reading the case of Tiverton Estates Ltd v Wearwell [1975] Ch 146 where at page 159-160, the statement “subject to contract” had been decided, in the words of Lord Denning, “.. for over a hundred years, the courts have held that the effect of the words “subject to contract” is that the matter remains in negotiation until a formal contract is executed….” [27] The High Court case of Kumpulan A Besik Sdn Bhd (supra) relied by the Plaintiff’s counsel stated the two types of contract which are formal and informal. In the former, to constitute a valid contract, there must be separate and definite parties, the parties must be in agreement, there must be consensus ad idem and the parties must intend to create legal relations. In the case of Charles Grenier Sdn Bhd (supra), there was sufficient clarity of the parties to the transaction including the price and the terms which are essential to constitute an agreement. [28] In this case however, based on the clear wordings of the Letter of Award, it is subjected to the formalization of contract which will clarify and amend the Letter of Award as specified in paragraphs 2, 3 and 5. There is no certainty as to the terms of a contract to be entered into and no consensus ad idem criteria under section 7 (a) of the Contracts Act 1950. [29] This Court is of the view that the letter may be called a letter of intent or a letter of award and whatever name it carries, the intention of the parties must be objectively sought. Although the case referred by the Defendant’s counsel is a Singaporean authority which is persuasive and not binding to be followed, the facts of that case is similar to the present case. This Court rely on the submissions put forward by the counsels. A good counsel is one who produces authorities to support the statement of law he is relying upon and they could be in the form of reported judgments, textbooks or even published law articles: Pacific Forest Industries Sdn Bhd & Anor v Lin Wen-Chih & Anor [2009] 6 MLJ 293. [30] In this instant case, in not fulfilling the conditions as stated in the Letter of Award, although Plaintiff had acknowledged to accept the terms and conditions in the said letter, without the formalization of a contract, the Letter of Award ceases to be valid. [31] The evidence of no contract is corroborated by the Plaintiff’s witness, SP-2, Datuk Zulkifli Bin Ishak, one of the Directors for the Plaintiff whom testified (at pages 120-121 Appeal Record Bahagian B) and admitted that the Letter of Award was not a contract: “S : Ya, soalan saya tadi Dato ada cakap dalam jawapan nombor 10 tadi kausa tindakan plaintif dan defendan adalah kemungkiran kontrak. So saya ada tanya apakah kontrak yang dimaksudkan oleh Dato. So soalan saya seterusnya saya merujuk kepada mukasurat 13 dan 16 adakah ini yang kontrak yang dimaksudkan Dato? J : Ini appointment letter sebagai panel event. S : Bukan inilah kontrak dia? J : Ini bukan kontrak. S : Oh bukanlah? J : Ini appointment letter.” [32] Based on the record by the Defendant’s witness, he explained to the Court that it was a proposal for the appointment which were extended to other event management companies and has yet to formalize a contract between the Plaintiff and the Defendant. This Court also finds that there was no agreed price for the services to be rendered by the Plaintiff for the consideration of the benefits in carrying out the tasks in the event the contract is executed. [33] The Plaintiff represented by the Chairman Datuk Zulkifli Bin Ishak signed the acknowledgment letter on 12.9.2011 for the Letter of Award which was returned to the Defendant. The returned Acknowledgment (at page 354 of the Appeal Record Bahagian C) accepting the Letter of Award stated as follows: “I, Datuk Zulkifli Ishak in the capacity of Chairman duly authorized to sign for and on behalf of ZI Production Sdn Bhd hereby to confirm acceptance of the terms and conditions stipulated in this letter.” [34] As I have mentioned earlier, I wish to reiterate that in acknowledging the terms and conditions of the Letter of Award without any effect of formalization, the Letter of Award continue to cease as valid. [35] This Court is also aware of the other documentary evidence where the proposal for the appointment and to carry out a test run for the events is further supported by the Defendant’s letter to a member of the EXCO of the State dated 21 October 2011 where it was the Defendant’s proposal based on a working paper ‘Cadangan Bagi Penjenamaan, Promosi dan Pemasaran Teater DiRaja Selangor’ sent on 13 October 2011, requesting for permission to use the Royal Theatre premise to carry out the test run. This can be found at the second paragraph of the reply letter by the EXCO member not objecting to the proposal, “Sukacita dimaklumkan, setelah beberapa perbincangan yang diadakan di antara Y.Bhg Dato’ dan Pegawai saya, bahawa saya tiada halangan dengan cadangan tersebut di atas. Oleh itu saya bersetuju untuk membenarkan SACC Convec Sdn Bhd (SCSB) menggunakan premis Teater Diraja Selangor untuk tujuan MENGUJILARI (Test Run), bermula serta merta sehingga 31 Disember 2011. ….” [36] In relation to the contention by the Plaintiff that there was an oral contract, the counsel for the Defendant submitted that such statement by Plaintiff’s witness SP2 was an afterthought as it was not pleaded by the Plaintiff. This Court will not consider such evidence as it was not pleaded and stand by the established principle that parties are bound by their pleadings as decided in the Federal Court decision in Dato’ Tan Chin Who v Dato’ Yalumallai @ M Ramalingam s/o V Muthusamy [2016] MLJU 641. Whether Defendant has to pay Plaintiff? [37] The Court had heard that the Plaintiff prepared the invoices without any supporting documents. There was no quotation, Purchase Order and Delivery Order which the Court does wonder on what basis the invoices were prepared. The Defendant submitted that no documents to support the offer and the acceptance made as required under section 3 and section 10 of the Contracts Act 1950 and relied on the case of CFB Aluminium Extrusin SDn Bhd v Lim Soon Seng [2014] AEMJ 1192 that was referred in the case Wescourt Design Sdn Bhd v Wescourt Furnishing (M) Sdn Bhd [2015] 11 MLJ 735. [38] This is further supported by the evidence of the Plaintiff’s witness, SP-1 (at page 97, Appeal Record Bahagian B) who was the former CEO of the Defendant that there were no supporting documents: “S : Itu yang saya tanya tadi Dato, kalau ada kos, kalau ada pihak ketiga melibatkan pihak ketiga sebagai ZI mana dia surat tawaran untuk ini. Tak ada, delivery order tak ada, sebut harga tak ada, tak dibawa kepada Exco Memang semua tak ada kan. Tiba-tiba timbul invois? Betul? J : Betul. S : Betul? J : Betul.” [39] The other evidence is based on the record, the statement by Plaintiff’s witness SP-3 (at pages 195, 197 Appeal Record) where no supporting documents in the preparation of the invoices: “S : Sebelum En Leong buat invois itu En Leong berpandukan kepada apa? Supporting dokumen ada tak selalu? J : Tak ada. S : So based on what did you prepare this invoice? J : Based on my boss instructions. …… …… S : Appointment letters? J : Tak ada.” [40] This Court is of the view that in matters concerning goods and services where sold and delivered, there must be prove that the order was made and the goods were received by the buyer. This Court rely on the case attributed by the Defendant’s counsel, Wescourt Design SDn Bhd v Wescourt Furnishing (M) Sdn Bhd [2015] 11 MLJ 735 which referred the case of CFB Aluminium Extrusin SDn Bhd v Lim Soon Seng [2014] AEMJ 1192 where Lim Chong Fong JC (now High Court Judge) had said: “16. Generally, it is plain that the seller in a claim for payment for goods sold and delivered must prove that the order was made and the goods were received by the buyer. The proof is commonly by way of producing in court the purchase order, delivery order and the invoice for the goods (‘the key documents’)….” [41] Based on the invoices, this Court finds that they were prepared without any supporting documents to proof of any contract existed. This Court is concerned with the non-existence of purchase order and delivery order to substantiate the invoices produced by the Plaintiff which is in the ordinary course of business. This Court wish to rely on the authority of CFB Aluminium Extrusion Sdn Bhd (supra) case which stated that, “[13] Consequently in civil litigation…..that relevant documents that substantiate or support the oral allegations must be adduced at the trial where such documentary evidence is expected to be available in the ordinary course of business and commerce. Otherwise a reasonable explanation must be tendered to justify their non production. In the absence of these documents or explanation of their absence, mere oral testimony is not weighty enough to overcome the burden of proving the allegations on a balance of probabilities …” [42] It is essentially important to produce to the Court those documents. In commercial transactions, these documents are normally expected to be generated in the course of business and could be produced in Court. It is the Plaintiff who claimed for breach of contract and hence has the legal burden to proof the existence of a contract by way of producing the purchase order and the delivery order. [43] The Plaintiff claimed that the working paper had been approved by the Defendant. The counsel for the Defendant submitted to this Court that the Defendant had received the working paper (as at page 460-504 Appeal Record Bahagian C) on 18.6.2012 which were attached with the said invoices and the Defendant’s Financial Controller emailed to the sender of the working paper on 19.6.2012 (at pages 520-521 of the Appeal Record Bahagian C) raising doubt on the invoices submitted as there were no Purchase Order/Letter of Appointment and Delivery Services attached to the invoices. [44] The Defendant submitted that the working paper by Defendant is as tendered which can be found at pages 460 – 504 of the Appeal Record Bahagian C. Meanwhile the working paper by the Plaintiff which did not have the approval of the Financial Controller of the Defendant and the former Chief Executive Officer of the Defendant’s approval, remained as ID at the Sessions Court, was never approved by the Defendant. [45] The Defendant’s counsel directed the Court’s attention to the working paper that was submitted by the Plaintiff dated 30.12.2011 whereas the invoices were dated 18.12.2011, 28.12.20111 and 26.11.2011. The counsel for the Defendant submitted that the invoices could not be issued before the working paper was submitted. The counsel for the Defendant also pointed out to the Court that the Defendant had clearly objected by noting on the invoices “acknowledge receipt of this Invoice without admission of liability” handwritten by the CFO of the Defendant which the objection email made was also copied to the CEO and the EXCO. [46] This Court finds that the working paper claimed to be prepared by the Plaintiff would mean that the invoices were issued before the working paper was submitted for the services to be rendered which is not a practice in the ordinary course of business. This Court takes the working paper as claimed by the Plaintiff to be bad evidence to support the invoices. Whether the Defendant was estopped from raising objection [47] In relation to the issue of estoppel raised by the Plaintiff, it was claimed that the Defendant did not object on the invoices and therefore Plaintiff argued that the Defendant is estopped from denying. It is the Plaintiff who raised this rule and this Court finds that the Defendant had acknowledged receipt without admission of liability as stated in the invoices by the Financial Controller. This Court finds that the Defendant had objected to the invoices and therefore the estoppel rule is irrelevant. [48] Reverting to the principle for appellate intervention raised by the Plaintiff, the Plaintiff submitted that the Court in hearing appeal will not disturb the finding of fact by any trial judge unless, “the trial court is shown to be plainly wrong in arriving at its decision. A plainly wrong decision happens when the trial court is guilty of no or insufficient judicial appreciation of evidence.” The learned counsel for the Plaintiff relied on the Federal Court decision of Dream Property Sdn Bhd v Atlas Housing Sdn Bhd [2015] 2 CLJ 453. [49] This Court is of the view that in reference to the decision of the Federal Court, Dream Property (supra) case as submitted by the Plaintiff, the Court should not intervene with the decision of the trial judge unless the Session Judge was plainly wrong in arriving to its decision, “[60] It is now established that the principle on which an appellate court could interfere with findings of facts by the trial court is “the plainly wrong test” principle; see the Federal Court in Gan Yooki Chin & Anor (P) v Lee Ing Chin @ Lee Teck Seng & Anor [2004] 4 CLJ 309; [2005] 2 MLJ 1 (ap p. 10) per Steve Shim CJ SS. …” [50] It is incumbent upon the Court to look at all the surrounding factors and to weigh and evaluate the documentary evidence as to whether they support the Plaintiff’s oral testimony. This Court must direct its mind as to the probative effect of the documents and the evidence before the Court. It is always open for this Court to interfere if the findings made were unsupported by evidence or against the weight of evidence or if there was no proper judicial appreciation of the evidence or if there was any misdirection in law by the Session Judge: Jason Chan Huan Sen & ors v P.P. [2015] 2 CLJ 605. [51] In this case, the Court finds that the Session Judge had evaluated all the documentary evidence and the oral testimony of both Plaintiff’s and Defendant’s witnesses. The Session Judge did not consider evidence that was not tendered or withdrawn nor did she decide on an adverse inference from non-evidence: Tan Ah Chio & Ors v Lua Kim Soon & Ors [2015] 1 MLJ 334. It will be plainly wrong if this Court to state otherwise than its finding of the truth. [52] This Court had given due consideration on the evidence of the letter, the record of the Plaintiff’s witnesses statement whom testified admitting that the Letter of Award was not a contract and that the invoices were prepared without any supporting documents to proof the formalization of any contract. On that legal basis, the Court finds that the Plaintiff has failed to prove on the balance of probabilities that there was a contract between the Defendant and the Plaintiff. There was no money owed by the Defendant to the Plaintiff. I therefore dismissed the appeal with cost. Dated: 3 July 2017 (DATIN ZALITA BINTI DATO’ ZAIDAN) Judicial Commissioner Shah Alam High Court Counsel for the Appellant: 1. Ganeson a/l Gunathan 2. Gomathy a/p Balasupramaniam Tetuan Ganeson Gomathy & Partners Peguambela & Peguamcara Suite A-1-5, 1st Floor Kuchai Exchange No. 43, Jalan Kuchai Maju 13 Kuchai Lama, 58200 Kuala Lumpur Tel: 03-79725454 Fax:03-79724545 Counsel for the Respondent: Al-Sabri bin Hj. Ahmad Kabri Tetuan Al Sabri & Co Peguambela & Peguamcara Suite No. 11A Jalan Lawan Pedang 13/27 Seksyen 13, Tadisma Business Park 40100 Shah Alam Selangor Tel: 03-55110525/6 Fax: 03-55110528 1

Tika 2.6.0

BA-12B-164-09/2016

PERAYU ZI PRODUCTIONS SDN. BHD. RESPONDEN SACC CONVEC SDN. BHD.

03/07/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=10ef7102-1ec7-4171-bbb3-1377b931c7af&Inline=true

DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA (DALAM BIDANG KUASA RAYUAN) RAYUAN SIVIL NO: BA-12B-164-09/2016 ANTARA ZI PRODUCTIONS SDN. BHD. (NO PENDAFTARAN SYARIKAT: 701484-U) ....PERAYU DAN SACC CONVEC SDN. BHD. (NO PENDAFTARAN SYARIKAT: 861880-W) …RESPONDEN (DALAM MAHKAMAH SYESEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA GUAMAN NO: B52-43-03/2015) ANTARA ZI PRODUCTIONS SDN. BHD. (NO PENDAFTARAN SYARIKAT: 701484-U) …PLAINTIF DAN SACC CONVEC SDN. BHD. (NO PENDAFTARAN SYARIKAT: 861880-W) …DEFENDAN GROUNDS OF JUDGMENT Introduction [1] This is an appeal against the decision of the Session Judge which dismissed the Plaintiff’s claim on 7.9.2016. The parties in this appeal are the Appellant who was the Plaintiff and the Respondent who was the Defendant. [2] For ease of reference, in this judgment, the parties will be referred to as they were in the Sessions Court. Background Facts [3] The dispute before me is between the Plaintiff, an event management company and the Defendant who operates and manages the convention centre in Shah Alam regarding two events to be organized by the Defendant for ASTRO. The relevant factual background based on the written submission of the counsels may be stated as follows: (a) The Plaintiff is a company incorporated under the Companies Act 1965 and was registered on 4.7.2005 is owned by two Directors and carries a business of event management, advertising and promotional services. (b) The Defendant is a company established under the Companies Act 1965 was registered on 24 June 2009 and is wholly owned by Perbadanan Kemajuan Negeri Selangor (PKNS). The Defendant has four Directors and its conduct of business is operating and managing the Shah Alam Convention Centre. (c) Plaintiff pleaded that the cause of action against Defendant is for breach of contract of 5.9.2011. (d) Plaintiff claimed that by a Letter of Award of 5.9.2011, the Defendant appointed the Plaintiff as an Event Management Panel for SACC Sdn Bhd for a Business Associates Programme (BAP). (e) The Letter of Award signed by the Chief Executive Officer of the Defendant, Dato’ Zulkifli Bin Mohamad was received by the Plaintiff’s Director Datuk Zulkifli Bin Ishak on 12.9.2011 where the Plaintiff is appointed as a member of BAP for a period of two years from 5 September 2011 until 30 September 2013. (f) The Plaintiff claimed that both parties agreed that until a formal contract is signed, the said Letter of Award will be the valid and binding document on both parties. (g) The Plaintiff claimed that based on the appointment of Plaintiff as BAP member, the Defendant had directed the Plaintiff to manage the two events to be organised by the Defendant: (i) “Pementasan Dewa Kencana”; and (ii) “Maharaja Lawak Mega” (h) The Plaintiff claimed that the Defendant had agreed without condition to pay all expenses incurred by the Plaintiff in managing the two events. (i) The Plaintiff claimed that the theatre performance of Dewa Kencana was held on 23.12.2011 until 25.12.2011 where Plaintiff was the event manager appointed to carry out the tasks successfully in coordinating, security control and supervising. (j) The Plaintiff submitted the invoice for the management fee dated 26.12.2011 amounting to RM45,000.00 to the Defendant. (k) The Plaintiff claimed it had successfully managed another event “Maharaja Lawak” from October 2011 until December 2011 for the Defendant where the Plaintiff was acting as the Event Manager and had carried out the tasks successfully. The Plaintiff then submitted 5 invoices for the expenses incurred and the management fee, altogether totaled at RM238,000.00 to the Defendant. (l) The Plaintiff claimed that the Defendant had received the payment RM500,000.00 from Astro on 5.4.2012 and all suppliers including Plaintiff, claimed to be paid upon the Selangor State Government’s EXCO’s approval. (m) The Plaintiff claimed that Yang Berhormat Rodziah Binti Ismail who is an EXCO member of the Selangor State Government, the Chairman of Welfare, Woman Affairs, Science, Technology and Innovation had asked the Defendant to pay the contractor, the event manager that is the Plaintiff in organizing the ‘Program Maharaja Lawak Mega Astro’ that was aired on 28.10.2011 considering that it had been organized well and under the responsibility of the Defendant. (n) The Plaintiff claimed that the Defendant had breached the Letter of Award when the Defendant failed, refused and/or negligent to pay the expenses incurred and the management fee amounting to RM283,000.00. (o) Plaintiff claimed that it suffered loss of RM283,000.00 due to Defendant’s breach to pay for the management and the expenses incurred on the two events that is, RM45,000 for the management fee of Dewa Kencana and RM238,000 for the management fee and expenses incurred, and prayed for general damages and exemplary damages. The Plaintiff served one Letter of Demand dated 23.1.2014 to the Defendant demanding for the RM283,000.00 as special damages. (p) The Session Judge dismissed all Plaintiff’s claims for Special Damages of RM283,000.00, General Damages, Exemplary Damages, interests and cost. (q) Being dissatisfied with the said decision, the Plaintiff appealed to this Court. Session Court’s Decision [4] The Session Judge’s decision is reproduced here as follows: “DAPATAN MAHKAMAH Berdasarkan keterangan saksi Plaintiff dan Defendan, dokumen yang dikemukakan dan hujahan pihak. Tuntutan Plaintif adalah berdasarkan i) Surat Panel Business Associate Program bertarikh 5.9.2011 (Surat Anugerah/BAP) ii) Lima Invois bertarikh 18.12.2011 dan satu invois bertarikh 28.12.2011 Kausa tindakan Plaintif dalam kes ini adalah bahawa Defendan mungkir surat Anugerah dengan Plaintif bila gagal membayar perbelanjaan dan yuran pengurusan yang dilakukan Plaintif dalam dua acara iaitu Pementasan Dewa Kencana dan Maharaja Lawak Mega. …… Surat BAP tersebut bukan dikeluarkan oleh Defendan, sebaliknya merupakan surat dari SACC (Pusat Konvensyen Shah Alam). Surat BAP adalah surat bersyarat di mana panel yang dilantik hendaklah menandatangani perjanjian kontrak dalam tempoh 30 hari dari tarikh lantikan. Dalam kes ini tiada apa-apa kontrak antara Plaintif dan Defendan. Keterangan SP1, Dato Zulkifli Mohamad, Ketua Pegawai Eksekutif Defendan. Beliau akui bahawa tiada surat tawaran perkhidmatan diberi kepada Plaintif. Pihak SACC sebagai ‘event manager’ diminta memberikan cadangan syarikat yang berkebolehan dan berkeupayaan membantu melaksanakan projek tersebut. Di bawah Business Associate Programme (BAP) syarikat Plaintif didapati mempunyai kebolehan dalam bidang kerja yang diperlukan. Sebab itu Plaintif dicadangkan diberi projek ini. Saksi SP2 sendiri mengakui, Letter of Award (BAP) di mukasurat 13 ikatan Dokumen itu bukan kontrak sebaliknya surat lantikan sahaja. Saksi SP3, seorang akauntan pula menyatakan bahawa beliau menyediakan invois-invois kepada SACC berdasarkan arahan bertulis dari majikannya tanpa apa-apa dokumen sokongan. Beliau sendiri tidak pasti invois yang dibuat untuk tujuan apa dan hanya berdasarkan apa yang dimaklumkan oleh majikan kepadanya sahaja. Mahkamah turut dimaklumkan oleh saksi SP1 bahawa sesuatu kontrak pembekalan barangan dan perkhidmatan perlu wujud melalui dokumentasi dan perlu dapatkan kelulusan exco SACC kerana tanpa kelulusan, pembayaran tidak boleh dilakukan. Dalam kes ini, pelantikan Plaintif untuk menguruskan kedua-dua program yang dituntut tidak mendapat kelulusan dari EXCO Defendan. Fakta ini dijelaskan oleh SP1 dalam keterangan beliau semasa disoalbalas. …… Kertas kerja yang mencadangkan kelulusan pembayaran kepada Plaintif yang dikemukakan kepada Bahagian Kewangan Defendan bersama invois didapati tidak mempunyai tandatangan kelulusan CEO. …. Atas sebab itu invois yang dihantar itu diterima tanpa pengakuan liability. Mahkamah juga mendapati kertas kerja tersebut jika pun sahih adalah bertarikh 30.12.2011 manakala invois-invois yang dihantar adalah bertarikh 18.12.2011, 26.11.2011 dan 28.11.2011. Timbul anggapan pada Mahkamah bahawa kertas kerja itu hanya wujud terkemudian untuk menyokong invois bagi mendapatkan bayaran dan oleh itu tidak boleh diterima sebagai bukti perkhidmatan telah diberikan oleh Plaintif kepada Defendan. Secara keseluruhannya, atas imbangan kebarangkalian, Mahkamah dapati Plaintif gagal membuktikan tuntutannya terhadap Defendan. Tidak wujud sebarang kontrak antara Plaintif dan Defendan untuk Defendan menguruskan kedua program Pementasan Dewa Kencana dan Maharaja Lawak Mega. Tidak ada sebarang Purchase Order atau Surat Lantikan atau Delivery of Service melibatkan Defendan dalam kes ini. Kertas kerja yang dikemukakan adalah pemikiran semula selepas invois disediakan dan ianya tidak dibuktikan mendapat kelulusan dari pihak Defendan sendiri. Atas alasan itu, adalah wajar untuk Mahkamah menolak tuntutan laintif dengan kos mengikut skala.” Plaintiff’s Submission [5] The learned counsel for the Plaintiff advanced a number of grounds that can be manifestly summarized as follows: (a) The Plaintiff’s main contention is that the Defendant had breached the contract where the Plaintiff had carried out its services for the two programmes and submitted invoices for payment but Defendant refused to pay the Plaintiff for the reason the Plaintiff was not appointed according to the normal process under SACC; (b) the Session Judge had erred in facts and law to dismiss Plaintiff’s claim against the Defendant and submitted that this Court should intervene with the decision of the trial court based on a number of decisions of the Federal Court, the case of Gan Yook Chin v Lee Ing Chin [2004] 4 CLJ 309; UEM Group Bhd v Genisys Integrated Engineers Pte Ltd [2010] 9 CLJ 785; Dream Property Sdn Bhd v Atlas Housing Sdn Bhd [2015] 2 CLJ 453; (c) the Session Judge had erred in facts and law in deciding that the Plaintiff was not appointed to manage the two programmes and in deciding that the Plaintiff as a member of Defendant’s BAP Panel, was not offered by the Defendant to manage the two programmes on behalf of the Defendant for the management fee of RM280,000.00. (d) the Session Judge failed to consider the witness statement PW-1 the Chief Executive Officer of the Defendant that the Plaintiff managed the two programmes on the Defendant’s request; (e) the Plaintiff was at all material time managed the two events on Defendant’s request and that the Defendant had promised to pay all the management fees due. The Plaintiff’s counsel referred the Court to the Plaintiff’s witness statement from the record: “S : Untuk soalan daripada rakan bijaksana saya, ada tak surat tawaran perkhidmatan yang telah diberikan kepada plaintif dan Dato telah kata surat tawaran tak ada yang adanya company profile. So apabila beliau telah bertanyakan bahawa adakah terdapat sebarang surat mengenai khususnya kepada barang yang ditawarkan Dato kata taka da. Boleh Dato terangkan bagaimana plaintif telah diminta untuk melakukan projek ini tanpa satu surat tawaran? J : Bila projek ini dilaksanakan di Royal Theatre Shah Alam ia sebenarnya ialah untuk menguji lari juga satu asset kerajaan negeri yang tak digunakan. Oleh kerana itu pihak SACC ini sebenarnya adalah event manager yang mana diminta untuk memberikan cadangan syarikat-syarikat yang mana boleh dan mempunyai keupayaan untuk membantu dari segi pelaksanaan projek. Jadi kita lihat dari segi program business associate program yang kita ada terdapat syarikat plaintif ini yang mempunyai kebolehan dalam bidang kerja yang kita perlukan. Oleh kerana itu kita cadangkan supaya syarikat ini diberikan peluang untuk projek ini.” (f) the Plaintiff submitted the invoices for the scope of works carried out by the Plaintiff, invoices No. ZIP 0047/12/2011, No. ZIP 0048/12/2011, No. ZIP 0049/12/2011, No. ZIP 0052/12/2011, No. ZIP 0053/12/2011, No. ZIP 0054/12/2011 and No. ZIP 0058/12/2011 amounting to RM280,000.00, sent to the Defendant on 28.12.2011. Defendant’s failure in paying the Plaintiff amounted to a breach of contract. (g) Plaintiff submitted that there was a working paper prepared which had been approved by the Defendant for payment to be made to the Plaintiff by the Defendant. (h) It was argued by the Plaintiff that the Defendant had been estopped from denying the invoices or objecting to any money owing to the Plaintiff as the Defendant did not object to the invoices submitted which was to be communicated on any discrepancies within seven days of receipt. (i) Counsel for the Plaintiff submitted that there was an oral contract after the letter on BAP. Defendant’s Submission [6] The learned counsel for the Defendant pointed to the Court that the Plaintiff’s claim is only based on the Letter of Award and the invoices. The Defendant submitted that the Panel Letter of Business Associate Programme, the Letter of Award was not a contract between Plaintiff and Defendant for the management ‘Projek Maharaja Lawak Mega dan Dewan Kencana’ as claimed by the Plaintiff. [7] The counsel for the Defendant submitted in its Defence (at pages 29 - 42 of Appeal Record Bahagian A), that there were no nexus between Plaintiff and Defendant as there was no offer made, therefore there was no acceptance, no consideration and no intention to create legal relations between the parties: “6. (i) Merujuk kepada perenggan 6 Pernyataan Tuntutan, Pihak Defendan ingin menafikan sekeras-kerasnya kenyataan bahawa Plaintif pernah dilantik untuk menguruskan dua (2) Majlis khusus seperti yang didakwa secara salah oleh Plaintif. Surat panel BAP tersebut bukan merupakan surat lantikan dari Defendan untuk menguruskan dua majlis khusus ……. (ii) Defendan secara tegas menegaskan bahawa Defendan tidak pernah sama sekali melantik Plaintif untuk kerja-kerja di para 6 i)(a) dan (b) tersebut di atas. Tidak ada perhubungan (“nexus”) di antara Plaintif dan Defendan berkaitan dua skop kerja tersebut di (a) dan (b) tersebut. Tidak ada atwaran dari Defendan, penerimaan dari Plaintiff, Nota tempahan (Purchase Order), Nota serahan kerja (Job Delivery Order), dan/atau melantik Plaintif untuk event Pementasan Dewa Kencana seperti yang didakwa. Tuntutan Plaintif adalah tidak berasas sama sekali. 9. (i) Merujuk kepada Para 9 Pernyataan Tuntutan, Defendan tidak pernah meminta apa-apa sebut harga dari Plaintif, defendan juga tidak pernah mengeluarkan Nota Tempahan (“Purchase Order”), tidak juga wujud surat lantikan dan juga tidak pernah wujud apa-apa pengesahan pengesahan perlaksanaan kerja yang dilakukan oleh Defendan. ….” [8] The Defendant submitted that the Letter of Award was only an appointment letter for Plaintiff to be a panel for the BAP, an initiative programme organized by the Shah Alam Convention Centre. It was submitted in the written submission that the BAP provides the incentives and it was not an appointment letter to organize events as claimed by the Plaintiff: [9] On this basis, the Defendant directed the Court’s attention to the procedural requirement in obtaining services where there is an approval process by the EXCO to be followed and made reference to some of the examples of the approval process (at pages 70 – 71 of the Appeal Record Bahagian B). Therefore, as submitted by the Defendant, the Plaintiff’s services nor the appointment was never approved by the Defendant. [10] The counsel for the Defendant also submitted to this Court that there was no quotation, Purchase Order nor Delivery Order and the only document produced by the Plaintiff was just the invoices. The Defendant had replied its objection via email to the Plaintiff’s claim of a purchase order and delivery of services (as in page 520 paragraph 3, Appeal Record Bahagian C). [11] The counsel for the Defendant submitted the evidence on contractual relationship based on the testimony given by Plaintiff’s witness SP2 (Datuk Zulkifli Bin Ishak) (at pages 120-121 of the Appeal Record Bahagian B) that the document referred to which was the Letter of Award was not a contract but an appointment letter in general. The counsel for the Defendant relied on the authority which makes a contract under section 3 and section 10 of the Contracts Act 1950 and based on one article of 2012, 5 MLJ CXLVII, “Only agreements enforceable by law are legally binding contracts. An offer or proposal is one of the essential elements for the formation of contract. The contracts cannot be entered into without one of the parties offering or proposing and the other accepting.” [12] The Defendant’s solicitors replied to the Plaintiff on 11.2.2014 denying of any money owing to the Plaintiff. [13] In relation to the contention that there was an oral contract, the counsel for the Defendant submitted that such statement by Plaintiff’s witness SP2 was an afterthought and it was not pleaded by the Plaintiff and invited the Court to expunge the statement from the record. [14] In relation to the working paper claimed prepared by the Plaintiff for the purposes of managing the two events, the learned counsel for the Defendant informed this Court that the working paper by Plaintiff was not the original copy. The working paper which was provided by the Defendant as tendered in court, marked as exhibit D23 – D30 (at pages 460-504 Appeal Record Bahagian C). The copy by the Plaintiff did not have the Financial Controller’s and the Chief Executive’s approval of the Defendant and were marked as ID at the Sessions Court. [15] The invoices as submitted by the Plaintiff to the Defendant (at pages 379-385, Appeal Record Bahagian C), had been objected by the Defendant by putting a note “acknowledge receipt of this Invoice without admission of liability”, on each invoices handwritten by the Defendant’s CFO (Financial Controller). THE COURT’S FINDING [16] There were three issues raised at the trial court which are as follows: (i) Whether the Defendant’s Letter of Award of 5.9.2011 to the Plaintiff was a Contract between the Plaintiff and the Defendant to manage the two events that is Dewa Kencana Theatre and ‘Maharajalawak Mega’; and (ii) Whether Defendant has to pay Plaintiff for the expenses and management fee in managing the two theatre performances Dewa Kencana and ‘Maharajalawak Mega’ as demanded in the invoices issued by the Plaintiff. (iii) whether the Defendant was estopped from raising objection on the invoices that had been submitted by the Plaintiff. Whether Letter of Award was a Contract? [17] The heart of the matter revolves around the Letter of Award of 5.9.2011 which is also known as the BAP Letter between the Plaintiff and the Defendant (at pages 351-353 of the Appeal Record Bahagian C). The Letter of Award was signed by the Defendant’s Chief Executive Officer and some of the salient provisions are reproduced here, as follows: “APPOINTMENT AS PANEL OF EVENT MANAGERS FOR SHAH ALAM CONVENTION CENTRE – BUSINESS ASSOCIATE PROGRAM (BAP) 1. SACC Convec Sdn Bhd (“SACC”) are please to inform you that ZI Production Sdn Bhd is hereby appointed as a panel of Event Managers for Shah Alam Convention Centre, placed under our Business Associate Program (BAP). 2. Your appointment is hereby acknowledged, subject to paragraph 3 and 4 herein below, the Terms and Conditions of Contract, Specifications, Price Schedule, this Letter of Award and other Documents of the Contract. 3. You are required to execute in due course the formal Contract between SACC Convec Sdn Bhd and ZI Production Sdn Bhd within 30 days from date of this Letter of Award. Pending the execution of the formal Contract, this letter, as clarified and amended by the Terms and Conditions of Contract and this Letter of Award shall constitute a binding agreement between ZI Production Sdn Bhd and SACC Convec Sdn Bhd. 4. Your benefits as a BAP member (as specified in the formal Contract will comprise as follows: ….. …… 5. The provision of the incentives and benefits in accordance with paragraph 2 and 3 herein above are subject to the terms and conditions determined in the Contract and shall be a condition precedent to the validity of this Letter of Award. 6. The effective date of the Contract shall be the date of this Letter of Award. The Contract Period shall be for two (2) years commencing from 5 September 2011 to 30 September 2011 (both dates inclusive), with an option for an extension for a further period of two (2) years subject to a mutual agreement. 7. This Letter of Award shall be subject to the matters contained in Terms and Conditions of the Agreement. This Letter of Award is sent to you in duplicate. Kindly return the original copy, duly signed and witnessed where indicated to this office and retains the duplicate copy. …” [18] The learned counsel for the Plaintiff submitted that the Plaintiff was offered as a member of Defendant’s BAP to manage two events on behalf of the Defendant with the offered payment of RM280,000.00 which Plaintiff accepted. The Plaintiff’s counsel relied on section 2 of the Contracts Act 1950 and cases, Kumpulan A Besik Sdn Bhd v Araman Jaya Sdn Bhd [2011] 8 MLJ 77; Charles Grenier Sdn Bhd v Lau Wing Hong [1996] 3 MLJ 327 and Wing Fah Enterprise Sdn Bhd v Matsushita Electronic Components (M) Sdn Bhd [2011] 9 MLJ 320. [19] In ascertaining the language of the letter of award or whether there was an agreement, Chesire, Fifoot & Furmston’s Law of Contract, Sixteen Edition, stated that the task of the courts is to extract the intention of the parties both from the terms of their correspondence and from the circumstances which surround it and the interpretation that may be provided. This had been pointed out in the case of Esso Standard Malaya Bhd v Southern Cross Airways (Malaysia) Bhd [1972] 1 MLJ 168 by Raja Azlan Shah J (as he then was) that if the agreement is made subject to certain conditions to be specified in a formal contract, then until those conditions are thus specified, there is no final agreement such as the court will enforce. [20] After a careful perusal of the Letter of Award, this Court finds that the pertinent statements in relation to the Plaintiff’s contractual status with the Defendant can be found in paragraphs 2, 3 and 5. Paragraph 2 stated that the Plaintiff’s appointment is acknowledged and is made subjected to paragraphs 3 and 4 of the Letter of Award which is conditional upon formalizing a contract. At paragraph 2, it mentioned the other conditions to a contract that is, “the Terms and Conditions of Contract, Specifications, Price Schedule, this Letter of Award and other Documents of the Contract”. [21] At paragraph 3, the Plaintiff is required to execute the formal Contract within 30 days and “Pending the execution of the formal Contract, this letter, as clarified and amended by the Terms and Conditions of Contract and this Letter of Award shall constitute a binding agreement between ZI Production Sdn Bhd and SACC Convec Sdn Bhd.” Whereas paragraph 5 stated that the incentives and benefits are subject to the terms and conditions determined in the Contract, “and shall be a condition precedent to the validity of this Letter of Award.” [22] The Letter of Award clearly stated that the Defendant is appointing Plaintiff as a member of the Panel BAP and Plaintiff’s performance in sealing the agreement is still subjected to the terms and conditions of a formal contract. Borrowing the words in the said Letter of Award, “pending the formalization of a contract”, the Letter of Award will “be clarified and amended by the Terms and Conditions of Contract” as stipulated in paragraph 3. In addition, the incentives and benefits for the Plaintiff is still subjected to the terms and conditions to be determined and must be a conditional precedent to the validity of the Letter of Award. [23] As a general rule, when an acceptance to a contract is ‘subject to contract’, there is an apparent lack of intention to enter into a legally binding contract. The counsel for the Defendant submitted the Singapore Court of Appeal case of Compaq Computer Asia Pte Lyd v Computer Interface (S) Pte Ltd [2004] 3 SLR (R) 316. In that case, a written agreement could not be concluded and signed between Compaq and CIS and Compaq issued to CIS a letter of award (LOA) which enclosed various schedules setting out the services to be rendered and the charges. [24] The Court found that not all the essential terms had been set out in that LOA for instance payment terms, exclusion of liability and insurance which are vital for a contractual arrangement. It was held that the LOA was conditional upon the final terms and conditions being agreed, “It seemed clear from the LOA that although CIS had been selected to be the subcontractor, there were terms on which the parties had yet to agree, and only upon the execution of a written agreement would there be a contract between the parties.” [25] The counsel for the Defendant also submitted a legal article, “Offer” and Its Significance For Formation Of Contract: The Malaysian Perspective” [2012] 5 MLJ cxlvii by Dr. Adnan Trakic, which emphasized on formation of contract in the case of George Trollope & Sons v Martyn Brothers [1934] 2 KB 436 and as explained in the case of Storer v Manchester City Council [1974] 3 All ER 824 by Lord Denning, ‘that there is no binding contract until the contracts of sale have been formally exchanged’ [26] This Court had also the benefit of reading the case of Tiverton Estates Ltd v Wearwell [1975] Ch 146 where at page 159-160, the statement “subject to contract” had been decided, in the words of Lord Denning, “.. for over a hundred years, the courts have held that the effect of the words “subject to contract” is that the matter remains in negotiation until a formal contract is executed….” [27] The High Court case of Kumpulan A Besik Sdn Bhd (supra) relied by the Plaintiff’s counsel stated the two types of contract which are formal and informal. In the former, to constitute a valid contract, there must be separate and definite parties, the parties must be in agreement, there must be consensus ad idem and the parties must intend to create legal relations. In the case of Charles Grenier Sdn Bhd (supra), there was sufficient clarity of the parties to the transaction including the price and the terms which are essential to constitute an agreement. [28] In this case however, based on the clear wordings of the Letter of Award, it is subjected to the formalization of contract which will clarify and amend the Letter of Award as specified in paragraphs 2, 3 and 5. There is no certainty as to the terms of a contract to be entered into and no consensus ad idem criteria under section 7 (a) of the Contracts Act 1950. [29] This Court is of the view that the letter may be called a letter of intent or a letter of award and whatever name it carries, the intention of the parties must be objectively sought. Although the case referred by the Defendant’s counsel is a Singaporean authority which is persuasive and not binding to be followed, the facts of that case is similar to the present case. This Court rely on the submissions put forward by the counsels. A good counsel is one who produces authorities to support the statement of law he is relying upon and they could be in the form of reported judgments, textbooks or even published law articles: Pacific Forest Industries Sdn Bhd & Anor v Lin Wen-Chih & Anor [2009] 6 MLJ 293. [30] In this instant case, in not fulfilling the conditions as stated in the Letter of Award, although Plaintiff had acknowledged to accept the terms and conditions in the said letter, without the formalization of a contract, the Letter of Award ceases to be valid. [31] The evidence of no contract is corroborated by the Plaintiff’s witness, SP-2, Datuk Zulkifli Bin Ishak, one of the Directors for the Plaintiff whom testified (at pages 120-121 Appeal Record Bahagian B) and admitted that the Letter of Award was not a contract: “S : Ya, soalan saya tadi Dato ada cakap dalam jawapan nombor 10 tadi kausa tindakan plaintif dan defendan adalah kemungkiran kontrak. So saya ada tanya apakah kontrak yang dimaksudkan oleh Dato. So soalan saya seterusnya saya merujuk kepada mukasurat 13 dan 16 adakah ini yang kontrak yang dimaksudkan Dato? J : Ini appointment letter sebagai panel event. S : Bukan inilah kontrak dia? J : Ini bukan kontrak. S : Oh bukanlah? J : Ini appointment letter.” [32] Based on the record by the Defendant’s witness, he explained to the Court that it was a proposal for the appointment which were extended to other event management companies and has yet to formalize a contract between the Plaintiff and the Defendant. This Court also finds that there was no agreed price for the services to be rendered by the Plaintiff for the consideration of the benefits in carrying out the tasks in the event the contract is executed. [33] The Plaintiff represented by the Chairman Datuk Zulkifli Bin Ishak signed the acknowledgment letter on 12.9.2011 for the Letter of Award which was returned to the Defendant. The returned Acknowledgment (at page 354 of the Appeal Record Bahagian C) accepting the Letter of Award stated as follows: “I, Datuk Zulkifli Ishak in the capacity of Chairman duly authorized to sign for and on behalf of ZI Production Sdn Bhd hereby to confirm acceptance of the terms and conditions stipulated in this letter.” [34] As I have mentioned earlier, I wish to reiterate that in acknowledging the terms and conditions of the Letter of Award without any effect of formalization, the Letter of Award continue to cease as valid. [35] This Court is also aware of the other documentary evidence where the proposal for the appointment and to carry out a test run for the events is further supported by the Defendant’s letter to a member of the EXCO of the State dated 21 October 2011 where it was the Defendant’s proposal based on a working paper ‘Cadangan Bagi Penjenamaan, Promosi dan Pemasaran Teater DiRaja Selangor’ sent on 13 October 2011, requesting for permission to use the Royal Theatre premise to carry out the test run. This can be found at the second paragraph of the reply letter by the EXCO member not objecting to the proposal, “Sukacita dimaklumkan, setelah beberapa perbincangan yang diadakan di antara Y.Bhg Dato’ dan Pegawai saya, bahawa saya tiada halangan dengan cadangan tersebut di atas. Oleh itu saya bersetuju untuk membenarkan SACC Convec Sdn Bhd (SCSB) menggunakan premis Teater Diraja Selangor untuk tujuan MENGUJILARI (Test Run), bermula serta merta sehingga 31 Disember 2011. ….” [36] In relation to the contention by the Plaintiff that there was an oral contract, the counsel for the Defendant submitted that such statement by Plaintiff’s witness SP2 was an afterthought as it was not pleaded by the Plaintiff. This Court will not consider such evidence as it was not pleaded and stand by the established principle that parties are bound by their pleadings as decided in the Federal Court decision in Dato’ Tan Chin Who v Dato’ Yalumallai @ M Ramalingam s/o V Muthusamy [2016] MLJU 641. Whether Defendant has to pay Plaintiff? [37] The Court had heard that the Plaintiff prepared the invoices without any supporting documents. There was no quotation, Purchase Order and Delivery Order which the Court does wonder on what basis the invoices were prepared. The Defendant submitted that no documents to support the offer and the acceptance made as required under section 3 and section 10 of the Contracts Act 1950 and relied on the case of CFB Aluminium Extrusin SDn Bhd v Lim Soon Seng [2014] AEMJ 1192 that was referred in the case Wescourt Design Sdn Bhd v Wescourt Furnishing (M) Sdn Bhd [2015] 11 MLJ 735. [38] This is further supported by the evidence of the Plaintiff’s witness, SP-1 (at page 97, Appeal Record Bahagian B) who was the former CEO of the Defendant that there were no supporting documents: “S : Itu yang saya tanya tadi Dato, kalau ada kos, kalau ada pihak ketiga melibatkan pihak ketiga sebagai ZI mana dia surat tawaran untuk ini. Tak ada, delivery order tak ada, sebut harga tak ada, tak dibawa kepada Exco Memang semua tak ada kan. Tiba-tiba timbul invois? Betul? J : Betul. S : Betul? J : Betul.” [39] The other evidence is based on the record, the statement by Plaintiff’s witness SP-3 (at pages 195, 197 Appeal Record) where no supporting documents in the preparation of the invoices: “S : Sebelum En Leong buat invois itu En Leong berpandukan kepada apa? Supporting dokumen ada tak selalu? J : Tak ada. S : So based on what did you prepare this invoice? J : Based on my boss instructions. …… …… S : Appointment letters? J : Tak ada.” [40] This Court is of the view that in matters concerning goods and services where sold and delivered, there must be prove that the order was made and the goods were received by the buyer. This Court rely on the case attributed by the Defendant’s counsel, Wescourt Design SDn Bhd v Wescourt Furnishing (M) Sdn Bhd [2015] 11 MLJ 735 which referred the case of CFB Aluminium Extrusin SDn Bhd v Lim Soon Seng [2014] AEMJ 1192 where Lim Chong Fong JC (now High Court Judge) had said: “16. Generally, it is plain that the seller in a claim for payment for goods sold and delivered must prove that the order was made and the goods were received by the buyer. The proof is commonly by way of producing in court the purchase order, delivery order and the invoice for the goods (‘the key documents’)….” [41] Based on the invoices, this Court finds that they were prepared without any supporting documents to proof of any contract existed. This Court is concerned with the non-existence of purchase order and delivery order to substantiate the invoices produced by the Plaintiff which is in the ordinary course of business. This Court wish to rely on the authority of CFB Aluminium Extrusion Sdn Bhd (supra) case which stated that, “[13] Consequently in civil litigation…..that relevant documents that substantiate or support the oral allegations must be adduced at the trial where such documentary evidence is expected to be available in the ordinary course of business and commerce. Otherwise a reasonable explanation must be tendered to justify their non production. In the absence of these documents or explanation of their absence, mere oral testimony is not weighty enough to overcome the burden of proving the allegations on a balance of probabilities …” [42] It is essentially important to produce to the Court those documents. In commercial transactions, these documents are normally expected to be generated in the course of business and could be produced in Court. It is the Plaintiff who claimed for breach of contract and hence has the legal burden to proof the existence of a contract by way of producing the purchase order and the delivery order. [43] The Plaintiff claimed that the working paper had been approved by the Defendant. The counsel for the Defendant submitted to this Court that the Defendant had received the working paper (as at page 460-504 Appeal Record Bahagian C) on 18.6.2012 which were attached with the said invoices and the Defendant’s Financial Controller emailed to the sender of the working paper on 19.6.2012 (at pages 520-521 of the Appeal Record Bahagian C) raising doubt on the invoices submitted as there were no Purchase Order/Letter of Appointment and Delivery Services attached to the invoices. [44] The Defendant submitted that the working paper by Defendant is as tendered which can be found at pages 460 – 504 of the Appeal Record Bahagian C. Meanwhile the working paper by the Plaintiff which did not have the approval of the Financial Controller of the Defendant and the former Chief Executive Officer of the Defendant’s approval, remained as ID at the Sessions Court, was never approved by the Defendant. [45] The Defendant’s counsel directed the Court’s attention to the working paper that was submitted by the Plaintiff dated 30.12.2011 whereas the invoices were dated 18.12.2011, 28.12.20111 and 26.11.2011. The counsel for the Defendant submitted that the invoices could not be issued before the working paper was submitted. The counsel for the Defendant also pointed out to the Court that the Defendant had clearly objected by noting on the invoices “acknowledge receipt of this Invoice without admission of liability” handwritten by the CFO of the Defendant which the objection email made was also copied to the CEO and the EXCO. [46] This Court finds that the working paper claimed to be prepared by the Plaintiff would mean that the invoices were issued before the working paper was submitted for the services to be rendered which is not a practice in the ordinary course of business. This Court takes the working paper as claimed by the Plaintiff to be bad evidence to support the invoices. Whether the Defendant was estopped from raising objection [47] In relation to the issue of estoppel raised by the Plaintiff, it was claimed that the Defendant did not object on the invoices and therefore Plaintiff argued that the Defendant is estopped from denying. It is the Plaintiff who raised this rule and this Court finds that the Defendant had acknowledged receipt without admission of liability as stated in the invoices by the Financial Controller. This Court finds that the Defendant had objected to the invoices and therefore the estoppel rule is irrelevant. [48] Reverting to the principle for appellate intervention raised by the Plaintiff, the Plaintiff submitted that the Court in hearing appeal will not disturb the finding of fact by any trial judge unless, “the trial court is shown to be plainly wrong in arriving at its decision. A plainly wrong decision happens when the trial court is guilty of no or insufficient judicial appreciation of evidence.” The learned counsel for the Plaintiff relied on the Federal Court decision of Dream Property Sdn Bhd v Atlas Housing Sdn Bhd [2015] 2 CLJ 453. [49] This Court is of the view that in reference to the decision of the Federal Court, Dream Property (supra) case as submitted by the Plaintiff, the Court should not intervene with the decision of the trial judge unless the Session Judge was plainly wrong in arriving to its decision, “[60] It is now established that the principle on which an appellate court could interfere with findings of facts by the trial court is “the plainly wrong test” principle; see the Federal Court in Gan Yooki Chin & Anor (P) v Lee Ing Chin @ Lee Teck Seng & Anor [2004] 4 CLJ 309; [2005] 2 MLJ 1 (ap p. 10) per Steve Shim CJ SS. …” [50] It is incumbent upon the Court to look at all the surrounding factors and to weigh and evaluate the documentary evidence as to whether they support the Plaintiff’s oral testimony. This Court must direct its mind as to the probative effect of the documents and the evidence before the Court. It is always open for this Court to interfere if the findings made were unsupported by evidence or against the weight of evidence or if there was no proper judicial appreciation of the evidence or if there was any misdirection in law by the Session Judge: Jason Chan Huan Sen & ors v P.P. [2015] 2 CLJ 605. [51] In this case, the Court finds that the Session Judge had evaluated all the documentary evidence and the oral testimony of both Plaintiff’s and Defendant’s witnesses. The Session Judge did not consider evidence that was not tendered or withdrawn nor did she decide on an adverse inference from non-evidence: Tan Ah Chio & Ors v Lua Kim Soon & Ors [2015] 1 MLJ 334. It will be plainly wrong if this Court to state otherwise than its finding of the truth. [52] This Court had given due consideration on the evidence of the letter, the record of the Plaintiff’s witnesses statement whom testified admitting that the Letter of Award was not a contract and that the invoices were prepared without any supporting documents to proof the formalization of any contract. On that legal basis, the Court finds that the Plaintiff has failed to prove on the balance of probabilities that there was a contract between the Defendant and the Plaintiff. There was no money owed by the Defendant to the Plaintiff. I therefore dismissed the appeal with cost. Dated: 3 July 2017 (DATIN ZALITA BINTI DATO’ ZAIDAN) Judicial Commissioner Shah Alam High Court Counsel for the Appellant: 1. Ganeson a/l Gunathan 2. Gomathy a/p Balasupramaniam Tetuan Ganeson Gomathy & Partners Peguambela & Peguamcara Suite A-1-5, 1st Floor Kuchai Exchange No. 43, Jalan Kuchai Maju 13 Kuchai Lama, 58200 Kuala Lumpur Tel: 03-79725454 Fax:03-79724545 Counsel for the Respondent: Al-Sabri bin Hj. Ahmad Kabri Tetuan Al Sabri & Co Peguambela & Peguamcara Suite No. 11A Jalan Lawan Pedang 13/27 Seksyen 13, Tadisma Business Park 40100 Shah Alam Selangor Tel: 03-55110525/6 Fax: 03-55110528 1

Tika 2.6.0

WA-24C(ARB)-3-01/2017

PLAINTIF Maxwell Accent JV Sdn Bhd DEFENDAN Kuala Lumpur Aviation Fuelling System Sdn Bhd

30/06/2017

YA DATO' LEE SWEE SENG

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=77456912-2f3e-4fc0-aa21-8c82cd66fb79&Inline=true

Failed Extraction

WA-12BC-22-12/2016

PLAINTIF 1. ) Weststar Construction Sdn Bhd 2. ) Prisma Athira Architect DEFENDAN 1. ) Prisma Athira Architect 2. ) Weststar Construction Sdn Bhd

30/06/2017

YA DATO' LEE SWEE SENG

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=7dbcd7d0-27d9-4b71-994e-0ea5322d597f&Inline=true

1 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF WILAYAH PERSEKUTUAN, MALAYSIA (CIVIL DIVISION) CIVIL APPEAL NO: WA-12BC-22-12/2016 BETWEEN WESTSTAR CONSTRUCTION SDN BHD - APPELLANT (COMPANY NO: 121634-W) AND PRISMA ATHIRA ARCHITECT - RESPONDENT (Claiming to be a firm) IN THE SESSION COURT AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF WILAYAH PERSEKUTUAN, MALAYSIA CIVIL SUIT NO: WA-B52C-47-05/2016 BETWEEN PRISMA ATHIRA ARCHITECT - PLAINTIFF (Claiming to be a firm) 2 And WESTSTAR CONSTRUCTION SDN BHD - DEFENDANT (COMPANY NO: 121634-W) THE JUDGMENT OF Y.A. LEE SWEE SENG [1] The Appellant who is the Defendant in the Sessions Court, had appealed against the decision of the learned Sessions Court Judge ("SCJ") who allowed the Respondent’s claim of RM814,983.99 against the Appellant for agreed consultancy fees. Project [2] The Respondent as Plaintiff below had sued, as an architect, the agreed consultancy fees for architectural fees, civil and structural ("C&S") engineering fees and mechanical and electrical ("M&E") engineering fees. It is an agreed fact that the Defendant had appointed the Plaintiff the main as consultant for its helicopter hangar project ("the Project") vide 2 letters of appointment dated 3.8.2010 and 19.11.2010. [3] The total fees for the Plaintiff's consultancy services amounted to RM1,404,984.00, consisting of the following: a. Architectural fees comprise RM786,791.00; 3 b. C&S engineering fees comprise RM393,395.00 and c. M&E engineering fees comprise RM224,798.00. [4] As the Defendant had paid the sum of RM590,000.00, the Plaintiff claimed in the suit below the balance sum of RM814,984.00. Problem [5] The Defendant contended that the Plaintiff had been negligent in the under design for the trusses for the hangars. They counterclaimed a sum of RM855,191.71 covering rectification works of RM354,265.00 being additional support necessary for the trusses and also a sum of RM130,000.00 being the fees incurred for engaging an independent engineering checker to check on the integrity of the trusses construction and special damages for negligence. The other component of the Counterclaim is for RM370,926.71 being the LAD claim. [6] In any event the Defendant contended that the Plaintiff could not claim for the engineering consultancy fees as they were not duly registered under the Registration of Engineers Act 1967 ("REA") and further that the fees for the M&E engineering work had not been proved as there was no evidence that such a service had been provided. [7] The Defendant also claimed general damages for breach of contract and for the tort of negligence. 4 [8] The learned SCJ had allowed the Plaintiff's claim together with interest and costs and had dismissed the Defendant's Counterclaim with costs. Being dissatisfied with the said decision of the SCJ, the Defendant had appealed to this Court. Prayers [9] The Defendant as Appellant prayed that the SCJ’s decision should be set aside and that the Plaintiff's claim should be dismissed and instead the Defendant's counterclaim should be allowed. [10] The Defendant argued that the Plaintiff as an architect could only sue for his architectural consultancy fees and not for the C&S engineering and M&E engineering fees as only registered engineers under the Registration of Engineers Act 1967 could sue for such fees. [11] It was further argued that the contract for the agreed engineering consultancy services and the fees arising out of it, is illegal and null and void and unenforceable. [12] The Defendant further argued that even though the defence of illegality was not raised in the pleadings, but raised for the first time in the submission stage before the SCJ, the SCJ was nevertheless bound to take cognizance of it and decide accordingly. 5 [13] With respect to M&E engineering fees, it was also contended by the Defendant that there was no evidence that such a consultancy service had been provided and hence not proved, on the balance of probabilities. Principles Whether illegality has to be pleaded in that the Plaintiff's Claim is illegal and unenforceable for Breach of the Registration of Engineers Act 1967 [14] It is clear that the Plaintiff's fees as agreed with the Defendant encompasses engineering fees. [15] It is also clear that the Plaintiff is a firm of architect and not engineers, and specifically the Plaintiff is "not registered as a Professional Engineer under the REA." Section 7(1A) REA reads: (1A) A person shall not, unless he is a Professional Engineer with Practising Certicate – (a) practise, carry on business or take up employment which requires him to carry out or perform professional engineering services for designated engineering works subject to section 8; ... (d) be entitled to recover in any court any fee, charge, 6 remuneration or other form of consideration for any professional engineering services rendered subject to section 8; ..." (emphasis added) [16] The necessary legal implication arising from the above is that the Plaintiff who is not a “Professional Engineer with Practising Certificate” is “not entitled to recover in any court any fee, charge, remuneration or other form of consideration for any professional engineering services rendered.” [17] The Defendant submitted that there are two exceptions to section 7(1A)(d) of the Act, namely sections 7A and 7B. Section 7A applies to engineering consultancy practice, but that exception is not applicable to the Plaintiff. [18] As for section 7B which applies to a multi-disciplinary practice, it is subject to strict requirements namely: a. It must be a body corporate; b. It must have applied for registration with the Board; c. It must be incorporated under the Companies Act; d. It must have a board of directors prescribed by the Board; e. It must have a shareholding structure prescribed by the Board; f. It must have the minimum paid-up capital prescribed by the Board; 7 g. It must be under the control and management of a professional engineer with practising certificate authorised by the directors to make all final engineering decisions. [19] It was submitted that the Plaintiff is thus not qualified to claim for engineering fees, under sections 7, or 7A, or 7B REA. [20] Learned counsel for the Defendant referred to the following cases in support of the above proposition: a. In Sami Mousawi-Utama Sdn Bhd v Kerajaan Negeri Sarawak [2004] 2 MLJ 414, the Court of Appeal found a violation of the Act to be against the statutory provisions and public policy; b. In Lion Asia Investment Pte Ltd v Atelier Adt International Consultants Ltd & Anor [2002] 5 CLJ 86, the Court held that whether the Acts expressly or impliedly prohibited the claims, the claims would nevertheless fall foul of either s 24(a) or (b) of the Contracts Act 1950. The Court further held that the legal analysis is a straightforward application of the clear words of the Act to the facts; c. In Norman Disney & Young v Affifi Hj Hassan [2011] 1 CLJ 210, the Court took the view that any attempt to circumvent the requirements of the Act would run foul of s 24(a) and (b) of the 8 Contracts Act 1950, and allowing any such claim would be to defeat the intention of Parliament. [21] Learned counsel for the Defendant submitted that the learned Sessions Court Judge fell into error for the following reasons: a. Because illegality was never pleaded; b. Because the facts and evidence with regard to the illegality was not raised at trial; c. Because it was the Defendant who appointed the Plaintiff as the main consultant, and the Defendant is now estopped from raising the issue of illegality after the Plaintiff has performed its part of the bargain; d. Because the Plaintiff being an architect, is permitted to claim as he did pursuant to the Architects Rules 1996. [22] The Defendant's stand is that the Federal Court had pronounced authoritatively that courts are bound to take notice of illegality, whether ex facie or which later appears, even though not pleaded. [23] The rationale is quite simple: once a Court of law is appraised of facts tending to support the suggestion of illegality, it must “take notice ex proprio motu and even though not pleaded ... for clearly, no Court 9 could knowingly be party to the enforcement of an unlawful agreement.” [24] It would be fair to say that where illegality is not pleaded, one has to tread more cautiously and follow the dicta of the Federal Court case of Seven Seas Supply Co. v Rajoo [1966] 1 MLJ 71 at 73-74. Though more than four decades ago, it is still a sound approach to follow. It reads: "There remains the only other point of substance raised by the defendants that the loans were illegal and void under the provisions of the Moneylenders Ordinance, 1959 (No. 58 of 1959) and consequently not recoverable by the plaintiff. The ground of appeal was framed in this way: "That on the evidence the learned judge ought to have found (albeit that this was not pleaded by the defendants but referred to in the affidavit sworn by R. M. K. Naidu on the 9th of December, 1961) that the plaintiff was a moneylender and, there being no suggestion that he was licensed as such, that the loans made by the plaintiff were illegal and void and hence not recoverable by him." This defence was not pleaded. 10 Now it is well settled law that where a contract is ex facie illegal, the court will decline to enforce it, irrespective of whether illegality is pleaded or not. The position is succinctly stated by Devlin J. in Edler v Auerbach [1949] 2 All ER 692 at p 697 cited with approval in Snell Unity v Finance Ltd [1963] 3 All ER 50 at p 55 in this way: "That case" (North-Western Salt Co Ltd Electrolytic Alkali Co Ltd [1914] AC 461) "authorises, I think, four prepositions: first, that where a contract is ex facie illegal, the court will not enforce it whether the illegality is pleaded or not; secondly, that where, as here, the contract is not ex facie illegal, evidence of extraneous circumstances tending to show that it has an illegal object should not be admitted unless the circumstances relied on are pleaded; thirdly, that where unpleaded facts, which taken by themselves show an illegal object have got in evidence (because, perhaps, no objection was raised or because they were adduced for some other purpose), the court should not act on them unless it is satisfied that the whole of the relevant circumstances are before it; but, fourthly, that where the court is satisfied that all 11 the relevant facts are before it and it can see clearly from them that the contract had an illegal object, it may not enforce the contract, whether the facts were pleaded or not." The court therefore ought not, on its own initiative, to refuse to enforce a contract on the ground of illegality unless it is quite certain that all the relevant facts are in evidence. So far from being certain that all the relevant facts were before the court it appeared to me that essential evidence was missing. The question of whether the plaintiff was a moneylender was disputed. The plaintiff was asked if he was a moneylender but he denied it and also the fact that the defendants had ever paid him interest. The matter was never explored in any detail nor given that close examination, it should have received and no doubt would have if it had been in issue and pleaded. In these circumstances it is impossible to say that all the relevant circumstances relating to the question of whether the plaintiff was a moneylender or not were before the court. I have come to the conclusion that the plaintiff is right in his contention that the third of those propositions enunciated by Devlin 12 J. covers this case i.e. the court will not act on unpleaded facts unless it is satisfied that the whole of the relevant circumstances are before it." (emphasis added) [25] I would say in the case before us, it appears to fall under the fourth proposition of Devlin J. in Edler v Auerbach [1949] 2 All ER 692 at p 697, in that all the facts necessary to support the argument of an illegal object as in contravening section 7(1A) REA are before the Court. [26] The Defendant is right to say that the facts needed to be established to show that the Plaintiff is not entitled to claim under the REA are very simply: a. The claim is for engineering fees; b. The claim is made by someone other than a professional engineer with practising certificate. [27] Both these facts are adduced in evidence and that even a reference to the Act was made at trial. I agree that the conclusion, if arrived at, that the agreement was illegal need not be put to the witnesses as that is a legal proposition and a matter for the Court to decide irrespective of the parties' view one way or the other. [28] However to be fair to the learned SCJ, she did proceed under para 28 of her judgment to consider for completeness, the issue of illegality 13 raised for the first time in the written submissions and rejected it for reasons given which this Court shall now proceed to consider. Whether estoppel would apply in the circumstances of this case where the Defendant had agreed to the Plaintiff, as the main consultant, to appoint an engineering consultant for the engineering consultancy services [29] I would further agree with learned counsel for the Defendant that estoppel does not arise against any party raising the issue of illegality notwithstanding the party having participated in or even benefited from the illegal contract. He referred to the following cases as illustrating these points: a. In Norman Disney & Young (supra), the Defendant pleaded illegality despite having agreed to the contract initially – the plea of illegality was upheld; b. In Raymond Banham & Anor v Consolidated Hotels Ltd [1976] 1 MLJ 5, HC (Singapore), the Court held the contract to be unenforceable notwithstanding the defendants’ own participation in the illegal contract; c. In Thong Foo Ching & Ors v Shigenori Ono [1998] 4 CLJ 674, CA, the Court considered parties to an illegal agreement or 14 arrangement to be outside the pale of the law as such agreements and arrangements would be void ab initio; d. In David Taylor & Son Ltd v Barnett [1953] 1 All ER 843, CA, the Court held that an umpire must decline to make an award to enforce an illegal contract even if it goes against what he considered fair and reasonable in the circumstances; e. In Tan Ah Kek & Anor v Wong Thang Song & Anor [2016] MLJU 81, a case similar to the present case because illegality was not pleaded but only raised at the end of the trial; the Court considered it an error of the JC to rule that it was unfair for the issue of illegality to be raised six years after the execution of the agreement and after the respondents had expended money on the said land by building the factory (thereby creating an estoppel ordinary). [30] I agree with the Defendant that if estoppel could be raised, then the case of Tan Ah Kek & Anor (supra) would have been the ideal case to raise the issue of estoppel, because monies were in fact expended by the respondent. Yet, the Court of Appeal disregarded the “fairness” of the situation and insisted on strict compliance when it comes to illegality. 15 [31] The argument of estoppel would also fail since there cannot be an estoppel to evade the plain provisions of a statute. In Kok Hoong v Leong Cheong Kweng Mines Ltd [1964] 1 MLJ 49 Viscount Radcliffe, Privy Council, at p 54 stated: "... a party cannot set up estoppels in the face of a statute ..." [32] In United Malayan Banking Corporation Bhd v Syarikat Perumahan Luas Sdn Bhd (No 2) [1988] 3 MLJ 352b Edgar Joseph Jr J (as he then was) at p 356 observed as follows: "The defence of estoppel accordingly fails since there cannot be an estoppel to evade the plain provisions of a statute." [33] It is thus clear that estoppel cannot be raised against a statute and indeed it has no bearing on illegality. Whether the Claim by the Plaintiff as an Architect for the component of engineering consultancy fees is a valid Claim permitted under Architects Rules 1996 [34] Learned counsel for the Plaintiff referred this Court to the Statement of Agreed Facts dated 15.8.2016 where the following salient facts were agreed by the Defendant: That the Defendant appointed the Plaintiff as the main consultant. 16 That the Plaintiff had appointed Iktisas Ingenieurs Sdn Bhd ("IISB") as Structural and Public Engineer for the said project. That IISB was responsible for the design of the said project including structural steel works. That on 12.4.2012, IISB had supplied the design for the structural steel works for the said project to the Defendant. By the letters of 13.4.2015, 10.6.2015, 5.8.2015, 2.10.2015, 5.11.2015 and 18.12.2015 the Plaintiff had demanded the Defendant to settle the outstanding amount of RM814,983.99. [35] It was also a finding of fact of the learned SCJ that the Defendant had agreed to the appointment of IISB as the Civil and Structural Engineer for the said Project. [36] One must give due effect to the Architects Rules 1996 as the billing and claim was made by the Plaintiff as a firm of Architects. The question then is whether the Architects Act 1967 and the Architect Rules 1996 permit the Architect to make such a claim. [37] Section 7 of the Architects Act 1967 provides that: 7. No person shall, unless he is an Architect 17 (a) be entitled to set up an architectural consultancy practice to render architectural consultancy services subject to section 7A; ... (c) be entitled to recover in any court any fee, charge, remuneration or other form of consideration for architectural consultancy services rendered as an Architect." (emphasis added) [38] Section 7A(1) provides as follows by way of reiteration: "Architectural consultancy practice 7A. (1) An Architect shall not, unless registered as a sole proprietorship, a partnership or a body corporate and has been issued with a certificate of registration— (a) be entitled to set up an architectural consultancy practice to render architectural consultancy services; and (b) recover in any court any fee, charge, remuneration or other form of consideration for architectural consultancy services rendered as an architectural consultancy practice." [39] Section 7B(1) of the Architects Act 1967 provides for the following with respect to a multi-disciplinary practice: 18 "A body corporate providing a combination of services comprising architectural consultancy services, professional engineering services or quantity surveying services. 7B.(1) Where a body corporate carries on a practice of providing a combination of services comprising architectural consultancy services, professional engineering services or quantity surveying services, the Board may, subject to such conditions or restrictions as it may deem fit to impose, register that part of the practice providing architectural consultancy services." [40] The question then is, what if the registered Architect did not carry out engineering consultancy services but with the consent of the client, engaged a Professional Engineer under the REA to carry out such engineering consultancy services and then invoiced the client for such engineering services rendered? [41] The relevant Rules in the Third Schedule of the Architect Rules 1996 on Conditions of Engagement of an Architect provide as follows: THIRD SCHEDULE [Rule 29] PART ONE CONDITIONS OF ENGAGEMENT OF AN ARCHITECT 19 [Subrule 29(1)] "Architect who carries on business as an architectural consultancy practice. 1. (1) An Architect who carries on business as an architectural consultancy practice shall provide architectural consultancy services as described in the scope of services incorporated in the Memorandum of Agreement between the Architect and the client. (2) The architectural consultancy services provided by the Architect shall be in accordance with the Architects (Scale of Minimum Fees) Rules 2010 (3) The Architect shall be remunerated solely by fees payable by the client for architectural consultancy services provided by him. Engagement of consultants by client. 2. An Architect shall advise the client on the need for other consultants to be engaged for any part of the project and unless otherwise agreed upon, the consultants shall be engaged and paid by the client. Engagement of consultants by Architect. 20 3. An Architect may be required to engage his own consultants and if the engagement is approved by the client, the fees which would have been payable to such consultants if they were separately engaged shall be paid through the Architect. Coordination of consultants’ works. 4. An Architect shall instruct the consultants and coordinate the consultants’ works where required, whether the consultants are engaged pursuant to paragraph 2 or 3. Architect not liable for acts etc. of consultants engaged by client. 5. Where consultants are engaged by the client for any part of the project pursuant to paragraph 2, the Architect shall not be liable for their performance, acts or omissions. Architect responsible for acts etc. of consultants engaged by him. 6. Where consultants are engaged for any part of the project pursuant to paragraph 3, the Architect shall be primarily responsible for their performance, acts or omissions. Client’s agreement. 21 7. (1) An Architect shall obtain the written agreement of the client in respect of his remuneration for architectural consultancy services to be provided by him pursuant to subparagraph 1(1) within sixty days from the date the notification regarding such remuneration is duly served on the client. (2) Notwithstanding subparagraph (1), where the client’s agreement in writing is not obtained within the period as stipulated in subparagraph (1) but the client agrees by his conduct to the conditions of engagement and the scale of professional fees and charges, the client shall for the purposes of subparagraph (1) be considered to have agreed to such conditions of engagement and scale of professional fees and charges." (emphasis added) [42] As is clear from Rule 3 above, the professional engineering services is still being provided by Professional Engineers duly registered under the REA and it is only where the invoicing of fees is concerned that it is done through the Architect. [43] In most standard form construction contracts the Superintending Officer (S.O.) may be the Architect and the burden would be on him to instruct the engineer and to coordinate the engineer's work as provided in Rule 4 above. It is not a case of subordinating the Professional Engineers to the Architects but rather that there is a need to have a 22 person to be the S.O. for the project. The Architect is certainly not taking over the work of the Professional Engineers but merely invoicing on the engineer's behalf the share of his fees. [44] This makes sense as the employer need not then have to enter into separate contracts with each of the consultants i.e. the Architect, the Engineer and the Quantity Surveyor. Where the employer has engaged its own engineer or any other consultants, the Architect is not liable for the performance, acts or omissions of the consultants as provided under Rule 5 above. That flows from the privity of contract principle in that only parties to a contract may sue each other. [45] Conversely where the Architect has engaged its own consultants with the consent of the employer, then the Architect would be liable for the said consultants' performance, acts or omissions. The contract is not between the employer and these consultants but the employer and the Architect on the one hand and between the Architect and the consultants on the other hand. [46] Learned counsel for the Defendant do not think so because according to him, Rule 3 did not specify that the consultants would be engineering consultants. There are many forms of consultants involved in the design and construction of any building or project including consultants for landscape, facade, interior design, etc. 23 [47] I do not understand why the word "consultants" in Rule 3 cannot be extended to engineering consultants when already in a multi- disciplinary practice under section 7B would cover Professional Engineers' services and Consultant Quantity Surveyors' services. [48] Even interior designers are now covered by Part VA of the Architects Act 1967 from sections 27A to sections 27J. [49] Learned counsel for the Defendant further argued that a lot of the consultancy work required (other than engineering consultancy) would not be regulated by any specific act of Parliament. Hence, there is nothing wrong with Rule 3 in so far as it relates to these unregulated consultancies. However, according to the Defendant, when it comes to engineering consultancy services, there is a specific Act of Parliament which applies, namely the REA. [50] It was further submitted by the Defendant that generalia specialibus non derogant applies in that a specific statute would prevail over a general one. The Defendant's stand is that where engineering consultancy services are concerned, not only must it be provided by Professional Engineers duly registered under the REA but also that all invoicing and billing must be in the name of the engineering firm for only an engineering firm can sue for its fees. 24 [51] Section 7(1) (c) REA provides as follows: "7(1) (c) No person shall, unless he is a Professional Engineer- be entitled to recover in any court any fee, charge, remuneration or other form of consideration for any professional engineering services rendered." [52] I think one must be careful not to miss the point: the Architect here is not providing the services of engineering consultant but the Professional Engineers in IISB. The Architect is merely invoicing the employer for the fees of the Professional Engineers in that it is merely collecting the engineering services fees on behalf of the Engineering firm or body corporate as in this case. The Engineering Company cannot bill or sue for its fees against the employer because it has no privity of contract with the employer but with the Architect. [53] The Architects Rules 1996 coming after the REA 1967 must have taken into consideration the provisions of a prior statute in the REA before settling for Rule 3 in permitting the Architect to collect fees of the Engineer on its behalf. [54] Therefore this is not a case of a specific statute trumping over a general one but rather two different statutes, one for the Engineers 25 under the REA and one for the Architects under the Architects Act 1967 and both can be read harmoniously as in accommodating each other. [55] It was further submitted that if indeed Rule 3 covers engineering consultancy, then it obviously is in contradiction to the REA. In such a case, it was argued, Rule 3 becomes void to the extent of the inconsistency, i.e. in so far as it relates to engineering consultancy fees. [56] Learned counsel for the Defendant stated that this is a well- established principle upheld by the superior courts, as seen in the following cases: a. In Ramachandram s/o Appalanaidu & Ors v Dato Bandar Kuala Lumpur & Anor [2012] 6 MLJ 519, CA clearly stipulates that a delegated legislation cannot override any Act; b. In Sia Cheng Soon & Anor v Tengku Ismail bin Tengku Ibrahim [2008] 3 MLJ 753, even the rules of the Federal Court could not override s 96(a) of the Courts of Judicature Act 1964. [57] Where a multi-disciplinary practice of an architectural consultant under a company incorporated under the Companies Act 2012 may produce a single invoice for services such as architectural consultancy combined with engineering services and consultant Quantity Surveyor services, I cannot see how it could be a conflict with the REA for an 26 Architectural firm to invoice the employer on behalf of the Engineering company the engineering services fees. [58] This is not in conflict with the REA but in tandem and consistent with the Architects Act 1967 and the Architect Rules 1996 under which the billing is done. Whether assuming that to bill for the engineering services rendered the Plaintiff has to be incorporated under section 7B of the Architects Act 1967 as in a multi-disciplinary practice, section 66 Contracts Act 1950 may nevertheless be invoked to allow the Plaintiff's claim [59] The Defendant's argument is that, if at all the learned SCJ wanted to save any part of the Plaintiff's claim, she could at most save the claim for architectural fees only. Architectural fees amounted to RM786,791.00, out of which RM590,000.00 has been admitted to have been paid, leaving a balance of RM196,791.00. [60] The Defendant further submitted that even this claim is tainted with illegality because it falls under the same contract, but if the architectural fees were deemed to be severable, then this portion would admittedly be due. 27 [61] This Court has taken the view that both the claim for architectural fees and engineering consultancy fees are unaffected by the REA and that the Architects Act 1967 and the Architect Rules 1996 allow for it. [62] However, assuming for a moment that such a billing is only allowed under a multi-disciplinary practice as envisaged in section 7B of the Architects Act 1967 under a company incorporated under the Companies Act 2016, then as the Plaintiff is not so incorporated but practices as a firm, then it is illegal for the Architect to sue for the portion of the engineering services fees. [63] Section 24(a) of the Contracts Act 1950 provides that if the object of an agreement is forbidden by law then the object is unlawful and the agreement whose object is unlawful is void. [64] Section 66 Contracts Act 1950 provides as follows: "Obligation of person who has received advantage under void agreement, or contract that becomes void 66. When an agreement is discovered to be void, or when a contract becomes void, any person who has received any advantage under the agreement or contract is bound to restore it, or to make compensation for it, to the person from whom he received it." (emphasis added) 28 [65] Section 66 Contracts Act 1950 provides for restitutionary remedy to the innocent party when a contract is discovered to be void. Here is a case where the Plaintiff thought it was perfectly all right to have come under Rule 3 of the Third Schedule to the Architects Rules 1996 on Conditions of Engagement of an Architect to have been perfectly proper and legal to bill on behalf of the engineer appointed with the consent of the Defendant, the engineering services component of the agreed total consultancy fees for the Project. [66] The Defendant had no qualms or quarrel with and indeed consented to the Plaintiff appointing IISB as the engineering consultant for the engineering consultancy services to be rendered. It can be safely surmised that the defense of illegality was raised as an afterthought for the first time in the written submission of the Defendant and was not raised in the pleadings. [67] It would be fair to say that both the Plaintiff and the Defendant were unaware when the 2 letters of appointment were issued on the prohibition on the Plaintiff billing on behalf of the engineer the fees for the engineering services rendered by IISB. [68] Having therefore received a benefit under the said agreement in that the engineering services had been provided for an agreed fees, it is 29 then not open to the Defendant to refuse to pay on ground that the agreement is tainted with illegality. [69] It is incongruent and indeed unacceptable for the Defendant now to rely on the high pedestal of illegality to avoid a legal obligation to pay for the benefit it had bargained for and received. It is in such a circumstance that section 66 Contracts Act 1950 comes in aid of the innocent party claiming for its fees. I can do no better than to refer to the precedent set by his Lordship Azmi L.P. in the Federal Court case of Ng Siew San v Menaka [1973] 2 MLJ 154 where at page 156 his Lordship opined after setting out section 66 Contracts Act 1950: "In deciding this question the learned judge firstly made the following findings: 1. that both parties had no knowledge of the illegality until the affidavit by Nachiappa Chettiar had been filed, and 2. there was no evidence upon which such knowledge could be imputed to either of them.” [70] At page 157 his Lordship, continued: "24. The consideration or object of an agreement is lawful, unless– (a) it is forbidden by law; or 30 (b) it is of such a nature that, if permitted, it would defeat the provisions of any law; or (c) it is fraudulent; or (d) it involves or implies injury to the person or property of another; or (e) the court regards it as immoral, or opposed to public policy. In each of these cases, the consideration or object of an agreement is said to be unlawful. Every agreement of which the object or consideration is unlawful is void." From the above provisions the agreement in the instant case being forbidden by law is thereby void. The principle is clearly stated by Parke B. in Cope v Rowlands (1836) 2 M & W 149 at p 157 in the following words:– "It is perfectly settled that where the contract which the plaintiff seeks to enforce, be it express or implied, is expressly or by implication forbidden by the common or statute law, no court will lend its assistance to give it effect. It is equally clear that a contract is void if prohibited by a statute, though the statute inflicts a penalty only, because such a penalty implies a prohibition. And it may be safely laid 31 down, notwithstanding some dicta apparently to the contrary, that, if the contract be rendered illegal, it can make no difference in point of law whether the statute which makes it so has in view the protection of the revenue or any other object. The sole question is whether the statute means to prohibit the contract. ..." The next question is whether section 66 of our Contracts Ordinance applies. I have already set out the grounds upon which counsel for Ng argued before us that section 66 could not apply to this case. In deciding this question in favour of Menaka the learned judge made two findings of fact namely, both parties were not aware of the illegality at the time of the execution of the documents and it was only discovered when the statement of defence was filed... As to the effect of section 66, the learned trial judge cited the following passage from the judgment of Chandra Reddy C.J. in Kanuri Sivaramakrishnaiah v Vemuri Venkata Narahari Rao AIR 1960 And Pra 186 at p 188: "It is manifest that in order to invoke this action, the invalidity of the contract or agreement should be discovered subsequent to the making of it. This cannot be taken 32 advantage of by parties who knew from the beginning the illegality thereof. It only applies to a case where one of the parties enters into an agreement under the belief that it was a legal agreement, i.e. without the knowledge that the agreement is forbidden by law or opposed to public policy and as such illegal. The effect of section 65, (section 66 of the Malayan Contracts Ordinance) is that, in such a situation, it enables a person not in pari delicto to claim restoration since it is not based on an illegal contract but dissociated from it. That is permissible by reason of the section because the action is not founded on dealings which are contaminated by illegality. The party is only seeking to be restored to the status quo ante." In the circumstances, I would say that the judge was right that Ng should restore the advantage he had received by returning the amount he received from Menaka. That is to say Ng has to return $19,400 to Menaka. Mr. Palasuntharam, however, argued that the learned judge should have awarded interest. He pointed out in the case of Harnath Kaur v Indar Bahadur Singh LR 50 IA 69 the Privy Council awarded 33 interest at the rate of 6% from the date of the institution of the suit in that case. I agree." [71] On further appeal to the Privy Council the decision of the Federal Court was affirmed in Menaka v Lum Kum Chum [1977] 1 MLJ 91. Lord Fraser of Tullybelton in delivering the judgment of the Privy Council observed at page 94 the following: “Mohamed Azmi J. gave effect to section 66 by finding that the advantage which the borrower had received under the contract was the sum of $20,000 and that he should restore that sum to the appellant. But as he had made two payments of interest amounting together to $600 the learned judge found that the $600 was an advantage received by the lender and that it should be deducted from the $20,000 leaving a balance of $19,400 to be paid to the respondent who now represents the borrower. Leaving aside for the moment the question of whether any interest should also be payable, their Lordships agree with both Courts below that the principal sum of $19,400 should be paid by the respondent to the appellant. In that way effect will be given to section 66 under which each party is bound to restore any advantage which he has received to the person from whom he received it-see Govindram 34 Seksaria v. Radborne (1947) LR 74 Ind App 295, 303 where Lord Morton of Henryton said: “The result of section 65 of the Indian Contract Act was that, as from [the date on which the contract became void] each of the parties became bound to restore to the other any advantage which the restoring party had received under the contract of sale.” Section 65 of the Indian Contract Act, 1872, is in terms identical with those of section 66 of the Contracts (Malay States) Ordinance, 1950. The principle underlying both sections is the same, and it is that: “a right to restitution may arise out of the failure of a contract though the right be not itself a matter of contractual obligation.” See is Babu Raja Mohan Manucha v Babu Manzoor Ahmad Khan (1942) LR 70 Ind App1, 10. ...” [72] I have no doubt that the Defendant cannot avoid its obligation to pay for the agreed fees for the engineering consultancy services rendered by IISB and billed through the Plaintiff on ground of illegality as the Plaintiff had proceeded on the basis that it was perfectly permissible 35 for it to do so and the Defendant had even consented to this arrangement that seems to have the approval of Rule 3 of the Third Schedule to the Architects Rules 1996. [73] Section 66 Contracts Act 1959 would apply to prevent the Defendant from retaining the benefit of the engineering services rendered without payment and further would constrain the Defendant to pay for the benefit it had received. Whether the Learned Sessions Court Judge Erred in Fact and in Law when she allowed the Plaintiff's Claim for M&E Engineering Works [74] There is a total sum of RM224,798.00 allocated for M&E works. However, according to the Defendant, the only evidence put before the Court was that of C&S works, and no M&E works. [75] Without a single M&E drawing submitted, it was argued that the Plaintiff had not proven that it had carried out any M&E works. The Defendant concluded that therefore, at the very least, a sum of RM224,798.00 must be deducted from the amount awarded to the Plaintiff. [76] However, the Defendant in its Defence and Counterclaim had not challenged the Plaintiff with respect to the M&E services provided. The 36 Defendant did not deny that the M&E services were ever provided at all or adduce evidence that the M&E consultancy services were provided by another engineer. [77] The Defence and Counterclaim taken as a whole was centred on the negligence on the part of the Plaintiff. In this appeal, the Defendant had not pursued the appeal against the dismissal of the Defendant's Counterclaim for negligence. [78] The consultants appointed by the Plaintiff, IISB, had furnished the drawings direct to the Defendant. When cross-examined SP3, Encik Wan Ahmad Nizar, the engineer from IISB, had stated that the fees components cover both the C&S as well as the M&E Works. [79] It was not put to him under cross-examination that the M&E consultancy services were not provided. The requirement of putting a contrary position to the witness being cross-examined is of crucial importance. As was observed in Browne v Dunn H.L.(1894) 6 R 67 at pp 70-71 by Lord Herschell L.C. as follows: "Now, my Lords, I cannot help saying that it seems to me to be absolutely essential to the proper conduct of a cause, where it is intended to suggest that a witness is not speaking the truth on a particular point, to direct his attention to the fact by 37 some questions put in cross- examination showing that that imputation is intended to be made, and not to take his evidence and pass it by as a matter altogether unchallenged, and then, when it is impossible for him to explain, as perhaps he might have been able to do if such questions had been put to him, the circumstances which it is suggested indicate that the story he tells ought not to be believed, to argue that he is a witness unworthy of credit. My Lords, I have always understood that if you intend to impeach a witness you are bound, whilst he is in the box, to give him an opportunity of making any explanation which is open to him; and as it seems to me, that is not only a rule of professional practice in the conduct of a case, but is essential to fair play and fair dealing with witnesses." (emphasis added) [80] The Federal Court very recently in Ng Siew Lan v John Lee Tsun Vui & Anor [2017] 2 MLJ 167, after affirming once again the rule in Browne v Dunn (supra) as part of our jurisprudence, observed as follows: [26] The same point was lucidly explained by Mukharji J in AEG Carapiet v AY Derderian AIR 1961 Cal 359 in the following terms: The law is clear on the subject. Wherever the opponent has declined to avail himself of the opportunity to put his 38 essential and material case in cross-examination, it must follow that the testimony given could not be disputed at all. It is wrong to think that this is merely a technical rule of evidence. It is a rule of essential justice. It serves to prevent surprises at trial and miscarriage of justice, because it gives notice to the other side of the actual case that is going to be made when the turn of the party on whose behalf the cross-examination is made comes to give evidence by producing witnesses. It has been stated on high authority of the House of Lords that this much counsel is bound to do when cross-examining that he must put to each of his opponent’s witnesses in turn, so much of his own case as concerns that particular witness or which that witness had any share. If he asked no question with regard to this, then he must be taken to accept the plaintiff’s account in its entirety. Such failure leads to miscarriage of justice, first by springing surprise upon the party when he has finished the evidence of his witnesses and when he has no further chance to meet the new case made which was never put and secondly, because such subsequent testimony has no chance of being tested and corroborated." (Emphasis added) 39 [81] The learned SCJ had made a finding of fact that the Plaintiff had proved on the balance of probabilities that the M&E consultancy services had been provided. In spite of the many demand letters for payment, the Defendant had not denied that the M&E consultancy services were not provided. [82] The learned SCJ, being the trial judge, had the audio-visual advantage of having heard the 3 witnesses from the Plaintiff and another 3 witnesses from the Defendant. Matters of weight and sufficiency of evidence are best left to the trial judge unless it can be shown that the trial judge had arrived at a perverse finding not substantiated or supported by the evidence adduced. [83] Overall it would be difficult to envisage how a hangar project can be carried out without any mechanical and electrical drawings or input from the consulting engineers. Pronouncement [84] Having carefully considered the issue of illegality raised and the challenge on the finding of facts with respect to whether the Plaintiff had proved on a balance of probabilities the M&E consultancy services claimed, I am of the view that the circumstances taken as a whole do not justify appellate intervention. 40 [85] The decision and judgment of the learned SCJ is upheld and the Defendant's appeal is dismissed with costs of RM10,000.00 to be paid by the Defendant to the Plaintiff and deposit of costs of this appeal to be paid to the Plaintiff towards account of the costs of this appeal. Dated: 30.6.2017. LEE SWEE SENG Judge Construction Court High Court Kuala Lumpur For the Appellant : Chan Kheng Hoe together with Darryl Khor (Messrs Kheng Hoe) For the Respondent : Ranjan Chandran together with Mohamed Noor Mahmood (Messrs Mohamed Noor, Amran & Yoon) Dates of Decision: 10.4.2017

Tika 2.6.0

02(f)-55-08/2015(B)

PERAYU Majlis Peguam Malaysia RESPONDEN 1. Rajehgopal a/l Velu 2. Ganashaligham a/l Rajah

Legal Profession — Disciplinary proceedings — Appeal against decision of disciplinary board — Whether Court of Appeal erred in requiring charge to be specifically framed or preferred against advocate and solicitor in disciplinary proceedings — Whether there was any prejudice or denial of natural justice to advocate or solicitor — Whether DB and DC required to frame specific charge against advocate and solicitor — Whether findings of DC and DB in disciplinary proceedings fell within scope of complaint — Whether DB had power to enhance punishment recommended by DC without giving reasons — Whether period of suspension imposed unreasonable and inappropriate

29/06/2017

YA TAN SRI DATUK RAMLY BIN HAJI ALIKorumYAA TAN SRI DATUK SERI PANGLIMA RICHARD MALANJUMYAA TAN SRI DATO' SRI AHMAD BIN HAJI MAAROPYA TAN SRI DATO' SRI ABU SAMAH BIN NORDINYA TAN SRI DATUK RAMLY BIN HAJI ALIYAA TAN SRI ZAHARAH BINTI IBRAHIM

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=3b1c826c-a885-46b4-9896-2e3e5eceb98c&Inline=true

CA NO 02(f)-55-08/2015(B) – MAJLIS PEGUAM MALAYSIA V RAJEHGOPAL A/L VELU & GANASHALINGAM A/L RAJAH IN THE FEDERAL COURT OF MALAYSIA (APPELLATE JURISDICTION) CIVIL APPEAL NO 02(f)-55-08/2015(B) BETWEEN 1. MAJLIS PEGUAM MALAYSIA .. APPELLANT AND 1. RAJEHGOPAL A/L VELU 2. GANASHALINGAM A/L RAJAH .. RESPONDENTS [IN THE APPEAL COURT OF MALAYSIA (APPELLATE JURISDICTION) CIVIL APPEAL NO. B-02(W)-452-03/2015 BETWEEN RAJEHGOPAL A/L VELU .. APPELLANT AND GANASHALINGAM A/L RAJAH .. RESPONDENT AND MAJLIS PEGUAM MALAYSIA .. INTERVENER/ RESPONDENT] CORUM RICHARD MALANJUM, CJSS AHMAD BIN HJ MAAROP, FCJ ABU SAMAH BIN NORDIN, FCJ RAMLY BIN HJ ALI, FCJ ZAHARAH BINTI IBRAHIM, FCJ JUDGMENT OF THE COURT 1. The appellant in the present appeal before us, the Bar Council, Malaysia, was the intervener in the proceedings in the courts below. The 1st respondent was an advocate and solicitor practising under the name and style of Messrs. Rajehgopal Velu & Associates. He was found guilty of misconduct unbefitting of an advocate and solicitor by the Disciplinary Board (the DB) under section 94(3)(o) of the Legal Profession Act 1976 (the LPA) and was suspended from practice as an advocate and solicitor for a period of 12 months. His appeal to the High Court was dismissed, but later was allowed by the Court of Appeal. Dissatisfied with the decision of the Court of Appeal, the appellant appealed to this court. Hence the present appeal before us. We heard and allowed the appeal on 29.6.2016 but with a reduced period of suspension of 6 months with effect from 21 days from the date of the order with no order as to costs. We shall now give our reasons for the decision. Factual Background 2. On 21.7.2013, the 2nd respondent, one Ganashalingam a/l Rajah wrote a letter of complaint against the conduct of the 1st respondent, to the DB (the Complaint). 3. The Complaint was about the 1st respondent who had attested 2 signatures in a property transfer form (Form 14A). The signatures were purportedly those of the late Mdm. Maheswari a/p Veerappoo (the mother of the 2nd respondent), and one Mdm. Ponnamah a/p Chinniah, as the vendors. The late Mdm. Maheswari had already passed away at the time the 1st respondent attested the alleged execution of the said Form 14A, while Mdm. Ponnamah claimed that she did not at any time sign the said Form 14A. The complainant, in his letter, claimed that there was a ‘penipuan’ committed by the 1st respondent, as a result the complainant had lost the property to one Soo Chee Ming, who was the purchaser as stated in the said Form 14A. 4. An Investigating Tribunal (IT) was appointed on 23.6.2005 to investigate into the matter. The IT had on 29.6.2005, written a letter to the 1st respondent seeking his written explanation. In his letter of explanation dated 6.7.2015 to the IT, the 1st respondent stated, among others: (a) he admitted attesting the Form 14A without the presence of Mdm. Maheswari and Mdm. Ponnamah; (b) he did so in trust and reliance on his freelance staff, Rengasamy @ Balasundram a/l Veerappan, whom he had known and trusted for the past 10 years; (c) he was informed by the said Renggasamy @ Balasundram a/l Veerappan that both Mdm. Maheswari and Mdm. Ponnamah were his relatives/aunts and that they were of old age and were constrained in their physical movement and requested the 1st respondent to attest their signatures as vendors of the property; (d) he assumed that the purchaser’s solicitor, Abigail Lee Mei Sing of Messrs KL Lim & Lee, had conducted all the necessary inquiries and searches; (e) he admitted that he had acted negligently in the circumstances. 5. The IT heard the Complaint on 2.8.2005, 29.8.2005, 14.9.2005, 29.9.2005 and 17.10.2005, and after considering the 1st respondent’s letter of explanation and giving him every opportunity to cross-examine the witnesses of the complainant (and indeed his solicitor had cross-examined them), recommended that there should be a formal investigation by the Disciplinary Committee (DC) on the matter. 6. On 20.3.2006, the DC was appointed and heard the Complaint on 20.6.2006 and 28.6.2006. After hearing the parties the DC made inter alia the following findings: “Apart from the fact that the respondent had attested the signatures of the transferors without seeing them, there is also the question of whether the respondent was involved in the fraud perpetrated on the owners of the property which resulted in the transfer of the property to the purchaser. On this issue, we find that there is insufficient evidence to prove that the respondent has intentionally participated in the fraud perpetrated on the owners of the property. Notwithstanding that there is insufficient evidence to show that the purchaser has intentionally participated in the fraud, the fact remains that the respondent has acted unprofessionally in attesting the signatures of the owners whom he did not witness actually signing the transfer.” 7. The DC accordingly found the 1st respondent guilty of conduct unbefitting of an advocate and solicitor under section 94(3)(o) of the LPA and recommended that he be suspended from practice as an advocate and solicitor for a period of 6 months. 8. The DB heard the matter on 20.6.2006 and 28.6.2006 in the presence of the complainant and his counsel as well as the 1st respondent and his counsel pursuant to section 103D (2) of the LPA. The DB having agreed with the DC that the 1st respondent was guilty under section 94(3)(o) of the LPA, imposed a greater punishment and suspended the 1st respondent from practice as an advocate and solicitor of the High Court of Malaya for a period of 12 months. The suspension was to take effect 21 days from the date of the order (16.5.2014). At the High Court 9. Dissatisfied with the DB’s decision, the 1st respondent appealed to the High Court. At the High Court, the 1st respondent raised the following issues: (a) that there was no specific charge framed and preferred against the 1st respondent in the proceedings (first issue); (b) that Miss Abigail M.S. Lee from Messrs K.L. Lim & Lee was not called to testify and thus giving the 1st respondent no opportunity to cross-examine this witness and this was a procedural failure as well as breach of natural justice and the court should invoke adverse inference against the complainant (second issue); and (c) that the National Land Code allows attestation to be made based on trust and, in this case, the 1st respondent trusted Balasundram who brought him the documents (third issue). 10. On the first issue the learned trial judge found that it was not fatal and it did not hamper the defence of the 1st respondent as he was very much aware of the Complaint against him; and the Complaint itself was a sufficient notice on the matter facing him. 11. On the second issue, the trial judge found that it was of no consequence to the Complaint faced by the 1st respondent. The trial judge was of the view that whether Miss Abigail testified or not it did not take away the fact that the 1st respondent did not deny that he had attested the signatures of the vendors in their absence; and the non-denial of the 1st respondent amounted to an admission to the Complaint against him in respect of which he was given full liberty to explain, and therefore there was no breach of natural justice. 12. On the third issue, the trial judge, applying the provisions of section 211 of the National Land Code 1965 and the decision in Albert Chew v. Hong Leong Finance Bhd [2001] 4 CLJ 419, held that it was a mandatory requirement for the person authorised to attest a signature to ensure that the instrument in question was signed by the real person before him. 13. On this issue, the trial judge said: “I could locate no provision in the National Land Code as contended by the plaintiff (1st respondent) which allows attestation based on trust and in the absence of the person executing the document.” 14. In the upshot, the trial judge dismissed the 1st respondent’s appeal. At the Court of Appeal 15. The 1st respondent then appealed to the Court of Appeal against the decision of the High Court. At the Court of Appeal, the 1st respondent raised two main grounds, namely: (a) that there was no charge framed against the 1st respondent before the DC; and (b) in enhancing the punishment to a suspension of 12 months, from the 6 months as recommended by the DC, the DB did not give any reasons. 16. The Court of Appeal allowed the 1st respondent’s appeal on 4.8.2015 and held that a charge must be precisely formulated and framed to include specific accusation against the 1st respondent who had the right to know and must have notice of the very nature of the allegations against him at the first opportunity. 17. The Court of Appeal also held that the DC had acted outside the scope of powers granted to it, which was to inquire into the Complaint of fraud, when it held that the 1st respondent had acted unprofessionally and was guilty of misconduct under section 94(3)(o) of the LPA in attesting the signatures in question which was not the subject matter of the Complaint. The Court of Appeal was “constrained to hold that the DC’s decision is null and void for illegality” and therefore the decision of the DB (including the imposition of the suspension order of 12 months on the 1st respondent) was also null and void. Before this court 18. Dissatisfied with the decision of the Court of Appeal, the intervener appealed to this court. At the hearing of the appeal before us parties raised 3 issues, namely- (a) whether the DB and the DC are required to frame a formal charge as against an advocate and solicitor in disciplinary proceedings (the First Issue); (b) whether the findings or decisions of the DC and the DB in the disciplinary proceedings against the 1st respondent fall within the terms or scope of the Complaint (the Second Issue); and (c) whether the DB has the power to enhance the punishment recommended by the DC on the 1st respondent without giving any reasons (the Third Issue). 19. It is not in dispute that a letter of complaint dated 21.7.2003 was sent by the complainant, the 2nd respondent in this appeal, alleging misconduct committed by the 1st respondent as an advocate and solicitor in attesting the signatures of the alleged vendors one Mdm. Maheswari and Mdm. Ponnamah in the related Form 14A without seeing them sign in his presence. 20. To better understand the true meaning of the Complaint in detail, it is important to reproduce the full content of the letter in its original text in Bahasa Malaysia: “Ganashalingam A/L Rajah No 16, Jalan Dato’ Yusof Shahabudin 4, Taman Sentosa, 41200 Klang, Selangor Darul Ehsan Tel: 012-2176860 21/7/03 Lembaga Tatatertib Peguam-Peguam 9th Floor, Wisma Maran 28, Medan Pasar, 50050 Kuala Lumpur Tuan, Per: Aduan Tentang Salahlaku Peguam Nama: V. Rajehgopal Tempat Beramal: Rajehgopal Velu & Partners, No. 41, Mezzanine Floor, Wisma Valiappa, Jalan Dato’ Hamzah, Klang, Selangor (Tel: 03-33723804) Penipuan Penyaksian Tandatangan di atas Borang 14A Pindahmilik Hartanah di bawah hakmilik GM 434, Lot No. 343, Mukim Batang Berjuntai, Negeri Selangor Darul Ehsan Pemilik-Pemilik asal: Ponnamah a/p Chinniah Maheswary a/p Veerappoo _________________________________________________________ Saya merujuk kepada perkara di atas. Saya mewakili ibu saya, Maheswari a/p Veerappoo yang telah meninggal dunia pada 10.9.94. Dukacita saya maklumkan kepada pihak tuan bahawa peguam yang tersebut di atas telah melakukan satu penipuan dalam menyaksikan tandatangan ibu saya (Maheswari a/p Veerappoo) dan Ponnamah a/p Chinniah bagi pindahmilik ke atas hartanah tersebut di atas. Dalam borang tersebut, dinyatakan bahawa tarikh beliau menyaksikan Ponnamah A/P Chinniah dan ibu saya menandatangani borang pindahmilik tersebut adalah pada 4.3.02. Sedangkan pada masa itu, ibu saya telah meninggal dunia. Beliau meninggal dunia pada 10.4.94. Manakala Ponnamah a/p Chinniah tersebut pada bila-bila masa tidak pernah menandatangnai borang pindahmilik tersebut. Oleh itu, tandatangan beliau dan ibu saya tersebut telah dipalsukan. Memandangkan ibu saya telah meninggal dunia pada 10.4.94 dan Ponnamah a/p Chinniah tidak pernah menandatangani borang pindahmilik terebut, maka peguam V. Rajehgopal tersebut telah melakukan satu penipuan bahawa beliau telah menyaksikan Ponnamah a/p Chinniah dan si mati menandatangani borang pindahmilik tersebut. Akibat daripada pemalsuan tersebut, hakmilik hartanah tersebut telah dipindahkan kepada seorang bernama Soo Chee Ming. Berikutan perkara ini juga, Ponnamah a/p Chinniah tersebut telah membuat laporan polis. Bersama-sama ini saya lampirkan dokumen-dokumen yang berikut untuk rujukan tuan:- (a) Sesalinan Borang Pindahmilik yang telah didaftarkan pada 31.5.02. (b) Sesalinan Surat Mati Maheswari a/p Veerappoo. (c) Sesalinan hakmilik hartanah tersebut yang telah ditukar namanya kpeada Soo Chee Ming. (d) Sesalinan laporan Polis oleh Ponnamah a/p Chinniah bertarikh 23.6.03. (e) Sesalinan surat kepada Pentadbir Tanah Daerah Kuala Selangor bertaikh 24.6.2003. (f) Sesalinan Surat Akuan saya bertarikh 30.10.2003. (g) Sesalinan Kad Pengenalan saya. Oleh kerana salahlaku oleh peguam tersebut adalah satu kesalahan yang serius saya berharap pihak tuan dapat menyiasat perkara ini dan mengambil tindakan yang sewajarnya terhadap peguam tersebut. Terima kasih.” 21. In essence, in the said letter of Complaint, the 2nd respondent made the following assertions: (a) that Mdm. Maheswari and Mdm. Poonamah were the registered owners of a piece of landed property; (b) that on or about 4.3.2002, the property was transferred to one Soo Chee Ming using a Form 14A purportedly signed by the said Mdm. Maheswari and Mdm. Ponnamah; (c) that the signatures of Mdm. Maheswari and Mdm. Ponnamah were allegedly attested by the 1st respondent, as an advocate and solicitor; (d) that Mdm. Maheswari died on 10.4.1994; (e) that Mdm. Ponnamah did not at any time sign the said Form 14A; and (f) that by reason of the above the 1st respondent had committed a ‘penipuan’ in saying that the signatures of Mdm. Maheswari and Mdm. Ponnamah were attested before or in front of him. First Issue: No charge framed 22. On the first issue, that no specific charge was framed and preferred against the 1st respondent in the disciplinary proceedings, the learned High Court Judge held that it was not fatal in the present case and it did not hamper the defence of the 1st respondent as he was very much aware of the Complaint against him. To the learned judge, the Complaint itself was a sufficient notice to the 1st respondent on the matter facing him. 23. The Court of Appeal disagreed with the High Court on this issue. The Court of Appeal expressed the view that: “the disciplinary proceedings initiated against an advocate and solicitor are serious and carry penal consequences such as a fine, suspension or being struck off the Roll of Advocates and Solicitors. Accordingly, we agree with the view in Abdullah Borhan v. Ketua Polis Melaka & Another (supra) that the charge in question must be precisely formulated to include the specific accusation against the appellant who has the right to know and must have notice of the very nature of the charge at the first opportunity. This will enable the appellant to be forewarned with clarity and certainty the essential elements or ingredients against him in order to ensure that he can be forearmed in his defence for the purpose of directing all the evidence exclusively to the specific charge (see also the Privy Council’s opinion in B Surinder Singh Kanda v. The Government of the Federation of Malaya [1962] (PC)). The view is that in a disciplinary process, the respondent is only required to respond to the charge and nothing else was approved in Lim Teng Ee Joyce v. Singapore Medical Council [2005] SGHC 129.” 24. Learned counsel for the appellant submitted before us that there was no requirement under the Legal Profession (Disciplinary Proceedings) (Investigating Tribunal and Disciplinary Committee) Rules 1994 (the 1994 Rules) requiring charges to be framed against an advocate and solicitor in disciplinary proceedings; thus an omission to frame a formal charge against the 1st respondent in the present case would not amount to a breach of the LPA as there cannot a breach where no such requirement exists. The appellant contended that what was essential was that the 1st respondent is supplied with sufficient material particulars to enable him to meet the allegations made against him in the Complaint. The appellant cited (2) authorities to support this point, namely: Aziana Uda Bahari v. Gan Kong You [2009] 8 CLJ 438 (High Court) and Lau Keen Fai v. Lim Ban Kay [2011] 3 CLJ 213 (High Court). 25. Learned counsel for the 1st respondent, on the other hand, submitted that section 103B of the LPA provides that an inquiry must be carried out into a written complaint and its findings shall be made expeditiously. It was further submitted “that merely because the word “inquiry” is used in the Legal Profession Act 1976, it does not follow that no charge needs to be framed for the solicitor to answer.” 26. Learned counsel further submitted that the requirement for a charge to be framed was so obvious that Parliament in its wisdom did not think it necessary to say so in express terms. It was also submitted that a solicitor is entitled to know not just the facts he would have to meet but also the appropriate “head” of grave impropriety or misconduct as highlighted in section 94(3) of the LPA that he had to face in any disciplinary proceedings against him. 27. It was further submitted by learned counsel that the importance of a charge, in a case of an advocate and solicitor facing disciplinary proceedings under the LPA must be appreciated in the context of the LPA, and the courts in Malaysia and Singapore have emphasized the need and importance of framing a charge in the proceedings. To support his proposition, learned counsel relied on the following authorities, namely: Yong Nguk Fan & Anor v. Toh Boon Pin & Ors. [2006] 7 CLJ 296; Lim Teng Ee Joyce v. Singapore Medical Council [2005] 3 SLR 709; Tan Tiang Hin Jerry v. Singapore Medical Council [2000] 2 SLR 274; Abdullah Borhan v. Ketua Polis Melaka & Anor [2008] 9 CLJ 605; Raja Abdul Malek Muzaffar Shah bin Raja Shahruzzaman v. Setiausaha Suruhanjaya Pasukan Polis & Ors. [1995] 1 MLJ 308; and Saufee A Rahman v. Che Yusof Che Ngah & Ors. [2014] 7 CLJ 691. 28. Learned counsel also submitted that even though the LPA did not have an express provision for a charge to be framed, common law will come into the picture and supply the deficiency so as not to allow a person be punished without being heard. The case of Cooper v. Wandsworth Board of Works (1861-73) All ER Rep 1554 was cited in support of the proposition. 29. We agree with learned counsel for the appellant that there is no provision in the LPA or the 1994 Rules requiring a charge to be specifically framed or preferred against an advocate and solicitor in disciplinary proceedings. 30. We also agree that in disciplinary proceedings under the LPA, the advocate and solicitor concerned must be given an opportunity of being heard. This is a basic rule of natural justice which must be observed. The advocate and solicitor concerned shall not be punished without being heard. On this point, the Privy Council in B Surinder Singh Kanda (supra) had aptly remarked (which we agree)- “If the right to be heard is to be a real right which is worth anything, it must carry with it a right in the accused man to know the case which is made against him. He must know what evidence has been given and what statements have been made affecting him: and then he must be given a fair opportunity to correct or contradict them.” 31. At the outset, it must be stressed that disciplinary proceedings against a solicitor under the LPA are not proceedings in a criminal court of law. The proceedings although quasi–judicial in nature need not emulate the strict adversarial procedure practised in a criminal court (see: Jerald Allen Gomez v. Shencourt Sdn Bhd (Majlis Peguam, Intervernor) [2006] 2 MLJ 343). On this point we agree with Abdull Hamid Embong J (as he then was), in Jerald Allen Gormez (supra) when his Lordship commented: “To say that, in the absence of such procedures, the disciplinary committee should adhere strictly to the procedures in the proceedings of a criminal court, would be implying some requirements not intended by statute.” 32. The rules of natural justice in disciplinary proceedings should not be governed by the adversarial system of justice of criminal courts but should be inquisitorial or investigatory in nature. Inquisitorial or investigative proceedings are not inconsistent with the rules of natural justice (see: Federal Court’s decision in Lembaga Jurutera Malaysia v. Leong Pui Kun [2009] 2 MLJ 36). 33. It is a trite principle that a disciplinary committee of a professional body is entitled to conduct its disciplinary hearing in respect of a member of the body in whatever way it deems appropriate provided that the method or manner it adopts is not in breach of any specific provisions of the relevant statutes or regulations and does not result in a denial of natural justice to the member concerned. 34. In Lim Ko & Anor v. Board of Architects [1966] 2 MLJ 80, the Federal Court held, inter alia, that the proceedings of disciplinary tribunals or committees conducting an inquiry are by no means bound by the strict rules which apply to criminal trials. A legalistic approach is not appropriate in those proceedings. The same principle was adopted by the Federal Court in Tan Hee Lock v. Commission of Federal Capital & Ors. [1973] 1 MLJ 2; Tanjong Jara Sdn Bhd v. Minister of Labour and Manpower & Anor [1987] 1 MLJ 124; and by the Court of Appeal in Haji Ali bin Haji Othman v. Telekom Malaysia Bhd [2003] 3 MLJ 29. 35. In the present case, we agree that the 1st respondent was entitled to know the details of the allegations made against him in the letter of Complaint at the very earliest stage, i.e. before the Investigative Tribunal started its investigation or inquiry. This would enable the 1st respondent to prepare his explanation and later to be heard at all stages of the proceedings thereafter. The statements in the letter of Complaint must convey with sufficient clarity and certainty on the nature of all the allegations made against him. The 1st respondent must be able to meet every relevant ingredient of the Complaint and must be given opportunity to contradict them. 36. In Lau Keen Fai v. Lim Ban Kay [2011] 3 CLJ 213, the High Court held: “(1) The LPA does not provide specifically that the DC is required to frame a charge. Thus an omission to frame a formal charge would not amount to a breach of the LPA. There was no requirement that it ought to be framed in any particular form or that it ought to take the form of a charge framed in a criminal proceeding. What was essential was that the person against whom the misconduct was alleged was supplied with sufficient material particulars to enable him to meet the allegation. Herein, all the requirements of a charge were found in the letter of complaint that the DB had forwarded to the appellant. The appellant had sufficient notice of the complaint against him. Despite the absence of a formal charge the appellant was able to meet the complaint lodged against him. The absence of a charge did not occasion any procedural unfairness or a breach of the rules of natural justice as the appellant had not been deprived of the opportunity to contradict the complaint.” We agree with the above. 37. In considering whether there was any prejudice or denial of natural justice to the 1st respondent, the court is to look at the substance, rather than the form, to determine whether the 1st respondent had been informed of all the material ingredients and facts relating to the Complaint lodged against him. It does not necessarily mean that it must only be by way of a formal charge framed against him. The 1st respondent needed to be informed sufficiently of the facts and particulars of the misconduct complained of to enable him to explain and exculpate himself. That is his right and it forms an integral part of the rules of natural justice. 38. The relevant facts and material particulars that need to be informed to the 1st respondent are particulars which, if established, are capable of showing the elements of misconduct mentioned in the Complaint. In this respect, we agree with Bowen LJ in Leeson v. General Council of Medical Education and Registration [1889] 43 Ch D 366 where he said: “With respect to the charge made, the charge of which he has notice, it is a charge of infamous conduct in some professional respect, and the particulars which should be brought to his attention in order to enable him to meet that charge ought to be particulars of conduct which, if established, is capable of being viewed by honest persons as conduct which is infamous. That is all.” 39. Our view is that, any complaint against an advocate and solicitor must comply with the requirements under rule 3 of the 1994 Rules which provides: “3. Contents of Complaints (1) A complaint shall be made in writing by the complainant or his solicitor. (2) A complaint shall contain the following: (a) the full name, identity card or passport number and address of the complainant; (b) the facts of the complaint; (c) copies of any documents that the complainant proposes to rely on in support of his complaint; (d) the signature of the complainant; (e) the name and address of the complainant’s solicitor, if any.” 40. The Complaint against the 1st respondent in this case fulfilled all the above requirements under rule 3 of the 1994 Rules. It was sufficient to give opportunity to the 1st respondent to exercise his right to be heard and to explain and exculpate himself, even though it was not presented in the form of a formal charge. Even if a formal charge is drawn up, such charge would inevitably be a regurgitation of the facts and particulars contained in the letter of Complaint. 41. The 1st respondent in the present case knew fully well the details of the allegation made against him as stated in the letter of Complaint. From the records of proceedings made available to us, we find that the 1st respondent was represented by his counsel at all levels of the proceedings. He took part in the proceedings. Based on the details of his participation in the proceedings and his letter of explanation dated 6.7.2005, it is clear that he had sufficient notice of all the material facts of the Complaint made against him. The conduct of the 1st respondent’s right from the beginning, was inconsistent with a person who did not have sufficient knowledge of the Complaint against him. The absence of a charge specifically framed against him did not occasion any procedural unfairness or breach of the rules of natural justice. He was not prejudiced in any manner. He was not deprived of the opportunity to contradict the Complaint against him. 42. As stated earlier, there is no requirement either under the LPA or under the 1994 Rules requiring a charge to be framed against the 1st respondent. The DB and DC was at liberty to proceed with the disciplinary proceedings against the 1st respondent without having to specifically frame a formal charge against him provided, to borrow the words of Nik Hashim FCJ, in Lembaga Jurutera Malaysia v. Leong Pui Kun (supra), “the procedure adopted was not in breach of any specific provision of the Act and did not result in a denial of natural justice” to the 1st respondent. 43. Apparently, the Court of Appeal in finding that a formal charge needed to be specifically framed against the 1st respondent was relying on the authority of Abdullah Borhan v. Ketua Polis Melaka & Anor [2008] 9 CLJ 605 where the High Court in Melaka in dealing with disciplinary proceedings against a police officer ruled that “the procedural requirements in drafting a charge meant for a criminal trial would apply with equal force to a disciplinary charge such as in the instant case because both of them share the common denominator i.e. penal consequences”; and “It is trite law that the charge in question must be precisely formulated to include the specific accusation against the plaintiff who has the right to know and must have notice of the very nature of the charge at the first opportunity”. The same authority were also relied upon by the 1st respondent’s counsel in his submissions before us in the appeal. 44. With respect, the Court of Appeal had failed to notice that the disciplinary proceedings in that case were against a police officer based on the Police (Conduct and Discipline) (Junior Police Officers and Constables) Regulations 1970, where regulation 3(1) of the said Regulations sets out expressly a mandatory requirement that “A charge shall be framed in accordance with the offence as prescribed in the Schedule. The charge shall describe the offence briefly and identify the officer with the unlawful act or omission charged”. In the present case, we are dealing with disciplinary proceedings against an advocate and solicitor under the LPA. As stated earlier, there is no express provision either in the LPA or the 1994 Rules mandating such requirement. Therefore the issue of framing a charge such as is required under the Police (Conduct and Discipline) (Junior Police Officers and Constables) Regulation 1970 does not arise in the case before us and failure to draft such a charge against the 1st respondent does not amount to a breach of the law or relevant regulations. 45. The Court of Appeal also relied on the decision of the Privy Council in B. Surinder Singh Kanda v. The Government of the Federation of Malaya [1962] MLJ 169 (PC) to support its finding on the requirement of having specific charge framed against the 1st respondent. 46. Our observation is that the Privy Council in that case did not deal with the issue of a charge to be framed against the police officer in the disciplinary proceedings. It is more of a case of a complaint by the police officer that he was not given a reasonable opportunity of being heard in the disciplinary proceedings against him. On that issue the Privy Council ruled: “Applying these principles their Lordships are of opinion that Inspector Kanda was not in this case given a reasonable opportunity of being heard. They find themselves in agreement with the view expressed by Rigby J. in these words: “In my view, the furnishing of a copy of the Findings of the Board of Inquiry to the Adjudicating Officer appointed to hear the disciplinary charges, coupled with the fact that no such copy was furnished to the plaintiff amounted to such a denial of natural justice as to entitle this Court to set aside those proceedings on this ground. It amounted, in my view, to a failure to afford the plaintiff a reasonable opportunity of being heard in answer to the charge preferred against him which resulted in his dismissal.” 47. The issue in that case was that a copy of the Findings of the Board of Inquiry which contained statements of the witnesses, was only given to the Adjudicating Officer but not to the officer charged. Similar complaint does not arise in the present case before us. In short, that case did not support the Court of Appeal’s finding pertaining to the requirement to frame a formal charge against the 1st respondent in the present case. 48. The Court of Appeal also relied on the case of Lim Teng Ee Joyce v. Singapore Medical Council (supra), to support its finding on the same issue relating to the framing of a specific charge against the 1st respondent and that in a disciplinary process, the 1st respondent is only required to respond to the charge and nothing else. In that case the court in Singapore was dealing with disciplinary proceedings involving a medical practitioner in Singapore. 49. It must be noted that it was a mandatory requirement in a disciplinary proceedings involving medical practitioners in Singapore that a charge be framed against the practitioner as required under rule 27(2) of the Medical Registration Regulations in Singapore, and the charge shall first be read out to the practitioner; and that rule 35(1) of the Regulations empowers a disciplinary tribunal to alter a charge or frame a new charge whether in substitution for or in addition to an existing charge at any time before it makes a finding. Clearly, there were statutory provisions mandating such requirement. Again, we find that this authority did not support the Court of Appeal’s finding on the issue. 50. As stated earlier, disciplinary proceeding involving an advocate and solicitor under the LPA or the 1994 Rules cannot be equated to criminal proceedings in a criminal court of law, especially relating to the framing of a formal charge against the accused person. Section 173(a) of the Criminal Procedure Code (the CPC) provides that “when the accused appears or is brought before the court a charge containing the particulars of the offence of which he is accused shall be framed and read and explained to him, and he shall be asked whether he is guilty of the offence charged or claims to be tried.” The form of a charge, particulars as to time, place and person contained in a charge, and the manner of committing an offence to be stated in a charge are statutorily provided under sections 152, 153 and 154 of the CPC. These are mandatory statutory requirements provided for by law which must be complied with in criminal proceedings in a criminal court of law. However, there is no such requirement under the LPA or the 1994 Rules relating to disciplinary proceedings involving an advocate and solicitor. Second Issue: Whether findings of the DC and DB fall within the scope of the Complaint 51. This issue was touched upon by the Court of Appeal in its judgment. In paragraph 17 of its judgment, the Court of Appeal ruled as follows: “In this instance, the DC was appointed to conduct an inquiry into the Complaint pursuant to s. 103B of the LPA 1976. The appellant was exonerated of the Complaint of fraud against him. The finding that the appellant had acted unprofessionally in attesting the signatures in question was not the subject matter of the Complaint. In our view, the DC had acted outside the terms of power granted to it, which is to inquire into the Complaint of fraud. The DC’s finding that the appellant is guilty of misconduct was made for an extraneous purpose (R Rama Chandran v. Industrial Court [1997] 1 MLJ 145; Ranjit Kaur Gopal Singh v. Hotel Excelsior [2010] 8 CLJ 1). Accordingly, we are constrained to hold that the DC’s decision is null and void for illegality.” 52. Learned counsel for the appellant in his written submissions before us submitted as follow: “The findings and recommendation made by the DC and the making of the DB Order were within the scope of the Complaint as they arose from facts based on the Complaint, which were put to and admitted by R1. The Court of Appeal erred in finding that the unprofessional manner in which R1 attested the signatures on the Form 14A was not the subject matter of the Complaint. Similarly, although the DC found that there was insufficient evidence to prove that R1 had intentionally participated in the fraud, the undeniable fact remains that R1 had attested the Form 14A without the presence of R2’s late mother and Ponnamah.” 53. In order to appreciate and decide on this issue, it is necessary to refer to and read the full contents of the letter of Complaint in question. 54. The letter of Complaint in itself, does not contain the word “fraud” although the word was used throughout the proceedings right from the beginning by counsel as well the courts below. The gist of the Complaint as can be gathered and understood from the full text of the letter is that the 1st respondent as an advocate and solicitor (in its original text) “telah melakukan satu penipuan dalam menyaksikan tandatangan ibu saya (Maheswari a/p Veerapoo) dan Ponnamah a/p Chinniah bagi pindahmilik ke atas hartanah tersebut di atas ….. Dalam borang tersebut, dinyatakan bahawa tarikh beliau menyaksikan Ponnamah a/p Chinniah dan ibu saya menandatangani borang pindahmilik tersebut adalah pada 4.3.2002. Sedangkan pada masa itu, ibu saya telah meninggal dunia. Beliau meninggal dunia pada 10.4.1999, manakala Ponnamah a/p Chinniah tersebut pada bila-bila masa tidak pernah menandatangani borang pindahmilik tersebut. …. maka peguam V. Rajegopal tersebut telah melakukan satu penipuan bahawa beliau telah menyaksikan Ponnamah a/p Chinniah dan si mati menandatangani borang pindah milik tersebut”. In short, the Complaint was that the 1st respondent as an advocate and solicitor had attested the relevant Form 14A for the transfer of the land in question without the presence of the late Mdm. Maheswari a/p Veerapoo and Mdm. Ponnamah a/p Chinniah. The ‘penipuan’ mentioned in that letter clearly refers to that conduct of the 1st respondent. 55. The above complaint or allegation was not disputed by the 1st respondent. He admitted attesting the relevant Form 14A without the presence of the two vendors and also admitted that he had acted negligently in the circumstances. His only excuse was that he did so in trust and reliance of his freelance staff, one Rengasamy @ Balasundram a/l Veerapan, whom he had known and trusted for the past 10 years. 56. We therefore agree with learned counsel for the appellant that the findings and recommendations made by the DC and the making of the DB order that the 1st respondent was guilty of conduct which is unbefitting of an advocate and solicitor under section 94(3)(o) of the LPA in attesting the said Form 14A without the presence of the vendors were within the scope of the Complaint. The Court of Appeal erred in finding that the 1st respondent’s conduct which the DC found to fall under section 94(3)(o) of the LPA was not the subject matter of the Compliant and that the DC had acted outside the terms of power granted to it, which was to inquire into the Complaint of fraud. Therefore that finding cannot stand. Third Issue: Enhancement of punishment by the DB without giving reasons 57. This issue was raised in the 1st respondent’s submissions before us. Counsel for the 1st respondent submitted that the DB erred in enhancing the punishment against the 1st respondent of suspension from practice as an advocate and solicitor of the High Court of Malaya from a period of 6 months as recommended by the DC to a period of 12 months with effect from 21 days from the date of the order (16.5.2014), without giving any reasons. This, according to learned counsel, was in breach of section 103D(1) of the LPA. 58. The facts relating to this issue from the records of the proceedings are not in dispute, i.e. the DB has not given any reasons for rejecting the DC’s recommendation and enhancing the suspension period from 6 months as recommended by the DC to 12 months. Learned counsel for the 1st respondent contended that the DB had exceeded its power for failing to give reasons and therefore the order as to the suspension period must fall. Learned counsel relied on the current provisions of section 103(1) of the LPA which in effect provides that “After consideration of the report of the Disciplinary Committee, the Disciplinary Board may make an order affirming or rejecting the finding or recommendation of the Disciplinary Committee and if the Disciplinary Board rejects the finding or recommendation of the Disciplinary Committee, the Disciplinary Board shall record the reason for the rejection.” 59. We agree that under the current provisions of section 103D(1) of the LPA, the DB shall record the reasons if it rejects the recommendation made by the DC. It is a mandatory requirement. However, it must be noted that the said requirement was only inserted into the section by an amendment to the LPA vide the Legal Profession (Amendment) Act 2012 (Act A1444) which came into effect on 3.6.2014 vide P.U. (B) 262/2014. There was no indication that the amendment was to take effect retrospectively. 60. The disciplinary proceedings on the matter before the DB was conducted on 16.5.2014 (prior to the effective date of the amendment to section 103D(1) of the LPA). The suspension order was also made on 16.5.2014. At that time, there was no statutory requirement in section 103D(1) or other provisions of the LPA which required the DB to give and to record its reason if it chooses to reject the recommendation made by the DC. There was no statutory duty or obligation to do so. Therefore the DB cannot be said to have exceeded its power for failing to give reasons for its rejection of the DC’s recommendation. 61. However, in the present appeal, based on the facts and circumstances of the case, we are of the view that the period of suspension of (6) months imposed on the 1st respondent as recommended by the DC, is more reasonable and appropriate. The fact that the 1st respondent had admitted to his negligent conduct in the matter question and that there was no finding of fraud on his part, coupled with the fact that he was relying on his freelance staff one Rengasamy @ Balasundram whom he had known and trusted for the past 10 years should be considered as good mitigating factors for him. Conclusion 62. In the upshot, we would answer the issues before us as follows: (a) the DB and the DC are not required to frame a specific formal charge as against an advocate and solicitor in disciplinary proceedings under the LPA. There is no such requirement under the LPA as well as the 1994 Regulations; (b) the findings of the DC and the DB in the disciplinary proceedings that the 1st respondent was guilty of conduct which is unbefitting of an advocate and solicitor under section 94(3)(o) of the LPA fall within scope of the Complaint lodged against him; and (c) at the material date (16.5.2014) the DB had the power to enhance the punishment recommended by the DC on the 1st respondent without giving any reasons, as the statutory requirement to give reasons was only brought into effect on 3.6.2014 vide the Legal Profession (Amendment) Act 2012 (Act A 1444). 63. We therefore allow the appeal and set aside the Order of the Court of Appeal. We hold that the 1st respondent was in breach of section 94(3)(o) of the LPA. We make an order that the 1st respondent be suspended from practice as an advocate and solicitor in the High Court of Malaya for a period of (6) month to take effect from 21 days from the date of this order. We make no order as to costs (as agreed by the parties). Dated: 29 JUN 2016 sgd RAMLY HJ ALI FEDERAL COURT JUDGE MALAYSIA Counsels: 1. Sean Yeow (with Hoi Jack S’ng) Messrs. Lee Hishamuddin Allen & Gledhill ... for the Appellant 2. T. Gunaseelan and Ramanathan Velu Messrs. Rama Velu & Associates … for the 1st Respondent Cases referred to: 1. Albert Chew v. Hong Leong Finance Bhd [2001] 4 CLJ 419 2. B Surinder Singh Kanda v. The Government of the Federation of Malaya [1962] MLJ 169 (PC) 3. Aziana Uda Bahari v. Gan Kong You [2009] 8 CLJ 438 4. Lau Keen Fai v. Lim Ban Kay [2011] 3 CLJ 213 5. Yong Nguk Fan & Anor v. Toh Boon Pin & Ors. [2006] 7 CLJ 296 6. Lim Teng Ee Joyce v. Singapore Medical Council [2005] 3 SLR 709 7. Tan Tiang Hin Jerry v. Singapore Medical Council [2000] 2 SLR 274 8. Abdullah Borhan v. Ketua Polis Melaka & Anor [2008] 9 CLJ 605 9. Raja Abdul Malek Muzaffar Shah bin Raja Shahruzzaman v. Setiausaha Suruhanjaya Pasukan Polis & Ors. [1995] 1 MLJ 308 10. Saufee A Rahman v. Che Yusof Che Ngah & Ors. [2014] 7 CLJ 691. 11. Jerald Allen Gomez v. Shencourt Sdn Bhd (Majlis Peguam, Intervener) [2006] 2 MLJ 343 12. Lembaga Jurutera Malaysia v. Leong Pui Kun [2009] 2 MLJ 36 13. Lim Ko & Anor v. Board of Architects [1966] 2 MLJ 80 14. Tan Hee Lock v. Commission of Federal Capital & Ors. [1973] 1 MLJ 2 15. Tanjong Jara Sdn Bhd v. Minister of Labour and Manpower & Anor [1987] 1 MLJ 124 16. Haji Ali bin Haji Othman v. Telekom Malaysia Bhd [2003] 3 MLJ 29 17. Leeson v. General Council of Medical Education and Registration [1889] 43 Ch D 366 18. Cooper v. Wandsworth Board of Works [1861-73] All ER Rep. 1554. Legislations Referred to: 1. Legal Profession Act 1976: section 94(3)(o), section 103D (2) 2. National Land Code 1965: section 211 3. Criminal Procedure Code: sections 152, 153, 154 and 173(a) 42

Tika 2.6.0

02(f)-55-08/2015(B)

PERAYU Majlis Peguam Malaysia RESPONDEN 1. Rajehgopal a/l Velu 2. Ganashaligham a/l Rajah

Legal Profession — Disciplinary proceedings — Appeal against decision of disciplinary board — Whether Court of Appeal erred in requiring charge to be specifically framed or preferred against advocate and solicitor in disciplinary proceedings — Whether there was any prejudice or denial of natural justice to advocate or solicitor — Whether DB and DC required to frame specific charge against advocate and solicitor — Whether findings of DC and DB in disciplinary proceedings fell within scope of complaint — Whether DB had power to enhance punishment recommended by DC without giving reasons — Whether period of suspension imposed unreasonable and inappropriate

29/06/2017

YA TAN SRI DATUK RAMLY BIN HAJI ALIKorumYAA TAN SRI DATUK SERI PANGLIMA RICHARD MALANJUMYAA TAN SRI DATO' SRI AHMAD BIN HAJI MAAROPYA TAN SRI DATO' SRI ABU SAMAH BIN NORDINYA TAN SRI DATUK RAMLY BIN HAJI ALIYAA TAN SRI ZAHARAH BINTI IBRAHIM

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=3b1c826c-a885-46b4-9896-2e3e5eceb98c&Inline=true

CA NO 02(f)-55-08/2015(B) – MAJLIS PEGUAM MALAYSIA V RAJEHGOPAL A/L VELU & GANASHALINGAM A/L RAJAH IN THE FEDERAL COURT OF MALAYSIA (APPELLATE JURISDICTION) CIVIL APPEAL NO 02(f)-55-08/2015(B) BETWEEN 1. MAJLIS PEGUAM MALAYSIA .. APPELLANT AND 1. RAJEHGOPAL A/L VELU 2. GANASHALINGAM A/L RAJAH .. RESPONDENTS [IN THE APPEAL COURT OF MALAYSIA (APPELLATE JURISDICTION) CIVIL APPEAL NO. B-02(W)-452-03/2015 BETWEEN RAJEHGOPAL A/L VELU .. APPELLANT AND GANASHALINGAM A/L RAJAH .. RESPONDENT AND MAJLIS PEGUAM MALAYSIA .. INTERVENER/ RESPONDENT] CORUM RICHARD MALANJUM, CJSS AHMAD BIN HJ MAAROP, FCJ ABU SAMAH BIN NORDIN, FCJ RAMLY BIN HJ ALI, FCJ ZAHARAH BINTI IBRAHIM, FCJ JUDGMENT OF THE COURT 1. The appellant in the present appeal before us, the Bar Council, Malaysia, was the intervener in the proceedings in the courts below. The 1st respondent was an advocate and solicitor practising under the name and style of Messrs. Rajehgopal Velu & Associates. He was found guilty of misconduct unbefitting of an advocate and solicitor by the Disciplinary Board (the DB) under section 94(3)(o) of the Legal Profession Act 1976 (the LPA) and was suspended from practice as an advocate and solicitor for a period of 12 months. His appeal to the High Court was dismissed, but later was allowed by the Court of Appeal. Dissatisfied with the decision of the Court of Appeal, the appellant appealed to this court. Hence the present appeal before us. We heard and allowed the appeal on 29.6.2016 but with a reduced period of suspension of 6 months with effect from 21 days from the date of the order with no order as to costs. We shall now give our reasons for the decision. Factual Background 2. On 21.7.2013, the 2nd respondent, one Ganashalingam a/l Rajah wrote a letter of complaint against the conduct of the 1st respondent, to the DB (the Complaint). 3. The Complaint was about the 1st respondent who had attested 2 signatures in a property transfer form (Form 14A). The signatures were purportedly those of the late Mdm. Maheswari a/p Veerappoo (the mother of the 2nd respondent), and one Mdm. Ponnamah a/p Chinniah, as the vendors. The late Mdm. Maheswari had already passed away at the time the 1st respondent attested the alleged execution of the said Form 14A, while Mdm. Ponnamah claimed that she did not at any time sign the said Form 14A. The complainant, in his letter, claimed that there was a ‘penipuan’ committed by the 1st respondent, as a result the complainant had lost the property to one Soo Chee Ming, who was the purchaser as stated in the said Form 14A. 4. An Investigating Tribunal (IT) was appointed on 23.6.2005 to investigate into the matter. The IT had on 29.6.2005, written a letter to the 1st respondent seeking his written explanation. In his letter of explanation dated 6.7.2015 to the IT, the 1st respondent stated, among others: (a) he admitted attesting the Form 14A without the presence of Mdm. Maheswari and Mdm. Ponnamah; (b) he did so in trust and reliance on his freelance staff, Rengasamy @ Balasundram a/l Veerappan, whom he had known and trusted for the past 10 years; (c) he was informed by the said Renggasamy @ Balasundram a/l Veerappan that both Mdm. Maheswari and Mdm. Ponnamah were his relatives/aunts and that they were of old age and were constrained in their physical movement and requested the 1st respondent to attest their signatures as vendors of the property; (d) he assumed that the purchaser’s solicitor, Abigail Lee Mei Sing of Messrs KL Lim & Lee, had conducted all the necessary inquiries and searches; (e) he admitted that he had acted negligently in the circumstances. 5. The IT heard the Complaint on 2.8.2005, 29.8.2005, 14.9.2005, 29.9.2005 and 17.10.2005, and after considering the 1st respondent’s letter of explanation and giving him every opportunity to cross-examine the witnesses of the complainant (and indeed his solicitor had cross-examined them), recommended that there should be a formal investigation by the Disciplinary Committee (DC) on the matter. 6. On 20.3.2006, the DC was appointed and heard the Complaint on 20.6.2006 and 28.6.2006. After hearing the parties the DC made inter alia the following findings: “Apart from the fact that the respondent had attested the signatures of the transferors without seeing them, there is also the question of whether the respondent was involved in the fraud perpetrated on the owners of the property which resulted in the transfer of the property to the purchaser. On this issue, we find that there is insufficient evidence to prove that the respondent has intentionally participated in the fraud perpetrated on the owners of the property. Notwithstanding that there is insufficient evidence to show that the purchaser has intentionally participated in the fraud, the fact remains that the respondent has acted unprofessionally in attesting the signatures of the owners whom he did not witness actually signing the transfer.” 7. The DC accordingly found the 1st respondent guilty of conduct unbefitting of an advocate and solicitor under section 94(3)(o) of the LPA and recommended that he be suspended from practice as an advocate and solicitor for a period of 6 months. 8. The DB heard the matter on 20.6.2006 and 28.6.2006 in the presence of the complainant and his counsel as well as the 1st respondent and his counsel pursuant to section 103D (2) of the LPA. The DB having agreed with the DC that the 1st respondent was guilty under section 94(3)(o) of the LPA, imposed a greater punishment and suspended the 1st respondent from practice as an advocate and solicitor of the High Court of Malaya for a period of 12 months. The suspension was to take effect 21 days from the date of the order (16.5.2014). At the High Court 9. Dissatisfied with the DB’s decision, the 1st respondent appealed to the High Court. At the High Court, the 1st respondent raised the following issues: (a) that there was no specific charge framed and preferred against the 1st respondent in the proceedings (first issue); (b) that Miss Abigail M.S. Lee from Messrs K.L. Lim & Lee was not called to testify and thus giving the 1st respondent no opportunity to cross-examine this witness and this was a procedural failure as well as breach of natural justice and the court should invoke adverse inference against the complainant (second issue); and (c) that the National Land Code allows attestation to be made based on trust and, in this case, the 1st respondent trusted Balasundram who brought him the documents (third issue). 10. On the first issue the learned trial judge found that it was not fatal and it did not hamper the defence of the 1st respondent as he was very much aware of the Complaint against him; and the Complaint itself was a sufficient notice on the matter facing him. 11. On the second issue, the trial judge found that it was of no consequence to the Complaint faced by the 1st respondent. The trial judge was of the view that whether Miss Abigail testified or not it did not take away the fact that the 1st respondent did not deny that he had attested the signatures of the vendors in their absence; and the non-denial of the 1st respondent amounted to an admission to the Complaint against him in respect of which he was given full liberty to explain, and therefore there was no breach of natural justice. 12. On the third issue, the trial judge, applying the provisions of section 211 of the National Land Code 1965 and the decision in Albert Chew v. Hong Leong Finance Bhd [2001] 4 CLJ 419, held that it was a mandatory requirement for the person authorised to attest a signature to ensure that the instrument in question was signed by the real person before him. 13. On this issue, the trial judge said: “I could locate no provision in the National Land Code as contended by the plaintiff (1st respondent) which allows attestation based on trust and in the absence of the person executing the document.” 14. In the upshot, the trial judge dismissed the 1st respondent’s appeal. At the Court of Appeal 15. The 1st respondent then appealed to the Court of Appeal against the decision of the High Court. At the Court of Appeal, the 1st respondent raised two main grounds, namely: (a) that there was no charge framed against the 1st respondent before the DC; and (b) in enhancing the punishment to a suspension of 12 months, from the 6 months as recommended by the DC, the DB did not give any reasons. 16. The Court of Appeal allowed the 1st respondent’s appeal on 4.8.2015 and held that a charge must be precisely formulated and framed to include specific accusation against the 1st respondent who had the right to know and must have notice of the very nature of the allegations against him at the first opportunity. 17. The Court of Appeal also held that the DC had acted outside the scope of powers granted to it, which was to inquire into the Complaint of fraud, when it held that the 1st respondent had acted unprofessionally and was guilty of misconduct under section 94(3)(o) of the LPA in attesting the signatures in question which was not the subject matter of the Complaint. The Court of Appeal was “constrained to hold that the DC’s decision is null and void for illegality” and therefore the decision of the DB (including the imposition of the suspension order of 12 months on the 1st respondent) was also null and void. Before this court 18. Dissatisfied with the decision of the Court of Appeal, the intervener appealed to this court. At the hearing of the appeal before us parties raised 3 issues, namely- (a) whether the DB and the DC are required to frame a formal charge as against an advocate and solicitor in disciplinary proceedings (the First Issue); (b) whether the findings or decisions of the DC and the DB in the disciplinary proceedings against the 1st respondent fall within the terms or scope of the Complaint (the Second Issue); and (c) whether the DB has the power to enhance the punishment recommended by the DC on the 1st respondent without giving any reasons (the Third Issue). 19. It is not in dispute that a letter of complaint dated 21.7.2003 was sent by the complainant, the 2nd respondent in this appeal, alleging misconduct committed by the 1st respondent as an advocate and solicitor in attesting the signatures of the alleged vendors one Mdm. Maheswari and Mdm. Ponnamah in the related Form 14A without seeing them sign in his presence. 20. To better understand the true meaning of the Complaint in detail, it is important to reproduce the full content of the letter in its original text in Bahasa Malaysia: “Ganashalingam A/L Rajah No 16, Jalan Dato’ Yusof Shahabudin 4, Taman Sentosa, 41200 Klang, Selangor Darul Ehsan Tel: 012-2176860 21/7/03 Lembaga Tatatertib Peguam-Peguam 9th Floor, Wisma Maran 28, Medan Pasar, 50050 Kuala Lumpur Tuan, Per: Aduan Tentang Salahlaku Peguam Nama: V. Rajehgopal Tempat Beramal: Rajehgopal Velu & Partners, No. 41, Mezzanine Floor, Wisma Valiappa, Jalan Dato’ Hamzah, Klang, Selangor (Tel: 03-33723804) Penipuan Penyaksian Tandatangan di atas Borang 14A Pindahmilik Hartanah di bawah hakmilik GM 434, Lot No. 343, Mukim Batang Berjuntai, Negeri Selangor Darul Ehsan Pemilik-Pemilik asal: Ponnamah a/p Chinniah Maheswary a/p Veerappoo _________________________________________________________ Saya merujuk kepada perkara di atas. Saya mewakili ibu saya, Maheswari a/p Veerappoo yang telah meninggal dunia pada 10.9.94. Dukacita saya maklumkan kepada pihak tuan bahawa peguam yang tersebut di atas telah melakukan satu penipuan dalam menyaksikan tandatangan ibu saya (Maheswari a/p Veerappoo) dan Ponnamah a/p Chinniah bagi pindahmilik ke atas hartanah tersebut di atas. Dalam borang tersebut, dinyatakan bahawa tarikh beliau menyaksikan Ponnamah A/P Chinniah dan ibu saya menandatangani borang pindahmilik tersebut adalah pada 4.3.02. Sedangkan pada masa itu, ibu saya telah meninggal dunia. Beliau meninggal dunia pada 10.4.94. Manakala Ponnamah a/p Chinniah tersebut pada bila-bila masa tidak pernah menandatangnai borang pindahmilik tersebut. Oleh itu, tandatangan beliau dan ibu saya tersebut telah dipalsukan. Memandangkan ibu saya telah meninggal dunia pada 10.4.94 dan Ponnamah a/p Chinniah tidak pernah menandatangani borang pindahmilik terebut, maka peguam V. Rajehgopal tersebut telah melakukan satu penipuan bahawa beliau telah menyaksikan Ponnamah a/p Chinniah dan si mati menandatangani borang pindahmilik tersebut. Akibat daripada pemalsuan tersebut, hakmilik hartanah tersebut telah dipindahkan kepada seorang bernama Soo Chee Ming. Berikutan perkara ini juga, Ponnamah a/p Chinniah tersebut telah membuat laporan polis. Bersama-sama ini saya lampirkan dokumen-dokumen yang berikut untuk rujukan tuan:- (a) Sesalinan Borang Pindahmilik yang telah didaftarkan pada 31.5.02. (b) Sesalinan Surat Mati Maheswari a/p Veerappoo. (c) Sesalinan hakmilik hartanah tersebut yang telah ditukar namanya kpeada Soo Chee Ming. (d) Sesalinan laporan Polis oleh Ponnamah a/p Chinniah bertarikh 23.6.03. (e) Sesalinan surat kepada Pentadbir Tanah Daerah Kuala Selangor bertaikh 24.6.2003. (f) Sesalinan Surat Akuan saya bertarikh 30.10.2003. (g) Sesalinan Kad Pengenalan saya. Oleh kerana salahlaku oleh peguam tersebut adalah satu kesalahan yang serius saya berharap pihak tuan dapat menyiasat perkara ini dan mengambil tindakan yang sewajarnya terhadap peguam tersebut. Terima kasih.” 21. In essence, in the said letter of Complaint, the 2nd respondent made the following assertions: (a) that Mdm. Maheswari and Mdm. Poonamah were the registered owners of a piece of landed property; (b) that on or about 4.3.2002, the property was transferred to one Soo Chee Ming using a Form 14A purportedly signed by the said Mdm. Maheswari and Mdm. Ponnamah; (c) that the signatures of Mdm. Maheswari and Mdm. Ponnamah were allegedly attested by the 1st respondent, as an advocate and solicitor; (d) that Mdm. Maheswari died on 10.4.1994; (e) that Mdm. Ponnamah did not at any time sign the said Form 14A; and (f) that by reason of the above the 1st respondent had committed a ‘penipuan’ in saying that the signatures of Mdm. Maheswari and Mdm. Ponnamah were attested before or in front of him. First Issue: No charge framed 22. On the first issue, that no specific charge was framed and preferred against the 1st respondent in the disciplinary proceedings, the learned High Court Judge held that it was not fatal in the present case and it did not hamper the defence of the 1st respondent as he was very much aware of the Complaint against him. To the learned judge, the Complaint itself was a sufficient notice to the 1st respondent on the matter facing him. 23. The Court of Appeal disagreed with the High Court on this issue. The Court of Appeal expressed the view that: “the disciplinary proceedings initiated against an advocate and solicitor are serious and carry penal consequences such as a fine, suspension or being struck off the Roll of Advocates and Solicitors. Accordingly, we agree with the view in Abdullah Borhan v. Ketua Polis Melaka & Another (supra) that the charge in question must be precisely formulated to include the specific accusation against the appellant who has the right to know and must have notice of the very nature of the charge at the first opportunity. This will enable the appellant to be forewarned with clarity and certainty the essential elements or ingredients against him in order to ensure that he can be forearmed in his defence for the purpose of directing all the evidence exclusively to the specific charge (see also the Privy Council’s opinion in B Surinder Singh Kanda v. The Government of the Federation of Malaya [1962] (PC)). The view is that in a disciplinary process, the respondent is only required to respond to the charge and nothing else was approved in Lim Teng Ee Joyce v. Singapore Medical Council [2005] SGHC 129.” 24. Learned counsel for the appellant submitted before us that there was no requirement under the Legal Profession (Disciplinary Proceedings) (Investigating Tribunal and Disciplinary Committee) Rules 1994 (the 1994 Rules) requiring charges to be framed against an advocate and solicitor in disciplinary proceedings; thus an omission to frame a formal charge against the 1st respondent in the present case would not amount to a breach of the LPA as there cannot a breach where no such requirement exists. The appellant contended that what was essential was that the 1st respondent is supplied with sufficient material particulars to enable him to meet the allegations made against him in the Complaint. The appellant cited (2) authorities to support this point, namely: Aziana Uda Bahari v. Gan Kong You [2009] 8 CLJ 438 (High Court) and Lau Keen Fai v. Lim Ban Kay [2011] 3 CLJ 213 (High Court). 25. Learned counsel for the 1st respondent, on the other hand, submitted that section 103B of the LPA provides that an inquiry must be carried out into a written complaint and its findings shall be made expeditiously. It was further submitted “that merely because the word “inquiry” is used in the Legal Profession Act 1976, it does not follow that no charge needs to be framed for the solicitor to answer.” 26. Learned counsel further submitted that the requirement for a charge to be framed was so obvious that Parliament in its wisdom did not think it necessary to say so in express terms. It was also submitted that a solicitor is entitled to know not just the facts he would have to meet but also the appropriate “head” of grave impropriety or misconduct as highlighted in section 94(3) of the LPA that he had to face in any disciplinary proceedings against him. 27. It was further submitted by learned counsel that the importance of a charge, in a case of an advocate and solicitor facing disciplinary proceedings under the LPA must be appreciated in the context of the LPA, and the courts in Malaysia and Singapore have emphasized the need and importance of framing a charge in the proceedings. To support his proposition, learned counsel relied on the following authorities, namely: Yong Nguk Fan & Anor v. Toh Boon Pin & Ors. [2006] 7 CLJ 296; Lim Teng Ee Joyce v. Singapore Medical Council [2005] 3 SLR 709; Tan Tiang Hin Jerry v. Singapore Medical Council [2000] 2 SLR 274; Abdullah Borhan v. Ketua Polis Melaka & Anor [2008] 9 CLJ 605; Raja Abdul Malek Muzaffar Shah bin Raja Shahruzzaman v. Setiausaha Suruhanjaya Pasukan Polis & Ors. [1995] 1 MLJ 308; and Saufee A Rahman v. Che Yusof Che Ngah & Ors. [2014] 7 CLJ 691. 28. Learned counsel also submitted that even though the LPA did not have an express provision for a charge to be framed, common law will come into the picture and supply the deficiency so as not to allow a person be punished without being heard. The case of Cooper v. Wandsworth Board of Works (1861-73) All ER Rep 1554 was cited in support of the proposition. 29. We agree with learned counsel for the appellant that there is no provision in the LPA or the 1994 Rules requiring a charge to be specifically framed or preferred against an advocate and solicitor in disciplinary proceedings. 30. We also agree that in disciplinary proceedings under the LPA, the advocate and solicitor concerned must be given an opportunity of being heard. This is a basic rule of natural justice which must be observed. The advocate and solicitor concerned shall not be punished without being heard. On this point, the Privy Council in B Surinder Singh Kanda (supra) had aptly remarked (which we agree)- “If the right to be heard is to be a real right which is worth anything, it must carry with it a right in the accused man to know the case which is made against him. He must know what evidence has been given and what statements have been made affecting him: and then he must be given a fair opportunity to correct or contradict them.” 31. At the outset, it must be stressed that disciplinary proceedings against a solicitor under the LPA are not proceedings in a criminal court of law. The proceedings although quasi–judicial in nature need not emulate the strict adversarial procedure practised in a criminal court (see: Jerald Allen Gomez v. Shencourt Sdn Bhd (Majlis Peguam, Intervernor) [2006] 2 MLJ 343). On this point we agree with Abdull Hamid Embong J (as he then was), in Jerald Allen Gormez (supra) when his Lordship commented: “To say that, in the absence of such procedures, the disciplinary committee should adhere strictly to the procedures in the proceedings of a criminal court, would be implying some requirements not intended by statute.” 32. The rules of natural justice in disciplinary proceedings should not be governed by the adversarial system of justice of criminal courts but should be inquisitorial or investigatory in nature. Inquisitorial or investigative proceedings are not inconsistent with the rules of natural justice (see: Federal Court’s decision in Lembaga Jurutera Malaysia v. Leong Pui Kun [2009] 2 MLJ 36). 33. It is a trite principle that a disciplinary committee of a professional body is entitled to conduct its disciplinary hearing in respect of a member of the body in whatever way it deems appropriate provided that the method or manner it adopts is not in breach of any specific provisions of the relevant statutes or regulations and does not result in a denial of natural justice to the member concerned. 34. In Lim Ko & Anor v. Board of Architects [1966] 2 MLJ 80, the Federal Court held, inter alia, that the proceedings of disciplinary tribunals or committees conducting an inquiry are by no means bound by the strict rules which apply to criminal trials. A legalistic approach is not appropriate in those proceedings. The same principle was adopted by the Federal Court in Tan Hee Lock v. Commission of Federal Capital & Ors. [1973] 1 MLJ 2; Tanjong Jara Sdn Bhd v. Minister of Labour and Manpower & Anor [1987] 1 MLJ 124; and by the Court of Appeal in Haji Ali bin Haji Othman v. Telekom Malaysia Bhd [2003] 3 MLJ 29. 35. In the present case, we agree that the 1st respondent was entitled to know the details of the allegations made against him in the letter of Complaint at the very earliest stage, i.e. before the Investigative Tribunal started its investigation or inquiry. This would enable the 1st respondent to prepare his explanation and later to be heard at all stages of the proceedings thereafter. The statements in the letter of Complaint must convey with sufficient clarity and certainty on the nature of all the allegations made against him. The 1st respondent must be able to meet every relevant ingredient of the Complaint and must be given opportunity to contradict them. 36. In Lau Keen Fai v. Lim Ban Kay [2011] 3 CLJ 213, the High Court held: “(1) The LPA does not provide specifically that the DC is required to frame a charge. Thus an omission to frame a formal charge would not amount to a breach of the LPA. There was no requirement that it ought to be framed in any particular form or that it ought to take the form of a charge framed in a criminal proceeding. What was essential was that the person against whom the misconduct was alleged was supplied with sufficient material particulars to enable him to meet the allegation. Herein, all the requirements of a charge were found in the letter of complaint that the DB had forwarded to the appellant. The appellant had sufficient notice of the complaint against him. Despite the absence of a formal charge the appellant was able to meet the complaint lodged against him. The absence of a charge did not occasion any procedural unfairness or a breach of the rules of natural justice as the appellant had not been deprived of the opportunity to contradict the complaint.” We agree with the above. 37. In considering whether there was any prejudice or denial of natural justice to the 1st respondent, the court is to look at the substance, rather than the form, to determine whether the 1st respondent had been informed of all the material ingredients and facts relating to the Complaint lodged against him. It does not necessarily mean that it must only be by way of a formal charge framed against him. The 1st respondent needed to be informed sufficiently of the facts and particulars of the misconduct complained of to enable him to explain and exculpate himself. That is his right and it forms an integral part of the rules of natural justice. 38. The relevant facts and material particulars that need to be informed to the 1st respondent are particulars which, if established, are capable of showing the elements of misconduct mentioned in the Complaint. In this respect, we agree with Bowen LJ in Leeson v. General Council of Medical Education and Registration [1889] 43 Ch D 366 where he said: “With respect to the charge made, the charge of which he has notice, it is a charge of infamous conduct in some professional respect, and the particulars which should be brought to his attention in order to enable him to meet that charge ought to be particulars of conduct which, if established, is capable of being viewed by honest persons as conduct which is infamous. That is all.” 39. Our view is that, any complaint against an advocate and solicitor must comply with the requirements under rule 3 of the 1994 Rules which provides: “3. Contents of Complaints (1) A complaint shall be made in writing by the complainant or his solicitor. (2) A complaint shall contain the following: (a) the full name, identity card or passport number and address of the complainant; (b) the facts of the complaint; (c) copies of any documents that the complainant proposes to rely on in support of his complaint; (d) the signature of the complainant; (e) the name and address of the complainant’s solicitor, if any.” 40. The Complaint against the 1st respondent in this case fulfilled all the above requirements under rule 3 of the 1994 Rules. It was sufficient to give opportunity to the 1st respondent to exercise his right to be heard and to explain and exculpate himself, even though it was not presented in the form of a formal charge. Even if a formal charge is drawn up, such charge would inevitably be a regurgitation of the facts and particulars contained in the letter of Complaint. 41. The 1st respondent in the present case knew fully well the details of the allegation made against him as stated in the letter of Complaint. From the records of proceedings made available to us, we find that the 1st respondent was represented by his counsel at all levels of the proceedings. He took part in the proceedings. Based on the details of his participation in the proceedings and his letter of explanation dated 6.7.2005, it is clear that he had sufficient notice of all the material facts of the Complaint made against him. The conduct of the 1st respondent’s right from the beginning, was inconsistent with a person who did not have sufficient knowledge of the Complaint against him. The absence of a charge specifically framed against him did not occasion any procedural unfairness or breach of the rules of natural justice. He was not prejudiced in any manner. He was not deprived of the opportunity to contradict the Complaint against him. 42. As stated earlier, there is no requirement either under the LPA or under the 1994 Rules requiring a charge to be framed against the 1st respondent. The DB and DC was at liberty to proceed with the disciplinary proceedings against the 1st respondent without having to specifically frame a formal charge against him provided, to borrow the words of Nik Hashim FCJ, in Lembaga Jurutera Malaysia v. Leong Pui Kun (supra), “the procedure adopted was not in breach of any specific provision of the Act and did not result in a denial of natural justice” to the 1st respondent. 43. Apparently, the Court of Appeal in finding that a formal charge needed to be specifically framed against the 1st respondent was relying on the authority of Abdullah Borhan v. Ketua Polis Melaka & Anor [2008] 9 CLJ 605 where the High Court in Melaka in dealing with disciplinary proceedings against a police officer ruled that “the procedural requirements in drafting a charge meant for a criminal trial would apply with equal force to a disciplinary charge such as in the instant case because both of them share the common denominator i.e. penal consequences”; and “It is trite law that the charge in question must be precisely formulated to include the specific accusation against the plaintiff who has the right to know and must have notice of the very nature of the charge at the first opportunity”. The same authority were also relied upon by the 1st respondent’s counsel in his submissions before us in the appeal. 44. With respect, the Court of Appeal had failed to notice that the disciplinary proceedings in that case were against a police officer based on the Police (Conduct and Discipline) (Junior Police Officers and Constables) Regulations 1970, where regulation 3(1) of the said Regulations sets out expressly a mandatory requirement that “A charge shall be framed in accordance with the offence as prescribed in the Schedule. The charge shall describe the offence briefly and identify the officer with the unlawful act or omission charged”. In the present case, we are dealing with disciplinary proceedings against an advocate and solicitor under the LPA. As stated earlier, there is no express provision either in the LPA or the 1994 Rules mandating such requirement. Therefore the issue of framing a charge such as is required under the Police (Conduct and Discipline) (Junior Police Officers and Constables) Regulation 1970 does not arise in the case before us and failure to draft such a charge against the 1st respondent does not amount to a breach of the law or relevant regulations. 45. The Court of Appeal also relied on the decision of the Privy Council in B. Surinder Singh Kanda v. The Government of the Federation of Malaya [1962] MLJ 169 (PC) to support its finding on the requirement of having specific charge framed against the 1st respondent. 46. Our observation is that the Privy Council in that case did not deal with the issue of a charge to be framed against the police officer in the disciplinary proceedings. It is more of a case of a complaint by the police officer that he was not given a reasonable opportunity of being heard in the disciplinary proceedings against him. On that issue the Privy Council ruled: “Applying these principles their Lordships are of opinion that Inspector Kanda was not in this case given a reasonable opportunity of being heard. They find themselves in agreement with the view expressed by Rigby J. in these words: “In my view, the furnishing of a copy of the Findings of the Board of Inquiry to the Adjudicating Officer appointed to hear the disciplinary charges, coupled with the fact that no such copy was furnished to the plaintiff amounted to such a denial of natural justice as to entitle this Court to set aside those proceedings on this ground. It amounted, in my view, to a failure to afford the plaintiff a reasonable opportunity of being heard in answer to the charge preferred against him which resulted in his dismissal.” 47. The issue in that case was that a copy of the Findings of the Board of Inquiry which contained statements of the witnesses, was only given to the Adjudicating Officer but not to the officer charged. Similar complaint does not arise in the present case before us. In short, that case did not support the Court of Appeal’s finding pertaining to the requirement to frame a formal charge against the 1st respondent in the present case. 48. The Court of Appeal also relied on the case of Lim Teng Ee Joyce v. Singapore Medical Council (supra), to support its finding on the same issue relating to the framing of a specific charge against the 1st respondent and that in a disciplinary process, the 1st respondent is only required to respond to the charge and nothing else. In that case the court in Singapore was dealing with disciplinary proceedings involving a medical practitioner in Singapore. 49. It must be noted that it was a mandatory requirement in a disciplinary proceedings involving medical practitioners in Singapore that a charge be framed against the practitioner as required under rule 27(2) of the Medical Registration Regulations in Singapore, and the charge shall first be read out to the practitioner; and that rule 35(1) of the Regulations empowers a disciplinary tribunal to alter a charge or frame a new charge whether in substitution for or in addition to an existing charge at any time before it makes a finding. Clearly, there were statutory provisions mandating such requirement. Again, we find that this authority did not support the Court of Appeal’s finding on the issue. 50. As stated earlier, disciplinary proceeding involving an advocate and solicitor under the LPA or the 1994 Rules cannot be equated to criminal proceedings in a criminal court of law, especially relating to the framing of a formal charge against the accused person. Section 173(a) of the Criminal Procedure Code (the CPC) provides that “when the accused appears or is brought before the court a charge containing the particulars of the offence of which he is accused shall be framed and read and explained to him, and he shall be asked whether he is guilty of the offence charged or claims to be tried.” The form of a charge, particulars as to time, place and person contained in a charge, and the manner of committing an offence to be stated in a charge are statutorily provided under sections 152, 153 and 154 of the CPC. These are mandatory statutory requirements provided for by law which must be complied with in criminal proceedings in a criminal court of law. However, there is no such requirement under the LPA or the 1994 Rules relating to disciplinary proceedings involving an advocate and solicitor. Second Issue: Whether findings of the DC and DB fall within the scope of the Complaint 51. This issue was touched upon by the Court of Appeal in its judgment. In paragraph 17 of its judgment, the Court of Appeal ruled as follows: “In this instance, the DC was appointed to conduct an inquiry into the Complaint pursuant to s. 103B of the LPA 1976. The appellant was exonerated of the Complaint of fraud against him. The finding that the appellant had acted unprofessionally in attesting the signatures in question was not the subject matter of the Complaint. In our view, the DC had acted outside the terms of power granted to it, which is to inquire into the Complaint of fraud. The DC’s finding that the appellant is guilty of misconduct was made for an extraneous purpose (R Rama Chandran v. Industrial Court [1997] 1 MLJ 145; Ranjit Kaur Gopal Singh v. Hotel Excelsior [2010] 8 CLJ 1). Accordingly, we are constrained to hold that the DC’s decision is null and void for illegality.” 52. Learned counsel for the appellant in his written submissions before us submitted as follow: “The findings and recommendation made by the DC and the making of the DB Order were within the scope of the Complaint as they arose from facts based on the Complaint, which were put to and admitted by R1. The Court of Appeal erred in finding that the unprofessional manner in which R1 attested the signatures on the Form 14A was not the subject matter of the Complaint. Similarly, although the DC found that there was insufficient evidence to prove that R1 had intentionally participated in the fraud, the undeniable fact remains that R1 had attested the Form 14A without the presence of R2’s late mother and Ponnamah.” 53. In order to appreciate and decide on this issue, it is necessary to refer to and read the full contents of the letter of Complaint in question. 54. The letter of Complaint in itself, does not contain the word “fraud” although the word was used throughout the proceedings right from the beginning by counsel as well the courts below. The gist of the Complaint as can be gathered and understood from the full text of the letter is that the 1st respondent as an advocate and solicitor (in its original text) “telah melakukan satu penipuan dalam menyaksikan tandatangan ibu saya (Maheswari a/p Veerapoo) dan Ponnamah a/p Chinniah bagi pindahmilik ke atas hartanah tersebut di atas ….. Dalam borang tersebut, dinyatakan bahawa tarikh beliau menyaksikan Ponnamah a/p Chinniah dan ibu saya menandatangani borang pindahmilik tersebut adalah pada 4.3.2002. Sedangkan pada masa itu, ibu saya telah meninggal dunia. Beliau meninggal dunia pada 10.4.1999, manakala Ponnamah a/p Chinniah tersebut pada bila-bila masa tidak pernah menandatangani borang pindahmilik tersebut. …. maka peguam V. Rajegopal tersebut telah melakukan satu penipuan bahawa beliau telah menyaksikan Ponnamah a/p Chinniah dan si mati menandatangani borang pindah milik tersebut”. In short, the Complaint was that the 1st respondent as an advocate and solicitor had attested the relevant Form 14A for the transfer of the land in question without the presence of the late Mdm. Maheswari a/p Veerapoo and Mdm. Ponnamah a/p Chinniah. The ‘penipuan’ mentioned in that letter clearly refers to that conduct of the 1st respondent. 55. The above complaint or allegation was not disputed by the 1st respondent. He admitted attesting the relevant Form 14A without the presence of the two vendors and also admitted that he had acted negligently in the circumstances. His only excuse was that he did so in trust and reliance of his freelance staff, one Rengasamy @ Balasundram a/l Veerapan, whom he had known and trusted for the past 10 years. 56. We therefore agree with learned counsel for the appellant that the findings and recommendations made by the DC and the making of the DB order that the 1st respondent was guilty of conduct which is unbefitting of an advocate and solicitor under section 94(3)(o) of the LPA in attesting the said Form 14A without the presence of the vendors were within the scope of the Complaint. The Court of Appeal erred in finding that the 1st respondent’s conduct which the DC found to fall under section 94(3)(o) of the LPA was not the subject matter of the Compliant and that the DC had acted outside the terms of power granted to it, which was to inquire into the Complaint of fraud. Therefore that finding cannot stand. Third Issue: Enhancement of punishment by the DB without giving reasons 57. This issue was raised in the 1st respondent’s submissions before us. Counsel for the 1st respondent submitted that the DB erred in enhancing the punishment against the 1st respondent of suspension from practice as an advocate and solicitor of the High Court of Malaya from a period of 6 months as recommended by the DC to a period of 12 months with effect from 21 days from the date of the order (16.5.2014), without giving any reasons. This, according to learned counsel, was in breach of section 103D(1) of the LPA. 58. The facts relating to this issue from the records of the proceedings are not in dispute, i.e. the DB has not given any reasons for rejecting the DC’s recommendation and enhancing the suspension period from 6 months as recommended by the DC to 12 months. Learned counsel for the 1st respondent contended that the DB had exceeded its power for failing to give reasons and therefore the order as to the suspension period must fall. Learned counsel relied on the current provisions of section 103(1) of the LPA which in effect provides that “After consideration of the report of the Disciplinary Committee, the Disciplinary Board may make an order affirming or rejecting the finding or recommendation of the Disciplinary Committee and if the Disciplinary Board rejects the finding or recommendation of the Disciplinary Committee, the Disciplinary Board shall record the reason for the rejection.” 59. We agree that under the current provisions of section 103D(1) of the LPA, the DB shall record the reasons if it rejects the recommendation made by the DC. It is a mandatory requirement. However, it must be noted that the said requirement was only inserted into the section by an amendment to the LPA vide the Legal Profession (Amendment) Act 2012 (Act A1444) which came into effect on 3.6.2014 vide P.U. (B) 262/2014. There was no indication that the amendment was to take effect retrospectively. 60. The disciplinary proceedings on the matter before the DB was conducted on 16.5.2014 (prior to the effective date of the amendment to section 103D(1) of the LPA). The suspension order was also made on 16.5.2014. At that time, there was no statutory requirement in section 103D(1) or other provisions of the LPA which required the DB to give and to record its reason if it chooses to reject the recommendation made by the DC. There was no statutory duty or obligation to do so. Therefore the DB cannot be said to have exceeded its power for failing to give reasons for its rejection of the DC’s recommendation. 61. However, in the present appeal, based on the facts and circumstances of the case, we are of the view that the period of suspension of (6) months imposed on the 1st respondent as recommended by the DC, is more reasonable and appropriate. The fact that the 1st respondent had admitted to his negligent conduct in the matter question and that there was no finding of fraud on his part, coupled with the fact that he was relying on his freelance staff one Rengasamy @ Balasundram whom he had known and trusted for the past 10 years should be considered as good mitigating factors for him. Conclusion 62. In the upshot, we would answer the issues before us as follows: (a) the DB and the DC are not required to frame a specific formal charge as against an advocate and solicitor in disciplinary proceedings under the LPA. There is no such requirement under the LPA as well as the 1994 Regulations; (b) the findings of the DC and the DB in the disciplinary proceedings that the 1st respondent was guilty of conduct which is unbefitting of an advocate and solicitor under section 94(3)(o) of the LPA fall within scope of the Complaint lodged against him; and (c) at the material date (16.5.2014) the DB had the power to enhance the punishment recommended by the DC on the 1st respondent without giving any reasons, as the statutory requirement to give reasons was only brought into effect on 3.6.2014 vide the Legal Profession (Amendment) Act 2012 (Act A 1444). 63. We therefore allow the appeal and set aside the Order of the Court of Appeal. We hold that the 1st respondent was in breach of section 94(3)(o) of the LPA. We make an order that the 1st respondent be suspended from practice as an advocate and solicitor in the High Court of Malaya for a period of (6) month to take effect from 21 days from the date of this order. We make no order as to costs (as agreed by the parties). Dated: 29 JUN 2016 sgd RAMLY HJ ALI FEDERAL COURT JUDGE MALAYSIA Counsels: 1. Sean Yeow (with Hoi Jack S’ng) Messrs. Lee Hishamuddin Allen & Gledhill ... for the Appellant 2. T. Gunaseelan and Ramanathan Velu Messrs. Rama Velu & Associates … for the 1st Respondent Cases referred to: 1. Albert Chew v. Hong Leong Finance Bhd [2001] 4 CLJ 419 2. B Surinder Singh Kanda v. The Government of the Federation of Malaya [1962] MLJ 169 (PC) 3. Aziana Uda Bahari v. Gan Kong You [2009] 8 CLJ 438 4. Lau Keen Fai v. Lim Ban Kay [2011] 3 CLJ 213 5. Yong Nguk Fan & Anor v. Toh Boon Pin & Ors. [2006] 7 CLJ 296 6. Lim Teng Ee Joyce v. Singapore Medical Council [2005] 3 SLR 709 7. Tan Tiang Hin Jerry v. Singapore Medical Council [2000] 2 SLR 274 8. Abdullah Borhan v. Ketua Polis Melaka & Anor [2008] 9 CLJ 605 9. Raja Abdul Malek Muzaffar Shah bin Raja Shahruzzaman v. Setiausaha Suruhanjaya Pasukan Polis & Ors. [1995] 1 MLJ 308 10. Saufee A Rahman v. Che Yusof Che Ngah & Ors. [2014] 7 CLJ 691. 11. Jerald Allen Gomez v. Shencourt Sdn Bhd (Majlis Peguam, Intervener) [2006] 2 MLJ 343 12. Lembaga Jurutera Malaysia v. Leong Pui Kun [2009] 2 MLJ 36 13. Lim Ko & Anor v. Board of Architects [1966] 2 MLJ 80 14. Tan Hee Lock v. Commission of Federal Capital & Ors. [1973] 1 MLJ 2 15. Tanjong Jara Sdn Bhd v. Minister of Labour and Manpower & Anor [1987] 1 MLJ 124 16. Haji Ali bin Haji Othman v. Telekom Malaysia Bhd [2003] 3 MLJ 29 17. Leeson v. General Council of Medical Education and Registration [1889] 43 Ch D 366 18. Cooper v. Wandsworth Board of Works [1861-73] All ER Rep. 1554. Legislations Referred to: 1. Legal Profession Act 1976: section 94(3)(o), section 103D (2) 2. National Land Code 1965: section 211 3. Criminal Procedure Code: sections 152, 153, 154 and 173(a) 42

Tika 2.6.0

WA-24C-170-12/2016, WA-24C-8-01/2017 &WA-24C-9-01/2017

PLAINTIF 1. ) PCP Construction Sdn Bhd 2. ) Leap Modulation Sdn Bhd DEFENDAN 1. ) Leap Modulation Sdn Bhd 2. ) PCP Construction Sdn Bhd

27/06/2017

YA DATO' LEE SWEE SENG

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=85a0e0e2-3046-4b04-b110-f0c93930590e&Inline=true

1 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF KUALA LUMPUR (CIVIL DIVISION) ORIGINATING SUMMONS NO. WA-24C-170-12/2016 In the matter of an Adjudication between PCP Construction Sdn Bhd and Leap Modulation Sdn Bhd [Adjudication Reference No.: KLRCA/D/ADJ-0418-2016] And In the matter of an Adjudication before Miss Janet Chai Pei Ying And In the matter of an Adjudication Award dated 06.12.2016 handed down by Miss Janet Chai Pei Ying And In the matter of Section 28 of the Construction Industry Payment and Adjudication Act 2012 And In the matter of Order 7 and/or 28 and/or 92 Rule 4 of the Rules of Court 2012 2 BETWEEN PCP CONSTRUCTION SDN BHD [Company No.: 520191-U] ... PLAINTIFF AND LEAP MODULATION SDN BHD ... DEFENDANT [Company No.: 922377 P] (Heard together with) IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF KUALA LUMPUR (CIVIL DIVISION) ORIGINATING SUMMONS NO.:WA-24C-8-01/2017 In the matter of the adjudication between PCP Construction Sdn Bhd and Leap Modulation Sdn Bhd [Adjudication Reference No.: KLRCA/D/ADJ-0418-2016] And In the matter of the adjudication before Madam Janet Chai Pei Ying And 3 In the matter of the adjudication decision dated 6.12.2016 made by Madam Janet Chai Pei Ying And In the matter of Section 28 of the Construction Industry Payment and Adjudication Act 2012 And In the matter of Section 16(1) of the Construction Industry Payment and Adjudication Act 2012 And In the matter of Order 7 and/or Order 28 and/or Order 92 Rule 4 of the Rules of Court 2012 BETWEEN LEAP MODULATION SDN BHD [Company No.: 922377-P] … PLAINTIFF AND PCP CONSTRUCTION SDN BHD [Company No.: 520191-U] … DEFENDANT (Heard together with) 4 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF KUALA LUMPUR (CIVIL DIVISION) ORIGINATING SUMMONS NO.:WA-24C-9-01/2017 In the matter of the adjudication between PCP Construction Sdn Bhd and Leap Modulation Sdn Bhd [Adjudication Reference No.: KLRCA/D/ADJ-0418-2016] And In the matter of the adjudication before Madam Janet Chai Pei Ying And In the matter of the adjudication decision dated 6.12.2016 made by Madam Janet Chai Pei Ying And In the matter of Section 28 of the Construction Industry Payment and Adjudication Act 2012 And 5 In the matter of Section 15 of the Construction Industry Payment and Adjudication Act 2012 And In the matter of Order 7 and/or Order 28 and/or Order 92 Rule 4 of the Rules of Court 2012 BETWEEN LEAP MODULATION SDN BHD [Company No.: 922377-P] … PLAINTIFF AND PCP CONSTRUCTION SDN BHD [Company No.: 520191-U] … DEFENDANT The Judgment of YA Lee Swee Seng [1] The main issue for determination that straddles these three Originating Summonses ("OS") is whether the Adjudicator had rightly declined jurisdiction to hear the set-off pleaded by the non-paying party in the Adjudication and the related issue as to whether this Court may allow part of the set-off that should have been heard by the Adjudicator and so reduce the Adjudicated Sum accordingly. 6 [2] There is also the issue as to whether the Adjudicator could interpret clause 25.4(iv) PAM 1998 Contract to allow for payments to be made to the unpaid party for Interim Payment Certificates not paid yet at the point of determination of the Contract. Prayers [3] The first OS WA-24C-170-12/2016, in chronological sequence of point of filing, is the OS filed by the Claimant in the Adjudication, PCP Construction Sdn Bhd ("PCP") to enforce the Adjudication Decision under section 28 of the Construction Industry Payment and Adjudication Act 2012 ("CIPAA"). [4] The second OS No. WA-24C-8-01/2017 filed by the Respondent in the Adjudication, Leap Modulation Sdn Bhd ("Leap Modulation") is to stay the Adjudication Decision pending the disposal of the application to set aside and the arbitration between the Claimant and the Respondent. [5] The third OS WA-24C-9-01/2017 filed by Leap Modulation is for setting aside the Adjudication Decision. [6] By consent and for good reason, the 3 OS were heard together as the decision in one will affect the other two. 7 Project [7] Leap Modulation had appointed PCP as the main contractor via the Letter of Award dated 30.4.2014 for a project known as Contract No. LM/MO/14/0007 entitled "Proposed Construction of 1 Commercial Block of 29 storeys consisting of: (i) 22 floors of office units (473) and 1 floor of facilities, (ii) 5 podium floors of car parks, (iii) 2 floors of basement car parks, (iv) 1 floor for mechanical on Lot 41096, Jalan Aman Damai, Mukim Petaling, Kuala Lumpur. [8] The contract sum was for RM65 million. The Contract Documents comprise of the Letter of Award, the Articles of Agreement and Conditions of Building Contract (PAM 1998)(With Quantities) ("COC") and the Amendments to the COC, collectively called the "Contract". [9] The parties shall be referred to as Claimant and Respondent as they were in the Adjudication and sometimes as PCP and Leap Modulation respectively. Proceedings in Adjudications [10] The unpaid party, PCP, as Claimant in the Adjudication had claimed for payment under Interim Certificates No. 17R and No. 18 for the sum of RM1,821,680.60 under the said Contract. They served on the non-paying party, Leap Modulation a Payment Claim on 22.1.2016. 8 [11] The non-paying party, Leap Modulation, served their Payment Response. Though not drafted elegantly in legal language, they briefly stated that they are entitled to compensation from the Claimant for all losses caused by them arising from the Respondent's determination of the Contract as a result of the Claimant's default in failure to proceed regularly and diligently with the work and for failure to comply with architect's instructions and also for expenses for rectification work and to complete the work. True no specific amount is mentioned here except in the Adjudication Response served subsequently in answer to the Claimant's Adjudication Claim as required under section 10(1) CIPAA. [12] After the appointment of the Adjudicator by the KLRCA, the Claimant served their Adjudication Claim. They stated that the Respondent in the Adjudication had failed to make payment of the progress payment certificates issued by the architect who is the contract administrator of the Contract. The Claimant said that the Payment Certificates Nos. 17R and 18 were due and payable on 27.11.2015 and 31.12.2015 respectively under the Contract. [13] The Claimant further stated that as there was no payment by the Respondent in respect of the Payment Certificates, the Claimant served on the Respondent a notice of default of payment on 6.1.2016 pursuant to clause 26 of the COC. 9 [14] The Claimant further stated that instead of making payments, the Respondent issued a Notice of Default on 11.1.2016 on the basis that the Claimant had failed to comply with clause 25.1(ii) of the COC for failing to proceed regularly and diligently with the works and clause 25.1(vi) of the COC for persistently refusing or failing to comply with written instructions from the architect. The Respondent thereafter issued a Notice of Determination of the Contract pursuant to clause 25.2 of the COC on 1.2.2016. [15] On the other hand, the Respondent in their Adjudication Response stated that the Claimant had failed to comply with the terms and conditions of the Contract in performance of the Contract works. The Respondent stated that the Claimant had persistently delayed in the progress of works and that the Claimant had failed to achieve major works scheduled in the fortnightly work programme. [16] The Respondent further alleged that the progress of works was extremely slow in the construction of the typical floors where the Claimant had only completed 2 floors in 4 months instead of 3 floors per month as scheduled in the Master Work Programme. [17] Various letters from the Architects on the slow progress were exhibited together with documents substantiating poor quality of works in the column and beam alignments, missing reinforced concrete element, 10 defects on the concrete structures of the works, reinforcement non- compliance and insufficient slab thickness, to name but a few. [18] In further support of the Respondent's contention on the poor quality of works, the Respondent exhibited the relevant Architect/Engineer Instructions, Non-Compliance Reports and correspondences between the parties running into 25 items. [19] The Respondent further exhibited photographs of various structural defects in the Claimant's works. [20] Briefly the Respondent sought to set-off the following as against the amounts in the Payment Certificates Nos. 17R and 18 as follows: i. Outstanding amount of RM351,646.68 certified under Interim Certificate No. 19 dated 19.1.2016; ii. Structural defects investigation and audit costs of RM161,839.50; iii. Additional costs of completion of RM6,860,842.45; iv. Associated costs amounting to RM1,624,841.11. [21] The Respondent further contended that as they had terminated the Claimant's employment due to defaults and breaches by the Claimant, the payments under Certificates 17R and 18 need not be paid under 11 clause 25.4(iv) of the COC until the completion of works and until the completion and verification of the accounts within a reasonable time by the Architect certifying that there are outstanding amount to the Claimant after taking into account the costs of completing the remaining works. On 6.12.2016, the Adjudicator delivered an adjudication decision in favour of the Claimant as follows: (a) the Respondent shall pay to the Claimant a sum of RM1,930,981.43 as the Adjudicated Sum within 14 days hereof; (b) the Respondent do pay the interest at the rate of 5% per annum on the adjudicated sum of RM1,930,981.43 from 6.12.2016 until the date of full payment (c) the Respondent shall pay to the Claimant within 14 days hereof the following payment: (i) Adjudicator’s fees (excluding GST) and KLRCA’s administration fee amounting to RM19,423.36; (ii) GST on the Adjudicator’s fees of RM1,923.11; (iii) KLRCA registration fee of RM250.00; (iv) KLRCA adjudicator appointment fee of RM400.00; (v) Adjudicator’s expenses of RM627.18; 12 (d) the Respondent shall pay to the Claimant the sum of RM10,000.00 as the costs allowed to the Claimant within 14 days from the date hereof. Principles [22] There are very limited grounds for setting aside an Adjudication Decision under section 15 CIPAA, with the common grounds being that under section 15(b) in that there has been a breach of natural justice or under section 15(d) in that the Adjudicator has acted in excess of his jurisdiction. [23] I agree with the Claimant that an adjudication decision cannot be aside on the grounds that: (i) the parties disagree with the adjudicator’s decision be it on the merits or on the assessment of the case or finding of facts or law by the adjudicator; and (ii) the fact that this Court may have made a different finding on the issues of law or facts. [24] In the case of Bina Puri Construction Sdn Bhd v Hing Nyit Enterprise Sdn Bhd [2015] MLJU 941 paragraph 9, Justice Ravinthran Paramuguru J. held that: 13 "It must be noted that under CIPPA, there is no right of appeal against the decision of the Adjudicator which is interim in nature or of temporary finality only. Section 15 has provided limited grounds on which the decision of the Adjudicator may be set aside. Since an application under section 15 is not an appeal, the decision of the Adjudicator cannot be reviewed on merits… [12] ... As I said earlier, section 15 does not envisage that the decision of the Adjudication can be reviewed on its merits. Therefore, it is immaterial if the Adjudicator had erred in his finding of facts." (emphasis added) [25] The same principle was echoed by Justice Mary Lim Thiam Suan J (now JCA) in ACFM Engineering & Construction Sdn Bhd v Esstar Vision Sdn Bhd and another case [2015] MLJU 1951 where her Ladyship held that: “[54] In one of the few adjudication cases that went on appeal, the Court of Appeal in Carillion Construction Limited v Devonport Royal Dockyard Limited [2005] EWHC 778 too, gave relevant insights as to the approach and attitude of the Courts in such matters. At paragraphs 85 and 86 of the judgment, the Court said: 14 "85. The objective which underlies the Act and the statutory scheme requires the Courts to respect and enforce the adjudicator's decision unless it is plain that the question which he has decided was not the question referred to him or the manner in which he has gone about his task is obviously unfair. It should only be in rare circumstances that the courts will interfere with the decision of an adjudicator. ..." [55] Again, one finds the same refrain from the Court of Appeal. That these adjudication decisions are meant to be complied with; and that it is only in "rare" cases or where it is "plain that the question which he has decided was not the question referred to him or the manner in which he has gone about his task is obviously unfair" that the Court should wade in to interfere. I agree that this is the right approach to adopt in relation to section 15 of CIPAA 2012."(emphasis added) [26] In Econpile (M) Sdn Bhd v IRDK Ventures Sdn Bhd and another case [2017] 7 MLJ 732 at para 72, I had also echoed the same principle, referring to the English case of UK Technology and Construction Court in Westwood Structural Services Ltd v Blyth 15 Wood Park Management Co Ltd [2008] EWHC 3138 (TCC) which held that: “[13] The principles as to enforcement of adjudicators' decisions are well known. They can be summarised as follows: (a) "the objective which underlies the Act and the statutory scheme requires the courts to respect and enforce the adjudicator's decision unless it is plain that the question which he has decided was not the question referred to him or the manner in which he has gone about his task is obviously unfair. It should be only in rare circumstances that the courts will interfere with the decision of an adjudicator": see para 85 of the judgment of Chadwick LJ in Construction Ltd v Devonport Royal Dockyard Ltd [2005] EWCA Civ 1358 104 ConLR 1; [2006] BLR 15. (b) An error of fact or law will not invalidate an adjudicator's decision. If the adjudicator has answered the right question in the wrong way, his decision will nevertheless be binding. It is only if he has answered the wrong question that his decision will be a nullity: see the Court of Appeal decisions in Bouygues (UK) Ltd v Dahl- Jensen (UK) Ltd [2001] 1 All ER (Comm) 1041, 73 ConLR 16 135, [2000] BLR 522 and C & B Scene Concept Design Ltd v Isobars Ltd [2002] EWCA Civ 46, 82 ConLR 154; [2002] BLR 93."(emphasis added) [27] I agree with the Claimant that an adjudication decision may only be set aside if: (a) the learned Adjudicator has failed to answer the question referred to her or she has answered a question which was not referred to her; or (b) the manner in which she has gone about her task is obviously unfair; which may then amount to one of the grounds under Section 15 CIPAA. Whether the Adjudicator's interpretation of clause 25.4(iv) of the Contract is erroneous and goes toward jurisdiction [28] The Respondent had relied on clause 25.4(iv) to withhold payment of Payment Certificates Nos.17R and 18 to the Claimant following the determination of the Contract as the said clause 25.4(iv) provides that: “The Contractor shall allow or pay to the Employer in the manner hereinafter appearing the amount of loss caused to Employer by the determination. Until after the completion of the works under sub-clause 25.4(i), the Employer shall not be bound by any 17 provision in this contract to make any further payment to the Contractor, but upon such completion and verification of the accounts within a reasonable time the Architect shall certify the amount of expense properly and actually incurred by the Employer and the amount of any loss caused to the Employer by the determination and, if such amounts added to the monies paid to the Contractor before the date of determination exceed the total amount which would have been payable on completion in accordance with the Contract, the difference shall be a debt payable to the Employer by the Contractor, and if the said amounts when added to the said monies be less than the said total amount, the difference shall be debt payable by the Employer to the Contractor."(emphasis added) [29] In holding that the Respondent shall not be entitled to withhold interim certificates no.17R and 18 by relying on clause 25.4(iv), the Adjudicator considered the submissions by both parties and took into account the following: (a) High Court’s decision in Econpile (M) Sdn Bhd v IRDK Ventures Sdn Bhd and another case [2017] 7 MLJ 732 where I had opined that clauses such as clause 25.4(iv) of the Contract has the effect of postponing payment due until 18 the final accounts are concluded and the works completed and that would be defeating the purpose of the CIPAA and is therefore void and unenforceable being a conditional payment provision under section 35(1) CIPAA and the adjudicator may disregard it altogether (para 46 Adjudication Decision); (b) case law has dictated that the interim certificates constitute finality on the assessed value of work done by the contractor which under the terms of the construction contract oblige the employer to forthwith pay the contractor the sum certified, and the failure on the part of the employer constitutes a breach of an essential term of the contract which the contractor may sue to recover (para 51 Adjudication Decision); (c) clause 30.3 of the said Contract provide that the amount stated as due in the interim certificate shall be the total value of the work properly executed, unless agreed between the parties as to stage payments (para 52 Adjudication Decision); (d) clause 30.3(i) of the Contract provide that the employer shall not be entitled to withhold or deduct any amount certified as 19 due under any architect’s certificates by reason of any claim of set-off or counterclaim or allegation of defective works, material or goods or for any other reasons whatsoever which he may purport to excuse him from making payment of the amount stated to be due in the interim certificate (para 52 Adjudication Decision); (e) Clause 30.2 of the Contract provides that the contractor shall be entitled to payment within the period of honouring certificates, which is 30 days; and (f) the Adjudicator has also duly taken note and considered all of Respondent's submission and argument. [30] In relation to the issue on clause 25.4(iv) one must also bear in mind clause 30.2 which provides that the contractor shall be entitled to payment within the period of honouring certificates. As correctly stated by the Adjudicator the period of honouring the certificates is 30 days and so the last day for payment of the Payment Certificates Nos. 17R and 18 are 3.12.2015 and 30.12.2015 respectively. [31] Thus these payments were due even before the Notice of Determination issued by the Respondent dated 1.2.2016. Against this is the expression in clause 25.4(iv) of "further payment" and the question 20 as to whether that expression would include all payments certified and due for payment but not paid yet. [32] I cannot find any good reason to disagree with the Adjudicator that these 2 Payment Certificates were already due for payment and so the Respondent cannot use the event of determination of the Contract to withhold payment. [33] That is a matter of interpretation as to whether the Payment Claim is due for the 2 Payment Certificates or whether the 2 Payment Certificates fall within the meaning of "further payment" which are to be postponed until completion of works. The Adjudicator had asked herself the right question under Issues at paragraph 40 b. of her Decision which reads: "Whether the Respondent is able to rely on clause 25.4(iv) of the COC to withhold payment of the Payment Certificates Nos. 17R and 18." [34] The Adjudicator had asked the right question and I am of the view that she had answered correctly and even if she had answered wrongly, that is no justification for this Court to interfere unless it is a question that goes towards jurisdiction. 21 [35] The answer to the question raised does not go towards jurisdiction and even if this Court is minded to arrive at a different answer, that is still no good reason to interfere as this is not an appeal. Whether the Adjudicator had wrongly failed to exercise jurisdiction over the set-off in the Architect's Payment Certificate No. 19 which is a negative Certificate [36] Where an issue is a jurisdictional one raised at the Adjudication, this Court in a setting aside application is not bound by the decision of the Adjudicator. When a jurisdictional challenge is raised the Adjudicator may in his discretion proceed and complete the adjudication proceedings without prejudice to the rights of any party to apply to set aside the Adjudication Decision under section 15 or to oppose the application to enforce the Adjudication Decision under section 28(1) CIPAA. [37] Implicit in that exercise of discretion is the liberty given to the Adjudicator to decide on the issue of jurisdiction though his decision would not be binding on this Court in a setting aside or enforcement application. [38] In a case where the Adjudicator is clear that he has or does not have jurisdiction especially in a matter of contingent jurisdiction in that a 22 matter must come within the Payment Claim (section 5) and Payment Response (section 6) as required under section 27(1) CIPAA, he may proceed to exercise or decline jurisdiction accordingly. [39] When the matter comes before the Court for decision under a section 15 or 28(1) CIPAA application, the Court will decide on the matter afresh, independent of and unfettered by the decision of the Adjudicator. [40] This is so because where jurisdiction is concerned, it is a matter conferred by statute and confined to the matters raised in the Payment Claim and Payment Response and not even in the Adjudication Claim or Adjudication Response. Unless parties have agreed to extend the jurisdiction of the Adjudicator to decide on any matter not referred to the Adjudicator pursuant to section 5 and 6, the Adjudicator clearly has no jurisdiction as stated in section 27(2) CIPAA. [41] In such a case, where an Adjudicator purports to exercise jurisdiction, he would be exceeding his jurisdiction where he does not have jurisdiction. [42] The Respondent had given some reasons for disputing the amount claimed in the Payment Claim and as required in section 6(2) the non- 23 paying "shall serve a Payment Response in writing in the unpaid party stating the amount disputed and the reasons for the dispute." [43] It is true that a specific amount is not stated with respect to the amount disputed and one can suppose that the entire amount is disputed for even in a case where the Payment Response is not served, the non-paying is deemed to have disputed the entire Payment Claim under section 6(4) CIPAA. In fact, paragraph 2 of the Payment Response reads as follows: "We write to dispute your entire claim for the sum of RM1,821,680.60 vide the Payment Claim premised on the following:..." [44] CIPAA does not expect parties to frame their claims and defences of set-off in precise legal language and the lament from the industry is that the Payment Claim, Payment Response as well as the subsequent Adjudication Claim, Adjudication Response and Adjudication Reply have run into pages after pages of legalese. [45] The procedure and proceedings were supposed to be simple such that even legal representation is not necessary as stated in section 8(3) CIPAA as follows: "A party to the adjudication proceedings may represent himself or be represented by any representative appointed by the party." 24 [46] The choice of language is apparent as we are only too familiar that in a court proceeding in litigation, a company invariably has to be represented by solicitors and by and large, parties in an adjudication would be companies incorporated under the Companies Act 1965 or the new Companies Act 2016. [47] The intent is that the procedure should be simple and not complicated, swift and not unnecessarily detained by technical legal objections and in plain language so that a party not represented by solicitors would not have to wade through a legal labyrinth; trying to figure out for instance the difference between a cross-claim that is or is not a set-off but more in the nature of a counter claim. [48] It is here that the perspicuity of the language used in section 6(2) is to be appreciated as follows: "A non-paying party who disputes the amount claimed in the payment claim, either wholly or partly, shall serve a payment response in writing on the unpaid party stating the amount disputed and the reason for the dispute." (emphasis added) [49] The legislature has avowedly avoided the legal term of a "defence, set-off, cross-claim". Nothing could be simpler and less intimidating than the expression "the reason for the dispute." 25 [50] The reasons for the dispute in the Payment Response served in Exhibit P2 of Enclosure 2 in the OS for setting aside, is captured and contained in paragraphs (c), (d) and (e) of the Payment Response. They stated that the Claimant is obligated to compensate them for all losses caused to them by the determination of the Contract and that in the light of the Claimant's structural non-compliances since November 2015 as well as various defaults leading to the determination, the Claimant will appreciate that they are being put to great expense not only to complete the Work following the determination but also to carry out the rectification works following the Claimant's structural non-compliances especially in the light of the adverse independent concrete test results in January 2016. [51] The Adjudicator fully appreciated the fact the Respondent ought to be allowed to set off the amount of RM351,646,68 from the Interim Certificate No. 19 against payment of the Payment Certificates Nos. 17R and 18 provided that she had jurisdiction to decide on the set off raised of costs of rectification works as can be seen in paragraph 62 of the Adjudication Decision. [52] Unlike the other 3 items raised only for the first time in the Adjudication Response with respect to the various heads of structural defects investigation and audit costs, additional costs of completion of 26 about RM6.8 million and associated costs of RM1.6 million, this item certified by the Architect as payable by the Claimant to the Respondent was issued on 19.1.2016 which certified a sum of RM351,646.68 as being due from the Claimant to the Respondent "due to the extremely poor results of the concrete core test samples observed on 17/12/2015, we had no choice but to revalue the work done for payment." See paragraph 54 of the Adjudication Decision. [53] That Interim Certificate 19 at p 1052 of Enclosure 6 in the OS for setting aside was issued on 19.1.2016 before the service of the Payment Claim by the Claimant on 22.1.2016. Even if the Claimant had missed that, they should have been completely candid and disclosed it in their Adjudication Claim as Certificate 19 is a follow-up and continuing from Certificate 18. [54] At any rate the fact that the amount raised as a set off in this Interim Certificate 19 was not specifically stated is not a matter that the Claimant is prejudiced because the said Interim Certificate had already been issued by the Architect before the service of the Payment Claim by the Claimant. [55] The fact that the amount is not pleaded would mean that the Respondent has to prove this in the Adjudication Response documents filed, which they had. 27 [56] The Adjudicator was fully conscious of the fact that the Architect had the right to issue this Payment Certificate 19 as she observed in the following paragraphs of her Adjudication Decision: "60. As regards the Interim Certificate No. 19 dated 19.1.2016, I note clause 30.1 of the COC, which provides that the Architect may, by any certificate correct any error or discrepancy which has been discovered in any previous certificate or may modify any previous certificate, other than a certificate of practical completion or the final certificate, which has been issued by him. 61. While this is a certificate that was issued later in time after the Payment Certificates Nos. 17R and 18 were already due and payable, it nevertheless relates to estimated value of work done by the Claimant, as assessed and verified by the Architect under the COC." (emphasis added) [57] The Respondent having raised the defence of set off for the rectification works, no matter how inelegant and imprecise as in failure to state the amount in the Payment Response, cannot be shut out totally by the Adjudicator taking too restrictive a view of her own jurisdiction and being unduly technical. 28 [58] One should not be exacting more from a Respondent in adjudication than one would from a Defendant in litigation or arbitration in that if the amount of set off is not quantified though stated in the Architect Certificate, then one is precluded from raising this as a defence even though reference has been made to it in fulfilling the requirement of section 6(2) in "stating the reason for the dispute". [59] I would say that it would be retrogressive and much to be regretted if Adjudicators should embark on an exercise of over-analyzing what is a dispute that has been referred to in an adjudication under CIPAA. [60] The important thing is that the parties are fully aware of what they have to answer arising from the Payment Claim and the Payment Response. Hence the need to avoid being pedantic or overly technical or legalistic where the determination of the issues of the dispute is concerned. [61] The advice of Akinhead J in Witney Town Council v Beam Construction (Cheltenham) Ltd [2011] 139 ConLR 1 at 18 (paragraph 38), provides guidance in this respect: “[38]… (iv) What a dispute in any given case is will be a question of fact albeit that the facts may require to be interpreted. Courts should 29 not adopt an over-legalistic analysis on what the dispute between the parties is, bearing in mind that every construction contract is a commercial transaction and parties cannot broadly have contemplated that every issue between the parties would necessarily have to attract a separate reference to adjudication.” [62] Going back to basics, the entire rationale of service of the Payment Claim and Payment Response is that the parties are not caught by surprise and that an adjudicator should not stray outside the dispute and go on a frolic of his own. One must not miss the wood for the trees. Judge Toulmin CMG QC in AWG Construction Services Ltd v Rockingham Motor Speedway Ltd [2004] EWHC 888 (TCC) at paragraph 141 said: “[141] In my view, each case must depend on the circumstances and the context in which a referral is made. In some cases the issues referred are very specific. In other cases it is clear that the issues are more general and have been so treated by the parties, and that there is significantly more room for the case to be developed. The test in each case is first what dispute did the parties agree to refer to the adjudicator? And, secondly, on what basis? If the basis which is argued in the adjudication is wholly different to that which a defendant has had an opportunity 30 to respond in advance of the adjudication, this may constitute a different dispute not referred to the adjudicator or, put another way, in so far as adjudicator reaches a decision on the new issues, it is not responsive to the issues referred to him.” (emphasis added) [63] As is not uncommon, a termination at this early stage of the life of a contract may require some time for the dust to settle where the counter allegations of defective works are concerned coupled with extra costs incurred in completing the balance Work which would invariably hinge on whether the determination of the employment by the Respondent is valid for the reasons given. As it is, final accounts have not been concluded and the true extent of the Respondent cross claim as a set off may not be fully determinable at this stage in Adjudication. [64] The Adjudicator had pointed out that the 3 items in the claim for structural defects investigation and audit costs of RM161,839.50, additional costs of completion of about RM6.8 million and associated costs of about RM1.6 million are matters to be pursued at arbitration by the Respondent as they had not specifically required the Adjudicator to decide on the issue of validity of termination in their Payment Response filed. The Adjudicator had some basis for finding that those claims by way of a set off were not properly and precisely pleaded. 31 [65] I am doubtful if the Adjudicator could have completed such a massive adjudication within the tight time frame provided for under CIPAA unless the parties had agreed to extend the time for her to arrive at her Decision under section 12(2)(c) CIPAA. She had wisely declined jurisdiction for those claims on ground of not properly and precisely pleaded and that these cross-claims are still evolving and more properly pursued in arbitration. [66] I am also reminded of what was observed in Cantillon Ltd v Urvasco Ltd [2008] 117 ConLR 1: "[67] ... As the authorities established that the responding party can put forward any arguable defence in adjudication, ... it must follow that the adjudicator can rule not only on that defence but also upon the ramifications of the defence to the extent that it is successful in so far as it impacts upon the fundamental dispute." (emphasis added) [67] In the present case the defence of set off is wide enough to cover the event certified by the Architect in Certificate 19 that has an impact on the fundamental dispute being the Payment Claim under Certificate Nos. 17R and 18 as modified and corrected by Certificate No. 19 and thus reducing the Claimant's Payment Claim had the Adjudicator correctly exercised and assumed jurisdiction to hear this set off. 32 [68] I would say that the Adjudicator's analysis of her jurisdiction would be applicable to the three items of structural defects investigation and audit costs, additional costs of completion of about RM6.8 million and associated costs of about RM1.6 million but not to the sum certified as due from the Claimant to the Respondent under Certificate No. 19 of RM351,646.68. Her cautious and perhaps unduly cautious approach is reproduced below: (a) paragraph 42: “At the outset, I am mindful that my jurisdiction as an adjudicator under CIPAA as provided in section 27(1) of CIPAA, is limited to the matters referred to adjudication by the parties pursuant to sections 5 and 6 of CIPAA. On the extent and construction of section 27(1) and therefore the matters that I have jurisdiction of, I look to the learned High Court Judge’s judgment in View Esteem Sdn Bhd v Bina Puri Holdings Sdn Bhd [2015] MLJU 695 for guidance. That firstly, the parties are bound by their pleadings under the rules of procedure in civil litigation; in adjudication, those pleadings are to be found in the Payment Claim and Payment Response, and not the Adjudication Claim, Adjudication Response or the Adjudication Reply. That 33 secondly, because adjudication is intended to provide a speedy resolution of the payment dispute, the adjudicator cannot be expected to deal with issues, legal and/or factual, which may still be evolving or in the making as the adjudicator sits down to determine the dispute. (b) paragraph 64: “As is clear from Justice Mary Lim’s judgment (as she then was) in the cases of View Esteem and WRP Asia Pacific, my jurisdiction as adjudication are restricted to the matters found in the sections 5 and 6; that the adjudication takes jurisdiction from the payment claim and payment response, not from the adjudication claim, response or reply. This is materially significant and important as this brings to bear the whole scheme of CIPAA; that the adjudication proceedings is to deal with or resolve a payment dispute. My sole task as an adjudicator is to resolve the dispute between the parties arising from the payment claim and payment response. As Justice Mary Lim said in her judgment in WRP Asia Pacific’s case, my sole task is to resolve the dispute for the reasons already made known between the parties and nothing else…” 34 (c) paragraph 66: “Whilst I could appreciate this, section 27(1) of CIPAA and the cases are clear on my role as an adjudicator. My jurisdiction is limited to the matters as raised in the Payment Claim and Payment Response. To be more specific, my role as an adjudicator is to resolve the dispute for the reasons already made known between the parties and nothing else. I am therefore bound by section 27(1) of the CIPAA and given that the matters claimed by the Respondent as a set- off/deduction have not been raised in its Payment Response, I am not able to consider the set off…” [69] As I had pointed out, it is not quite correct to say that the set-off and deduction had not been pleaded at least where the negative certification of the Architect in Certificate No. 19 is concerned that comes up under the rubric of the "compensation that the Respondent was seeking for all losses caused by the Claimant..." The actual words of "set off or cross claim" need not have to be used; only the reasons for disputing the claim. [70] I would therefore hold that the adjudicator had wrongly and unduly diminished and restricted her jurisdiction to hear the set off in Certificate No. 19 certified by the Architect. 35 Whether a failure of the Adjudicator in exercising jurisdiction to hear the set-off in Certificate 19 is a breach of natural justice [71] Having held that the Adjudicator had wrongly declined jurisdiction over the above set off, the question is whether such a failure to exercise jurisdiction is a breach of natural justice? [72] This issue was addressed head-on by Coulson J in Pilon Limited v Breyer Group Plc [2010] EWHC 837 (TCC) as follows: "5. ISSUE 2; DID THE ADJUDICATOR TAKE AN ERRONEOUSLY RESTRICTIVE VIEW OF HIS OWN JURISDICTION AND, IF SO, WHAT ARE THE CONSEQUENCES? 5.1. The Law 17. An adjudicator can make an inadvertent mistake when answering the question put to him, and that mistake will not ordinarily affect the enforcement of his decision: see Bouygues (UK) Ltd v Dahl-Jensen (UK) Ltd [2000] BLR 49. If, on the other hand, he considers and purports to decide an issue which is outside his jurisdiction, then his decision will not be enforced: see the discussion in Sindall Ltd v Solland [2001] 3 TCLR 712. But there is a third category, which is where the adjudicator takes 36 an erroneously restrictive view of his own jurisdiction, with the result that he decides not to consider an important element of the dispute that has been referred to him. This failure is usually categorised as a breach of natural justice. Cases in this category include: 17.1. Ballast Plc v The Burrell Company (Construction Management) Limited [2001] BLR 529, where the adjudicator failed to address the valuation dispute referred to him because the parties had departed from the terms of the written contract. Lord Reid concluded that the adjudicator’s decision - to the effect that, as a matter of jurisdiction, he could not take into consideration even the possibility that the parties might depart from the written terms of the contract - was wrong in law. The adjudicator had misconstrued his powers and failed to exercise his jurisdiction to determine the dispute. His decision was therefore ruled a nullity. 17.2. Broadwell v k3D [2006] ADJ CS 04/21, in which HHJ Raynor QC refused to enforce an adjudicator’s decision because he had failed to address the responding party’s counterclaim. This was on the erroneous basis that there had been no mention of the counterclaim in the notice of 37 adjudication, leading the adjudicator to conclude that he did not have the jurisdiction to consider it. The judge held that this fundamental error meant that the adjudicator had failed to have regard to the responding party’s legitimate defence, and had therefore not conducted the adjudication in accordance with the rules of natural justice. 17.3. Thermal Energy Construction Limited v AE and E Lentjes Uk Limited [2009] EWHC 408 (TCC), where HHJ Stephen Davies refused to enforce an adjudicator’s decision in circumstances where the adjudicator had again wholly failed to address the set-off and counterclaim raised by the defending party ..." (emphasis added) [73] At paragraph 22 of the judgment, the Court stated that when an Adjudicator erroneously takes a restrictive view of his own jurisdiction, it is tantamount to a breach of natural justice. Justice Coulson J distilled the various situations in this regard as follows: “As a matter of principle, therefore, it seems to me that the law on this topic can be summarised as follows: 22.1 The adjudicator must attempt to answer the question referred to him. The question may consist of a number of 38 separate sub-issues. If the adjudicator has endeavoured generally to address those issues in order to answer the question then, whether right or wrong, his decision is enforceable: see Carillion v Devonport. 22.2 If the adjudicator fails to address the question referred to him because he has taken an erroneously restrictive view of his jurisdiction (and has, for example, failed even to consider the defence to the claim or some fundamental element of it), then that may make his decision unenforceable, either on grounds of jurisdiction or natural justice: see Ballast, Broadwell, and Thermal Energy. 22.3 However, for that result to obtain, the adjudicator's failure must be deliberate. If there has simply been an inadvertent failure to consider one of a number of issues embraced by the single dispute that the adjudicator has to decide, then such a failure will not ordinarily render the Decision unenforceable: see Bouygues and Amec v TWUL. 22.4 It goes without saying that any such failure must also be material: see Cantillon v Urvasco and CJP Builders Limited v William Verry Limited [2008] EWHC 2025 (TCC). In other words, the error must be shown to have had a potentially 39 significant effect on the overall result of the adjudication: see Keir Regional Ltd v City and General (Holborn) Ltd [2006] EWHC 848 (TCC). 22.5 A factor which may be relevant to the court's consideration of this topic in any given case is whether or not the claiming party has brought about the adjudicator's error by a misguided attempt to seek a tactical advantage. That was plainly a factor which, in my view rightly, Judge Davies took into account in Quartzelec when finding against the claiming party.” (emphasis added) [74] I would gladly follow such a sensible and sound approach consistent with the notion of fair play and reasonableness as representing our law within the scheme of statutory adjudication under CIPAA. [75] Here too the Adjudicator had consciously or deliberately, as referred to in para 22.3 of the said judgment, addressed the issue of jurisdiction and came to a rather narrow and restrictive view of her jurisdiction resulting in her wrongfully declining jurisdiction over the above set off. 40 [76] However there is a redeeming factor in that the Adjudicator had carefully decided that if not for jurisdiction or rather the lack of jurisdiction as she perceived it, she would have allowed the claim of set off in Certificate No. 19. This vital element would be relevant in the later discussion as to whether this Court may in this unique circumstance set aside part of the Adjudication Sum by reducing it accordingly by the sum that the Adjudicator would have allowed had she not wrongly declined jurisdiction to consider the above set off. [77] Conversely such an Adjudication Decision or so much of it as may be tainted would not be enforceable. Thus in the case of PC Harrington Contractors Limited v Tyroddy Construction Limited [2011] EWHC 813 (TCC) (High Court), His Lordship Akenhead J, in paragraphs 21(e) & (g), decided that: “(e) It seems to me, therefore, that, by wrongly deciding that this was a matter outside his jurisdiction, he put himself in the position whereby he did not consider the final account evidence and argument in any detail or indeed really at all. He has, therefore, put himself in a comparably similar position to the adjudicators in the CJP v William Verry and the Humes Building Contractors cases in that, by ruling on his jurisdiction in such a way that he has denied himself the opportunity to consider the merits of the exercise which 41 Harrington had asked him to determine, he has committed a breach of natural justice. (emphasis added) ... (g) These points are material and certainly more than peripheral breaches of the rules of natural justice. ... The consequence of the above is that on this ground the decisions of the Adjudicator should not be enforce.” (emphasis added) [78] In the case of Paul Boardwell t/a Boardwell Construction v k3D Property Partnership Ltd [2006] Adj. C.S. 04/21 (High Court), His Lordship HHJ Raynor, QC, decided that: “... The Defendant relied upon paragraph 49 of Quietfield Ltd v Vascroft Contractors Ltd [2006] EWHC 174 (TCC) and more particularly paragraph 51 – ... the adjudicator ought to have considered Vascroft’s substantive defence, but he failed to do so. In those circumstances, as Quietfield have fairly conceded, the adjudicator’s decision cannot be enforced because he failed to abide by the rules of natural justice.” (emphasis added) 42 [79] A similar decision can be found in the case of Buxton Building Contractors Ltd v Governers of Durand Primary School [2004] EWHC 733 (TCC) (High Court). [80] Likewise in Thermal Energy Construction Limited v AE & E Lentjes UK Limited [2009] EWHC 408 (TCC) (High Court), His Lordship Davies J, at paragraphs 16, 26 & 37, observed as follows: “16. ... What Mr. Furst has submitted is that this is a case where the Defendant, having raised the defence of set-off and counterclaim, was entitled to have the Adjudicator consider that question, and the Adjudicator was indeed obliged to consider that question as being one of the matters raised by the Defendant in its defence. He submits that by failing to do so, that failure being evidenced by an absence of any reasons given in relation to that element of the defence, the Adjudicator failed to comply with his obligations under the contractual adjudication scheme. ... 26. It seems to me that in those circumstances, the position is that the Adjudicator has not, evidently, dealt with this issue at all, and he has not given any reasons which would indicate that he has dealt with this issue. That this is therefore one of those 43 cases, one envisages rare, where the Adjudicator has failed to comply with his obligations. ... 37. For all these reasons I have reached the conclusion that this is one of those relatively rare cases where the Court must decline to enforce the decision of the Adjudicator.” (emphasis added) [81] I am therefore constrained to find that there was nevertheless a breach of natural justice when the Adjudicator failed to exercise and assume jurisdiction to hear and allow the set off of rectification costs pleaded in the Payment Response and more precisely referred to in the Adjudication Response in Payment Certificate 19 being a negative Certificate. Whether this Court may reduce the Adjudicated Sum by the amount that the Adjudicator said she would allow as a set off in Payment Certificate 19 if she had jurisdiction [82] It has been generally thought that once there is a breach of natural justice then the natural consequence is that the whole of the Adjudication Decision has to be set aside much like an arbitral award 44 where it can be shown that there has been a breach of natural justice on the part of the learned Arbitrator. [83] It is said that public policy demands that and there is no need to second guess how the decision would be like if there had not been a breach of natural justice. [84] Be that as it may, it has been said that it is not every breach of natural justice would result in an Adjudication Decision to be set aside. The breach must not be peripheral or minor but must be portent and major; reflective of a breach of fair play or procedural fairness. [85] However bearing in mind the purpose of the Act in facilitating regular and timely payment and to provide a mechanism for speedy dispute resolution through adjudication, it would be rather wasteful of time and resources if in cases where one can sever the good from the bad, not to be able to save the Adjudication Decision with setting aside the part affected. [86] Granted not every case is amenable to that for the Court cannot get into the shoes, as it were of the Adjudicator, and take over the finding of fact which is within the pure purview and province of the Adjudicator. 45 [87] However in our present case the Adjudicator had said categorically that she would have allowed the said set off in Payment Certificate No. 19 if not for the fact of her perceived lack of jurisdiction. It is not unlike a case where a Sessions Court Judge is finding that there has been no liability on the part of the defendant driver in negligence in a running down case, nevertheless would undertake an assessment of damages exercise if it is found on appeal that the defendant is negligent wholly or contributorily. [88] To have to set aside the whole of the Adjudication Decision, only to have it re-adjudicated with predictable result because the other part of the Adjudication Decision is unassailable, would be an exercise in wasteful and wanton dissipation of resources of time and money. It would be to prefer and prize form over substance. [89] There has been substantial development in the jurisprudence in this area of law with respect to adjudication. I need to refer only to the approach of the English courts in Cantillon Ltd v Urvasco Ltd [2008] EWHC 282 (TCC) where Justice Akenhead reasoned with unrivaled persuasion a case for severability in cases which justify it as follows: "59. In Keating on Construction Contracts (8th edition) the following is said at Chapter 17-045: 46 “It seems probable that if there is a breach of natural justice, the whole decision is unenforceable, and it is not possible to sever the good from the bad.” In a footnote supporting this observation the following is said: “See RSL ( South West) Ltd -v- Stansell Ltd unreported (June 16, 2003), but also see the observations in Griffin –v- Midas Homes Ltd [2001] 78 Con LR 152. For a discussion of the issue of severability of adjudicators’ decisions generally, see Sheridan and Helps, ‘Construction Act Review’ [2004] 20 Const. LJ 71”. 60. I am by no means convinced that this observation in Keating (of great weight that it is) is correct. The case of Griffin and Another -v- Midas Homes Ltd [2000] 78 Con LR 152 is actually authority for the proposition that, where an Adjudicator has exceeded his jurisdiction, that part of the decision which was made within his jurisdiction can be enforced. It does not appear that the issue of severability as such was argued in that case or, as such, ruled upon by HHJ Lloyd, QC, who tried it. 61. The paper by Peter Sheridan and Dominic Helps in the Construction Law Journal is specifically about “Severability of 47 Adjudicator’s decisions”. The authors specifically addressed the issue as to whether an Adjudicator’s decision may be partly enforceable and partly not enforceable. They make observations on a number of cases: ... 62. The authors of this article conclude as follows: “On the basis of the cases decided so far, the following would appear to be the position on severability: (1) Where two or more disputes are referred to an Adjudicator, a valid objection to one decision, on jurisdiction or natural justice grounds, will not necessarily affect the validity and enforceability of the Adjudicator’s decision on the other dispute or disputes. (2) Where a single dispute is referred to one Adjudicator, it may not be severed so as to excise a part of the decision to which valid objection is taken, on jurisdiction or natural justice grounds, leaving the balance valid and enforceable. A decision on the single dispute is either valid and enforceable or invalid and not enforceable. 48 (3) It follows that an Adjudicator’s decision may not be corrected to take account of a jurisdiction objection, with the result that a sum larger than that in the Adjudicator’s decision may be enforced by a Claimant. ... 65. On the severability issue, I conclude, albeit obiter in the result, as follows: a. The first step must be to ascertain what dispute or disputes has or have been referred to adjudication. One needs to see whether in fact or in effect there is in substance only one dispute or two and what any such dispute comprises. b. It is open to a party to an adjudication agreement as here to seek to refer more than one dispute or difference to an adjudicator. If there is no objection to that by the other party or if the contract permits it, the adjudicator will have to resolve all referred disputes and differences. If there is objection, the adjudicator can only proceed with resolving more than one dispute or difference if the contract permits him to do so. 49 c. If the decision properly addresses more than one dispute or difference, a successful jurisdictional challenge on that part of the decision which deals with one such dispute or difference will not undermine the validity and enforceability of that part of the decision which deals with the other(s). d. The same in logic must apply to the case where there is a non-compliance with the rules of natural justice which only affects the disposal of one dispute or difference. e. There is a proviso to (c) and (d) above which is that, if the decision as drafted is simply not severable in practice, for instance on the wording, or if the breach of the rules of natural justice is so severe or all pervading that the remainder of the decision is tainted, the decision will not be enforced. f. In all cases where there is a decision on one dispute or difference, and the adjudicator acts, materially, in excess of jurisdiction or in breach of the rules of natural justice, the decision will not be enforced by the Court."(emphasis added) [90] In a very real sense in the present case there are at least 2 disputes. One is the Claimant's payment claim and the other is the 50 Respondent's cross-claim of a set-off in Payment Certificate No. 19. If the set-off should have been heard then let it be heard and allowed as the Adjudicator said it would if she could. It is then not a case of a little leaven leaveneth the whole lump but one where the wheat could be separated from the chaff. [91] In the decision of UK Technology and Construction Court in Paice and another v MJ Harding (t/a MJ Harding Contractors) [2016] EWHC 2945 (TCC), the Court held that: “Jurisdiction [64] The issue is whether the adjudicator had jurisdiction to determine the claimants' entitlement to deduct the sum of £6,049.60 from the amount otherwise due to the defendant on account of design provided by the claimants to the defendant in respect of House A, not forming part of the contract; if there was no jurisdiction, whether that part of the decision is severable. … [68] The adjudicator's jurisdiction is derived from the adjudication agreement. Article 7 and cl 9.2 of the contract entitle either party to refer any dispute or difference arising under the contract to adjudication. The dispute in respect of the design fees did not 51 arise under the contract; it arose, if at all, under a separate agreement. Therefore, the adjudicator did not have jurisdiction to determine the design fees dispute. … [70] However, that part of the adjudication decision can be severed from the other parts of the decision: Cantillon v Urvasco Ltd [2008] EWHC 282 (TCC), (2008) 117 ConLR 1, per Akenhead J at paras [63] and [76]. The defendant relies on the decision in Cleveland Bridge (UK) Ltd v Whessoe-Volker Stevin Joint Venture [2010] EWHC 1076 (TCC), (2010) 130 ConLR 159 to submit that the design fees issue cannot be severed but Cleveland can be distinguished on its facts. In that case, the adjudicator did not identify an alternative decision so as to identify the proportion that would survive any excess of jurisdiction. In this case, the adjudicator identified and valued the design fees claim separately, so that there is no difficulty in severing that part of the award from the rest of the decision. [71] Accordingly, paras 3.245–3.263 of the adjudication decision are in excess of jurisdiction and are not enforceable but can be severed from the remainder of the decision.” (emphasis added) 52 [92] In the case of Bovis Lend Lease Ltd v The Trustees of the London Clinic [2009] EWHC 64 (TCC), the UK Technology and Construction Court held that: “[39] A further issue arises between the parties as to whether or not it is legally and practically possible to 'sever' the adjudicator's decision if it be the case that he did have jurisdiction to address the dispute relating to delay, extension of time and the recovery of liquidated damages but did not have jurisdiction to address the loss and expense claim. … Discussion – severability [69] It follows from the above that, since the adjudicator had jurisdiction and there has been no breach of the rules of natural justice, the question of severability simply does not arise. If I had had to decide the point, I would only have done so on the basis that the clinic had established its jurisdictional argument in relation to the loss and expense claim (which it has not). If I had formed the view that the adjudicator had simply, consciously, not given the clinic sufficient time to respond (within the constraints of the adjudication timetable available in this case), this would probably not have been a case which would have led to severance. 53 However, on a jurisdictional basis, if I had formed the view that the crystallised dispute did not include the claim for loss and expense, I would have been of the view that that part of the decision which demonstrably related to the extension of time claim and the recovery of liquidated damages could be recovered. The award was one which was eminently severable. The adjudicator indicated clearly what 'redress' he was granting with regard to the extension and liquidated damages issues.” (emphasis added) [93] In Australia too there has been a palpable paradigm shift in favour of severance. The Supreme Court of Victoria in Gantley Pty Ltd v Phoenix International Group [2010] VSC 106, discussed the doctrine of severance at great length and I am particularly impressed with the reference to the over-arching purpose of the Act. The Court therein reasoned as follows: “Is Severance of the Payment Claims Possible? “[95] In these matters, however, I did raise with counsel the possibility of severance, in the event that I found that part of the payment claims, being the claims for variations, were described in adequate detail such that these components of the payment claims ought to survive, even if the balance of 54 the claim in each case was to be declared invalid on the ground of non-compliance with s 14(3)(a). Accordingly, I heard argument on the point, which I will now address. … [114] It was submitted by Mr Robins, who appeared for the respondent, that severance should not be permitted because the Act did not permit this to occur. Either the progress claim was fully compliant in all of its facets, or it was not, it was argued. If one part of the progress claim did not satisfy the requirements of s 14(3)(a) the whole of the progress payment would therefore fail and should be set aside as being invalid. [115] I do not accept this submission. The question should be whether the Act, either expressly or impliedly, operates to exclude the common law doctrine of severance. I find that it does not. Indeed, the purposes and objects of the Act earlier described are best served by processes which, so far as possible, ought to accommodate reasonable flexibility and avoid unnecessary technicality. [116] Severance in this case would operate to achieve the purpose and objects of the Act and would not operate to diminish the attainment of these goals. A respondent to a 55 payment claim and an adjudicator, if appointed, should be able to assess the valid part of this progress claim which sufficiently describes the work for which payment is claimed, and provide a rational response or adjudication determination in respect of that part of the claim, and exclude from consideration that part of the claim which does not comply.” (emphasis added) [94] I am emboldened in the company of eminent minds referred to above to comfortably sever the good from the bad and in the result, to allow so much of the set off represented in Payment Certificate 19 to be deducted from the Adjudication Sum and the interest of 5% per annum to apply to this reduced Adjudication Sum accordingly. Whether there are special circumstances justifying a stay of the Adjudication Decision pending the disposal of the arbitration [95] Section 16(1) CIPAA provides for the grounds for the stay of the Adjudication Decision as follows: "16(1) A party may apply to the High Court for a stay of an adjudication decision in the following circumstances: (a) an application to set aside the adjudication decision under section 15 has been made; or 56 (b) the subject matter of the adjudication is pending final determination by arbitration or the court." [96] It is quite academic with respect to the application for stay pending the hearing of the application for setting aside as parties were content to let the status quo remain until the 3 OS were heard together and disposed of. [97] What is relevant with respect to the application for stay of the Adjudication Decision is stay until the disposal of the arbitration. The fact that there is a pending arbitration is a mere threshold condition that must be met. It is that condition precedent and once that is met, the Court that always retain a discretion in stay, will decide on the stay based on whether there are special circumstances. [98] This can be seen in Subang Skypark Sdn Bhd v Arcradius Sdn Bhd [2015] 11 MLJ 818 where Justice Mary Lim J (now JCA) held that: “[25] In both cases under sub-s 16(1), the other proceedings be it for setting aside of the adjudication decision or, arbitration or court proceedings in relation to the same subject matter, are pending and the stay is really to preserve some status quo. But, it is only under either of these two situations that an application for stay may be lodged and not otherwise. This limited right is 57 consistent with the whole scheme of CIPAA 2012, which is to afford speedy disposal of payment disputes on a temporary note of finality. During this time of pendency, be it of an application to court to set aside the adjudication decision, or where the final determination by another arbiter or court is awaited, the adjudication decision is binding on the parties. Compliance with the adjudication decision is a given and part of the rules of the game in this industry and what CIPAA is all about in the first place." (emphasis added) [99] Thus the fulfillment of section 16(1) does not mean the stay to be granted automatically. As explained by Justice Mary Lim J (now JCA) in Subang Skypark (supra) that: "[27] That is not to say that simply because the dispute or subject matter of the adjudication decision is now in the arbitration mode regime, the grant of stay is automatic. It is not, let alone as of right or as a matter of course. Being in arbitration merely puts the plaintiff's case as one within s 16 for consideration; or one which has crossed the threshold. The existence of concurrent proceedings merely prequalifies the plaintiff for this application." (emphasis added) 58 [100] A stay of the Adjudication Decision may only be granted in exceptional circumstances. To quote Subang Skypark (supra): "[29] How then is an application for stay to be considered; should it be on the same general principles applicable where there is an appeal; or should the exercise of discretion be along the same principles when dealing with a fortuna injunction? [30] It is this court's view that in the exercise of discretion of whether to grant the stay or make an order for payment to the Director of KLRCA, the court must weigh into play in a fairly extensive way, the object of CIPAA; and that it is for a speedy disposal of a payment dispute. This is regardless of the fact that this is a payment dispute that arose in the final days of the construction contract, a point which the parties appear to have no issue with and there is no challenge in this respect anyway. Having gone through the hoops of adjudication, there is now decision in the defendant's favour. [31] This court is of the view that the defendant should not be deprived of the very benefit of why it resorted to adjudication 59 in the first place; save if satisfactory reasons are present for a stay of that adjudication decision. [32] It is my further view that stay should only be granted in exceptional circumstances; and such circumstances must necessarily refer to the financial status of the other party. The merits of the case before the arbitration or the court; or even the chances of success in setting aside the adjudication decision are not relevant considerations. The grant of any stay must always weigh in the primary object of the CIPAA 2012; that it is to ensure a speedy resolution of a payment dispute; that it is to inject much needed cashflow into the contractual arrangements between parties that saw progressive payments of claims as the recognised and accepted way of doing business in construction contracts. It would be futile to encourage parties to resort to adjudication and then deprive a successful claimant of its claim by staying the access to the cash simply because there is another proceeding of the nature described in sub-s 16(1) which is pending. The whole concept of temporary finality would be lost and the object of the Act defeated if such was the consideration." (emphasis added) 60 [101] This principle has been affirmed and approved by the Court of Appeal in the case of View Esteem Sdn Bhd v Bina Puri Holdings Bhd [2016] 6 MLJ 717 where Justice Hamid Sultan JCA held that: "[31] Further, trial court must be extremely slow in granting an application for stay as the purpose of the CIPAA 2012 is to ensure that the contractor gets his due immediately. In dealing with the stay application, trial court ought also take note that in almost all standard form of construction contract, the employee is protected by unjustified claim from the contractor as there will be provision for certification of the claim by neutral persons such as QS as well as architect as in the instant case. [32] …Unless there is overwhelming evidence that the contractor will not be able to complete his contractual obligations as well as meet up with the financial obligation to the employer, a stay should not be granted. Even if a stay is granted, it must be on condition that the money is paid to court and/or stakeholders account as the court deem fit." (emphasis added) [102] To come within the meaning of exceptional circumstances, the Respondent must adduce concrete and overwhelming evidence as to 61 the financial inability on the part of the Claimant to repay the Adjudicated Sum, should the Respondent succeed in the arbitration. [103] The Respondent submitted that the guarantor, Mr Goh Pian Chiang (a director of the Claimant) refused to extend the personal guarantee and that shows that he has no faith in the Claimant's financial ability and was not willing to give any guarantee or assurance as to the Claimant's financial ability. [104] It appeared that the Respondent had via letter dated 27.10.2015 required the Claimant to provide an extended guarantee to be guaranteed by two directors of the Claimant. On top of that, clause 7.2 of the said Contract only provides that the said guarantee shall be in force from 2.5.2014 until 2.10.2016 and it does not provide for any extension as requested by Plaintiff. [105] I can accept the reason why the Claimant and Mr Goh Pian Chiang had rejected the Respondent's request which was unreasonable and a unilateral imposition of a fresh term the Contract as well as the arrangement between the parties. [106] The Respondent highlighted that the Claimant's Financial Statements and Report for the year of 2015 shows a decline in Claimant's cash reserve and trade receivable. The Claimant explained 62 that the decline in the cash reserve is mainly attributed to the Respondent's own failure to pay the Claimant based on the Contract. The failure of the Respondent to pay had driven the Claimant to utilise its own cash reserves to pay its suppliers. Be that as it may, the Claimant still has sufficient cash to repay the Adjudicated Sum to the Plaintiff if directed by this Court due to the Claimant's strong and healthy long-standing financial status. This can be seen in Exhibit B-3 of the Claimant's Affidavit in Reply which shows that the Claimant has RM2,962,456.71 in its bank account as at 30.1.2017. [107] I can agree with the Claimant that it is still a profitable company as can be shown at page 8 of Exhibit “LM-7” of the Affidavit in Support which is the “Balance Sheet as at 31 December 2015”, whereby it has recorded a positive increment for balance from RM2,230,840.00 (year 2014) to RM2,635,153.00 (year 2015). [108] In addition to the above, the Claimant's financial ability and status is not solely confined to cash reserves only. As a matter of fact, the Claimant still owns considerable immovable assets amounting to RM4,087,821.00 as stated in the said Balance Sheet as at 31 December 2015 which, if coupled with the Claimant's liquid assets, is more than sufficient to repay the Adjudicated Sum, should need be. (Exhibit B-5 of the Claimant's Affidavit in Reply). 63 [109] I find that there should be no cause for worry about the Claimant's ability to repay and in any event the burden of proof on the balance of probabilities is on the Respondent and the Respondent has not been able to point to any evidence of a reasonable apprehension of the Claimant's inability to repay. [110] Then there is the Respondent's fear that an adjudication proceeding between the Claimant and one Ing Cheong Engineering Sdn Bhd (“ICESB”) may result in favour of ICESB and that the Claimant may not be able to repay the Adjudicated Sum should the Claimant be required to pay ICESB under the said adjudication proceeding. [111] To allay the Respondent's fears, the Claimant disclosed that even if they are obliged to pay ICESB under the said adjudication, the sum claimed by ICESB in the said adjudication is only RM539,445.83 which is only around 25% of the Adjudicated Sum. The Respondent's fear is more imaginary than real. [112] The Respondent alleged that Mr Goh Pian Chiang has formed a new company named Kreatiflex Construction Sdn Bhd and there is possibility that Mr Goh Pian Cheng will let the Claimant to be wound up to avoid repayment of the Adjudicated Sum. The Claimant clarified that Kreatiflex Construction Sdn Bhd was incorporated in 2005 and has since then started to accept construction works as a sub-contractor, which is 64 long way before the said Contract. The allegation of the Respondent is baseless and speculative and far from the “concrete and overwhelming evidence” as required by case law. [113] For all the reasons given above I am constrained to dismiss the stay application for being singularly devoid of merits. Pronouncement [114] To recapitulate, I had set aside that part of the Adjudicator's Decision with respect to not considering the set off in Certificate No. 19 and thus, if rightly considered, would result in a set-off of RM351,646.68 from the Adjudication Sum of RM1,930,981.43, giving the reduced sum of RM1,579,334.75. Interest at 5% per annum shall be on this reduced sum. [115] Correspondingly I had allowed enforcement for this reduced sum plus interest. [116] The stay application was dismissed as there was no cogent evidence pointing towards the impecuniosity or insolvency of the Claimant. [117] As I had set aside part of the Adjudication Decision, I exercised my discretion and made no order as to costs in the setting aside application as well as the enforcement application. As for the stay application, I 65 ordered costs of RM5,000.00 to be paid by the Respondent to the Claimant. Dated: 27 June 2017. - sgd - Y.A. LEE SWEE SENG Judge Construction Court Kuala Lumpur For the Plaintiff in : Phang Soon Mun and OS WA-24C-170-12/2016 : Chew Chun Wei and for the Defendant in : (Messrs Han & Partners) OS WA-24C-8-01/2017 and : OS WA-24C-9-01/2017 For the Defendant in : Andrew Heng and Roger Leong OS WA-24C-170-12/2016 : (Messrs Zain Megat & Murad) and for the Plaintiff in : OS WA-24C-8-01/2017 and : OS WA-24C-9-01/2017 Date of Decision: 17 February 2017.

Tika 2.6.0

WA-24C(ARB)-30-10/2016

PLAINTIF Gumusut-Kakap Semi-Floating Production System (L) Ltd DEFENDAN Sabah Shell Petroleum Company Limited

23/06/2017

YA DATO' LEE SWEE SENG

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=09576c16-baf5-450c-9bd7-7245defa5120&Inline=true

1 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE STATE OF WILAYAH PERSEKUTUAN, MALAYSIA (CIVIL DIVISION) ORIGINATING SUMMONS NO: 24C(ARB)-30-10/2016 In the matter of the Semi-FPS Lease Agreement dated 9.11.2012 between Sabah Shell Petroleum Company Limited (Company No. 993229-W) and Gumusut-Kakap Semi-Floating Production System (Labuan) Limited (Company No. LL 06165) And In the matter of a Bond dated 28.11.2014 for USD20,000,000.00 by AmBank (M) Berhad, Labuan Offshore Branch Office in favour of Sabah Shell Petroleum Company Limited (Company No. 993229-W) And In the matter of Sections 41 and 50 and other relevant provisions of the Specific Relief Act 1950 And 2 In the matter of Sections 11(1)(f),(h) and Section 50 of the Arbitration Act 2005 And In the matter of Order 7, Order 28, Order 29 and Order 92 rule 4 of the Rules of High Court, 2012 BETWEEN GUMUSUT-KAKAP SEMI-FLOATING PRODUCTION SYSTEM (L) LTD … PLAINTIFF (Company No. LL 06165) AND 1. SABAH SHELL PETROLEUM COMPANY LIMITED (Company No. 993229-W) 2. AMBANK (M) BERHAD (Company No. 8515-D) … DEFENDANTS THE JUDGMENT OF YA LEE SWEE SENG [1] The Plaintiff, Gumusut-Kakap Semi-Floating Production System (L) Ltd, and the 1st Defendant (D1), Sabah Shell Petroleum Company Limited, 3 are in the oil and gas industry. The Plaintiff specialty is in the construction and lease of Semi-submersible Floating Production System (“SEMI-FPS”). D1 had entered into an agreement with the Plaintiff for the engineering, procurement, construction and lease of a SEMI-FPS dated 9.11.2012 (Lease Agreement No. C-591673) (“Lease Agreement”). [2] A dispute has arisen between the parties and D1 had called upon an on demand Performance Bond ("Bond") dated 28.11.2014 for the sum of USD 20 million procured by the Plaintiff from D2, AmBank (M) Berhad, under the terms of the Lease Agreement, in favour of D1. [3] Under the Lease Agreement, there was provided a Commencement of Commercial Production of oil ("CoCP"), namely, first oil delivery, which was achieved on 11.10.2014. Upon notification of CoCP, the Plaintiff was to procure the bond of USD 20 million in favour of the D1 from a Malaysian Bank and the lease payment for the SEMI-FPS day rate of USD 600,000 per day shall commence to be paid by D1 to the Plaintiff. [4] Under the Lease Agreement the Bond was procured by the Plaintiff as a security in respect of the Plaintiff's obligation to perform the work in accordance with the provisions of the Lease Agreement and without any defects, as well as the Plaintiff's obligation to complete all work prior to final 4 acceptance and completion. [5] On 20.10.2016, the Plaintiff filed an ex parte injunction application (Enclosure 3) with notice to restrain D1 from receiving the monies it demanded in respect of the Bond ("Ex parte Injunction"). The hearing of the Ex-parte Injunction was fixed on the same day and the Plaintiff informed D1 of the said hearing. It was heard as an opposed ex-parte application and after hearing the parties, this Court granted an Ex-parte Injunction order and fixed 3.11. 2016 for inter partes hearing. [6] During the inter partes hearing on 3.11.2016, the Plaintiff learned counsel informed the Court that they had just been served with some 55 volumes of affidavit and exhibits. They were given 14 days to reply to D1's affidavit. [7] Meanwhile, parties agreed that the status quo should be preserved and so this Court proceeded to grant an ad-Interim Injunction along the following terms subject to the usual undertaking as to damages until the disposal of this Originating Summons ("OS"): "(1) An ad interim injunction is granted restraining the 1st Defendant, whether by itself or through its directors, employees, servants, representatives and/or agents otherwise howsoever, from receiving 5 the proceeds of any payment made under the Bond (dated 28 November 2014 and issued pursuant to Contract No. C591673) or, in the event that the said proceeds have been received by the first Defendant, an Order that the funds be refunded to the Plaintiff within seven (7) days from the date of this Order; (2) That this ad interim injunction is maintained until the disposal of the Plaintiff's Originating Summons dated 20 October 2016; (3) The Plaintiff to renew the Bank Guarantee (dated 28 November 2014 and issued pursuant to Contract No. C591673) to remain valid up to 31 January 2017 and to include a provision on interest and to furnish the renewed Bank Guarantee (dated 28 November 2014 and issued pursuant to Contract No. C591673) to the 1st Defendant's solicitors by close of business on 6 November 2016. (4) The Plaintiff to deposit the interest on the secured sum of USD20,000,000.00 (at a rate of 3% per annum payable monthly) with the Plaintiff's solicitors from 30 November 2016 and thereafter on the last day of each succeeding month until the disposal of the Originating Summons. The Plaintiff's solicitors 6 are to give written confirmation of receipt to the 1st Defendant's solicitors at the end of each month. The interest earned is to be applied as ordered by the Court at the disposal of the Inter Partes Injunction and/or Originating Summons both dated 20 October 2016; Liberty to apply." (Emphasis added) [8] To date, the Order dated 3.11.2016 has not been perfected. The Plaintiff also made an oral application to withdraw the injunction OS against Ambank on the basis that Ambank had, by its letter dated 20.10.2016, given an unequivocal undertaking to abide by any decision of this Court. Upon the request of D1's Solicitors, the Plaintiff's Solicitors extended a copy of Ambank's letter of undertaking dated 20.10.2016 which reads: "[W]e write to confirm that we shall irrevocably and unconditionally undertake to strictly comply with all or any terms of the High Court order and directions in respect of the Injunction Application. In light of our undertaking in this matter, we therefore request that you withdraw the above action against us with no order as to costs." 7 [9] This Court allowed the Plaintiff's oral application and struck out the Plaintiff's OS against D2 with no order as to costs. Thus D1 shall hence forth be referred to as the "Defendant". [10] However, AmBank by their letter dated 4.11.2016 to the Plaintiff's solicitors took the stand that the Bond need not be extended or renewed as the demand had already been made on the Bond and sum secured will continue to be made available until a decision is made on the OS. The said letter reads as follows: "We… confirm the following: (i) Since SSPC has made a demand on the Bond before the expiry i.e. before 6 November 2016 (“the Expiry Date”), the sum secured under the Bond will continue to be available until a decision is made on the Originating Summons. (ii) The Bond does not need to be extended or renewed since the demand has already been made prior to the Expiry Date. " [11] On 4.11.2016, the Plaintiff applied to vary the Order dated 3.11.2016 ("1st Variation Application") and the hearing was fixed on the same day. On 4.11.2016, AmBank had provided the Plaintiff with a letter [Page 29, Exhibit “B-2”, Encl 87] confirming that: 8 (i) …the sum secured under the Bond will continue to be available until a decision is made in the Originating Summons. (ii) The Bond does not need to be extended or renewed since the demand has already been made prior to the expiry date. [12] This Court, upon hearing parties and examining the AmBank's undertaking, held that the requirement to renew the Bond was no longer necessary as it was initially requested due to an abundance of caution for fear that there might be a problem enforcing a Bond that would have expired by the time the inter–partes order is made. The Court thereby ordered as follows: a. stayed the requirement to renew the Bond; and b. directed the Plaintiff to procure AmBank's written undertaking to the Defendant's solicitors to abide by any decision of this Court on the Bond and confirm that the monies is available for payment out to the First Defendant upon the Court deciding that the call has been validly made; the said undertaking to be procured by 5 p.m. on 7.11.2016 (Monday). 9 [13] In line with the aforesaid direction, the Plaintiff procured AmBank's written undertaking to the Defendant's solicitors on 7.11.2016. This letter reads as follows: "In accordance with the High Court's directions on 4.11.2016, we write to confirm that: (i) We, AmBank (M) Berhad, will abide by any decision of the High Court on the Bond; (ii) The sum secured under the Bond, USD 20,000,000 (US Dollar Twenty Million Only), is available for payment out to SSPC upon the High Court deciding that the demand on the Bond by SSPC dated 19th October 2016 has been validly made” (emphasis added) [14] On 10.11.2016, this Court, upon hearing the parties, allowed the Variation Application by deleting prayer (3) completely and replacing the same with the following prayer: “(3) that AmBank (M) Berhad (“AmBank”) having given an undertaking and provided confirmation in writing on 7 November 2016 to the 1st Defendant (as attached to this Order) that the sum secured under the Bond of USD20,000,000.00 is available for payment out of 10 Ambank to the 1st Defendant forthwith upon the High Court deciding that the 1st Defendant’s demand on the Bond dated 19 October 2016 was validly made, AmBank, being the issuer of the Bond, do abide by any judgment and/or order that this High Court may make in relation to the Bond.” Prayer [15] The Plaintiff subsequently filed another application (2nd Variation Application) in Enclosure 86 on 23.11.2016 to vary the ad-interim injunctive order of 3.11.2016, fixed for hearing on 25.11.2016. [16] The Plaintiff had prayed that the whole of prayer (4) of the ad-interim injunctive order of 3.11.2016, which has not been perfected yet, be deleted altogether. Principles [17] Learned counsel for the Plaintiff submitted that it is trite law that an order pronounced by Court can always be withdrawn, altered or modified until it is drawn up, passed and perfected. Learned counsel further submitted that it is also settled law that when a Court has pronounced judgment, it retains control over the case until the Order giving effect to its judgment is formally perfected. He was however candid to admit that such 11 control must be used in accordance with judicial discretion as provided for under Order 42 Rule 13 of the Rules of Court 2012 ("ROC"). [18] This vast powers of the Court is not untrammeled as was observed by the Court of Appeal in Chua Wah Keow v Ng Ho Huat & Anor [1961] MLJ 321b, where Tan Ah Tah J (as he then was) said at p 322 as follows: "The principle relating to the power of a Judge to recall an unperfected order is stated by the English Court of Appeal in Re Harrison's Settlement, supra in the following terms (at p 188): 'We think that an order pronounced by the Judge can always be withdrawn, or altered or modified by him until it is drawn up, passed and entered.' It may perhaps be argued that the principle, laid down as it is in such wide terms, confers upon a Judge an unlimited power to withdraw, or alter, or modify an order made by him which has not yet been perfected. But a perusal of the cases in which the power has been exercised indicates that the power is not as untrammelled as it appears to be. In all these cases something transpired between the pronouncement of the order and the perfecting of it which 12 showed that there was some error in the order as pronounced." (emphasis added) [19] I would agree with the Defendant's submission that the mere fact that an order has not been perfected yet cannot be relied on as a justification to vary or amend an order. Otherwise there would be no finality to litigation and to the decision of a Court whether made pursuant to an interlocutory application or after full trial. If the order is with respect to a matter that is appealable, then of course any party to the proceedings who is dissatisfied with the order may exercise his right of appeal. Therefore even in a case where an Order is not perfected, there is no inherent right to vary the order and the Court's discretion to vary an Order prior to its perfection must be "exercised judicially and not capriciously" and only "in exceptional cases where the justice of the case requires it. [20] As was held in Commercial Plastic Industries Sdn Bhd v Lim Chin Cheap & Ors [2002] 6 MLJ 619, by Justice Ramly Ali J (now FCJ) at page 627. “However, I must stress here that this power, i.e. to amend or vary an order earlier granted, is not without limitations. It must be exercised 13 judicially and not capriciously. It must only be exercised in exceptional cases where the justice of the case requires." [21] While the question of functus officio does not arise at the stage when the Order made has not been perfected, yet as was explained in the case of Owners of Cargo carried in the ‘Ship Gang Cheng' v Owners and/or Persons Interested in the Ship ‘Gang Cheng' (No 2) [1998] 6 MLJ 492, at p. 497 "...such control, however, must be used in accordance with his discretion, exercised judicially and not capriciously." [22] Learned counsel for the Plaintiff urged this Court that as the Order dated 3.11.2016 had merely been pronounced by this Court and had not been perfected yet by the parties, this Court therefore has wide power to alter and modify the terms of the draft order dated 3.11.2016 by exercising its discretion. While that may be so, this Court must always bear in mind that its power to vary or amend orders prior to perfection "is not a blanket one" as it is subject to established principles and certain restrictions such as to correct an error in the order itself and that it certainly "does not allow the Court to make a fundamentally different order". 14 [23] The authority for this proposition is found in the case of Syarikat Marak Jaya Sdn Bhd v Syarikat Masinda Sdn Bhd [1991] 2 MLJ 417 at page 420 as follows: "To revert to the instant case, the order in question had not been extracted or perfected, but as regards the power of re-considering it, the order in question not being a consent order, what would be actually the nature of such power to be exercised? This court was much exercised by this problem. In my view, the nature of this power is not a blanket one; it is subject to a restriction which is, to correct an error in the order itself where the order made does not express the court's manifest intention in the matter or in other words it is not conformable with such manifest intention of the court. It does not allow a court to make a fundamentally different order. The power is exercised concurrently with the express power to correct any clerical error, or any error arising from accidental slip or omission as expressly conferred by O 20 r 11 of the Rules of the High Court 1980. If such restriction does not exist, it will also somewhat destroy the fabric of the principle that there should be finality in litigation, for 15 otherwise, the court may decide this way today and it may recall the parties and after further argument, decide in the opposite way tomorrow as was done in Chua Wah Keow [1961] MLJ 321, this would somewhat bring some disrepute to the court unless such a radical change is expressly authorized by any other written law such as follows." (emphasis added) [24] This vast power to vary an order given by the Court is not to be exercised on account of the Judge having changed his mind after giving his order or having being persuaded to change his mind. The Court of Appeal in Visia Finance Bhd v Expert Credit & Leasing Sdn Bhd & Ors [1998] 2 MLJ 705 at page 712 admonished as follows: "As to the trial judge's view that he could reopen the matter because no order had been perfected, we must make it clear that these curative powers can only be exercised under the slip rule if it can be clearly shown that the unextracted order was wrongly worded and in some way did not truly represent what was actually decided. Reference may be made to the cases cited by the appellant's counsel and in particular Chua Wah Keow v Ng Ho Huat & Anor [1961] MLJ 321 and Lim Kar Bee v Abdul Latif bin Ismail [1978] 1 MLJ 109." (emphasis added) 16 [25] Learned counsel for the Plaintiff sought to buttress his submission to vary the injunctive order of 3.11.2016 on account of the fact that there was a material change of circumstance with the Bank undertaking to pay the Defendant in the event that this Court should hold that the call on the Bond was validly made eventhough by the time of the decision the Bond would have expired. [26] I cannot see how that variation allowed for the 1st Variation Application can be justification for the 2nd Variation Application. As accepted by learned counsel for the Plaintiff, paragraph 3 of the said ad- interim injunctive order was on the basis that when this Court ordered a renewal or extension of the Bond it was due to the uncertainty of the status of Bond when it is called prior to its expiry but the hearing of the injunction application would be after the expiry of the Bond. The order was made purely in the abundance of caution so as to ensure that the D1's security under the Bond is intact pending final determination of the injunction application. [27] The Plaintiff's informal transcript of the notes of proceedings records as follows: "On 3.11.2016, the learned judge said this: 17 "YA: The position of the law is that once the call has been made, parties' rights have accrued ... LCW: It has accrued, yes. YA: But to be on the very safe side, in terms of the abundance of caution. Just renew it. On 8.11.2016, the learned judge said this: ARR: My point is this, yesterday there was a court order that the Plaintiff to renew the Bank Guarantee. YA: I did say that abundance of caution as some banks don't comply”. [28] Prayer (3) of the Order dated 3.11.2016 in relation to the grant of renewal or extension of the Bond by this Court was varied by deleting it after learned counsel for the Plaintiff informed the Court that AmBank was not prepared to renew the Bond but that they were prepared to undertake to the Defendant that they will abide by the decision that this Court may make on the validity of the call on the Bond and that the sum so secured by the Bond of USD 20 million would be released to the Defendant if the injunction is set aside finally. 18 [29] The variation was necessary as there was a problem with the implementation of the Court order with respect to prayer (3) on account of the Bank not willing to renew the Bond but willing instead to abide by the Court Order and to undertake to the Defendant that the sum secured by the Bond would be released if this Court would so order at the end of the inter- parte hearing of the injunction. [30] The variation order was made as there was a "Liberty to apply" order qualifying both prayers (3) and (4) of the said Order of 3.11.2016. [31] Prayer (4) of the said Order with respect to the payment of the monthly interest at 3% per annum on the sum secured of USD 20 million has nothing to do with the variation of the prayer (3) order. Had the Bank agreed to renew the Bond there would of course be no justification to vary prayer (4). Now that the Bank had not agreed to renew but instead had given the above undertaking to the Defendant and to abide by the order of this Court on the Bond, I cannot see how that would be a material change that renders the paying of interest unnecessary or redundant. The making of the order for the payment of interest in prayer (4) was irrespective of the order made by the Court in prayer (3) on 3.11.2016. All that the Bank would pay is the amount secured of USD 20 million and nothing on interest. 19 [32] The Court had exercised its discretion when granting the ad-interim injunction to try to hold in a balance the conflicting interests of the parties pending the exhausting of affidavits and the submissions of the parties pending the decision on the OS. [33] Whilst it is true that there was a "liberty to apply" clause to both prayers (3) and (4), I cannot agree that the variation of prayer (3) of the Order dated 3.11.2016 is a substantial change of circumstances justifying the variation to prayer (4). I cannot therefore agree that just because Ambank has confirmed and assured the Defendant that the monies under the Bond is available, this renders the order for interest unnecessary. [34] As can be gleaned from the leading case of Cristel v Cristel [1951] 2 KB 725 which has been applied in the Malaysian Federal Court case of Tong Lee Hwa & Anor v Chin Ah Kwi Tong Chong Fah v Chin Ah Kwi [1971] 2 MLJ 75, the Federal Court agreed that the term "liberty to apply" means that parties are at liberty to go back to court for the purpose of working out the terms of the order. It observed as follows at page 80: "With respect to the learned judge, the words "liberty to apply" in an order, prima facie, mean that when the order was drawn up its working out might involve matters on which it might be necessary to 20 obtain a decision of the court; they do not confer any right to ask the court to vary the order (see Cristel v Cristel [1951] 2 KB 725)." (emphasis added) [35] In Public Bank Bhd v Chan Tak Kow [1988] 3 MLJ 330 at page 331, it was held that the term "liberty to apply" should be: "....confined to the problems relating to enforcing or executing the order such as, for example, if there is some difficulty in its enforcement because of the terms of the order later found to be unclear or doubtful when faced with the actual situation on the ground, the party which obtained the order may approach the court again for its indulgence to seek clarification." [36] Such was the case with the 1st Variation Application to prayer (3) when the Plaintiff was supposed to procure an extension of the Bond by a certain date but the Bank took the position that there was no need to renew the Bond and that they would honour the Bond if this Court shall hold that the call by the Defendant on the Bond is validly made. There was thus a problem with the implementation or execution of the order of 3.11.2016 that constrained the Plaintiff to apply to this Court to vary it for otherwise the Plaintiff might be found to have breach the order in prayer (3) for failure to 21 procure the extension of the Bond. Apparently the position taken by the Bank has some support of the following authorities that take the stand that the rights of the parties have accrued under the Bond once the demand is made: (i) CIMB Bank v Sumbangan Kemuncak Sdn Bhd & Ors [2012] MLJU 49; (ii) Wuhan Guoyu Logistics Group Co Ltd & Anr v Emporiki Bank of Greece SA [2012] EWHC 1715., (Comm). [37] It is no doubt true that the injunction granted was against the Plaintiff's undertaking as to damages that the Defendant might suffer as a result of the injunction restraining them from receiving the secured sum of USD 20 million. Whilst in most cases, it might be difficult to quantify or anticipate what kind of damage the Defendant would suffer and hence the damages to be assessed thereafter, if the injunction is set aside, here this Court agrees with the Defendant that for so long as they are kept from receiving this sum, it can be anticipated the damages they would suffer if the injunction is finally set aside. [38] The Defendant's damage would reasonably be the interest they would have earned had they received this sum secured and placed in the 22 Bank to earn interest. Of course the Defendant might want to contend that their damage is more severe than that as in perhaps, had they had this sum to invest in a certain project, notice of which had been given to the Plaintiff, their loss would be the loss of the opportunity to make certain returns on the investment. [39] Learned counsel for the Plaintiff argued that as regards status quo, the applicable position to be maintained is the position of parties immediately preceding the filing of this Originating Summons and Injunction, i.e. the Bond remained available to the Defendant, albeit held by Ambank. This continues to be maintained. As per Lord Diplock in the locus classicus of Garden Cottage Foods Ltd v Milk Marketing Board [1984] AC 130 at page 140: "The status quo is the existing state of affairs; but since states of affairs do not remain static this raises the query: existing when? In my opinion, the relevant status quo to which reference was made in American Cyanamid is the state of affairs existing during the period immediately preceding the issue of the writ claiming the permanent injunction…" (emphasis added) 23 [40] Whilst generally the maintaining of status quo would mean the preservation of the position of the parties before the call on the Bond is made, there is nothing preventing the Court from looking at the situation which cannot be reversed, which is that a call has been made and so at the end of the day, if the call has been rightly made, the sum secured is to be released together with the interest earned for the period when the Defendant was kept out of the sum secured. Little wonder that learned counsel for the Defendant wanted the sum to be released to them as stakeholders in an interest earning account until the disposal of the application in Enclosure 3 and the OS. [41] The interest rate of 3% per annum on the sum secured is a conservative estimate of the interest that the Defendant would have earned had they put the money into a fixed deposit interest earning account. The interest earned is to be paid to the Plaintiff's solicitors at the end of each successive month with the said solicitors' confirmation to the Defendant's solicitors. [42] Should the Court hold that the call was unconscionable, then the amount of interest paid would be released by the Plaintiff's solicitors to the Plaintiff. 24 [43] Learned counsel for the Plaintiff said that this is tantamount to requiring the Plaintiff to reinforce its undertaking in damages. I do not think so. [44] It is a neat and convenient way to deal with a problem that arises from an injunction restraining a substantial sum from being released when one can anticipate and so assess at the outset the kind of damage that conservatively may be caused to the party restrained from receiving the sum secured under the Bond. There is no need to go for further assessment of damages suffered if the Defendant is prepared to accept that sum of interest retained as the damages they suffer for being deprived of the USD 20 million during the period between the ad-interim injunctive order and the disposal of the OS in their favour. [45] The Plaintiff's argument is that assets-wise they are more than financially capable of making good any award for damages. However this is a double-edged argument. If that be the financial position of the Plaintiff, then the Plaintiff should have little cause for complaint if their funds are moved from their account to their solicitors' account to be held as stakeholders pending the outcome of the hearing on the injunction. The interest per month is about USD 50,000.00. Learned counsel then submitted that going by the "quick asset test" exemplified by the cases 25 below, the Defendant is insolvent as its current liabilities exceeds its current assets: (i) Strukturmas (Selangor) Sdn Bhd v Majlis Perbandaran Petaling Jaya [2001] 3 MLJ 344; and (ii) Genting Sanyen Industrial Paper Sdn Bhd v WWL Corrugators Sdn Bhd [2000] 5 MLJ 33. [46] The Plaintiff submitted that the Defendant is a loss making company and that unless its parent company provides the funds, the Plaintiff would have real cause for worry. There is little cause for worry, at least not at this stage, because the interest is parked with the Plaintiff's own solicitors as stakeholders. [47] However it cannot be denied that the Plaintiff must have considerable confidence in the Defendant which had been around before most of us were born. It is a foreign company registered in Malaysia under the Companies Act 1965. This confidence of the Plaintiff in the Defendant's financial standing is seen in the long term lease of 25 years under the Lease Agreement at the rate of USD 600,000.00 per day (Clause 2.3.1) for the lease of the SEMI-FPS which works out to USD 18 million per month since 11.10.2014 to date and this has not been disputed by the Plaintiff. 26 Neither has the Plaintiff complained that the Defendant has defaulted in payments. [48] The Plaintiff's own auditors Ernst & Young had commented at page 8 of its audited accounts in Exhibit B2 in the Plaintiff's Affidavit in Support of its 2nd Application to vary the order of 3.11.16 (Enclosure 86) as follows: "As at 31 December 2015, the current liabilities of the Company exceeded its current assets by USD862,923,478 (2014: USD 1,071,629,495) mainly due to the loan from the ultimate holding company of USD 1,060,000,000 (2014: USD 1,250,000,000). The financial statements of the Company have been prepared on a going concern basis, as the ultimate holding company has agreed to provide the Company with financial support to meet its obligations when they fall due." (emphasis added) [49] The Plaintiff also exhibited the latest audited accounts of the Defendant in the same Exhibit B2 showing at page 16 of the audited accounts the following comment: "The balance sheet at 31 December 2015 reports net current liabilities of RM1,458,350,000 (2014:RM2,003,019.000) and net liabilities of RM131,235,000 (2014: net assets of RM417,039,000). 27 The accounts have been prepared under the going concern concept due to the availability of parent company funding, which will enable the Company to meet its liabilities as they fall due." (emphasis added) [50] In the light of the above, it would be a case of the pot calling the kettle black, for the Plaintiff to assert its financial superiority over the Defendant when both are dependent on their parent company funding to keep them in business. It is general knowledge that this Court can take cognizance of that in the past year the oil and gas industry has been severely hit by the sharp fall in the price of oil and are facing challenging time. [51] In fact it can be surmised that the Plaintiff's substantial revenue of USD 141,096,834 in 2015 is contributed significantly by the revenue from the lease of USD 18 million per month or USD 216 million. The Plaintiff's own audited accounts at page 19 Note 8 records as follows: "Finance lease receivables represent lease rental and interest receivable due from a customer, Sabah Shell Petroleum Company Limited ("SSPC"), for the lease of Semi-FPS." 28 [52] It is further recorded that for 2015 the future minimum lease receivables not later than one year is USD 230,146,832 and at Note 7 is it opined by the Plaintiff's auditors, lest there be some anxious concern, that: "Trade receivables that are neither past due nor impaired is due from a creditworthy debtor with good credit rating and profile." (emphasis added) [53] In the light of the reasons given above, it is within the Court's exercise of its discretion to order interest to be paid at the rate of 3% per annum of the sum secured by the Bond of USD 20 million which works out to a paltry USD50,000.00 per month; certainly paltry and more like petty cash for 2 big players in the oil and gas industry; the Plaintiff's ultimate holding company being Petronas Nasional Berhad as disclosed in the audited accounts exhibited and that of the Defendant, being the Royal Dutch Shell PLC. [54] It was submitted by the Plaintiff that the case of Nam Fatt Corporation Bhd & Anor v Petrodar Operating Co Ltd & Anor [2010] 9 CLJ 732 ("Nam Fatt") relied on by this Court in granting Prayer (4) of the Order dated 3.11.2016 to the Defendants could be distinguished. 29 [55] It was submitted by the Plaintiff that the facts in Nam Fatt are peculiar and distinguishable from the facts of the present case. In Nam Fatt, the learned judge awarded to the first defendant "interest at a rate of 3% per annum on the sum of RM18 million every quarter by 30th day of the commencement of each quarter to the first defendant's solicitors client's account earning interest and the first quarter shall commence on 1 July 2010" at the stage of setting aside the ad interim injunction and pending the hearing of the inter partes injunction and his Lordship's basis is as follows: "[80] I am of the view that at this stage of setting aside the ad-interim injunction and pending the hearing of the inter parte injunction the balance of convenience would have been more than achieved if the plaintiffs were to pay to the 1st defendant's solicitors the interests that could be earned on the sum of US$18 million so that at most, the only disadvantage to the 1st defendant is a postponement of their receipt of the sum of US$18 million under the PG until the hearing of the inter parte injunction. As the 1st plaintiff is under PN17 and there is a current restructuring plan afoot under a S176 scheme under the Companies Act 1965, the 1st defendant cannot be blamed for being anxious about the 1st plaintiff financial standing which can be allayed by the payment of interest periodically". 30 [56] It was further submitted that in the present case, the Plaintiff is not under PN17 and not under any restructuring plan under Section 176 scheme under the Companies Act 1965 but instead is in very good financial health and standing as can be seen in its latest audited financial statements for the year ended 31.12.2015. [57] The Plaintiff therefore contended that Prayer (4) ought to be granted only in special and limited circumstances, one of which is when the company seeking an injunctive relief is not a going concern. This, it was argued, is clearly not the case here. [58] I would say in a case where the Plaintiff's own auditors have qualified the going concern basis making it subject to "the ultimate holding company has agreed to provide the Company with financial support to meet its obligations when they fall due," it is within the exercise of the Court's discretion pending the hearing of the inter-parte injunction for the interest to be paid to the Plaintiff's solicitors. [59] The terms of the ad-interim injunctive order in Nam Fatt was affirmed by the Court of Appeal in Petrodar Operating Co Ltd v Nam Fatt Corporation Bhd & Anor [2012] 5 MLJ 445. 31 [60] In Ranhill E&C Sdn Bhd v Thyssenkrupp Industries (M) Sdn Bhd & Anor [2016] 6 CLJ 290 this Court observed as follows at the hearing of the application for injunction to restrain the 1st Defendant from receiving the monies secured under a Bond: “[55] The plaintiff contended that D1, though incorporated locally, is a company controlled from India, being a wholly-owned subsidiary of a foreign entity based on India…The plaintiff said that it was not in a position to ascertain the extent, if any of D1’s assets in Malaysia… [58] If the plaintiff is still anxious, that can be attended to by ordering that the amount of RM1,591,523.52 to be released by D2, be released to the solicitors’ clients’ account of D1’s solicitors herein and the same to be kept in an interest-earning account as stakeholders until the disposal of this suit.” [61] The Plaintiff there subsequently applied for an Erinford injunction which the Court granted subject to the paying of interest on the sum secured by the Bond as follows: "[77] Weighing the respective factors in the scale of balance of convenience and seeing that the trial is just round the corner in the first week of June, which is hardly three months away, the court 32 would be inclined to maintain the status quo ante and to grant the Erinford injunction subject to terms. The Erinford injunction would be until the disposal of the appeal or the disposal of the trial of this case whichever is earlier. [78] The plaintiff shall pay interest from 11 November 2015 (the date of call on the BG) to the date of disposal of trial or of the appeal whichever is earlier at the rate of 5% per annum to D1's solicitors and the first payment, calculated until the 31 March 2016, shall be paid to D1's solicitors as stakeholders by 31 March 2016 and the balance shall be on a monthly basis. Costs shall be costs in the cause." [62] The payment of interest on the sum secured by a Bond may be made at the ad-interim injunction stage or at the end of the inter-parte hearing for the injunction or even at the Erinford injunction stage in the exercise of the Court's discretion with the ends of justice in mind in that delicate balance of convenience test. [63] There was also the objection taken by the Defendant's learned counsel that the Plaintiff’s Notice of Application is procedurally flawed in that it does not state under which provision of the Rules of Court 2012 it was made. I would be inclined to follow the sentiments expressed 33 by Justice Mary Lim J (now JCA) in Safuan Group Berhad v Jambulingam Sethuraman Raki C/O Rimbun Corporate Advisory Sdn Bhd [2010] MLJU 1860 where her Ladyship held that an objection is to be dismissed where there is no prejudice or injustice caused. The Court would be slow to strike out applications due to technical non-compliance and compromise the interests of justice. Instead, the Court is able to cure such minor errors pursuant to its powers under Order 2 Rule 1(2), Order 1A and/or Order 92 Rules 5 of the Rules of Court 2012. See further Chin Wooi Keat v Isberg Corporation Sdn Bhd (dalam Penerimaan) & Anor [2014] 1 LNS 48. [64] I agree with the Plaintiff that the Defendant was not prejudiced and was certainly not misled as to the content and purpose of this application. The application was sufficiently clear and certain to the extent that the Defendant has able to address the issues raised and reply to the affidavit. I had therefore allowed the Plaintiff's learned counsel to make an oral application to amend the Notice of Application to reflect that it was made pursuant to Order 42 rule 13, Order 92 rule 4 and/or the inherent jurisdiction of this Court. 34 [65] To summarize, what the Plaintiff had sought to do was to ask this Court to review its decision of 3.11.2016 with respect to deleting prayer (4) altogether. There has been no material change of circumstances from that date to the date of the application (22.11.2016) to justify any review of the ad-interim order made, which by its very nature is temporary pending the outcome of the inter-partes hearing of Enclosure 3 where the injunction is concerned together with the main prayers in the OS. [66] The proper remedy would be for the Plaintiff to appeal against the said order of 3.11.2016 which the Plaintiff did by filing a Notice of Appeal dated 28.11.2016 at the same time as they filed an appeal against the decision of this Court in Enclosure 86 given on 25.11.2016. This is in line with the approach taken in Chua Weng Meng v Wong Kok Kong [1999] 2 MLJ 416 at page 422 where it was observed: "Having regard to the extensive rights of appeal, the power to recall an order which has not been passed and entered should be sparingly exercised if such issues for further consideration can be left to be dealt with by way of appeal to the Court of Appeal." 35 [67] This judgment is written both for the purpose of the Plaintiff's appeal in Enclosure 86 on their application to vary the order of 3.11.2016 as well as for their appeal against the ad-interim order in Enclosure 3. Pronouncement [68] For the reasons given above, the Plaintiff's application to vary prayer 4 of the ad-interim injunctive order of 3.11.2016 in Enclosure 86 is dismissed with costs in the cause. [69] In the meanwhile prayer (4) of the order of 3.11.2016 shall remain. The Plaintiff shall deposit with their solicitors the interest that would have been earned on the sum secured of USD 20 million calculated at the rate of 3% per annum and payable monthly to be paid on the last day of each month to the Plaintiff's solicitors commencing 30.11.2016 and thereafter on the last day of each succeeding month until the disposal of Enclosure 3 and the OS. The Plaintiff’s solicitors shall give written confirmation to the Defendant's solicitors at the end of each month. 36 [70] The interest earned shall be applied as the Court may direct at the end of the inter-parte hearing of Enclosure 3. Liberty to apply. Dated: 1 February 2017. Y.A. LEE SWEE SENG Judge Construction Court Kuala Lumpur For the Plaintiff : Lim Chee Wee, Shannon Rajan, Janice Tay, and Geraldine Goon. (Messrs Skrine) For the Defendant : Ariff Rozhan together with William Lim, Kho Sze Jia and Kow Kean Fatt (Messrs Ariff Rozhan & Co.) Dates of Decision: 3 November 2016 and 25 November 2016.

Tika 2.6.0

29-3300-03/2013

PERAYU PER : YASMIN PEREMA BINTI ABDULLAH (NO. K/P: 730427-05-5030) …. PERAYU / PENGHUTANG PENGHAKIMAN RESPONDEN EX-PARTE: HONG LEONG BANK BERHAD (No. Syarikat: 97141-X) (yang telah mengambil alih segala asset dan liabiliti Credit Corporation Malaysia Berhad melalui dua Perintah Letakhak bertarikh 29/12/2000 dan 27/7/2004) …. RESPONDEN / PEMIUTANG PENGHAKIMAN

21/06/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=da6282d3-bd0b-47a2-8ba3-b8e2ec69bce1&Inline=true

DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA KES KEBANKRAPAN NO: 29-3300-03/2013 PER : YASMIN PEREMA BINTI ABDULLAH (NO. K/P: 730427-05-5030) …. PERAYU/ PENGHUTANG PENGHAKIMAN EX-PARTE: HONG LEONG BANK BERHAD (No. Syarikat: 97141-X) (yang telah mengambil alih segala asset dan liabiliti Credit Corporation Malaysia Berhad melalui dua Perintah Letakhak bertarikh 29/12/2000 dan 27/7/2004) ….RESPONDEN/ PEMIUTANG PENGHAKIMAN GROUNDS OF JUDGMENT Introduction [1] This is an appeal filed by the Judgment Debtor (JD) against the decision of the learned Senior Assistant Registrar that was given on 5.12.2016 dismissing the JD’s application to set aside bankruptcy notice of 26.3.2013 and in the same application, to set aside the Receiving Order and Adjudication Order (RO & AO) made against the JD on 12.2.2014. [2] The parties are the Appellant (JD) and the Respondent who is the Judgment Creditor (JC). Facts [3] It is not in dispute that the JC’s initial action was based on a breach of Tenancy Agreement of 22.1.2000. A judgment was entered against the JD on 15.4.2003 for the sum of RM51,714.66 as at 23.7.2002 including interest of 8% per annum in monthly rest calculated on daily amount outstanding from 24.7.2002 until full settlement and cost of RM1,154.00. The Bankruptcy Notice was filed on 26.3.2013 at this Shah Alam High Court which was granted on the same day. [4] Based on the JC’s written submission, the JC had in 2005 executed through one Writ of Seizure and Sale at the Kuala Lumpur Session Court (Execution No: 1-56-503-05) but was withdrawn due to payment made by JD on 24.11.2005 for RM10,000.00. Another bankruptcy notice was filed against the JD at the Kuala Lumpur High Court No.D-29-72-2010 but was withdrawn with liberty to file afresh after an agreement for JD to make payment on 2.3.2011 until 3.7.2012. [5] The JC claimed that the JD again failed to make payments and filed a Bankruptcy Notice that was served on JD by way of one main newspaper Berita Harian advertisement on 5.7.2013 and by way of personal service on 27.7.2013. [6] The JC’s petition was issued to JD on 25.9.2013, 6 months after the Bankruptcy Notice was filed and the RO & AO was recorded on 12.2.2014. Cause Papers [7] The cause papers filed are as follows: “(a) Penghakiman Mahkamah Sesyen Kuala Lumpur bertarikh 15.04.2003 (selepas ini dirujuk sebagai “Penghakiman tersebut”); (b) Permintaan Mengeluarkan Notis Kebankrapan bertarikh 26.03.2013 (selepas ini dirujuk sebagai “Permintaan tersebut”); (c) Notis Kebankrapan bertarikh 26.03.2013 (selepas ini dirujuk sebagai “Notis Kebankrapan tersebut”); (d) Perintah Mahkamah bertarikh 20.05.2013 untuk lanjutan masa Notis Kebankrapan (selepas ini dirujuk sebagai “Perintah Lanjutan Masa tersebut”); (e) Perintah Mahkamah bertarikh 20.05.2013 untuk penyampaian ganti Notis Kebankrapan (selepas ini dirujuk sebagai “Perintah Penyampaian Ganti-BN tersebut”); (f) Affidavit Penyampaian yang diikrarkan oleh Mohd Rizuan bin Jaafar pada 10.07.2013 (selepas ini dirujuk sebagai “Affidavit Penyampaian-BN tersebut”); (g) Petisyen Pemiutang bertarikh 25.09.2013 (selepas ini dirujuk sebagai “Petisyen Pemiutang tersebut”); (h) Affidavit Kebenaran Kenyataan Di Dalam Petisyen yang diikrarkan oleh Chin Kar Hooi pada 24.09.2013 (selepas ini dirujuk sebagai “Affidavit Penyampaian-BN tersebut”); (i) Perintah Mahkamah bertarikh 02.12.2013 utnuk penyampaian ganti Petisyen Pemiutang tersebut (selepas ini dirujuk sebagai “Perintah Penyampaian Ganti-Petisyen tersebut”); (j) Affidavit Penyampaian yang diikrarkan oleh Mohd Ridzuan bin Jaafar pada 10.01.2014 (selepas ini dirujuk sebagai “Affidavit Penyampaian-Petisyen Pemiutang tersebut”); (k) Perintah Penerimaan Bagi Petisyen Pemiutang bertaikh 10.03.2014 (selepas ini dirujuk sebagai “Perintah Penerimaan tersebut”); (l) Perintah Penghukuman bertarikh 10.03.2014 (selepas ini dirujuk sebagai “Perintah Penghukuman tersebut”); (m) Saman Dalam Kamar bertarikh 08.09.2016 (Lampiran 33) (selepas ini dirujuk sebagai “Permohonan JD tersebut”); (n) Afidavit Sokongan yang diikrarkan oleh Yasmin Perema Binti Abdullah pada 01.09.2016 (selepas ini dirujuk sebagai “Afidavit Sokongan JD tersebut”); (o) Afidavit Jawapan Pemiutang Penghakiman yang diikrarkan oleh Esoda a/p Krishnasamy pada 06.10.2016 (selepas ini dirujuk sebagai “Afidavit Jawapan JC tersebut”); (p) Afidavit Jawapan yang diikrarkan oelh Yasmin Perema Binti Abdullah pada 24.10.2016 (selepas ini dirujuk sebagai “Afidavit Jawapan JD tersebut”); (q) Afidavit Jawapan Pemiutang Penghakiman Kedua yang diikrarkan oleh affirmed by Esod a/p Krishnasamy pada 10.11.2016 (selepas ini dirujuk sebagai “Afidavit Jawapan JC (2) tersebut”).” (r) Written submission of JD; and (s) Written submission of JC. JD’s Submission [8] The learned counsel for JD submitted the only ground for the appeal, that is the JC had failed to obtain leave of the Court under Order 46 r. 2(1)(a) of the Rules of Court 2012 (ROC 2012) before commencing the bankruptcy proceedings against JD as the judgment obtained was more than six years. [9] The counsel raised the issue as to whether the JC is allowed under section 3 (1)(i) of the Bankruptcy Act 1967 to issue a bankruptcy notice when there is a time lapse between the date of the judgment and the date of the bankruptcy notice which is 11 years and 8 months. The counsel referred to the two Federal Court cases: Dr. Shamsul Bahar Bin Abdul Kadir v RHB Bank Berhad [2015] 4 CLJ 561 and Amfraser Securities Pte Ltd v Poh Gaik Lye [2016] MLRA 995 and submitted that the JC cannot lawfully file the bankruptcy notice after a lapse of six years or more from date of judgment unless prior leave of the Court pursuant to Order 46 r. 2(1)(a) of the ROC 2012 has been obtained. [10] The counsel for JD submitted the effect of failure to obtain leave as required, arguing that it will amount to the subsequent action as incompetent and relied on the authority V. Gopal, Re: Ex: Bank Buh (M) Bhd [1987] 1 CLJ 602 where it was held that it was a requirement for a judgment creditor to obtain leave to issue execution under Order 46 r. 2(1)(a) of Rules of High Court 1980 before commencing with bankruptcy proceedings on a judgment entered more than six years earlier. [11] The counsel also referred to the case Wee Chow Yong, Ex P; Public Finance Bhd [1990] 1 CLJ 176; [1990] 3 CLJ, where Edgar Joseph Jr J (as then was) held in terms similar to VC George J in the V Gopal (supra) case that made reference to the English cases on the parallel English law which defines a creditor who has obtained a final judgment under section 3(1)(i) to mean that the petitioner is not entitled to enforce the judgment if he has not obtained the requisite leave as prescribed by Order 46 r.2(1)(a) where the bankruptcy notice was served after six years from date of judgment. Based on the foregoing two decisions, the Court heard the counsel’s submission that a creditor who has obtained a judgment and sat on it for more than six years in West Malaysia must obtain leave of Court before he can commence bankruptcy proceedings under section 3(1)(i) of the Bankruptcy Act 1967. In addition, the counsel submitted that the law pertaining to section 3 of the said Act 1967 had always been in place. [12] The counsel for the JD also referred to the Federal Court Case of Low Mun v. Chung Khiaw Bank Ltd [1987] 2 CLJ 400; [1987] CLJ (Rep) 172 where he pointed to the decision of Mohamed Azmi SCJ on section 3(1)(i) of the Act at page 176, “It is also essential that at the time of issue of the bankruptcy notice, the judgment creditor must be in the position to issue execution – see Re Woodall, ex parte Woodall [1884] 13 QBD 479.” [13] The counsel heavily relied on Dr Shamsul Bahar Bin Abdul Kadir vs RHB Bank Berhad [2015] 4 CLJ 561 stating that the Federal Court had reverted the position of Order 46 r. 2 (1)(a) of the ROC 2012 and pointed to the analysis where it derived its decision. The counsel also submitted that based on Dr. Shamsul Bahar’s (supra) case, the decision revolved around the requirement for leave from Court. [14] The counsel for the JD further sought to refer to the case Amfraser Securites Pte Ltd vs Poh Gail Lye 2016 MLRA 995, the Federal Court decision and quoted as follows, “(1) The notice was issued some 10 years and five months after the judgment had been obtained. It was more that six years after the judgment was obtained. No prior leave of court to issue a writ of execution to enforce a judgment pursuant to O 46 r. 2(1)(a) of the Rules of the High Court 1980 (“RHC”) had been obtained.” (paragraph 11, page 321 of the judgment). “(2) The phrase “who is for the time being entitled to enforce a final judgment” in the proviso to s 3(1)(i) of the Bankruptcy Act 1967 must be a person who is entitled to enforce a final judgment without prior leave of court. If when a bankruptcy notice is issued, the judgment is more than six years old, the judgment creditor is not in a position to execute the judgment without the prior leave of court. In such a case, leave under O 46 r 2 of the RHC must be obtained. In the instant case, since the notice was issued some 10 years and five months after the judgment had been obtained, the appellant was not a person who for the time being was entitled to enforce a final judgment in the proviso to s 3(1)(i) of the Bankruptcy Act 1967. In such a case, leave under O 46 r 2 of the RHC should have been obtained by the appellant. Since no leave had been obtained, it was not in a position to execute the judgment. Thus, it was not entitled to issue the notice. On this ground alone, the notice ought to be set aside.” (paragraph 15, page 323 of the judgment). [15] Counsel for the JD submitted that based on the Federal Court’s decisions, the bankruptcy notice is to be set aside as it is bad in law, a nullity ab initio and that the RO & AO cannot stand and must be set aside. Respondent’s/JC’s counsel: [16] The JC in this case advanced several grounds, the main ground is that the leave from the Court is not needed. The JC claimed that at all material time the Bankruptcy Notice had been served within the extended period. The JC objected to JD’s application for the reason that it was done after 2 years and 7 months that is after the RO & AO had been entered on 12.2.2014 and without giving any reasons to support the application to set aside. JC submitted that JD’s application is without bona fide. [17] JC also submitted that the Order had been issued and registered and thus cannot be set aside or amended except to correct clerical error and arithmetic as the Court had functus officio unless there’s a provision to say otherwise. [18] In relation to the claim that there was a long delay by the JD, the JC referred to two cases namely, Re Jonathan Chelliah Ex P Industrial & Commercial Insurance (M) Bhd [2007] 7 CLJ 132 and the case of Re Seow Yin Fong: Ex Parte: United Orient Leasing Company Berhad & Another Case [1994] 2 CLJ 845. In the former case, counsel pointed to the decision: “The debtor has all the opportunities to contest the judgment creditor’s claim at the earlier stages. This court must therefore consider the interest of the creditors….who will be greatly prejudiced should the adjudication and receiving orders be set aside at this juncture.” (emphasis made by JC) [19] The JC’s main contention is that the Bankruptcy Notice filed after 10 years does not hinder JC to file against the JD as the issuance of bankruptcy notice is not a writ of execution but a judgment. The counsel argued that since it is an action to bring upon a judgment, it is within the limitation period of 12 years and therefore no leave is required to be obtained and relied on the case Perwira Affin Bank v Lim Ah Hee [2004] 3 MLJ 253. [20] The JC submitted the authority, the case of Ambank (M) Bhd (Formerly known as AmFinance Bhd) v Tan Tem Son & Another Appeal [2013] 3 MLJ 179 that the bankruptcy proceeding is not a writ of execution within the meaning of Order 46 rule 2 of the ROC and since it is an action to enforce a judgment, it comes under section 6(3) of the Limitation Act 1953 which provides that the limitation is of 12 years and therefore the leave from Court is not needed. [21] The JC’s contention is heavily placed on a recent case of 25.01.2017 (Appeal No. B-03(IM)-12-01/2016), Hamzah Bin Mat Sah v Ambank (M) Berhad and quoted almost the whole decision in its written submission which is partly reproduced: “[11] The main issue that arose for determination in this appeal had been concerned with whether leave was required to be obtained by the JC from the court before it could proceed to execute Judgment against the JD after 6 years had lapsed from the date of the judgment pursuant to Order 46 Rule 2 of the Rules of Court 2012 (“ROC 2012”). [13] It was contended by the learned counsel for the JD that the ruling in the Dr Shamsul case [supra] had retrospective effect in the sense that it had the effect of requiring the JC to first obtain leave of court before it could execute against the JD upon the judgment that it obtained against the JD more than 6 years ago. [14] It must be noted that before the apex Court decided the way it did in the Dr. Shamsul case [supra], the then prevailing judicial review on the matter was encapsulated in the decision of the Federal Court in the case of Ambank (M) Bhd v Tan Tem Son & Anor [2013] 3 CLJ 317 where it was held that a bankruptcy action does not fall within the ambit of a writ of execution within the meaning of O.46 r.2 of the Rules of High Court 1980. Premised on that ruling, the issue of whether a JC was required to obtain prior leave of Court before it could begin a bankruptcy proceedings based on a final judgment which was obtained more than six years prior did not therefore arise. In short, no such leave was necessary to be obtained by the JC. [15] After considering the able submissions by both learned counsel, we were of the view that the ruling in the Dr. Shamsul case [supra] was generally prospective. [16] It is apparent that there was nothing in the decision of the apex Court in Dr. Shamsul case [supra] that it was meant to have a retrospective effect….. [17] If indeed it was to be applicable retrospectively, it could only be so applied in a very limited and circumscribed circumstances. ….” (emphasized by counsel) [22] The counsel for the JC submitted that following the recent case of Hamzah Bin Mat Sah v Ambank (M) Berhad (supra), “Oleh yang demikian, berdasarkan kes yang telah diputuskan tersebut, walaupun Mahkamah bersetuju bahawa adalah satu keperluan untuk JC mendapatkan kebenaran untuk Penghakiman yang melebihi 6 tahun, prinsip ini hanya terpakai kepada kes-kes yang difailkan selepas kes Dr. Shamsul. Ia tidak terpakai retrospektif.” Court’s Finding [23] Based on the facts before this Court, it cannot be disputed that the bankruptcy notice was issued more than six years after the judgment was obtained on 15.4.2003. There was an action taken in 2005 where JC filed for Writ of Seizure and Sale but withdrawn as JD made payment on 24.11.2005. A bankruptcy notice was then issued on 7.1.2010 but was also withdrawn. The bankruptcy notice was only issued some 11 years and 8 months on 15.4.2013. In other words, on the day the bankruptcy notice was issued, more than six years had lapsed from date of judgment. [24] The JD in her Summon in Chambers of 8.9.2016 for application to set aside and/or annul the Bankruptcy Notice stated among others, “1. Pemiutang Penghakiman tidak mendapatkan kebenaran Mahkamah yang Mulia ini untuk mengeluarkan Notis Kebankrapan bertarikh 26.3.2013 selepas tempoh 10 tahun dari Penghakiman bertarikh 15.4.2013 selaras dengan Aturan 46 kaedah 2 Kaedah-Kaedah Mahkamah 2012; 2. Pemiutang Penghakiman tidak berada dalam kedudukan untuk melaksanakan Penghakiman tersebut selepas tempoh enam (6) tahun dari Penghakiman bertarikh 15.4.2003 tanpa kebenaran Mahkamah yang Mulia ini….” [25] In the affidavit filed in support of her application to set aside the bankruptcy notice, JD deposed as follows: “6. Saya dinasihati oleh peguamcara saya dan sesungguhnya percaya bahawa Notis Kebankrapan tersebut adalah tidak dan perlu diketepikan dengan serta merta di mana selaras dengan Aturan 46 kaedah 2(1)(a) Kaedah-Kaedah Mahkamah 2012 dan kehendak mandatori Seksyen 3(1)(i) Akta Kebankrapan 1967 di mana Pemiutang Penghakiman yang berniat untuk menguatkuasakan mana-mana Penghakiman atau Perintah selepas tempoh enam (6) tahun atau lebih sejak tarikh Penghakiman atau Perintah, perlu mendapatkan suatu kebenaran Mahkamah yang Mulia ini untuk melaksanakan Penghakiman atau Perintah tersebut. 7. Saya sesungguhnya percaya dan menyatakan bahawa JC gagal untuk memohon kebenaran Mahkamah yang Mulia ini dan Notis Kebankrapan bertarikh 26.3.2013 telah dikeluarkan tanpa kebenaran Mahkamah yang Mulia ini selepas lebih kurang 10 tahun dari tarikh Penghakiman bertarikh 15.4.2003 untuk melaksanakan Penghakiman tersebut terhadap saya. ….” [26] The JC did not deny that no prior leave to execute under Order 46 rule 2(1)(a) of the ROC 2012 was obtained but contended that the bankruptcy notice and the proceedings involved including the RO & AO was made prior to the Dr Shamsul Bahar (supra) case which was decided on 6.4.2015. In addition, the Counsel argued that the leave from Court following Order 46 r. 2(1)(a) is not needed, relying on the authorities Perwira Affin Bank v Lim Ah Hee [2004] 3 MLJ 253 and Ambank (M) Bhd (Formerly Known as AmFinance Bhd) v Tan Tem Son & Another Appeal in supporting the contention that a bankruptcy proceeding is not a writ of execution but an action on judgment and as such, bankruptcy notice can be served without leave within the 12 years period. [27] In summary, the cases put forward by the JC encompasses the law that the bankruptcy proceeding is not a writ of execution and therefore Order 46 r.2 of the ROC 2012 did not apply to bankruptcy proceedings; the bankruptcy proceeding is an action upon a judgment within the meaning of section 6(3) of the Limitation Act 1953 where the limitation period is of 12 years and that there was nothing in Dr. Shamsul’s case to have a retrospective effect. [28] The main contention here is that when the bankruptcy notice was issued after six years, whether the JC is entitled to enforce the judgment within the meaning of section 3(1)(i) of the Bankruptcy Act 1967 without prior leave of court. [29] Section 3(1)(i) of the Bankruptcy Act 1967 provides: “(1) A debtor commits an act of bankruptcy…. (i) If a creditor has obtained a final judgment or final order against him for any amount and execution thereon not having been stayed has served on him…a bankruptcy notice under this Act requiring him to pay the judgment debtor or sum ordered to be paid in accordance with the terms of the judgment or order,…and he does not within 7 days after service of the notice…comply with the requirements of the notice.. Provided that for the purposes of this paragraph… any person who is for the time being entitled to enforce a final judgment or final order shall be deemed to be a creditor who has obtained a final judgment or final order;….” [30] There have been a number of cases decided whether a person who is entitled to enforce a judgment requires the prior leave of court. However before we delve into the cases, a quick look at the law requiring the leave following Order 46 r.2(1)(a) of the ROC 2012. [31] Order 46 rule 2(1)(a) of the ROC 2012 provides that, “When leave to issue any writ of execution is necessary (O 46 r2) 2 (1) A writ of execution to enforce a judgment or order may not be issued without the leave of the Court in the following cases: (a) where six years or more have lapsed since the date of the judgment or order; (b)… (2) Paragraph (1) is without prejudice to any written law or rule by which a person is required to obtain leave of the Court for the issue of a writ of execution or to proceed to execution on or otherwise the enforcement of a judgment order. …..” [32] Referring to the first paragraph of rule 2 at part (1), the words “a writ of execution to enforce a judgment or order”, the word ‘writ of execution’ is given the meaning under rule 1 of the same Order which “includes a writ of seizure and sale, a writ of possession and a writ of delivery”. The term “includes” means that the list is not exhaustive and it had been decided that bankruptcy proceedings is covered under Order 46 rule 1: Tengku Iskandar Tengku Ahmad v Sime Bank Bhd [2001] 7 CLJ 560. [33] The writ of execution definition can be found in Black’s Law Dictionary, (Second Edition) which means “a writ to put in force the judgment or decree of a court”. Lord Denning in Re Overseas Aviation Engineering (GB) Ltd [1962] 3 ALL ER 12 stated that ‘execution’ means, ‘quite simply, the process for enforcing or giving effect to the judgment of the court’. [34] Prior to the case of Dr. Shamsul Bahar (supra), the cases attributed by the counsel for the JD which I had the benefit of reading, provides the law that a judgment creditor must be in a position to issue execution on the judgment at the time when he issued the bankruptcy notice. [35] To put it simply, this would mean that the judgment creditor who seeks to make the judgment debtor bankrupt must have in his hands a final judgment that can be enforced: Ambank (M) Berhad v Raymond Yong Kim Yoong [2007] SGHC 172 at paragraph 14. In the case where six years or more had lapsed since obtaining the final judgment or final order, the person is no longer entitled to enforce that final judgment or order unless he has obtained prior leave of the Court by virtue of Order 46 r. 2(1)(a). [36] In the case of Ambank (M) Bhd (formerly known as AmFinance Bhd) v Tan Tem Son and another appeal [2013] 3 MLJ 179; [2013] 3 CLJ 317, which relied on the case Perwira Affin Bank Bhd v Lim Ah Hee @ Sim Ah Hee [2004] 3 MLJ 253; [2004] 2 CLJ 787, the Federal Court held that the phrase ‘any person who is for the time being entitled to enforce a final judgment’ in the proviso to section 3(1)(i) of the Bankruptcy Act 1967 does not require a judgment creditor to obtain leave pursuant to Order 46 r.2(1)(a) of the Rules of High Court 1980 prior to initiating a bankruptcy proceeding based on a final judgment which has been obtained more than six years ago. However, the Tan Tem Son (supra) case was reconsidered by a different panel in the Federal Court in the case of Dr. Shamsul Bahar bin Abdul Kadir v RHB Bank Bhd and another appeal [2015] 4 MLJ 1 which did not follow the decision of Tan Tem Son (supra) case. [37] The case of Dr. Shamsul Bahar Bin Abdul Kadir v RHB Bank Berhad [2015] 4 CLJ 561 discussed at length the background to the proviso which entails the words “execution thereon not having been stayed” that was borrowed from the English Bankruptcy Act of 1883. The meaning of the words “execution thereon not having been stayed” was first considered by the English Court of Appeal in Re ex parte Woodall (1884) 13 QBD 479 where it was held that a creditor must be in a position, when he issued the bankruptcy notice, to issue immediate execution upon the judgment. [38] Dr. Shamsul Bahar (supra) case also referred to the Singapore’s case of Ambank (M) Berhad v Raymond Yong Kim Yoong [2007] SGHC 172 where the Singapore Rules of Court Order 46 r 2(1)(a) is in pari materia with ROC 2012 Order 46 r 2(1)(a). In that case, Ambank (M) obtained judgment against the judgment debtor in Malaysia for failing to honour his obligations under a personal guarantee. The judgment was registered in Singapore almost six years later. Ambank (M) then instituted a bankruptcy proceedings against the judgment debtor in Singapore after almost 12 years. The High Court of Singapore held that the registered judgment was no longer enforceable by execution in Singapore without leave of the court because of almost 12 years lapsed since the Malaysian judgment was registered following Order 46 r 2(1)(a) of the Rules of Court (Cap 322, 2006). [39] The learned High Court Judge of Singapore made a comparison to the old Bankruptcy Act where the words “execution thereon not having been stayed” were used in contrast to its present law, under its section 61(1)(d) of the Bankruptcy Act (Cap 20,2000 Rev Ed), where the words “which is enforceable by execution” are used and stated that, “… the court had always insisted that, although the question of an execution of a judgment does not arise when a bankruptcy petition is presented, a judgment creditor who seeks to make the judgment debtor bankrupt on the basis of an unsatisfied judgment debt must have in his hands a final judgment that can be enforced forthwith or immediately. As such, where the leave of the court is required for whatever reason before a judgment may be enforced, such leave must be obtained before a person can be made bankrupt on the basis of that judgment.” [40] In the case of Amfraser Securities Pte Ltd v Poh Gaik Lye [2016] 4 MLJ 314, the Federal Court held that a person ‘who is for the time being entitled to enforce a final judgment’ in the proviso to section 3(1)(i) of the Bankruptcy Act 1967 must be a person who is entitled to enforce a final judgment without prior leave of court. It also held that, if when the bankruptcy notice is issued the judgment was more than six years old, then the judgment creditor is not in a position to execute the judgment without the prior leave of court. The leave under Order 46 r.2 of the RHC must be obtained. [41] This Court finds that the counsel for the JC’s submission on the issue of non-retrospective is without basis as the law requiring leave from court was in place under the Rules of Court 1980, now replaced by the ROC 2012. I agree with the counsel for the JD that section 3 of the Bankruptcy Act 1967 was the law in place but I am more inclined to say that the law under Order 46 r 1(1)(a) of the Rules of Court 1980 now replaced by ROC 2012 which provides the leave requirement had also been in place. This important element was also reflected in the case of Dr. Shamsul Bahar (supra) where the law referred was Order 46 r 2(1)(a) of the Rules of Court 1980. [42] To further strengthen my point, there have been other cases where the Court had exercised discretion in granting leave under Order 46 r 2(1)(a). In Tio Chee Heng v Chung Khiaw Bank Ltd [1981] 1 MLJ 227, a Federal Court Kota Kinabalu decision, it was an appeal from the decision of the judge to grant leave to issue execution against the appellant on two judgments entered more than six years ago. The first action was in respect of a charge to secure the repayment of a considerable sum of money advanced to a company of which the appellant was the sole proprietor and the other action was for repayment of the overdraft granted to the appellant. The appellant never contended against the explanation by the Bank that the reason for the delay in executing judgment against him was to give him time during the negotiations for settlement and the basis for the delay in seeking leave from Court was allowed. [43] In the case of Public Bank Bhd v Seato Trading (M) SDn Bhd & Ors [1996] 1 MLJ 165, the plaintiff had applied for leave for execution against the third defendant in respect of arrears after more than six years had passed from the date of judgment. The counsel for the plaintiff submitted that although six years had lapsed from the date of the judgment, no injustice or prejudice would be caused to the third defendant to make repayment and the plaintiff was only protecting its own interest by not putting further pressure on the third defendant as it would jeopardize the settlement of the debt and that the court should not dismiss plaintiff’s application because of the delay. The appeal was allowed. [44] The law in United Kingdom as explained in Halsbury’s Laws of England (Fifth Edition) on the writ of execution to enforce a judgment or order may not be issued without the permission of the court where six years or more have elapsed since the date of judgment or order, had been retained in the United Kingdom’s Civil Procedure Rules 1998 Sch 1 Rules of Supreme Court Order 46 r 2(1)(a) which corresponds to our ROC 2012. [45] Based on the foregoing, I am bound by Order 42 r 2(1)(a) of the ROC 2012 and the Federal Court decisions in Dr. Shamsul Bahar (supra) case and Amfraser Securities (supra) case. I have answered the main ground in the affirmative, that is the JC who commences the bankruptcy proceedings after more than 6 years have lapsed from the date of judgment, must obtain the prior leave of Court following Order 42 r 2(1)(a) of the ROC 2012. I allowed the appeal with cost. Dated: 21 June 2017 (DATIN ZALITA BINTI DATO’ HJ. ZAIDAN) Judicial Commissioner Shah Alam High Court SOLICITORS: APPELLANT : SATVINDER KAUR Tetuan Satvinder K &Associates Peguambela dan Peguamcara No. 3, Jalan Hujan Emas10 Oversea, Union Garden 58200 Kuala Lumpur [RUJ: SK/639/11/2014(L)] Tel: 03-7980 9798 Fax: 03-7980 7384 RESPONDENT : ROZANITA BINTI BASRUN Tetuan Thomas Ong Leong & Associates Peguambela dan Peguamcara Blok 3A02, Menara Mutiara Majestic No. 15, Jalan Othman 46000, Petaling Jaya Selangor Darul Ehsan [RUJ NO: TOL/0212401/OKS] Tel: 03-7980 9798 Fax: 03-7980 7384 28

Tika 2.6.0

29-3300-03/2013

PERAYU PER : YASMIN PEREMA BINTI ABDULLAH (NO. K/P: 730427-05-5030) …. PERAYU / PENGHUTANG PENGHAKIMAN RESPONDEN EX-PARTE: HONG LEONG BANK BERHAD (No. Syarikat: 97141-X) (yang telah mengambil alih segala asset dan liabiliti Credit Corporation Malaysia Berhad melalui dua Perintah Letakhak bertarikh 29/12/2000 dan 27/7/2004) …. RESPONDEN / PEMIUTANG PENGHAKIMAN

21/06/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

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DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA KES KEBANKRAPAN NO: 29-3300-03/2013 PER : YASMIN PEREMA BINTI ABDULLAH (NO. K/P: 730427-05-5030) …. PERAYU/ PENGHUTANG PENGHAKIMAN EX-PARTE: HONG LEONG BANK BERHAD (No. Syarikat: 97141-X) (yang telah mengambil alih segala asset dan liabiliti Credit Corporation Malaysia Berhad melalui dua Perintah Letakhak bertarikh 29/12/2000 dan 27/7/2004) ….RESPONDEN/ PEMIUTANG PENGHAKIMAN GROUNDS OF JUDGMENT Introduction [1] This is an appeal filed by the Judgment Debtor (JD) against the decision of the learned Senior Assistant Registrar that was given on 5.12.2016 dismissing the JD’s application to set aside bankruptcy notice of 26.3.2013 and in the same application, to set aside the Receiving Order and Adjudication Order (RO & AO) made against the JD on 12.2.2014. [2] The parties are the Appellant (JD) and the Respondent who is the Judgment Creditor (JC). Facts [3] It is not in dispute that the JC’s initial action was based on a breach of Tenancy Agreement of 22.1.2000. A judgment was entered against the JD on 15.4.2003 for the sum of RM51,714.66 as at 23.7.2002 including interest of 8% per annum in monthly rest calculated on daily amount outstanding from 24.7.2002 until full settlement and cost of RM1,154.00. The Bankruptcy Notice was filed on 26.3.2013 at this Shah Alam High Court which was granted on the same day. [4] Based on the JC’s written submission, the JC had in 2005 executed through one Writ of Seizure and Sale at the Kuala Lumpur Session Court (Execution No: 1-56-503-05) but was withdrawn due to payment made by JD on 24.11.2005 for RM10,000.00. Another bankruptcy notice was filed against the JD at the Kuala Lumpur High Court No.D-29-72-2010 but was withdrawn with liberty to file afresh after an agreement for JD to make payment on 2.3.2011 until 3.7.2012. [5] The JC claimed that the JD again failed to make payments and filed a Bankruptcy Notice that was served on JD by way of one main newspaper Berita Harian advertisement on 5.7.2013 and by way of personal service on 27.7.2013. [6] The JC’s petition was issued to JD on 25.9.2013, 6 months after the Bankruptcy Notice was filed and the RO & AO was recorded on 12.2.2014. Cause Papers [7] The cause papers filed are as follows: “(a) Penghakiman Mahkamah Sesyen Kuala Lumpur bertarikh 15.04.2003 (selepas ini dirujuk sebagai “Penghakiman tersebut”); (b) Permintaan Mengeluarkan Notis Kebankrapan bertarikh 26.03.2013 (selepas ini dirujuk sebagai “Permintaan tersebut”); (c) Notis Kebankrapan bertarikh 26.03.2013 (selepas ini dirujuk sebagai “Notis Kebankrapan tersebut”); (d) Perintah Mahkamah bertarikh 20.05.2013 untuk lanjutan masa Notis Kebankrapan (selepas ini dirujuk sebagai “Perintah Lanjutan Masa tersebut”); (e) Perintah Mahkamah bertarikh 20.05.2013 untuk penyampaian ganti Notis Kebankrapan (selepas ini dirujuk sebagai “Perintah Penyampaian Ganti-BN tersebut”); (f) Affidavit Penyampaian yang diikrarkan oleh Mohd Rizuan bin Jaafar pada 10.07.2013 (selepas ini dirujuk sebagai “Affidavit Penyampaian-BN tersebut”); (g) Petisyen Pemiutang bertarikh 25.09.2013 (selepas ini dirujuk sebagai “Petisyen Pemiutang tersebut”); (h) Affidavit Kebenaran Kenyataan Di Dalam Petisyen yang diikrarkan oleh Chin Kar Hooi pada 24.09.2013 (selepas ini dirujuk sebagai “Affidavit Penyampaian-BN tersebut”); (i) Perintah Mahkamah bertarikh 02.12.2013 utnuk penyampaian ganti Petisyen Pemiutang tersebut (selepas ini dirujuk sebagai “Perintah Penyampaian Ganti-Petisyen tersebut”); (j) Affidavit Penyampaian yang diikrarkan oleh Mohd Ridzuan bin Jaafar pada 10.01.2014 (selepas ini dirujuk sebagai “Affidavit Penyampaian-Petisyen Pemiutang tersebut”); (k) Perintah Penerimaan Bagi Petisyen Pemiutang bertaikh 10.03.2014 (selepas ini dirujuk sebagai “Perintah Penerimaan tersebut”); (l) Perintah Penghukuman bertarikh 10.03.2014 (selepas ini dirujuk sebagai “Perintah Penghukuman tersebut”); (m) Saman Dalam Kamar bertarikh 08.09.2016 (Lampiran 33) (selepas ini dirujuk sebagai “Permohonan JD tersebut”); (n) Afidavit Sokongan yang diikrarkan oleh Yasmin Perema Binti Abdullah pada 01.09.2016 (selepas ini dirujuk sebagai “Afidavit Sokongan JD tersebut”); (o) Afidavit Jawapan Pemiutang Penghakiman yang diikrarkan oleh Esoda a/p Krishnasamy pada 06.10.2016 (selepas ini dirujuk sebagai “Afidavit Jawapan JC tersebut”); (p) Afidavit Jawapan yang diikrarkan oelh Yasmin Perema Binti Abdullah pada 24.10.2016 (selepas ini dirujuk sebagai “Afidavit Jawapan JD tersebut”); (q) Afidavit Jawapan Pemiutang Penghakiman Kedua yang diikrarkan oleh affirmed by Esod a/p Krishnasamy pada 10.11.2016 (selepas ini dirujuk sebagai “Afidavit Jawapan JC (2) tersebut”).” (r) Written submission of JD; and (s) Written submission of JC. JD’s Submission [8] The learned counsel for JD submitted the only ground for the appeal, that is the JC had failed to obtain leave of the Court under Order 46 r. 2(1)(a) of the Rules of Court 2012 (ROC 2012) before commencing the bankruptcy proceedings against JD as the judgment obtained was more than six years. [9] The counsel raised the issue as to whether the JC is allowed under section 3 (1)(i) of the Bankruptcy Act 1967 to issue a bankruptcy notice when there is a time lapse between the date of the judgment and the date of the bankruptcy notice which is 11 years and 8 months. The counsel referred to the two Federal Court cases: Dr. Shamsul Bahar Bin Abdul Kadir v RHB Bank Berhad [2015] 4 CLJ 561 and Amfraser Securities Pte Ltd v Poh Gaik Lye [2016] MLRA 995 and submitted that the JC cannot lawfully file the bankruptcy notice after a lapse of six years or more from date of judgment unless prior leave of the Court pursuant to Order 46 r. 2(1)(a) of the ROC 2012 has been obtained. [10] The counsel for JD submitted the effect of failure to obtain leave as required, arguing that it will amount to the subsequent action as incompetent and relied on the authority V. Gopal, Re: Ex: Bank Buh (M) Bhd [1987] 1 CLJ 602 where it was held that it was a requirement for a judgment creditor to obtain leave to issue execution under Order 46 r. 2(1)(a) of Rules of High Court 1980 before commencing with bankruptcy proceedings on a judgment entered more than six years earlier. [11] The counsel also referred to the case Wee Chow Yong, Ex P; Public Finance Bhd [1990] 1 CLJ 176; [1990] 3 CLJ, where Edgar Joseph Jr J (as then was) held in terms similar to VC George J in the V Gopal (supra) case that made reference to the English cases on the parallel English law which defines a creditor who has obtained a final judgment under section 3(1)(i) to mean that the petitioner is not entitled to enforce the judgment if he has not obtained the requisite leave as prescribed by Order 46 r.2(1)(a) where the bankruptcy notice was served after six years from date of judgment. Based on the foregoing two decisions, the Court heard the counsel’s submission that a creditor who has obtained a judgment and sat on it for more than six years in West Malaysia must obtain leave of Court before he can commence bankruptcy proceedings under section 3(1)(i) of the Bankruptcy Act 1967. In addition, the counsel submitted that the law pertaining to section 3 of the said Act 1967 had always been in place. [12] The counsel for the JD also referred to the Federal Court Case of Low Mun v. Chung Khiaw Bank Ltd [1987] 2 CLJ 400; [1987] CLJ (Rep) 172 where he pointed to the decision of Mohamed Azmi SCJ on section 3(1)(i) of the Act at page 176, “It is also essential that at the time of issue of the bankruptcy notice, the judgment creditor must be in the position to issue execution – see Re Woodall, ex parte Woodall [1884] 13 QBD 479.” [13] The counsel heavily relied on Dr Shamsul Bahar Bin Abdul Kadir vs RHB Bank Berhad [2015] 4 CLJ 561 stating that the Federal Court had reverted the position of Order 46 r. 2 (1)(a) of the ROC 2012 and pointed to the analysis where it derived its decision. The counsel also submitted that based on Dr. Shamsul Bahar’s (supra) case, the decision revolved around the requirement for leave from Court. [14] The counsel for the JD further sought to refer to the case Amfraser Securites Pte Ltd vs Poh Gail Lye 2016 MLRA 995, the Federal Court decision and quoted as follows, “(1) The notice was issued some 10 years and five months after the judgment had been obtained. It was more that six years after the judgment was obtained. No prior leave of court to issue a writ of execution to enforce a judgment pursuant to O 46 r. 2(1)(a) of the Rules of the High Court 1980 (“RHC”) had been obtained.” (paragraph 11, page 321 of the judgment). “(2) The phrase “who is for the time being entitled to enforce a final judgment” in the proviso to s 3(1)(i) of the Bankruptcy Act 1967 must be a person who is entitled to enforce a final judgment without prior leave of court. If when a bankruptcy notice is issued, the judgment is more than six years old, the judgment creditor is not in a position to execute the judgment without the prior leave of court. In such a case, leave under O 46 r 2 of the RHC must be obtained. In the instant case, since the notice was issued some 10 years and five months after the judgment had been obtained, the appellant was not a person who for the time being was entitled to enforce a final judgment in the proviso to s 3(1)(i) of the Bankruptcy Act 1967. In such a case, leave under O 46 r 2 of the RHC should have been obtained by the appellant. Since no leave had been obtained, it was not in a position to execute the judgment. Thus, it was not entitled to issue the notice. On this ground alone, the notice ought to be set aside.” (paragraph 15, page 323 of the judgment). [15] Counsel for the JD submitted that based on the Federal Court’s decisions, the bankruptcy notice is to be set aside as it is bad in law, a nullity ab initio and that the RO & AO cannot stand and must be set aside. Respondent’s/JC’s counsel: [16] The JC in this case advanced several grounds, the main ground is that the leave from the Court is not needed. The JC claimed that at all material time the Bankruptcy Notice had been served within the extended period. The JC objected to JD’s application for the reason that it was done after 2 years and 7 months that is after the RO & AO had been entered on 12.2.2014 and without giving any reasons to support the application to set aside. JC submitted that JD’s application is without bona fide. [17] JC also submitted that the Order had been issued and registered and thus cannot be set aside or amended except to correct clerical error and arithmetic as the Court had functus officio unless there’s a provision to say otherwise. [18] In relation to the claim that there was a long delay by the JD, the JC referred to two cases namely, Re Jonathan Chelliah Ex P Industrial & Commercial Insurance (M) Bhd [2007] 7 CLJ 132 and the case of Re Seow Yin Fong: Ex Parte: United Orient Leasing Company Berhad & Another Case [1994] 2 CLJ 845. In the former case, counsel pointed to the decision: “The debtor has all the opportunities to contest the judgment creditor’s claim at the earlier stages. This court must therefore consider the interest of the creditors….who will be greatly prejudiced should the adjudication and receiving orders be set aside at this juncture.” (emphasis made by JC) [19] The JC’s main contention is that the Bankruptcy Notice filed after 10 years does not hinder JC to file against the JD as the issuance of bankruptcy notice is not a writ of execution but a judgment. The counsel argued that since it is an action to bring upon a judgment, it is within the limitation period of 12 years and therefore no leave is required to be obtained and relied on the case Perwira Affin Bank v Lim Ah Hee [2004] 3 MLJ 253. [20] The JC submitted the authority, the case of Ambank (M) Bhd (Formerly known as AmFinance Bhd) v Tan Tem Son & Another Appeal [2013] 3 MLJ 179 that the bankruptcy proceeding is not a writ of execution within the meaning of Order 46 rule 2 of the ROC and since it is an action to enforce a judgment, it comes under section 6(3) of the Limitation Act 1953 which provides that the limitation is of 12 years and therefore the leave from Court is not needed. [21] The JC’s contention is heavily placed on a recent case of 25.01.2017 (Appeal No. B-03(IM)-12-01/2016), Hamzah Bin Mat Sah v Ambank (M) Berhad and quoted almost the whole decision in its written submission which is partly reproduced: “[11] The main issue that arose for determination in this appeal had been concerned with whether leave was required to be obtained by the JC from the court before it could proceed to execute Judgment against the JD after 6 years had lapsed from the date of the judgment pursuant to Order 46 Rule 2 of the Rules of Court 2012 (“ROC 2012”). [13] It was contended by the learned counsel for the JD that the ruling in the Dr Shamsul case [supra] had retrospective effect in the sense that it had the effect of requiring the JC to first obtain leave of court before it could execute against the JD upon the judgment that it obtained against the JD more than 6 years ago. [14] It must be noted that before the apex Court decided the way it did in the Dr. Shamsul case [supra], the then prevailing judicial review on the matter was encapsulated in the decision of the Federal Court in the case of Ambank (M) Bhd v Tan Tem Son & Anor [2013] 3 CLJ 317 where it was held that a bankruptcy action does not fall within the ambit of a writ of execution within the meaning of O.46 r.2 of the Rules of High Court 1980. Premised on that ruling, the issue of whether a JC was required to obtain prior leave of Court before it could begin a bankruptcy proceedings based on a final judgment which was obtained more than six years prior did not therefore arise. In short, no such leave was necessary to be obtained by the JC. [15] After considering the able submissions by both learned counsel, we were of the view that the ruling in the Dr. Shamsul case [supra] was generally prospective. [16] It is apparent that there was nothing in the decision of the apex Court in Dr. Shamsul case [supra] that it was meant to have a retrospective effect….. [17] If indeed it was to be applicable retrospectively, it could only be so applied in a very limited and circumscribed circumstances. ….” (emphasized by counsel) [22] The counsel for the JC submitted that following the recent case of Hamzah Bin Mat Sah v Ambank (M) Berhad (supra), “Oleh yang demikian, berdasarkan kes yang telah diputuskan tersebut, walaupun Mahkamah bersetuju bahawa adalah satu keperluan untuk JC mendapatkan kebenaran untuk Penghakiman yang melebihi 6 tahun, prinsip ini hanya terpakai kepada kes-kes yang difailkan selepas kes Dr. Shamsul. Ia tidak terpakai retrospektif.” Court’s Finding [23] Based on the facts before this Court, it cannot be disputed that the bankruptcy notice was issued more than six years after the judgment was obtained on 15.4.2003. There was an action taken in 2005 where JC filed for Writ of Seizure and Sale but withdrawn as JD made payment on 24.11.2005. A bankruptcy notice was then issued on 7.1.2010 but was also withdrawn. The bankruptcy notice was only issued some 11 years and 8 months on 15.4.2013. In other words, on the day the bankruptcy notice was issued, more than six years had lapsed from date of judgment. [24] The JD in her Summon in Chambers of 8.9.2016 for application to set aside and/or annul the Bankruptcy Notice stated among others, “1. Pemiutang Penghakiman tidak mendapatkan kebenaran Mahkamah yang Mulia ini untuk mengeluarkan Notis Kebankrapan bertarikh 26.3.2013 selepas tempoh 10 tahun dari Penghakiman bertarikh 15.4.2013 selaras dengan Aturan 46 kaedah 2 Kaedah-Kaedah Mahkamah 2012; 2. Pemiutang Penghakiman tidak berada dalam kedudukan untuk melaksanakan Penghakiman tersebut selepas tempoh enam (6) tahun dari Penghakiman bertarikh 15.4.2003 tanpa kebenaran Mahkamah yang Mulia ini….” [25] In the affidavit filed in support of her application to set aside the bankruptcy notice, JD deposed as follows: “6. Saya dinasihati oleh peguamcara saya dan sesungguhnya percaya bahawa Notis Kebankrapan tersebut adalah tidak dan perlu diketepikan dengan serta merta di mana selaras dengan Aturan 46 kaedah 2(1)(a) Kaedah-Kaedah Mahkamah 2012 dan kehendak mandatori Seksyen 3(1)(i) Akta Kebankrapan 1967 di mana Pemiutang Penghakiman yang berniat untuk menguatkuasakan mana-mana Penghakiman atau Perintah selepas tempoh enam (6) tahun atau lebih sejak tarikh Penghakiman atau Perintah, perlu mendapatkan suatu kebenaran Mahkamah yang Mulia ini untuk melaksanakan Penghakiman atau Perintah tersebut. 7. Saya sesungguhnya percaya dan menyatakan bahawa JC gagal untuk memohon kebenaran Mahkamah yang Mulia ini dan Notis Kebankrapan bertarikh 26.3.2013 telah dikeluarkan tanpa kebenaran Mahkamah yang Mulia ini selepas lebih kurang 10 tahun dari tarikh Penghakiman bertarikh 15.4.2003 untuk melaksanakan Penghakiman tersebut terhadap saya. ….” [26] The JC did not deny that no prior leave to execute under Order 46 rule 2(1)(a) of the ROC 2012 was obtained but contended that the bankruptcy notice and the proceedings involved including the RO & AO was made prior to the Dr Shamsul Bahar (supra) case which was decided on 6.4.2015. In addition, the Counsel argued that the leave from Court following Order 46 r. 2(1)(a) is not needed, relying on the authorities Perwira Affin Bank v Lim Ah Hee [2004] 3 MLJ 253 and Ambank (M) Bhd (Formerly Known as AmFinance Bhd) v Tan Tem Son & Another Appeal in supporting the contention that a bankruptcy proceeding is not a writ of execution but an action on judgment and as such, bankruptcy notice can be served without leave within the 12 years period. [27] In summary, the cases put forward by the JC encompasses the law that the bankruptcy proceeding is not a writ of execution and therefore Order 46 r.2 of the ROC 2012 did not apply to bankruptcy proceedings; the bankruptcy proceeding is an action upon a judgment within the meaning of section 6(3) of the Limitation Act 1953 where the limitation period is of 12 years and that there was nothing in Dr. Shamsul’s case to have a retrospective effect. [28] The main contention here is that when the bankruptcy notice was issued after six years, whether the JC is entitled to enforce the judgment within the meaning of section 3(1)(i) of the Bankruptcy Act 1967 without prior leave of court. [29] Section 3(1)(i) of the Bankruptcy Act 1967 provides: “(1) A debtor commits an act of bankruptcy…. (i) If a creditor has obtained a final judgment or final order against him for any amount and execution thereon not having been stayed has served on him…a bankruptcy notice under this Act requiring him to pay the judgment debtor or sum ordered to be paid in accordance with the terms of the judgment or order,…and he does not within 7 days after service of the notice…comply with the requirements of the notice.. Provided that for the purposes of this paragraph… any person who is for the time being entitled to enforce a final judgment or final order shall be deemed to be a creditor who has obtained a final judgment or final order;….” [30] There have been a number of cases decided whether a person who is entitled to enforce a judgment requires the prior leave of court. However before we delve into the cases, a quick look at the law requiring the leave following Order 46 r.2(1)(a) of the ROC 2012. [31] Order 46 rule 2(1)(a) of the ROC 2012 provides that, “When leave to issue any writ of execution is necessary (O 46 r2) 2 (1) A writ of execution to enforce a judgment or order may not be issued without the leave of the Court in the following cases: (a) where six years or more have lapsed since the date of the judgment or order; (b)… (2) Paragraph (1) is without prejudice to any written law or rule by which a person is required to obtain leave of the Court for the issue of a writ of execution or to proceed to execution on or otherwise the enforcement of a judgment order. …..” [32] Referring to the first paragraph of rule 2 at part (1), the words “a writ of execution to enforce a judgment or order”, the word ‘writ of execution’ is given the meaning under rule 1 of the same Order which “includes a writ of seizure and sale, a writ of possession and a writ of delivery”. The term “includes” means that the list is not exhaustive and it had been decided that bankruptcy proceedings is covered under Order 46 rule 1: Tengku Iskandar Tengku Ahmad v Sime Bank Bhd [2001] 7 CLJ 560. [33] The writ of execution definition can be found in Black’s Law Dictionary, (Second Edition) which means “a writ to put in force the judgment or decree of a court”. Lord Denning in Re Overseas Aviation Engineering (GB) Ltd [1962] 3 ALL ER 12 stated that ‘execution’ means, ‘quite simply, the process for enforcing or giving effect to the judgment of the court’. [34] Prior to the case of Dr. Shamsul Bahar (supra), the cases attributed by the counsel for the JD which I had the benefit of reading, provides the law that a judgment creditor must be in a position to issue execution on the judgment at the time when he issued the bankruptcy notice. [35] To put it simply, this would mean that the judgment creditor who seeks to make the judgment debtor bankrupt must have in his hands a final judgment that can be enforced: Ambank (M) Berhad v Raymond Yong Kim Yoong [2007] SGHC 172 at paragraph 14. In the case where six years or more had lapsed since obtaining the final judgment or final order, the person is no longer entitled to enforce that final judgment or order unless he has obtained prior leave of the Court by virtue of Order 46 r. 2(1)(a). [36] In the case of Ambank (M) Bhd (formerly known as AmFinance Bhd) v Tan Tem Son and another appeal [2013] 3 MLJ 179; [2013] 3 CLJ 317, which relied on the case Perwira Affin Bank Bhd v Lim Ah Hee @ Sim Ah Hee [2004] 3 MLJ 253; [2004] 2 CLJ 787, the Federal Court held that the phrase ‘any person who is for the time being entitled to enforce a final judgment’ in the proviso to section 3(1)(i) of the Bankruptcy Act 1967 does not require a judgment creditor to obtain leave pursuant to Order 46 r.2(1)(a) of the Rules of High Court 1980 prior to initiating a bankruptcy proceeding based on a final judgment which has been obtained more than six years ago. However, the Tan Tem Son (supra) case was reconsidered by a different panel in the Federal Court in the case of Dr. Shamsul Bahar bin Abdul Kadir v RHB Bank Bhd and another appeal [2015] 4 MLJ 1 which did not follow the decision of Tan Tem Son (supra) case. [37] The case of Dr. Shamsul Bahar Bin Abdul Kadir v RHB Bank Berhad [2015] 4 CLJ 561 discussed at length the background to the proviso which entails the words “execution thereon not having been stayed” that was borrowed from the English Bankruptcy Act of 1883. The meaning of the words “execution thereon not having been stayed” was first considered by the English Court of Appeal in Re ex parte Woodall (1884) 13 QBD 479 where it was held that a creditor must be in a position, when he issued the bankruptcy notice, to issue immediate execution upon the judgment. [38] Dr. Shamsul Bahar (supra) case also referred to the Singapore’s case of Ambank (M) Berhad v Raymond Yong Kim Yoong [2007] SGHC 172 where the Singapore Rules of Court Order 46 r 2(1)(a) is in pari materia with ROC 2012 Order 46 r 2(1)(a). In that case, Ambank (M) obtained judgment against the judgment debtor in Malaysia for failing to honour his obligations under a personal guarantee. The judgment was registered in Singapore almost six years later. Ambank (M) then instituted a bankruptcy proceedings against the judgment debtor in Singapore after almost 12 years. The High Court of Singapore held that the registered judgment was no longer enforceable by execution in Singapore without leave of the court because of almost 12 years lapsed since the Malaysian judgment was registered following Order 46 r 2(1)(a) of the Rules of Court (Cap 322, 2006). [39] The learned High Court Judge of Singapore made a comparison to the old Bankruptcy Act where the words “execution thereon not having been stayed” were used in contrast to its present law, under its section 61(1)(d) of the Bankruptcy Act (Cap 20,2000 Rev Ed), where the words “which is enforceable by execution” are used and stated that, “… the court had always insisted that, although the question of an execution of a judgment does not arise when a bankruptcy petition is presented, a judgment creditor who seeks to make the judgment debtor bankrupt on the basis of an unsatisfied judgment debt must have in his hands a final judgment that can be enforced forthwith or immediately. As such, where the leave of the court is required for whatever reason before a judgment may be enforced, such leave must be obtained before a person can be made bankrupt on the basis of that judgment.” [40] In the case of Amfraser Securities Pte Ltd v Poh Gaik Lye [2016] 4 MLJ 314, the Federal Court held that a person ‘who is for the time being entitled to enforce a final judgment’ in the proviso to section 3(1)(i) of the Bankruptcy Act 1967 must be a person who is entitled to enforce a final judgment without prior leave of court. It also held that, if when the bankruptcy notice is issued the judgment was more than six years old, then the judgment creditor is not in a position to execute the judgment without the prior leave of court. The leave under Order 46 r.2 of the RHC must be obtained. [41] This Court finds that the counsel for the JC’s submission on the issue of non-retrospective is without basis as the law requiring leave from court was in place under the Rules of Court 1980, now replaced by the ROC 2012. I agree with the counsel for the JD that section 3 of the Bankruptcy Act 1967 was the law in place but I am more inclined to say that the law under Order 46 r 1(1)(a) of the Rules of Court 1980 now replaced by ROC 2012 which provides the leave requirement had also been in place. This important element was also reflected in the case of Dr. Shamsul Bahar (supra) where the law referred was Order 46 r 2(1)(a) of the Rules of Court 1980. [42] To further strengthen my point, there have been other cases where the Court had exercised discretion in granting leave under Order 46 r 2(1)(a). In Tio Chee Heng v Chung Khiaw Bank Ltd [1981] 1 MLJ 227, a Federal Court Kota Kinabalu decision, it was an appeal from the decision of the judge to grant leave to issue execution against the appellant on two judgments entered more than six years ago. The first action was in respect of a charge to secure the repayment of a considerable sum of money advanced to a company of which the appellant was the sole proprietor and the other action was for repayment of the overdraft granted to the appellant. The appellant never contended against the explanation by the Bank that the reason for the delay in executing judgment against him was to give him time during the negotiations for settlement and the basis for the delay in seeking leave from Court was allowed. [43] In the case of Public Bank Bhd v Seato Trading (M) SDn Bhd & Ors [1996] 1 MLJ 165, the plaintiff had applied for leave for execution against the third defendant in respect of arrears after more than six years had passed from the date of judgment. The counsel for the plaintiff submitted that although six years had lapsed from the date of the judgment, no injustice or prejudice would be caused to the third defendant to make repayment and the plaintiff was only protecting its own interest by not putting further pressure on the third defendant as it would jeopardize the settlement of the debt and that the court should not dismiss plaintiff’s application because of the delay. The appeal was allowed. [44] The law in United Kingdom as explained in Halsbury’s Laws of England (Fifth Edition) on the writ of execution to enforce a judgment or order may not be issued without the permission of the court where six years or more have elapsed since the date of judgment or order, had been retained in the United Kingdom’s Civil Procedure Rules 1998 Sch 1 Rules of Supreme Court Order 46 r 2(1)(a) which corresponds to our ROC 2012. [45] Based on the foregoing, I am bound by Order 42 r 2(1)(a) of the ROC 2012 and the Federal Court decisions in Dr. Shamsul Bahar (supra) case and Amfraser Securities (supra) case. I have answered the main ground in the affirmative, that is the JC who commences the bankruptcy proceedings after more than 6 years have lapsed from the date of judgment, must obtain the prior leave of Court following Order 42 r 2(1)(a) of the ROC 2012. I allowed the appeal with cost. Dated: 21 June 2017 (DATIN ZALITA BINTI DATO’ HJ. ZAIDAN) Judicial Commissioner Shah Alam High Court SOLICITORS: APPELLANT : SATVINDER KAUR Tetuan Satvinder K &Associates Peguambela dan Peguamcara No. 3, Jalan Hujan Emas10 Oversea, Union Garden 58200 Kuala Lumpur [RUJ: SK/639/11/2014(L)] Tel: 03-7980 9798 Fax: 03-7980 7384 RESPONDENT : ROZANITA BINTI BASRUN Tetuan Thomas Ong Leong & Associates Peguambela dan Peguamcara Blok 3A02, Menara Mutiara Majestic No. 15, Jalan Othman 46000, Petaling Jaya Selangor Darul Ehsan [RUJ NO: TOL/0212401/OKS] Tel: 03-7980 9798 Fax: 03-7980 7384 28

Tika 2.6.0

BA-24-84-01/2017

PLAINTIF SITI HANJAR BINTI H.ABDUL RAHMAN (No. K/P: 520618-10-5496) DEFENDAN TAJUK PASIFIK DEVELOPMENT SDN BHD (NO. SYARIKAT : 788289-P)

20/06/2017

YA DATUK AZIMAH BINTI OMAR

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DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN SAMAN PEMULA NO: BA-24-84-01/2017 Dalam Perkara Perjanjian Usahasama di antara Siti Hanjar Binti H.Abdul Rahman Dan Tetuan Tajuk Pasifik Development Sdn Bhd bertarikh 4.12.2007 Dan Dalam Perkara Perjanjian Usahasama di antara Siti Hanjar Binti H.Abdul Rahman Dan Tetuan Tajuk Pasifik Development Sdn Bhd bertarikh 12.12.2012 Dan Dalam Perkara Sesyen 38 dan 40 Akta Kontrak 1950 2 ANTARA SITI HANJAR BINTI H.ABDUL RAHMAN (No. K/P: 520618-10-5496) …PLAINTIF DAN TAJUK PASIFIK DEVELOPMENT SDN BHD (NO. SYARIKAT : 788289-P) …DEFENDAN ALASAN PENGHAKIMAN (Kandungan 1) A. PENGENALAN [1] Melalui Saman Pemula (Kandungan 1) yang difailkan pada 20.01.2017, Plaintif telah memohon perintah-perintah berikut:- i. Satu deklarasi yang menyatakan bahawa Perjanjian Usahasama yang telah ditandatangani oleh Plaintif dan Defendan pada 12.12.2012 (selepas ini dirujuk sebagai “Perjanjian Usahasama tersebut”) bagi membangunkan sebuah hartanah yang dikenali sebagai GM 6334, Lot 5091, Mukim Klang, Daerah Klang, Negeri Selangor Darul Ehsan 3 (selepas ini dirujuk “hartanah tersebut”) telah terbatal dan tidak sah; ii. Bahawa segala dokumen, perjanjian dan/atau Surat Kuasa Wakil yang telah diberikan oleh Plaintif kepada Defendan berasaskan pada Perjanjian Usahasama tersebut adalah turut terbatal dan tidak sah; iii. Bahawa Defendan adalah diperintahkan supaya menyerahkan segala dokumen-dokumen asal yang berkenaan dengan Perjanjian Usahasama tersebut termasuk 30 geran hartanah yang telah dipecah bahagi daripada hartanah tersebut di dalam tempoh masa 14 hari daripada tarikh perintah; iv. Bahawa Defendan membayar suatu gantirugi khas kepada Plaintif bagi menebus (“to redeem”) hartanah daripada Malaysia Building Society Berhad (selepas ini dirujuk sebagai “MBSB”) selaras dengan penyata akaun yang telah disediakan oleh pihak MBSB; v. Bahawa Defendan membayar suatu gantirugi am kepada Plaintif ke atas segala kesulitan dan/atau keresahan yang terpaksa dihadapi oleh Paintif disebabkan oleh tingkahlaku 4 Defendan yang telah menyebabkan hartanah tersebut dilelong oleh pihak MBSB. B. LATAR BELAKANG KES [2] Latar belakang kes yang menyebabkan Plaintif memfailkan Kandungan 1 adalah seperti berikut 2.1 Plaintif (Siti Hanjar Binti H.Abdul Rahman) adalah merupakan pemilik / tuanpunya berdaftar hartanah yang dahulunya dikenali sebagai GM 6334, Lot 5091, Mukim Klang, Daerah Klang, Negeri Selangor Darul Ehsan seluas 1.2646 hektar yang kini telah dipecah bahagi kepada 30 geran hakmilik yang berasingan (hartanah tersebut). 2.2 Pada 4.12.2007, Plaintif dan Defendan (Tajuk Pasifik Development Sdn Bhd) telah memasuki suatu Perjanjian Usahasama (Perjanjian 2007) bagi membangunkan hartanah tersebut. Melalui Perjanjian 2007 ini, Defendan sebuah syarikat pemaju akan membangunkan atau 5 memajukan hartanah tersebut kepada pembangunan kediaman dengan membangunkan dan menyiapkan tiga puluh (30) unit rumah berkembar setingkat beserta semua kelengkapan infrastruktur yang diperlukan bagi kawasan kediaman/perumahan. 2.3 Berikutan dengan Perjanjian 2007 tersebut, pada tarikh yang sama satu Surat Kuasa Wakil telah dilaksanakan oleh Plaintif kepada Defendan (SKW 2007) bagi memberikan kuasa kepada Defendan untuk menjalankan urusniaga ke atas hartanah tersebut bagi maksud pembangunan hartanah selaras dengan Perjanjian 2007. 2.4 SKW 2007 yang dilaksanakan tersebut adalah sah untuk tempoh masa selama 5 tahun dari tarikh ia dilaksanakan iaitu pada 4.12.2007 sehingga 3.12.2012. 2.5 Klausa 3.7, Perjanjian 2007 ini memperuntukkan berikut: 6 3.7 Tuan Tanah bersetuju untuk membenarkan TPDSB menggadai atau meletak bebanan Tanah Tersebut seperti yang dinyatakan di dalam Fasal 5 dan sebagai balasan. TPDSB dengan ini berwaad dan mengakujanji dengan Tuan Tanah bahawa ia akan mematuhi dengan suci hati dan sepenuhnya semua terma-terma dan syarat-syarat pinjaman yang dikenakan oleh institusi kewangan atau bank berkenaan terma pembayaran balik yang tepat pada masa dari jumlah pinjaman dan akan melepaskan gadaian atau mengakibatkan gadaian itu atau bebanan-bebanan dilepaskan dengan segera setelah pembayaran penuh jumlah pinjaman dan TPDSB bersetuju untuk menggantirugi dan terus menggantirugi Tuan Tanah berhubung apa-apa pecah terma dan syarat-syarat pinjaman yang dikenakan oleh institusi kewangan atau bank. Semua kos perbelanjaan dan yuran-yuran termasuk juga yuran guaman. Tuan Tanah (jika ada) dalam membuat gadaian dan/atau melepaskan gadaian atau bebanan akan ditanggung dan dibayar oleh TPDSB. (Penekanan oleh Mahkamah ini) 2.6 Manakala klausa 10.1 Perjanjian 2007 memperuntukkan terma berkenaan penyempurnaan penuh, penamatan dan lanjutan masa yang berbunyi: 7 FASAL 10 PENYEMPURNAAN PENUH PEMBANGUNAN DAN PENAMATAN 10.1 TPDSB akan menyempurnakan kerja-kerja pembinaan kediaman dan Pembangunan Tersebut termasuk permohonan untuk Perakuan Siap dan Pematuhan dalam tempoh dua (2) tahun dari tarikh permulaan pembinaan (selepas ini dipanggil “Tarikh Penyempurnaan”). ADALAH SENTIASA DISYARATKAN bahawasanya jika terdapat apa- apa tanggungan pada mana-mana peringkat Pembangunan Bercampur disebabkan kesalahan Tuan Tanah atau disebabkan oleh apa-apa perlanggaran peruntukan oleh Tuan Tanah di bawah Perjanjian ini atau tanggungan yang mana diakui berlaku disebabkan oleh keadaan-keadaan di luar kawalan TPDSB, TPDSB akan membuat permohonan untuk melanjutkan tempoh masa enam (6) bulan sebelum tamatnya Tarikh Penyempurnaan di mana permohonan itu tidak akan ditahan secara yang tidak munasabah dengan syarat lanjutan masa itu tidak akan melebihi dua (2) tahun. 2.7 Namun sehingga bulan Disember 2012, projek pembangunan hartanah tersebut masih belum selesai disempurnakan oleh Defendan dan dengan demikian Defendan telah memohon Plaintif untuk memasuki satu Perjanjian Usahasama yang baru. 2.8 Pada 12.12.2012 kedua-dua Plaintif dan Defendan telah menandatangani Perjanjian Usahasama Kedua 8 (Perjanjian 2012) dengan syarat-syarat dan terma perjanjian yang baru. 2.9 Selaras dengan Perjanjian 2012 tersebut, Surat Kuasa Wakil Kedua (SKW 2012) telah diberikan oleh Plaintif kepada Defendan pada tarikh yang sama juga (12.12.2012). 2.10 Klausa 2.1 Perjanjian 2012 telah memperuntukkan antara lain bahawa: FASAL 2 PERJANJIAN DAN BALASAN UNTUK USAHASAMA 2.1 Adalah dipersetujui bersama bahawa di atas balasan yang diperuntukkan dalam Fasal 6 di bawah dalam Perjanjian Usahasama ini, Tuan Tanah akan memberi dan memperuntukkan Tanah Tersebut kepada TPDSB serta melakukan semua perkara yang kebiasaannya dilakukan oleh pemilik berdaftar atau tuanpunya yang sah dan TPDSB akan menyediakan kerja- kerja teknikal komersial kewangan, pengurusan yang mahir dan akan membangunkan Tanah Tersebut spesifikasi dan pelan-pelan yang diluluskan tetapi tertakluk kepada kelulusan dan pindaan yang dibuat dan/atau akan dibuat oleh pihak berkuasa yang berkaitan sehingga kerja- kerja pembinaan Pembangunan tersebut siap dan sehingga penyerahan milikan kosong kepada pembeli-pembeli yang berkenaan dan tertakluk kepada terma-terma dan syarat-syarat yang dinyatakan di sini. Bahawa tempoh perjanjian ini adalah selama 5 tahun daripada Surat Kuasa Wakil 9 kepada TDSB didaftarkan di Mahkamah dan di Pejabat Tanah yang berkaitan. (Penekanan oleh Mahkamah ini) 2.11 Klausa 3.7 Perjanjian 2012 telah memperuntukkan bahawa Defendan adalah tidak dibenarkan untuk menggadaikan hartanah tersebut atau meletakkan sebarang bebanan ke atas hartanah tersebut. Klausa tersebut berbunyi: 3.7 Tuan Tanah dengan ini tidak membenarkan TPDSB menggadai atau meletakkan bebanan Tanah Tersebut kepada mana-mana institusi kewangan bagi mendapatkan pembiayaan bagi Pembangunan Tersebut. 2.12 Klausa 10.1 Perjanjian 2012 juga memperuntukkan bahawa Defendan hendaklah menyempurnakan kerja- kerja pembangunan dalam tempoh 3 tahun dari tarikh perjanjian. Klausa 10.1 memperuntukkan berikut: 10 FASAL 10 PENYEMPURNAAN PENUH PEMBANGUNAN DAN PENAMATAN 10.1. TPDSB akan menyempurnakan kerja-kerja pembinaan pembangunan yang dilakukan dan Pembangunan Tersebut termasuk permohonan untuk Sijil Siap Praktikal dalam tempoh TIGA (3) tahun dari tarikh permulaan pembinaan (selepas ini dirujuk sebagai “Tarikh Penyempurnaan”). ADALAH SENTIASA DISYARATKAN bahawasanya jika terdapat apa-apa tangguhan pada mana-mana peringkat Pembangunan tersebut disebabkan kesalahan Tuan Tanah atau disebabkan oleh apa-apa pelanggaran peruntukkan oleh Tuan Tanah di bawah perjanjian ini atau tanggungan yang mana diakui berlaku disebabkan oleh keadaan- keadaan di luar kawalan TPDSB, TPDSB akan membuat permohonan untuk melanjutkan tempoh masa SATU (1) tahun sebelum tamatnya Tarikh Penyempurnaan di mana permohonan itu tidak akan ditahan secara yang tidak munasabah dengan syarat lanjutan masa itu tidak akan melebihi Dua (2) tahun. 2.13 Plaintif telah mendakwa bahawa walaupun Perjanjian 2012 telah melampaui tempoh tiga (3) tahun, projek pembangunan itu belum disempurnakan oleh Defendan. Plaintif telah mendakwa terdapat perlanggaran- pelanggaran terma Perjanjian 2012 tersebut oleh Defendan. 11 2.14 Menurut Notis bertarikh 15.9.2016, Plaintif telah memberikan Defendan notis untuk penamatan Perjanjian 2012 atas perlanggaran-perlanggaran terma Perjanjian 2012 oleh Defendan serta memberikan Defendan tempoh masa enam puluh (60) hari untuk meremedikan perlanggaran-perlanggaran menurut klausa 7.13. 2.15 Plaintif telah mendakwa bahawa Defendan telah gagal mematuhi Notis bertarikh 15.9.2016 tersebut, justeru Saman Pemula di Kandungan 1 ini difailkan pada 20.1.2017. [3] Plaintif dengan itu, di dalam memohon perintah-perintah di Kandungan 1 telah bersandarkan kepada alasan-alasan berikut: i. Perjanjian 2012 yang ditandatangani Plaintif dan Defendan adalah suatu perjanjian baru dengan terma- terma yang baru. Defendan telah melanggar Perjanjian 2012 apabila gagal menyempurnakan pembangunan ke 12 atas hartanah tersebut walaupun tempoh masa perjanjian (kontrak) telah melampaui tiga (3) tahun sejak ia ditandatangani. ii. Defendan telah melanggar klausa 3.7 Perjanjian 2012 apabila gagal memastikan hartanah tersebut bebas dari sebarang bebanan apabila hartanah tersebut telah digadai oleh Defendan sebagai cagaran kepada Malaysia Building Society Berhad (MBSB). iii. Defendan telah gagal membuat bayaran terhadap pinjaman yang telah diperolehi daripada MBSB sehingga suatu perintah lelongan ke atas hartanah tersebut telah dibuat oleh Pejabat Tanah yang ditetapkan untuk lelongan pada 24.2.2017. Plaintif telah diserahkan dengan Saman kepada Penggadai oleh Pentadbir Tanah Klang untuk hadir siasatan menurut seksyen 261 (1)(c) Kanun Tanah Negara pada 18.10.2016. 13 iv. Defendan telah gagal untuk meremedikan perlanggaran Perjanjian 2012 dalam tempoh 60 hari dari tarikh notis Plaintif (15.9.2016) sebagaimana yang dikehendaki oleh klausa 7.13 Perjanjian. C. TENTANGAN DEFENDAN [4] Defendan telah membantah dengan kerasnya permohonan Plaintif dengan memfailkan afidavit jawapan yang diikrarkan oleh Hamzah bin Bero yang merupakan Pengarah Defendan. [5] Di dalam afidavit jawapan Defendan, walaupun diakui oleh Defendan bahawa terdapat kelewatan di dalam penyempurnaan projek pembangunan tersebut di mana projek tidak dapat disempurnakan dalam tempoh yang dipersetujui atas lebihan kos dan perubahan harga barang yang ditanggung Defendan, namun Defendan telahpun memaklumkan perkara kelewatan ini kepada Plaintif melalui kontraktor Defendan bernama Mohd Yusof bin Hasan sejak tahun 2015 lagi. 14 [6] Bagi membantah permohonan Plaintif, Defendan telah membangkitkan pengataan-pengataan berikut: i. Defendan tidak pernah memasuki sebarang perjanjian gadaian dengan mana-mana institusi kewangan selaras dengan Klausa 3.7 Perjanjian 2012 tersebut. ii. Gadaian yang wujud di hartanah tersebut adalah gadaian yang didaftarkan pada tahun 2008 di mana ia telah dimasuki selaras Perjanjian 2007 dan gadaian-gadaian (gadaian) ini telah dimasukki / dilaksanakan dengan kebenaran Plaintif sendiri. iii. tiada sebarang klausa atau terma di dalam Perjanjian 2012 yang menyatakan hartanah tersebut perlu bebas daripada sebarang bebanan. iv. Pembangunan hartanah tersebut tidak dapat disempurnakan dalam tempoh yang dipersetujui kerana terdapat lebihan kos dan perubahan pada harga barang 15 dan yang harus ditanggung oleh Defendan dan faktor- faktor lain yang telah dimaklumkan kepada Plaintif dan ianya dalam pengetahuan Plaintif. v. Perjanjian 2012 masih belum berakhir tempohnya dan tidak boleh ditamatkan sebelum 3 Disember 2017. Unit- unit yang telah dibina di atas hartanah tersebut telah dibeli oleh pembeli-pembeli dan mereka telah menandatangani Perjanjian Jual Beli. Sekiranya, Perjanjian 2012 tersebut ditamatkan sebelum masanya, Defendan pasti tidak dapat menyempurnakan obligasi kepada pembeli-pembeli tersebut. [7] Plaintif di dalam kes ini telah cuba memohon daripada Mahkamah ini satu perintah deklarasi untuk mengisytiharkan Perjanjian 2012 yang dimasuki olehnya dan Defendan terbatal dan tidak sah atas alasan bahawa terdapat pemecahan terma- terma perjanjian di pihak Defendan khasnya atas alasan bahawa projek pembangunan telah tidak disempurnakan dalam 16 tempoh yang dipersetujui di bawah Perjanjian 2012 dan perlanggaran klausa 3.7 dan klausa 10.1 perjanjian tersebut. [8] Pertamanya, adalah dihujahkan bagi pihak Plaintif bahawa Perjanjian 2012 adalah perjanjian baru dan bukanlah perjanjian lanjutan bagi Perjanjian 2007 kerana Perjanjian 2012 telah ditandatangani selepas Perjanjian 2007 tamat pada 3.12.2012 dengan terma-terma perjanjian yang baru. [9] Peguam Plaintif telah menghujahkan bahawa Defendan telah gagal menyempurnakan projek pembangunan tersebut dalam tempoh yang dipersetujui iaitu pada 30.9.2015 dan telahpun mengakui kelewatan tersebut di dalam perenggan 8 afidavit jawapannya yang menentang permohonan Plaintif. Atas pengakuan Defendan yang mengakui projek pembangunan tidak dapat disempurnakan pada tempoh yang dipersetujui kerana terdapatnya lebihan kos dan perubahan pada harga barang yang harus ditanggung sendiri oleh Defendan. Atas pengakuan tersebut, peguam Plaintif telah bergantung kepada 17 kes Ng Hee Thong & Anor V Public Bank Berhad [1995] 1 CLJ 609 Mahkamah Rayuan yang memutuskan berikut: “[2] It is a well settled principle governing the evaluation of affidavit evidence that where one party makes a positive assertion upon a material issue, the failure of his opponent to contradict is usually treated as an admission by him of the fact so asserted.” [10] Adalah menjadi hujahan Plaintif juga bahawa Defendan telah gagal untuk memastikan hartanah Plaintif bebas daripada sebarang bebanan seperti yang diehendaki di dalam klausa 3.7 Perjanjian 2012 yang tidak membenarkan Defendan meletakkan sebarang bebanan ke atas hartanah-hartanah tersebut. [11] Plaintif telah mendakwa bahawa Defendan yang telah gagal untuk menebus semula hartanah tersebut selepas menandatangani Perjanjian 2012 sehingga menyebabkan hartanah tersebut telah ditetapkan untuk lelongan awam pada 24.2.2017. Kegagalan menebus semula hartanah tersebut 18 adalah merupakan suatu perlanggaran kontrak oleh pihak Defendan. [12] Peguam Plaintif seterusnya menghujahkan bahawa apabila Defendan gagal untuk meremedikan perlanggaran tersebut dalam tempoh masa 60 hari menurut klausa 7.13 Perjanjian 2012 melalui notis Plaintif bertarikh 15.9.2016, maka kegagalan Defendan ini telah mengakibatkan Perjanjian 2012 terbatal. [13] Plaintif juga telah mendakwa bahawa beliau terpaksa berusaha mendapatkan wang untuk menebusbalik hartanah tersebut demi mengelakkan hartanah tersebut daripada dijual melalui lelongan awam. [14] Adalah dihujahkan oleh peguam Plaintif juga bahawa perjanjian jual beli-perjanjian jual beli yang ditandatangani oleh Defendan dan pembeli-pembeli unit adalah tidak sah kerana perjanjian- perjanjian tersebut telah ditandatangani oleh Defendan yang bersandar kepada SKW 2012 yang telah tamat tempoh. 19 [15] Defendan telah menafikan pengataan Plaintif yang Defendan telah memasuki perjanjian pinjaman dan memasuki gadaian pihak ketiga dengan mana-mana institusi kewangan selepas Perjanjian 2012 tersebut ditandatangani. Menurut Defendan, gadaian pihak ketiga telah dimasuki pada 3.4.2008 bagi faedah Malaysia Building Society Berhad (MBSB) yang mana Plaintif mempunyai pengetahuan mengenai gadaian tersebut. Malahan menurut Defendan lagi, gadaian yang telah dimasuki tersebut telah dimasuki sebelum Perjanjian 2012 dan adalah dengan kebenaran Plaintif sendiri. [16] Defendan seterusnya mengatakan bahawa ia telahpun menyempurnakan pembayaran pinjaman kepada MBSB melalui Deposit Cash Maybank berjumlah RM549,951.60 mengikut had masa yang ditetapkan iaitu sebelum 23.2.2017. H. DAPATAN MAHKAMAH [17] Di dalam kes ini, adalah fakta yang tidak dipertikaikan bahawa Plaintif dan Defendan telah memasuki dua perjanjian usahasama untuk membangunkan tanah kepunyaan Plaintif. 20 Untuk itu juga, dua surat kuasa wakil telah dilaksanakan oleh Plaintif untuk faedah Defendan. [18] Plaintif di dalam kes ini telah cuba mendakwa bahawa terdapatnya pemecahan terma-terma Perjanjian 2012 di pihak Defendan yang dikatakan gagal menyempurnakan projek pembangunan tersebut pada masa yang dipersetujui iaitu 30.9.2015. [19] Peguam Plaintif telah cuba menggunakan perenggan 8 afidavit jawapannya yang mana Defendan telah mengakui bahawa projek pembangunan tersebut tidak dapat disempurnakan pada tarikh yang dipersetujui atas masalah kos dan memohon Mahkamah ini mengambil pengakuan ini bagi membuktikan bahawa sememangnya Defendan telah melanggar terma perjanjian apabila mereka gagal menyiapkan projek mengikut tempoh masa yang dipersetujui. [20] Mahkamah ini tidak bersetuju dengan hujahan yang dibangkitkan peguam Plaintif kerana alasan-alasan berikut: 21 i. Plaintif sendiri telah dimaklumkan telah mengetahui pada tahun 2015, projek pembangunan belum lagi sempurna apabila dimaklumkan oleh kontraktor Defendan. Walaupun mengetahui projek tidak dapat disempurnakan pada 30.9.2015, Plaintif sendiri telah tidak bertindak untuk memberi notis kegagalan ini pada 30.9.2015. Sebaliknya Plaintif hanya telah bertindak selepas setahun dari tarikh 30.9.2015 dengan mengeluarkan notis menurut klausa 7.13 Perjanjian 2012 bertarikh 15.9.2016. Selama setahun Plaintif telah berdiam diri walaupun mengetahui projek belum disempurnakan, tetapi apabila mengetahui bahawa terdapat masalah bayaran pinjaman di pihak Defendan kepada MBSB dan Plaintif telah diserahkan dengan Saman kepada Penggadai, Plaintif baru bertindak untuk cuba menguatkuasakan haknya berdasarkan terma-terma perjanjian. Walhal melalui tindak-tanduk “conduct” Plaintif sendiri yang telah berdiam diri atau pasif selama setahun seolah-olah Plaintif sendiri telah menerima kelewatan tersebut. 22 ii. Berhubung hal ini, Mahkamah ini merujuk kepada klausa 2.1 Perjanjian 2012 yang telah ditandatangani oleh Plaintif dan Defendan pada 12.12.2012. Berdasarkan klausa 2.1 Perjanjian 2012, tempoh masa Perjanjian 2012 adalah 5 tahun iaitu dari tarikh SKW 2012 didaftarkan di Mahkamah dan Pejabat Tanah. SKW 2012 telah didaftarkan pada 2.1.2013 di Mahkamah dan berdasarkan tempoh lima (5) tahun, Perjanjian 2012 hanya akan tamat pada 2.1.2018. iii. Dengan Plaintif berdiam diri tersebut tanpa memberikan apa-apa notis berkenaan kelewatan atau ketidaksempurnaan projek pada tarikh yang dipersetujui, Plaintif sendiri telah mengambil kedudukan bahawa Perjanjian 2012 masih lagi berterusan dan sah dan memberi anggapan yang sah kepada Defendan untuk meneruskan Perjanjian 2012 sehingga ia berakhir pada 2.1.2018. Plaintif di dalam keadaan ini tidak boleh menggunakan alasan ketidakpenyempurnaan projek 23 sebagai perlanggaran Perjanjian 2012 terhadap Defendan. iv. Plaintif di dalam kes ini nampaknya tidak sabar-sabar untuk menamatkan Perjanjiannya dengan Defendan dengan memfailkan permohonan ini setahun lebih awal pada 20.1.2017 daripada tarikh tamat tempoh perjanjian pada 2.1.2018, sedangkan Defendan masih mempunyai masa dua belas (12) bulan atau setahun untuk menyempurnakan obligasinya di bawah Perjanjian 2012 tersebut. Atas alasan ini sahaja, adalah menjadi dapatan Mahkamah ini bahawa permohonan Plaintif sememangnya satu permohonan yang pra matang dan semestinya gagal. v. Plaintif di sini juga telah mendakwa bahawa Defendan telah meletakkan bebanan ke atas hartanah tersebut dengan memasukkan gadaian ke atas hartanah tersebut bertentangan dengan klausa 3.7 Perjanjian 2012. 24 vi. Mahkamah ini perlu menekankan bahawa berdasarkan kepada Eksibit “SH-1” yang telah dieksibitkan oleh Plaintif di Afidavit Sokongannya (Kandungan 2) pada Catatan Carian Persendirian ke atas ketiga-tiga puluh geran hak milik hartanah tersebut telah menunjukkan bahawa gadaian-gadaian yang didaftarkan oleh MBSB ke atas hartanah tersebut telah didaftarkan pada 3.4.2008. Gadaian-gadaian tersebut telah didaftar bagi tujuan menjamin pinjaman sebanyak RM1.3 juta yang diberikan kepada Defendan. vii. Berdasarkan Borang Gadaian 16 A di Eksibit “H-1” yang terkandung di dalam Afidavit Jawapan Defendan (Kandungan 5), adalah jelas menunjukkan gadaian yang didaftarkan adalah dengan kebenaran Plaintif sendiri dan sememangnya di dalam pengetahuan Plaintif. Plaintif sendiri telah sebagai tuanpunya/pemilik berdaftar hartanah-hartanah di dalam geran hakmilik yang disenaraikan di Jadual Tanah Dan Kepentingan (muka surat 4, Borang 16A telah mencagarkan hartanah- 25 hartanah yang disenaraikan tersebut menjamin pinjaman yang diberikan kepada Defendan. Borang 16A diperturunkan di bawah: Saya/Kami SITI HANJAR BINTI H. ABDUL RAHMAN (No. K/P: 520618- 10-5496) adalah seorang warganegara Malaysia yang cukup umur dan Beralamat di Kg Sungai Pinang, 42920 Pulau Lumut, Selangor Darul Ehsan Tuanpunya tanah/bahagian yang tak dipecahkan atas tanah yang diperihalkan dalam Jadual di bawah ini; *penerima pajak/penerima pajak kecil dalam *pajakan/pajakan kecil yang diperihalkan dalam Jadual di bawah ini bagi tanah yang tersebut itu: Bagi maksud menjamin: *(a) pembayaran balik pinjaman sebanyak RM………………… ringgit, yang dengan ini saya/kami mengaku telah terima, kepada pemegang gadaian yang tersebut namanya di bawah ini, beserta faedah; *(b) pembayaran jumlah wang sebanyak RM1,300,000.00 ringgit, kepada pemegang gadaian yang tersebut namanya di bawah ini berserta faedah, dan sebagai balasan- 26 MALAYSIA BUILDING SOCIETY BERHAD (No. Syarikat 9417-K) telah memberi kemudahan pinjaman kepada TAJUK PASIFIK DEVELOPMENT SDN. BHD.(788289-P) *(c) pembayaran kepada pemegang gadaian yang tersebut namanya di bawah ini, beserta faedah, akan wang yang dari semasa ke semasa kena dibayar kepadanya daripada *akaun semasa saya/akaun yang berikut yang disimpan di antara kami; vii. Di dalam Jadual Tanah Dan Kepentingan telah tertera gadaian yang telah dilaksana ke atas hartanah tersebut:- JADUAL TANAH *DAN KEPENTINGAN *Bandar/Pekan/ Mukim No. *Lot/ Petak/P.T. Jenis dan No. Hakmilik Bahagian tanah (jika ada) No. Berdaftar *pajakan/paj akan kecil (jika ada) No Berdaftar Gadaian (jika ada) (1) MUKIM KLANG (2) NO. PT 1.126048 2.126049 3.126050 4.126051 5.126052 6.126053 (3) No. H.S. (M) 1.45313 2.45314 3.45315 4.45316 5.45317 (4) SEMUA (5) SEMUA (6) SEMUA 27 7.126054 8.126055 9.126056 10.126057 11.126058 12. 126059 6.45318 7.45319 8.45320 9.45321 10.45322 11.45323 12.45324 viii. Apa yang jelas, gadaian-gadaian ke atas hartanah- hartanah Plaintif yang telah dibuat kepada MBSB pada 3.4.2008 bagi tujuan projek Perjanjian 2007 telah dimasuki sebelum Perjanjian 2012 ditandatangani dan ia telah dimasuki dengan mendapat kebenaran sepenuhnya daripada Plaintif dan bebanan adalah dengan penuh pengetahuan dan kesedaran Plaintif. Gadaian ini juga telah didaftarkan selaras dengan Perjanjian 2007 yang membenarkan gadaian dimasuki atau perletakan bebanan ke atas hartanah tersebut. Gadaian-gadaian tersebut masih lagi wujud dan berterusan dengan penuh pengetahuan Plaintif. 28 [22] Adalah menjadi dapatan Mahkamah ini, Plaintif kini tidak boleh membangkitkan klausa 3.7 Perjanjian 2012 dan mendakwa wujud pemecahan klausa tersebut. Gadaian-gadaian tersebut bukanlah gadaian / bebanan baru ke atas hartanah tersebut Klausa 3.7 di dalam Perjanjian 2012 meletakkan halangan untuk gadaian-gadaian baru yang dibuat selepas Perjanjian 2012 tersebut ditandatangani oleh Plaintif dan Defendan. [23] Adalah menjadi dapatan Mahkamah ini bahawa Plaintif di dalam kes ini cuba menamatkan Perjanjian 2012 dengan mendakwa terdapat pemecahan obligasi Defendan atas terma Perjanjian 2012 sedangkan obligasi yang terletak di bahu Defendan menurut klausa 3.7 Perjanjian 2012 adalah tidak meletakkan apa-apa bebanan baru ke atas hartanah tersebut selepas 12.12.2012. Ini tidak berlaku di dalam kes ini, maka tiada pemecahan terma 3.7 Perjanjian 2012 seperti yang didakwa Plaintif. Mahkamah ini perlu tekankan bahawa Plaintif yang telahpun bersetuju dengan gadaian yang telah dibuat pada perjanjian pertama, kini tidak boleh menggunakan klausa 3.7 Perjanjian 2012 iaitu perjanjian baru untuk mengatakan 29 Defendan telah melanggar klausa 3.7 sedangkan pinjaman dan gadaian telah dibuat berdasarkan Perjanjian 2007. Bagi Mahkamah ini walaupun dikatakan Perjanjian 2012 ini adalah perjanjian baru yang menggantikan Perjanjian 2007, namun gadaian dan pinjaman MBSB tersebut yang berlandaskan Perjanjian 2007 masih berterusan dan masih wujud. Tidak ada peruntukan di dalam Perjanjian 2012 yang membatalkan gadaian dan pinjaman secara otomatik apabila Perjanjian 2007 tersebut itu tamat tamatkan. Walhal di dalam perkara bersandarkan Perjanjian 2007, gadaian dan pinjaman tersebut adalah melibatkan pihak MBSB iaitu pihak yang tidak terlibat di dalam perjanjian usahasama tersebut. MBSB hanya institusi kewangan yang memberikan pinjaman kepada Defendan dan pinjaman tersebut dijamin oleh hartanah-hartanah Plaintif. Hujahan dan dakwaan Plaintif atas pemecahan/pelanggaran klausa 3.7 Perjanjian 2012 di pihak Defendan semestinya gagal dan tidak boleh diterima oleh Mahkamah ini. 30 [24] Mahkamah ini merujuk kepada kes Datuk Abdul Aziz Ahmad v Uda Holdings Sdn Bhd (1998) 5 CLJ. Di dalam kes Datuk Abdul Aziz Ahmad telah diputuskan antara lain: “…A court must not merely construe the words of a contract embodied in a document. It must be concerned with the facts and circumstances which, when taken together, point to the intention of the parties in relation to the effect that was meant to be given by them to a particular transaction. The law will always look beyond the terminology of the document to the actual facts of the situation and that it is no longer a question of words but substance to arrive at a just result.” [25] Berhubung dengan dakwaan Plaintif bahawa kegagalan Defendan menebusbalik hartanah tersebut telah menyebabkan hartanah-hartanah Plaintif hampir dilelong, namun berdasarkan surat daripada MBSB (Redemption Statement) bertarikh 23.16.2016 (Eksibit “H-5”, Kandungan 5) yang menyatakan berikut: 31 “We refer to your request for redemption in respect of the aforesaid Charge Properties. We wish to inform your that the redemption sum payable is as follows:- Due Date Amount 30/12/2016 RM544,422.61 31/01/2017 RM547,639.34 23/02/2017 RM549,951.57 Payment should be made by GIRO/RENTAS to our account which details are as follows:- Payee : Malaysia Building Society Berhad Account No : 5140-1204-7406 Beneficiary Bank : Malayan Banking Berhad Beneficiary Address: Kuala Lumpur Main Branch, Menara Maybank, 100 Jalan Tun Perak, 50050 Kuala Lumpur The redemption statement is subject to the following conditions:- Jumlah penuh sebanyak RM549,951.57 tersebut telahpun dijelaskan pembayarannya oleh Defendan kepada MBSB 32 melalui Deposit Cash Maybank dan diakui terima oleh MBSB pada 23.2.2017. [26] Bagi Mahkamah ini, bayaran ini telah dibuat oleh Defendan atas jumlah yang sepenuhnya dan dalam tempoh masa yang ditetapkan iaitu sebelum 23.2.2017. Maka di dalam kes ini tiada perlanggaran terma-terma Perjanjian 2012 di pihak Defendan seperti dakwaan Plaintif. [27] Atas alasan-alasan di atas permohonan Plaintif di dalam Kandungan 1 ditolak dengan kos sebanyak RM3000.00 kepada Defendan. ..................................................... (DATUK AZIMAH BINTI OMAR) Hakim Mahkamah Tinggi Shah Alam (Saman Pemula) Selangor Darul Ehsan Bertarikh 20hb Jun 2017 33 Peguam Plaintif - Tetuan Rastam Singa & Co. Encik Mohd Faiz Abdul Rahim Peguam Defendan - Tetuan Azam Idzham Azman & Partners Encik Mohd Kamal Illias

Tika 2.6.0

JA-24FC-1556-10/2016

PLAINTIF RHB Bank Berhad (No. Syarikat: 6171-M) DEFENDAN Sineo Enterprise Sdn Bhd (Dalam Likuidasi) (No. Syarikat: 35539-M) PENCELAH Chin Kon Meng (No. K/P: 530922-10-5465) ...Bakal Pencelah

20/06/2017

YA DATO' DR. CHOO KAH SING

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Page 1 of 10 DALAM MAHKAMAH TINGGI MALAYA DI JOHOR BAHRU SAMAN PEMULA NO. JA-24FC-1556-10/2016 Dalam Perkara Seksyen 256, Kanun Tanah Negara, Akta 56 Tahun 1965; Dan Dalam Perkara Aturan-Aturan 28 dan 83, Kaedah-Kaedah Mahkamah 2012; Dan Dalam Perkara Mengenai (i) Gadaian Perserahan No. 10633/1995; dan (ii) Gadaian Perserahan 87141/1996; Berhubung dengan hartanah yang dipegang di bawah GRN 530153, Lot 59592 (dahulunya CT 210, Lot 1100), Mukim Pulai, Daerah Johor Bahru Antara RHB Bank Berhad (No. Syarikat: 6171-M) Plaintif Dan Sineo Enterprise Sdn Bhd (Dalam Likuidasi) (No. Syarikat: 35539-M) Defendan Dan Chin Kon Meng (No. K/P: 530922-10-5465) Bakal Pencelah Page 2 of 10 DECISION (Enclosure 5) CHOO KAH SING Judicial Commissioner High Court, Johor Bahru Date: 20.6.2017 Page 3 of 10 Introduction [1] This is a decision on an interlocutory application (encl. 5) which was filed by the proposed intervener pursuant to Order 15 rule 6(2)(b) of the Rules of Court. On 9.5.2017, this Court dismissed the proposed intervener‟s application. The reasons for this Court‟s decision are set down below. Brief Facts [2] The plaintiff took out this Originating Summons for an order for sale over a charged property secured by two charges via Presentation Nos. 10633/95 and 87141/96. The charges secured several loan facilities granted to the defendant company by a previous financial institution. The rights and liabilities of the previous financial institution were vested with the plaintiff. The plaintiff seeks to recover from the defendant company an indebted sum amounting to several hundreds of millions. This foreclosure action was filed by the plaintiff to recoup the indebted sum. The defendant company was wound-up on 9.8.2011 by another creditor BSC Elevator Sdn. Bhd. [3] The proposed intervener is a contributory of the defendant company as well as a guarantor of the loan facilities. The proposed intervener has indicated to this Court that he has no intention to oppose the foreclosure proceedings taken by the plaintiff. All that the proposed intervener wants from this Court is to allow him to be made a party to the foreclosure action. Page 4 of 10 [4] The grounds for the proposed intervener‟s application are twofold. First, being a contributory of the defendant company, the proposed intervenor has a right in law of a proprietary nature to share in the surplus assets of the defendant company after the debts of the defendant company has been settled. Secondly, being a guarantor, the proposed intervenor also has a right to be heard in the subsequent applications which would naturally follow a pronouncement of an order for sale by this Court. The presence of the proposed intervener in the foreclosure proceedings would be necessary to ensure that all matters in dispute therein may be effectually and completely determined and adjudicated upon, the counsel for the proposed intervener submitted. The Reasons of this Court [5] A third party, not being a party in a legal proceeding, can be added as a party in the proceeding. This is provided under Order 15 rule 6(2)(b) of the Rules of Court („RoC‟). Leave of the court is required to be obtained before a third party could be added as a party. [6] In order to obtain leave from the court, a third party has to satisfy the court that he (i) ought to have been joined as a party or whose presence before the court is necessary to ensure that all matters in dispute in the cause or matter may be effectually and completely determined and adjudicated upon, or (ii) between him and any party to the cause or matter there may exist a question or issue arising out of or relating to or connected with any relief or remedy claimed in the cause or matter which, in the opinion of the court, would be just and convenient to determine as between him and that party as well as between the parties to the cause or matter (see O.15 r.6(2)(b)(i) and (ii) of the RoC). Page 5 of 10 [7] It is trite that „for a third party to intervene and to be joined as party in an action, the proposed intervener must demonstrate that he or she has some interest which is directly related to or connected with the subject matter of the action.‟ Further, „if a person wishes to be joined because of a financial interest, and not legal interest, in the outcome of the case, the court is unlikely to allow the third party to intervene‟ (see Malaysian Civil Procedure 2015, vol. 1, p. 156). [8] Based on the above legal propositions, the question for this Court to ask is – Will the proposed intervener‟s rights against the liabilities to any party to the action in respect of the subject matter of the action be directly affected by any order which may be made in the foreclosure proceeding? (see Pegang Mining Co. Ltd v Choong Sam & Ors [1969] 2 MLJ 52, p. 56) [9] The subject matter of this proceeding is for an order for sale of the charged property. The proposed intervener is not the chargor or registered proprietor of the charged property. He does not possess any legal interest in the charged property. A contributory of the defendant company has no direct legal interest over the assets of the defendant company (see Court of Appeal decision in Tan Choi Yu v Syarikat Tingan Lumber Sdn Bhd [1998] 4 MLJ 275). A contributory is merely liable to contribute to the assets of the company in the event the company is wound up. Hence, a contributory‟s right could not extend to a legal right over the assets of a company. [10] It makes no difference whether the defendant company has or has not been wound-up, the proposed intervener could not assert any legal Page 6 of 10 interest in the subject matter of the foreclosure proceeding, especially the surplus of the proceeds of the sale of the charged property which belongs to the defendant company (see Court of Appeal decision in Anafartalar Caddesi Sdn Bhd v Southern Investment Bank Bhd (formerly known as Perdana Merchant Bankers Bhd) [2003] 1 MLJ 561, at p. 565). [11] The learned counsel for the plaintiff has correctly submitted that in the event there is any surplus from the proceeds of the sale of the charged property, the surplus proceeds will be properly dealt with in the liquidation exercise of the defendant company by the appointed liquidator in accordance with the law. The contributory‟s interest, if any, ought to be dealt with in the liquidation exercise, not in the present foreclosure proceeding. [12] With regard to the fact that the proposed intervener is a guarantor of the loan facilities, his rights, if any, are against the plaintiff, not in a foreclosure proceeding. A guarantor of a loan facility has no right to be heard in a foreclosure proceeding. The lender has distinct rights under two separate contracts. The guarantor‟s right against the lender is distinct from the chargor. The lender could exercise either one or both rights together. The lender has a right on one hand, against the chargor in relation to the charged property under the charge; on the other hand, the lender has a right against the guarantor under the guarantee. [13] The two grounds submitted by the learned counsel for the proposed intervener ultimately converge to one objective which is the financial interest of the proposed intervener. The proposed intervener wanted to ensure the charged property could be auctioned at the highest Page 7 of 10 price in order to repay the debt owing to the plaintiff by the defendant company. The higher the sale price, the better the financial benefit for the proposed intervener. If the sale price could cover the debt, the proposed intervener would be released from the liability as a guarantor. It is the considered view of this Court that the underlining object of the proposed intervener is very much driven by his financial interest. [14] As stated earlier, if a person wishes to be joined as a party in the proceeding because of a financial interest, not legal interest, in the outcome of the case, the court is unlikely to allow the third party to intervene (see Lee Meow Lim v Lee Meow Nyin [1990] 3 MLJ 123 at p. 125; Soo Hong & Leong Kew Moi & Ors v UMBC Bhd & Anor [1997] 2 CLJ 548, CA). [15] This court is of the considered view that the process of fixing the reserve price for the auctioned property, i.e. the charged property if an order for sale is granted subsequently, is well governed by the existing rules and regulations and provisions under the National Land Code. There is no need for the proposed intervener to participate in the process, as the law does not permit such participation by the proposed intervener in such proceedings. In fact, it is the legal duty of the liquidator to ensure the process is carried out fairly and justly without compromising the defendant company‟s interest. The submission of the learned counsel for the proposed intervener that the charged property could be sold at the auction below the market value is unfounded. [16] Based on the above reasoning, this Court finds the grounds relied on by the proposed intervener to join as a party in this OS action have failed to satisfy the tacit test as laid down in Pegang Mining Co. Ltd Page 8 of 10 (supra) (see also the decision of the Federal Court in Hong Leong Bank Bhd (formerly known as Hong Leong Finance Bhd) v Staghorn Sdn Bhd and other appeals [2008] 2 MLJ 622). [17] The learned counsel for the proposed intervener relied on a decision by the then Supreme Court in Arab Malaysian Merchant Bank Berhad v Jamaludin bin Dato Mohd Jarjis [1991] 1 MLJ 27 as his crowning blow of the application. The learned counsel cited the following passage in the judgment at p. 28: One of the class of cases covered by the said rules [referring to O.15 r.6(2)(ii) of the High Court Rules 1980 which is pari materia with the present O.15 r.6(2)(b)(ii) of the RoC], which allows intervention by persons not parties, is where the proprietary or pecuniary rights of the intervener are directly affected by the proceedings or where the intervener may be rendered liable to satisfy any judgment either directly or indirectly. The ambit of this class has been materially widened by the decision of the UK Court of Appeal in Gurtner v Circuit, the effect of which is to include any case in which the intervener is directly affected not only in his legal rights but in his pocket. [18] The learned counsel for the proposed intervener placed great emphasis on the fact that what will be the reserved price fixed for the charged property and how much the successful auctioned price is will directly affect the proposed intervener‟s pocket. Page 9 of 10 [19] This Court is of the considered view that the learned counsel for the proposed intervener has overemphasized the phrase “is directly affected not only in his legal rights but in his pocket”. That phrase has to be understood within the peculiar facts of the case. [20] The proposed intervener (respondent) in that case had given a letter of undertaking to pay a judgment debt on behalf of the judgment debtor. The proposed intervener (respondent) could not keep up with the payment. He then challenged the excessive chargeable interest ordered in the judgment. The proposed intervener contended that the chargeable interest in the said judgment far exceeded that was allowed under the then Rules of the High Court 1980. The proposed intervener in that case had a direct nexus with the judgment debt. The outstanding amount in the judgment sum directly affected the proposed intervener‟s pocket. [21] The proposed intervener had stepped into the shoes of the judgment debtor. His right to intervene, or in other words, his right to be heard, sprung from his letter of undertaking accepting liability in the judgment. His challenge was against the extent of his liability. The proposed intervener had a direct legal interest in the subject matter, i.e. the judgment itself. [22] In the present facts, the proposed intervener has no direct nexus with the charged property in the foreclosure proceeding. The foreclosure proceeding relating to the charged property and the court proceeding in which a judgment was obtained against the proposed intervener as a guarantor are distinct in nature. The proposed intervener‟s right, if any, Page 10 of 10 is against the judgment entered against him as a guarantor, not in this foreclosure proceeding. Conclusion [23] Based on the above reasoning, this Court dismissed the proposed intervener‟s application and ordered costs of RM2,000.00 to be paid to the plaintiff by the proposed intervener. -Signed- ……………………………………. (CHOO KAH SING) Judicial Commissioner High Court Johor Bahru Proposed intervener‟s counsel : M Rajenthirakumar Messrs Kumar Associates Plaintiff‟s counsel : Chia Oh Sheng Messrs Lee Hishammuddin Allen & Gledhill

Tika 2.6.0

12BNCVC-4-01/2016

PERAYU SEROJA ANGGERIK DEVELOPMENT SDN BHD RESPONDEN MHNB REKA SDN BHD

14/06/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

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DALAM MAHKAMAH TINGGI DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN RAYUAN SIVIL NO: 12BNCVC-4-01/2016 ANTARA SEROJA ANGGERIK DEVELOPMENT SDN BHD (NO. SYARIKAT: 514293-U) … PERAYU DAN MHNB REKA SDN BHD (NO. SYARIKAT: 494830-P) … RESPONDEN DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN GUAMAN NO: B52NCVC-136-09/2014 ANTARA MHNB REKA SDN BHD (NO. SYARIKAT : 494830-P) … PLAINTIF DAN SEROJA ANGGERIK DEVELOPMENT SDN BHD (NO. SYARIKAT : 514293-U) … DEFENDAN GROUND OF JUDGMENT Introduction [1] This is an appeal against the decision of the Session Judge which allowed the Plaintiff’s claim on 19 January 2016. The parties in this appeal are the Appellant who was the Defendant and the Respondent was the Plaintiff at the Session Court. [2] For ease of reference, in this judgment, the parties will be referred to as they were in the Session Court. Background Facts [3] The relevant factual background giving rise to this appeal based on the written submission of the counsels may be briefly stated as follows: (a) Seroja Anggerik Development Sdn Bhd., the Defendant in this case, is a limited company registered in Bandar Baru Bangi, Selangor, was appointed by the Public Works Department, Malaysia to carry out a construction project. The Plaintiff is a limited company registered in Malacca. (b) JKR was the Project owner via a Letter of Intent of 8.1.2014 offered a Project known as “menyiapkan baki kerja tertinggal bagi Projek membina jalan baru dari Lebuhraya Seremban Port Dickson ke laluan 5 di Pasir Panjang dan menaik taraf laluan 5 dari Pasir Panjang ke Linggi Negeri Sembilan (Seksyen 1)” known as “the said Project”. The Defendant had received the Letter of Intent of 8.1.2014 from JKR with the contract sum for the Project as RM27,680.114.45. (c) The Plaintiff claimed that the Defendant, the Main Contractor for the said Project had subcontracted through a letter of 29.01.2014, the said Project to the Plaintiff for the sum of RM 22,689,187.00 which is disputed in this case. The letter is exhibit P-11 (at pages 188-189 of the Appeal Record Jilid 2 Bahagian C). (d) The Plaintiff claimed that the Plaintiff accepted the offer by the Defendant and commenced preliminary works where the details as claimed by the Plaintiff in Table 1 below. (e) JKR via letter dated 27.3.2014 approved the tender of the said Project to the Defendant. The Plaintiff claimed that the said Project was offered to the Defendant by way of a Letter of Award to carry out the project for the sum of RM27,680,117.45. (f) The Plaintiff claimed that the Defendant refused to offer the said Project to the Plaintiff for the original agreed price but instead insist that the Defendant will be awarded only if the Plaintiff accept the new offer for the sum of RM21,680,114.45. The Defendant on the other hand stated that the Defendant had offered the Plaintiff a new contract value for the amount RM21,680,114.45 and Plaintiff did not accept the letter of intent nor the letter of offer from the Defendant. (g) The Plaintiff claimed that the Defendant breached the contract and Plaintiff had suffered loss amounting to RM 1,084,005.23 which is 4.5% from contract sum. The Plaintiff sued the Defendants for the expenses incurred by the Plaintiff for work done and damages for the wrongful termination and/or breach of promise. (h) The Session Judge allowed the Plaintiff’s claims as follows: (i) RM450,000.00 for the Works done; (ii) RM500,000.00 as compensation for breach of contract; (iii) Interest at the rate fiver per centum (5%) on the amount RM450,000.00 calculated from 1.04.2014 to full settlement; (iv) Interest at the rate five per centum (5%) on the amount RM500,000.00 and/or on the said judgment sum until full completion; and (v) cost for this action amounting to RM20,000.00. (i) Being aggrieved with the said decision, the Defendant appealed to this Court. Defendant’s Submission [4] The learned counsel for the Defendant orally submitted the three main grounds for appeal as provided in his written submission, namely: (i) No legally binding contract existed; (ii) Plaintiff failed to prove the preliminary works amounting to RM450,000.00; (iii) Defendant is not responsible to pay damages amounting to RM550,000.00. [5] Based on the memorandum of appeal, the Counsel for the Defendant submitted that the Session Judge had erred in law and facts in considering the existence of a contract, the Letter of Intent of 29.01.2015 (“exhibit P11”) as binding and relied on the case of Mascom (M) Sdn Bhd v Panju Keagungan Sdn Bhd (2011) I LNS 1607. [6] It was submitted that the Session Judge had erred in law and facts, failing to consider the fact that, one acceptance letter (Surat Setuju Terima) of 30.01.2014 (“exhibit P1”) failed to be returned to the Appellant within the stipulated time. [7] The Defendant submitted that the Session Judge had erred in law and facts in deciding that the Plaintiff had commenced preliminary works, based on the Summary Bill of Quantity (BQ) (“exhibit P8”), the Letter for Payment of Deposit (Surat Penerimaan Pembayaran Deposit) of 7.2.2014 (exhibit P9”), Deposit Letter for Supply of Construction Materials (Surat Pembayaran Deposit Untuk Membekal Bahan Binaan) dated 10.03.2016 (“exhibit P20”), Photos (“exhibit P19”) and witness’s testimony SP2 without considering matters as follows: 7.1 The exhibit P8 was an empty BQ without the stamp and signature of witness SP2. The SP2 had testified confirming the normal practice that the BQ will be prepared by SP2 that has the stamp or SP2’s signature; 7.2 There was no supporting document for exhibit P9, a cheque or Bank Account to prove that payment had been received by SP2 whom said that the payment would be received through cheque or cash; 7.3 The claim for Project Management Consultant (PMC) appointment to be RM 65,000.00 but the payment made from Respondent to SP2 reflected the amount of RM 40,000.00; 7.4 The maker for the document exhibit P20 was not called to testify the validity of exhibit P20; 7.5 The Plaintiff failed to bring other evidence to support for instance invoice, purchase order or the details to prove the same of the materials ordered amounting to RM 250,000.00. 7.6 The claim by Plaintiff on the same of the works and deposit made to supplier amounted to RM 350,000.00 but exhibit P20 only showed payment made was only for RM 250,000.00. 7.7 The photos as exhibit P19 are only photos of the site visit and meeting with Jabatan Kerja Raya (JKR) representative only and no other evidence to support exhibit P19 that the photos were taken at the Project site and the meeting held with JKR representative, without the date and time recorded. 7.8 that the General damages amounting to RM 550,000.00 to be given to the Plaintiff on the basis that Plaintiff had rejected other job offers whereas this was never proven by the Plaintiff in rejecting other offers. Learned counsel for Defendant relied on the authority where claim for damages must be proven as in the case of Popular Industries Ltd v The Eastern Garment Manufacturing Co Sdn Bhd [1990] 2 CLJ Rep 635 and Letrik Bandar Hup Heng Sdn Bhd v Wong Sai Hong [2002] 5 CLJ 170. Plaintiff’s Submission [8] The Plaintiff alleged that Defendant had offered by letter on 29.1.2014 to subcontract the said Project to the Plaintiff for the contract value of RM 22,689,187.00 and had stated that the contract value cannot be modified. The Plaintiff commenced the preliminary works based on the LOI 29.1.2014 as in Table 1 below: No. Particulars Amount 1. Site visits to ensure that the scope of the work is as stated in the Bill of Quantity. This includes making measurements at sites/exact measurement of the balanced work need to be done at the abandoned site. The number of visits to the site is approximately 10 times. RM20,000.00 2. Appointment of Project Management Consultant RM65,500.00 3. Attending meeting at Defendant’s Office(Seroja Anggerik Development Sdn Bhd) RM3,500.00 4. Attended Meeting with JKR, 7 times to get confirmation on the price adjustment, scope of work and work specification RM5,000.00 5. Making preliminary discussions with a number of supplier/provider/surveyor to establish reasonable rates, this is to maintain the increase in rates, especially the rate of work for premix and hence made a unrefundable deposit to the supplier RM350,000.00 6. Meetings with En Nazri political secretary to meet with the deputy minister for JKR RM2,000.00 7. Meeting with Secretary to the deputy minister to expedite the project RM3,000.00 8. Preparation for setting up “site office” near to the site. RM1,000.00 Total RM450,000.00 [9] The Plaintiff alleged that on 12 March 2014, the Defendant reduced the contract sum from RM 22,689,187.00 to RM 21,680,114.45. [10] The Plaintiff claimed for damages RM 550,000.00 which is 2 - 2.5% of the contract sum and relied on the case of Court of Appeal, Tanjung Tiara Sdn Bhd v Southwind Development Sdn Bhd [2011] 1 CLJ 105 at page 106. Decision of Session Court [11] The Session Judge allowed the Plaintiff’s claims as in paragraph 3(h) above and the decision is reproduced here in part as follows: “Alasan-alasan Penghakiman 1. Berdasarkan dari keterangan semua saksi dan eksibit-eksibit yang telah dikemukakan di dalam Mahkamah, Mahkamah mendapati bahawa Plaintiff mempunyai tuntutan yang kukuh dan gagal dicabar oleh Defendan di dalam tuntutan ini. Atas asas demikian, Mahkamah telah membenarkan tuntutan Plaintiff terhadap Defendan bersama-sama dengan kos. 2. Tuntutan Plaintif adalah untuk kerja-kerja yang telah dilakukan sebanyak RMK 450,000.00 dan juga gantirugi sebanyak RM550,000.00. Tuntutan Plaintif sebanyak RM550,000.00 telah berjaya dibuktikan melalui eksibit P-8. Eksibit P-9, eksibit P-19 dan P-20. SP-2, Encik Mustafa Bin Osman telah memberi keterangan bahawa beliau bertanggungjawab membuat/menyediakan Bill of Quantity bagi membuktikan kerja-kerja yang dilakukan oleh Plaintif. SP-2 telah memberitahu Mahkamah di dalam keterangan beliau sendiri dan juga beberapa siri lawatan telah dibuat. Bill of Quantity adalah merupakan satu keterangan utama, dan it is a prime evidence. Fakta ini gagal dicabar oleh Defendan dengan bukti yang menunjukkan sebaliknya.” THE COURT’S FINDINGS Whether There Is A Contract Between The Parties [12] It was the Plaintiff’s contention that the LOI formed the contract between the Defendant and the Plaintiff. The Plaintiff’s claims were allowed at the Session Court on two grounds: 12.1 the expenses incurred by the Plaintiff for work done; and 12.2 the damages for wrongful termination and/or breach of promise. [13] At this appeal, the Defendant contended that the LOI tendered as exhibit P-11 (at page 188 of the Appeal Record Jilid 2 Bahagian C) relied by the Plaintiff as binding contract was not a contract between the Defendant and the Plaintiff. [14] The learned counsel for the Defendant referred the Court to paragraphs 2 and 3 of the LOI exhibit P-11, the words, “sukacita dimaklumkan bahawa Jabatan Kerja Raya Malaysia melalui Seroja Anggerik Development Sdn Bhd telah berhasrat untuk melantik syarikat tuan melaksanakan projek tersebut di atas dengan harga 22 juta” was not an affirmed or a resolute offer. The counsel for the Defendant also pointed out to paragraph 4 of the LOI which clearly stated that it was only a letter of intent and that the learned Session Judge had failed to take into consideration to the phrase, “surat ini hanyalah satu Surat Niat dan hendaklah tidak ditafsirkan dalam apa-apa jua sebagai mengikat syarikat tuan ke atasnya”. [15] As the content of the LOI had expressly stated as such, the learned counsel for the Defendant submitted the authority Kokomewah Sdn Bhd v Desa Hatchery Sdn Bhd [1995] 3 CLJ 511 and quoted JCA Abu Mansor whom stated that, “On the first issue, we are of the view there is no merit in the appellant’s contention that there was a concluded contract in the Letter of Intent. We uphold the learned trial Judge’s finding, on the evidence, when he held as referred to above that the RM37,971,570.27 was not a finalized contract sum and that the Letter of Intent dated 3 April 1985 was not a concluded contract.” [16] The counsel also referred to a High Court decision in the case of Mascom (M) Sdn Bhd v Panju Keagungan Sdn Bhd [2011] 1 LNS 1607 quoting Justice Asmabi’s principle in interpreting a LOI with reference to an English case, “23. … the effect and significance of a Letter of Intent had been discussed in the case of Turiff Construction Ltd and Turiff Ltd v Regalia Knitting Mills Ltd 9 BLR 20 QBD (at page 22 para 3) where His Lordship Judge Fay had this to say: As I understand it such a letter is no more than the expression in writing of a party’s intention to enter into a contract at a future date. Save in exceptional circumstance it can have no binding effect.” [17] The counsel for the Defendant submitted that the Plaintiff failed to reply to the LOI within the 7 days requirement stipulated in the LOI and that the Plaintiff failed to prove at the trial court that the said LOI which is exhibit P1 (page 190 of Appeal Record Jilid 2 Bahagian C) was not returned to the Defendant within the stated period. [18] To this the counsel for the Defendant claimed that the LOI could not be binding as the Letter of Award (LA) by JKR was awarded only on 27.3.2014 to the Defendant as the Main Contractor (at page 197 of Appeal Record) where the Date of the Site Possession given was 28.4.2014. [19] The Defendant’s Counsel also submitted that proof of no contract was corroborated by the Plaintiff’s witness’s statement (at page 112 of the Appeal Record Jilid 1 Bahagian A & B) whom during the examination by the Defendant’s Counsel agreed that the LOI was only an expression of desire to appoint. To this the Defendant’s Counsel submitted to the Court that as there was no reply to the Letter of Acceptance of 12 March 2014 (exhibit P12) from the Plaintiff, such conduct tantamounts to a rejection of acceptance which is corroborated by the evidence of Plaintiff’s witness SP3 (at page 120 Appeal Record Jilid 1 Bahagian A & B) where upon questioning, “En Zahari setuju atau tidak Surat Tawaran 12 Mac ini telah ditolak oleh pihak plaintiff?”, the answer given was “setuju”. [20] The Plaintiff on the other hand submitted that the LOI was binding as the Defendant had stated that the price could not be changed. The Plaintiff relied on the authority in relation to concluding a contract that is the case of Sinar Wang Sdn Bhd v Ng Kee Seng [2004] 3 CLJ 679 at page 688 where the counsel submitted that there was a LOI by JKR to Defendant and to the Plaintiff and that before the contract is concluded, there was a lot of work where the BQ had to be prepared as materials’ price could fluctuate. Counsel further submitted that the only reason that the contract could not proceed was the contract price was reduced. [21] The Counsel for the Plaintiff went on to say that the law now leans in favour of upholding bargains and submitted two new cases to support her argument that was not in the bundle of authorities, the case of RS & L Marine Sdn Bhd v Bras Ventures Bhd & Anor [2016] 9 CLJ 56 and JNA Ikhtisas Sdn Bhd v Kerajaan Malaysia [2015] 3 CLJ 1100. Analysis [22] The heart of the matter is whether there was a contract between the parties to start with based on the LOI. It was not disputed that the Plaintiff received a LOI from the Defendant based on one letter of intent received by the Defendant from JKR of 8.1.2014 (exhibit P10A, at pages 183-184, Appeal Record Jilid 2, Bahagian C). [23] It is pertinent that the main content of the letter of intent by JKR (exhibit P-10A) being the owner of the said Project to the Defendant be reproduced here as follows: “ SURAT NIAT PROJEK: MENYIAPKAN BAKI KERJA TERTINGGAL BAGI PROJEK MEMBINA JALAN BARU DARI LEBUHRAYA SEREMBAN – PORT DICKSON KE LALUAN 5 DI PASIR PANJANG DAN MENAIKTARAF LALUAN 5 DARI PASIR PANJANG KE LINGGI NEGERI SEMBILAN (SEKSYEN 1) Dengan hormatnya, saya merujuk kepada perkara di atas dan surat Kementerian Kewangan Malaysia rujukan S/L.KEW/PK.KI 2/700/810209/157/51-3 JLD 3 SK 2(4) bertarikh 18 Disember 2013 adalah berkaitan. 2. Sukacita dimaklumkan bahawa Kerajaan Malaysia melalui Jabatan Kerja Raya telah berhasrat untuk melantik syarikat tuan untuk melaksanakan projek tersebut di atas dengan harga RM dan tempoh siap kerja selama 12 bulan. Walau bagaimanapun penerimaan tender tersebut adalah tertakluk kepada persetujuan tuan kepada syarat berikut:- 2.1.1 Pihak tuan tidak boleh membuat sebarang perubahan harga, skop dan tidak layak untuk membuat sebarang tuntutan perbelanjaan tambahan dan kerugian sekiranya tawaran ini disetujuterima oleh pihak tuan. 3. Sila nyatakan persetujuan tuan secara rasmi dengan menandatangani dan disaksikan dengan sempurnanya surat disertakan ini dalam tempoh tujuh (7) hari daripada tarikh penerimaan surat ini, pihak kami menganggap pihak tuan tidak bersetuju untuk menerima tawaran ini dengan syarat yang telah dinyatakan. 4. Surat ini hanyalah satu Surat Niat dan hendaklah tidak ditafsirkan dalam apa-apa jua sebagai mengikat Kerajaan ke atasnya.” [24] The LOI from Defendant to the Plaintiff of 29 January 2014 can be found in exhibit P-11 (at pages 188-189 of the Appeal Record Jilid 2 Bahagian C) where some of the contents are reproduced here for ease of reference as follows: “2. Sukacita dimaklumkan bahawa Jabatan Kerja Raya Malaysia melalui Seroja Anggerik Development Sdn. Bhd. telah berhasrat untuk melantik syarikat tuan untuk melaksanakan projek tersebut di atas dengan harga RM22,689,187.00 dan tempoh siap kerja selama 12 bulan. Walau bagaimanapun penerimaan tender tersebut adalah tertakluk kepada persetujuan tuan kepada syarat berikut: 2.1.1 Pihak tuan tidak boleh membuat sebarang perubahan harga, skop dan tidak layak untuk membuat sebarang tuntutan perbelanjaan tambahan dan kerugian sekiranya tawaran ini disetujuterima oleh pihak tuan. 3. Sila nyatakan persetujuan tuan secara rasmi dengan menandatangani dan disaksikan dengan sempurnanya surat yang disertakan ini dalam tempoh tujuh (7) hari daripada tarikh penerimaan surat ini. Sekiranya pihak tuan tidak mengembalikan surat persetujuan dalam tempoh masa tujuh (7) hari daripada tarikh penerimaan surat ini, pihak kami menganggap pihak tuan tidak bersetuju untuk menerima tawaran ini dengan syarat yang telah dinyatakan. 4. Surat ini hanyalah satu Surat Niat dan hendaklah tidak ditafsirkan dalam apa-apa jua sebagai mengikat syarikat tuan ke atasnya.” [25] On 12 March 2014, the Defendant offered to the Plaintiff a subcontract works for the agreed contract sum for RM21,680,114.45 and stated that the Bill of Quantity will be based on a provisional sum. The offer letter marked as exhibit P-12 (at page 195 of Appeal Record Jilid 2, Bahagian C) is reproduced here in parts as follows: “MENYIAPKAN BAKI KERJA TERTINGGAL BAGI PROJEK MEMBINA JALAN BARU….. PER: Surat Tawaran Kerja Sub-kontraktor Mohon saya merujuk mengenai perkara di atas. 2. Dengan ini pihak kami ingin menawarkan kerja-kerja sub-kontraktor di atas berdasarkan harga yang telah dipersetujui iaitu sebanyak RM21,680,114.45 (Ringgit Malaysia Dua Puluh Satu Juta Enam Ratus Lapan Puluh Ribu, Satu Ratus Empat Puluh Empat Dan Empat Puluh Lima Sen Sahaja). Seperti mana dilampirkan di dalam Senarai Harga (B.Q), berdasarkan kuantiti sementara (provisional sum). Ianya juga akan tertakluk sebagaimana surat tawaran daripada Jabatan Kerja Raya Malaysia. 3. Pihak syarikat (Seroja Anggerik Development Sdn. Bhd) bersetuju membuat pembayaran kepada pihak sub-kontraktor (MHNB REKA SDN BHD) secara ‘Deed of Assignment’ seperti dinyatakan di dalam lampiran kontrak Jabatan Kerja Raya Malaysia – ‘Lampiran J/C-7’. 4. Segala syarat-syarat lain akan dibincangkan kemudian, setelah pihak syarikat (Seroja Anngerik Development Sdn Bhd) mendapat surat tawaran dari Jabatan Kerja Raya Malaysia. 5. Pihak kami berharap agar pihak tuan dapat melaksanakan segala kerja-kerja di atas secepat mungkin dan mengikut segala keperluan spesifikasi Jabatan Kerja Raya Malaysia.” [26] JKR wrote to the Defendant on the approved tender on 27 March 2014 with the Letter of Acceptance known as ‘Surat Setuju Terima’ dated 27 March 2014 (exhibit P-21 at pages 197 – 209 of Appeal Record Jilid 2 Bahagian C). Briefly, among the salient requirements based on the tender acceptance and Letter of Acceptance are as follows: (a) Date of Possession of Site: 28.4.2014; (b) Completion Date: 27.4.2015; (c) Defect Liability Period: 12 months (d) Performance Bond at the rate of 5% from contract sum that is RM1,384,005.72 to be submitted before or not later from Date of Possession of Site; (e) Insurance Public Liability Policy to be borne by Contractor minimum RM1,000,000.00 for the period 28.4.2014 – 10.8.2016 within 30 days from Date of Cover Note; (f) Insurance Policy for the Works at RM27,680,114.45 to be available within 3 months from Date of Possession of Site. (g) The Contract Document must be signed within 4 months from the date of Letter of Acceptance and that the Defendant is to implement the formalization of the Contract Document and prior to that the tender and the Letter of Acceptance is considered as binding between the Defendant and the Government. (h) The Letter of Acceptance of 27 March 2014 stated at paragraph 3 that the Contract Value of RM27,680,114.45 is retained and does not change. (i) The Letter of Acceptance of 27 March 2014 was signed by the Defendant on 31 March 2014. [27] Based on the facts submitted, the events leading to this appeal can be unfolded into a chronology order. There was a LOI from the Defendant to the Plaintiff based on JKR’s LOI to the Defendant (exhibit P-10A). The JKR’s Letter of Intent clearly stated that the Government of Malaysia through JKR is desirous to appoint the Defendant on the condition to the acceptance of the tender that no change can be made to the price, value and additional cost or losses. [28] Paragraph 3 of the LOI exhibit P10A specifically stated that the Defendant is to return the letter accompanying the LOI which bears the same reference number and date in accepting the offer and non-returning of the letter will be assumed as non-acceptance. The letter was returned to JKR, filled and signed on 15 January 2014 (exhibit P10B, at page 185 of the Appeal Record Jilid 2 Bahagian C) by the Defendant. [29] The letter to accept the offer as returned again provides the statement that the Defendant will not make any changes to the contract sum, the scope and any claims for additional cost and losses: “Pihak kami juga tidak akan membuat sebarang perubahan harga, skop dan sebarang tuntutan perbelanjaan tambahan dan kerugian.” [30] In comparison to the Defendant’s LOI (exhibit P-11) received by the Plaintiff, my careful perusal finds that it is almost a perfect replica of the Letter of Intent exhibit P-10A. The exact words of no change to the contract value and that the letter of intent is not intended to be binding, is expressly provided. The standard notice to accept the LOI (at page 190 of Appeal Record Jilid 2 Bahagian C) accompanying the LOI is of similar format to JKR’s. [31] The LOI exhibit P-11 between Defendant and the Plaintiff clearly stated that the Defendant is desirous to appoint the Plaintiff as the sub-contractor for the contract value of RM22,689,187.00. The remaining words at paragraph 2 of exhibit P-11 informing Plaintiff that the tender acceptance is subjected to the Plaintiff’s agreement to the condition that the Plaintiff cannot make any changes to the price, scope (works) and is not qualified to make a claim for additional cost and losses in the event the offer is accepted by the Plaintiff. [32] The letter of intent is at the very early stage of negotiation where the tender has yet to be agreed upon and approved by JKR. The contractual relationship between the main contractor and its subcontractors as simply explained by Sundra Rajoo & Harbans Singh KS, ‘Construction Law in Malaysia’, 2012, unless expressly prohibited under the construction contract, the main contractor is free to sublet portions of works to other parties to carry them out for and on his behalf and may consist of various types of works depending on their particular method of appointment and the ultimate contractual arrangement entered into. [33] In most building contracts, it is a normal practice to see a fair amount of negotiation taking place over the terms of contract. The case of Hock Chuan Ann Construction Pte Ltd v Kimta Electric Pte Ltd [2000] 2 SLR 519 is instructive as the court was invited to make sense out of a mass of facts concerning the negotiations carried out by the parties with a view of determining whether a subcontract is formed as prescribed by the legal principles. [34] So much so, the elements pertinent to contract value or the price, the supply of construction materials and contractor’s responsibilities during contract period may take time to be finalized particularly involving government procurement within an approved budget before the offer or proposal can be extended to a party by the other. [35] At this juncture, if this line of argument by Plaintiff is to be followed that there was a contract, I cannot disregard the fact that the negotiation has yet to be finalized for the contract to be effectively implemented and operationalized by both parties. More particularly, the offer between Defendant and Plaintiff has to be certain as it must be in accordance with the terms specified by JKR before an acceptance can be communicated. [36] This is important as the offer is the first element in the chain of events leading to a construction contract. The offer must consist of a definite proposal in clear terms capable of resulting in a binding agreement once it is accepted as decided in the Federal Court in Preston Corp Sdn Bhd v Edward Leong [1982] 2 MLJ 22. In that case, the wording of the quotation issued to the customer and printing orders were studied in determining the formation of the contract. It was held that the printing order constituted an offer and its confirmation by the respondents constituted acceptance which concluded a contract. [37] Therefore the effect of a letter of intent depends upon the objective meaning of the words used. Based on the Defendant’s LOI to the Plaintiff, the construction of the words are clearly in plain language that it has no binding effect. The LOI by Defendant to the Plaintiff was based on JKR’s Letter of Intent which is subjected to the acceptance of tender and other conditions. [38] Invitations to tender are not offers but are invitations to treat. This tender process was aptly put by Bingham LJ in the case of Blackpool and Fylde Aero Club Ltd v Blackpool Borough Council [1990] 1 WLR 1195 at page 1202, “A tendering procedure of this kind is, in many respects, heavily weighted in favour of the invitor. He can invite tenders from as many or as few parties as he chooses. He need not tell any of them who else, or how many others, he has invited. …. The invitation to tender may itself, in a complex case, although again not here, involve time and expense to prepare, but the invitor does not commit himself to proceed with the project, whatever it is;….” Therefore this Court finds that the LOI which is subjected to the tender to be accepted by JKR could not be a concluded contract as yet. [39] A letter of intent which provides the statement “subject to contract” had been decided where in the words of Lord Denning in the case of Tiverton Estates Ltd v Wearwell [1975] Ch 146 at 159, “.. for over a hundred years, the courts have held that the effect of the words “subject to contract” is that the matter remains in negotiation until a formal contract is executed….” [40] I stand to be guided by the decision of the Supreme Court in the case of Ayer Hitam Tin Dreging Malaysia Bhd v YC Chin Enterprises Sdn Bhd [1994] 2 MLJ 7544 which had decided on the status of a letter of intent. In that case, YC Chin entered into negotiations with Malaysia Mining Corp Bhd, a majority shareholder of Ayer Hitam, to develop and construct low cost houses and shophouses for Ayer Hitam’s workers. On 19 September 1984, Ayer Hitam wrote to YC Chin accepting YC Chin’s proposals in undertaking the project but subject to certain terms and conditions stipulated in the letter. One of the terms was that there be a formal agreement in writing entered into between the parties incorporating all the terms proposed by Ayer Hitam. [41] The Supreme Court held that essential matters referred to the letter still remained to be settled between the parties and the condition that a formal written agreement be executed was yet to be fulfilled, the letter did not constitute a contract binding in law but was only a record of terms upon which they were agreed upon as a basis for the negotiation of a contract. [42] Interestingly the Counsel for the Plaintiff said that the law tends to lean in favour of upholding bargains and relied on two authorities to support her argument. However what the Counsel for the Plaintiff did not do was to make reference to the Supreme Court decision in Ayer Hitam Tin Dredging Malaysia Sdn Bhd v YC Chin Enterprise Sdn Bhd [1994] 3 CLJ 133 that was referred in the case submitted to this Court, JNA Ikhtisas Sdn Bhd v Kerajaan Malaysia [2015] 3 CLJ 1100. [43] Based on Ayer Hitam Tin Dredging (supra) case, it is settled law that when an arrangement is made “subject to contract” or “subject to the preparation and approval of a formal contract” and similar expressions, it will generally be construed to mean that the parties are still in a state of negotiation and do not intend to be bound unless and until a formal contract is entered into. [44] There is a striking difference between the case of JNA Ikhtisas Sdn Bhd (supra) and Ayer Hitam Tin Dredging (supra) case where in the former, the defendant clearly intended the plaintiff to render services under a direct negotiated contract. [45] Although the case of RS & L Marine Sdn Bhd v Bras Ventures Bhd & Anor [2016] 9 CLJ 56 was referred by the counsel for the Plaintiff, this Court takes the stand that the case must be read as a whole and not in extraction. The RS & L Marine Sdn Bhd (supra) case was about the defendant, Bras Ventures who were trying to secure a project with TNB expressed the desire to award a portion of the works known as ‘Kerja-Kerja HDD merentasi Sungai Manjung, Perak’ to the plaintiff, RS & L Marine as the sub-contractor. The plaintiff has the experience and equipment to carry out the works in particular the use of Horizontal Directional Drilling (HDD). While the terms of payment of the contract price were being negotiated, the defendant conveyed their intention not to proceed with the subcontract with the Plaintiff. [46] The Court of Appeal stated that when the defendant informed TNB that they had appointed the plaintiff as the subcontractor, it was nothing more than that and it does not tantamount to prove that all the fundamental elements of a valid contract had been established consensus ad idem on the terms of payment of the contract price. In that regard, the Court of Appeal held that there was no concluded subcontract reached between Bras Ventures and the plaintiff. [47] It is for the Plaintiff to prove that there was communication in accepting the LOI of the Defendant in order not to treat the negotiation between the parties as still open to process of bargaining. Based on the submission by the Defendant’s Counsel on proof of no contract, this Court finds that it is corroborated by the Plaintiff’s witness (see page 112 of the Appeal Record Jilid 1 Bahagian A & B) whom agreed that the LOI was only an expression of desire to appoint and not a contract. [48] Reverting to the evidence given by the Plaintiff’s witness, he admitted upon questioning, “Q: Maksudnya surat ini ditulis “Surat Niat” tetapi Encik Zahari baca tiba-tiba menjadi Surat Tawaran pula. Setuju? A: Surat Niat tetap surat niat. Q: Setuju atau tidak, Surat ini menyatakan bahawa Seroja Anggerik hanya berhasrat untuk melantik dan bukan melantik pihak Plaintiff. Setuju atau tidak?” A: Ya (witness nod his head).” [49] It is of the Court’s view that it is for the Plaintiff to prove on the balance of probabilities that the contract exist before this Court can delve into the second and third grounds of appeal. [50] Reverting to the dispute, the Plaintiff claimed that the Defendant offered to the Plaintiff via letter of 29.1.2014 for the price of RM22,689,187.00 and the Plaintiff claimed that it had accepted the offer. However the Plaintiff could not produce any evidence that the acceptance letter to the LOI was returned to the Defendant. [51] In the Defendant’s defence, it was stated that a meeting took place between the Defendant and the Plaintiff on 12.2.2014 where the contract value was discussed and Plaintiff was offered with a new contract price of RM21, 680,114.45. The Defendant had issued the offer letter of 12.3.2014 with the new contract price of RM21, 680,114.45. The Defendant claimed that there was still no acceptance from the Plaintiff. [52] Based on the facts and the evidence tendered, the letter 12.3.2014 (exhibit P-12 at page 195 of the Appeal Record Jilid 2 Bahagian C) was an offer letter to the Plaintiff for the subcontract work at the price of RM21, 680,114.45. It specifically stated that the Bills of Quantity (BQ) is based on provisional sum which is subjected to the offer letter of JKR, the payment to the Plaintiff will be by way of Deed of Assignment and the other conditions will be discussed at a later stage upon receiving the offer letter from JKR. [53] The Defendant’s counsel submitted that the Defendant had wrote to the Plaintiff on 4 April 2014 in reply to the Plaintiff’s letter of 25 March 2014 denying the preliminary works of RM450,000.00 as the Defendant has yet to be appointed by JKR (exhibit P-18 at page 210 of the Appeal Record Jilid 2 Bahagian C). The Defendant also submitted that the Plaintiff did not reply to the offer letter of the Defendant which is as shown in Defendant’s letter of 29 April 2014 (at page 213 of the Appeal Record Jilid 2 Bahagian C), the Plaintiff was given 3 days to reply to the offer made by the Defendant. [54] Based on the foregoing, the evidence produced proved that the Plaintiff did not accept the new offered price for the subcontract works. In addition, this Court is of the view that the Plaintiff in disagreeing initially to the contract value offered by the Defendant at RM22,689,187.00 may amount to a rejection of the Defendant’s offer. [55] If the Plaintiff disagreed and had introduced a new contract value or had insisted on the original price, he would then be making a counter-offer. A counter-offer not only fails as an acceptance but it also amounts to a rejection of the original offer: Malayan Flour Mills Bhd v Saw Eng Chee (Administrator of the Estate of Saw Cheng Chor, Deceased) & Anor [1997] 1 MLJ 763 at page 773. This Court finds that the Plaintiff had never accepted the new offer by the Defendant. [56] Generally a contract is formed when there is an offer that has been accepted and the terms agreed to must enable the parties to perform the contract. The acceptance of the offer should be absolute and unqualified to be effective in order to satisfy the need to achieve the consensus ad idem criteria following section 7(a) of the Contracts Act 1950. This point of law had been decided in the case of Rajeswari Thedshanamurthy v Kin Nam Realty Development Sdn Bhd [1993] 1 MLJ 88. [57] The case of RS & L Marine Sdn Bhd (supra) case is similar with the instant case with regards to the fact that the contract value and other vital terms of the contract particularly the site possession to commence with the works have yet to be finalized between Plaintiff and Defendant. JKR’s approved tender and the Letter of Acceptance of 27 March 2014 proved to show that no prior contract or agreement could exist as the site possession was given after the date of JKR’s Letter of Acceptance to the Defendant which is 28.04.2014. [58] In this regard, counsel for the Plaintiff’s submission of the case Sinar Wang Sdn Bhd v Ng Kee Seng (supra) cannot be relied upon as there was an offer made in this case after the issuance of LOI from the Defendant. The fact still remain that the Plaintiff could not prove acceptance of the offer and thus commencement of the preliminary works. Alternatively, the Plaintiff may have jumpstart the construction which is illegal but this matter was not pleaded on the Defendant’s part. [59] Given that the wordings in the LOI are clear and free from any ambiguity and that the acceptance was never communicated to the offer made, it must follow that there was no contract. The existence of a contract has yet to be proven by the Plaintiff. This translates to what is simply the fact that there was no judicial appreciation of the law by the learned Session Judge in deciding that the burden is on the Defendant when it was the Plaintiff who brought the suit claiming that a contract exist. In her first part of her decision she stated that, “Berdasarkan dari keterangan semua saksi dan eksibit-eksibit yang telah dikemukakan di dalam Mahkamah, Mahkamah mendapati bahawa Plaintiff mempunyai tuntutan yang kukuh dan gagal dicabar oleh Defendan di dalam tuntutan. Atas asas demikian, Mahkamah telah membenarkan tuntutan Plaintiff terhadap Defendan bersama-sama dengan kos.” [60] The initial onus of proving the case is always on the plaintiff. The plaintiff, at the start of the plaintiff’s case, has the legal burden of proving the existence of any relevant fact and the evidential burden of some evidence of the existence of such fact. The law on the burden of proof can be found in a plethora of cases and the decision of the Federal Court in Letchumanan Chettiar Alagappan @ L. Allagapan, M. Venkatachalam S/O Venkatachalam Chettiar v Secure Plantation Sdn Bhd No. 02-78-10/2014 had extensively discussed the burden of proof with sections 101 – 103 of the Evidence Act 1950 and made reference to an earlier Federal Court case of International Times & Ors v Leong Ho Yuen [1980] 2 MLJ 86. [61] Based on the Letchumanan Chettiar Alagappan @ L. Allagapan case (supra), section 101 is the burden to establish the case which rests throughout on the party who asserts the affirmative of the issue while the ‘burden of proof’ in section 102 of the Evidence Act 1950 is the burden to adduce evidence, to rebut the claim in order to discharge the burden of proof. The Federal Court Judge Salleh Abbas in the International Times case stated that, “The onus as opposed to burden is not stable and constantly shifts during the trial from one side to the other according to the scale of evidence and other preponderates. Such shifting is one continuous process in the evaluation of evidence. According to ss 102 and 103 of the Evidence Act, if the party with whom this onus lies whether initially or subsequently as a result of its shifting does not give any or further evidence or gives evidence which is not sufficient, such party must fail. It is this onus that we are concerned with in the present appeal.” [62] Based on the facts and the law before me, there was no valid contract, less so any breach thereof. The first issue has been answered in the negative and I can disregard the second and third issues as irrelevant to be answered. However for the purpose of completeness, I will give my grounds for the rest of the issues in my judgment. Preliminary Works Amounting to RM450,000.00 [63] The learned counsel for the Defendant submitted that the Plaintiff had failed to prove the preliminary works of RM450,000.00. The Counsel submitted in his written submission that the Session Judge had erred in law and in facts upon deciding that Plaintiff had successfully proven through the Summary Bill of Quantity as in exhibit P8, Letter of Payment of Deposit (Surat Penerimaan Pembayaran Deposit) of 7.2.2014” (exhibit P9), Letter of Deposit Payment for Supply of Construction Materials (Surat Pembayaran Deposit Untuk Membekal Bahan Binaan) of 10.3.2016 (exhibit P20), the photos (exhibit P19) and on the witness’s (SP2) statement. [64] The counsel for the Defendant submitted that the Plaintiff in claiming for the loss due to the preliminary works must prove loss and relied on a number of authorities: Ban Chuan Trading Co Sdn Bhd & Ors v Ng Bak Guan [2003] 4 CLJ 785, a Court of Appeal decision; Blue Sea Pools Swimming Centre (Klang) Sdn Bhd v Loo Ah Chew & Sons Sdn Bhd [2003] 1 LNS 121; Popular Industries Ltd v The Eastern Garment Manufacturing Co. Sdn Bhd [1990] 2 CLJ Rep 635; Letrik Bandar Hup Heng Sdn Bhd v Wong Sai Hong [2002] 5 CLJ 170. [65] The preparation of the BQ was claimed to be made by the Plaintiff’s witness (a diploma holder in Quantity Surveyor (QS)) whom stated that the BQ must be stamped by the person who prepared it. The counsel for the Defendant pointed out to the Court that no stamp was found on the BQ to show that the witness prepared the BQ (at pages 98 & 99 of Appeal Record) and therefore there was no proof that the BQ was prepared by the Plaintiff’s witness. The Counsel for the Defendant submitted that it was a mere empty BQ and the witness could not prove that he prepared the BQ. [66] The counsel for Defendant submitted on the evidence adduced by the Plaintiff as follows: (a) the photos tendered as exhibit P19 (at pages 230-242 of Appeal Record Jilid 2 Bahagian C) could not be proven as they were just pictures of a visit of the site and meeting with JKR only; (b) on the deposit for the appointment of a Project Management Consultant, no receipts were produced and the letter of 7.12.2014, only mentioned the amount of RM40,000 whereas the claim is for RM65,000 (at page 120 of Appeal Record Jilid 1 Bahagian A & B); (c) On Exhibit P20, the deposit for supply materials of RM250,000.00 no proof given for the deposit as paid (at page 194 Appeal Record Jilid 2). The maker of the letter was not called but upon questioned by the Defendant’s Counsel (at page 153 of Appeal Record Jilid 2), the reply was that the payment of deposit was partly by cheque and partly by cash. The Counsel for the Defendant submitted that it was such an enormous amount but no receipt could be produced in court and there is a discrepancy as the amount claimed was RM350,000.00. [67] Counsel for the Defendant relied on the authority PP v Azilah Hadri & Anor [2015] 1 CLJ 579 where it was held that when a document is sought to be proved to establish the truth of the facts contained in it, the maker has to be called and failure to call will result in the contents of the documents being hearsay. Analysis [68] The counsel for the Plaintiff’ had submitted in her written submission (at paragraph 10), stating that the Plaintiff prepared the BQ for RM27million which is “duly accepted by JKR”. However, this Court has difficulty in believing for the reason that the accepted tender was awarded to the Defendant only on 27 March 2014 and the given Date of Site Possession was 28 April 2014. [69] Richard Wilmot-Smith QC in ‘Construction Contract, Law and Practice’, Second Edition, explained that the BQ is a method of valuation where the contractor is provided with the means for work to be progressively valued. Indeed it is an important document. The English case of Convent Hospital Ltd v Eberlin & Partners (a firm) and others [1988] 14 ConLR 1 at page 6 explained the various purpose of a BQ where for instance in a tender process, it will be an investigation whether the employer will recommend the contractor for the work and whether the contractor will undertake the various items at the prices shown by the contractor. [70] The BQ is an important document which is part of the contract in construction projects and therefore it must be proven that the prices shown are as inserted and justified normally by a qualified Quantity Surveyor. In this case, the BQ was tendered by the Plaintiff but the contents could not be proven as there was no official stamp nor signature to prove that the BQ was prepared by Plaintiff’s QS. [71] For exhibit P9 and exhibit P20, there were no corroborated evidence to proof for the payment made. I have to agree with the counsel for the Defendant based on the case of PP v Azilah Hadri & Anor [2015] 1 CLJ 579, failure to call the maker of the document sought by the Plaintiff will result the contents of those documents as hearsay. [72] In relation to the photos (exhibit P9), my careful scrutiny of the photos find that there was no other evidence to corroborate that the photos had been taken at the site Project for the preliminary works to be carried out. There was no date and time recorded. In addition, the Plaintiff could not produce the site meeting minutes which would capture the discussion for the preliminary works to be carried out. [73] The Court had in her mind that if the Plaintiff could prove that the preliminary works had been carried out prior to formalization of a written contract, the Plaintiff would be able on the principle of quantum meruit claim for the actual work done. However the claim under principle of quantum meruit must be pleaded: Proton Edar Sdn Bhd and Multioto Assist Sdn Bhd [2015] MLJU 2017 which was not pleaded on the part of the Plaintiff. In addition, the principle of quantum meruit applies when there was no formal contract executed which is not as alleged by Plaintiff. [74] This Court finds that as there was no concluded contract and no proof for the preliminary works done, the claim for preliminary works must fail. Damages amounting to RM550,000.00 [75] It was the Plaintiff’s contention that the Plaintiff ought to have received the profit based on 15% of the contract value for the said Project. The Defendant’s Counsel submitted that the Defendant is not responsible for the damages of RM550,000.00 and the reason that the Plaintiff had rejected other offers was never proven by the Plaintiff. During the cross-examination, the Plaintiff submitted that he is claiming for 2.5% when he should be getting 15%. [76] The counsel for the Defendant submitted based on the number of cases relied, Popular Industries Ltd v The Eastern Garment Manufacturing (supra) and Letrik Bandar Hup Heng Sdn Bhd v Wong Sai Hong (supra) that there must be proof for damages. It was also submitted that the learned Session Judge had erred in law in relying on the case of Tanjung Tiara Sdn Bhd v Southwind Development Sdn Bhd [2011] 1 CLJ 105 in allowing the claim for damages of RM550,000.00. [77] In proving damages, real or factual evidence must be adduced as opposed to general estimations before a party can succeed in its claim: Lay Hong Food Corporation Sdn Bhd (Sebelum ini dikenali sebagai Lay Hong Poultry Processing Sdn Bhd (No Syarikat): 633683-X v Tiong Nam Logistics Solutions Sdn Bhd (No Syarikat: 043831-V) No: B-02(NCVC)(W)-1182-06/2016. [78] I wish to state here the famous words of Lord Goddard in Bonham-Carter v Hyde Park Hotel [1948] WN 89 which cannot be resisted, “Plaintiffs must understand that if they bring actions for damages it is for them to prove their damage; it is not enough to write down the particulars and, so to speak, throw them at the head of the court, saying: ‘This is what I have lost, I ask you to give me these damages’. They have to prove it.” [79] In this case, this Court finds that there was no evidence that a contract was ever concluded for the Plaintiff to claim for loss of profit or estimation of profit from the contract value. In addition, the Plaintiff did not produce any offers by others that had been rejected as claimed by the Plaintiff. [80] This Court disagrees with the Session Judge’s reference to the case Tanjung Tiara (supra) case as it differs from this case. In Tanjung Tiara (supra) case it was an appeal on the assessment of damages where the issue of liability was not decided before the Court of Appeal. Furthermore, the evidence adduced to support the plaintiff’s claim for damages in that case was based on defendant’s own computation in its third party contract as a basis. In the instant case, there was no method of calculation and it was the Plaintiff’s own basis to make the computation at 2.5%. As there is no proof on damages as claimed, the damages of RM550,000.00 must fail. [81] For the reasons stated above, I am unable to agree with counsel for the Plaintiff that there exist a contract between the parties. There was no concluded contract, the claim for preliminary works and damages must fail. The Plaintiff’s claim is dismissed with cost. Dated: 14 June 2017 (DATIN ZALITA BINTI DATO’ ZAIDAN) Judicial Commissioner Shah Alam High Court, Selangor Counsel for the Respondent/Plaintiff Florencia A/P Sandanasamy Messrs Florencia & Partners No.71-3, Plaza Damansara Jalan Medan Setia 1, Bukit Damansara, 50490 Kuala Lumpur Counsel for the Appellant/Defendant 1. Abdullah Az-Zubayr bin Awaluddin 2. Dayang Noor Ailani binti Puyungan Razali Tetuan Zulpadli & Edham No. 24, Jalan Perumahan Gurney 54000 Kuala Lumpur 2

Tika 2.6.0

12BNCVC-4-01/2016

PERAYU SEROJA ANGGERIK DEVELOPMENT SDN BHD RESPONDEN MHNB REKA SDN BHD

14/06/2017

YA DATIN ZALITA BINTI DATO' HJ. ZAIDAN (PK)

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=6dc109e1-7f49-4a57-8808-9e3745daf5fb&Inline=true

DALAM MAHKAMAH TINGGI DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN RAYUAN SIVIL NO: 12BNCVC-4-01/2016 ANTARA SEROJA ANGGERIK DEVELOPMENT SDN BHD (NO. SYARIKAT: 514293-U) … PERAYU DAN MHNB REKA SDN BHD (NO. SYARIKAT: 494830-P) … RESPONDEN DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN GUAMAN NO: B52NCVC-136-09/2014 ANTARA MHNB REKA SDN BHD (NO. SYARIKAT : 494830-P) … PLAINTIF DAN SEROJA ANGGERIK DEVELOPMENT SDN BHD (NO. SYARIKAT : 514293-U) … DEFENDAN GROUND OF JUDGMENT Introduction [1] This is an appeal against the decision of the Session Judge which allowed the Plaintiff’s claim on 19 January 2016. The parties in this appeal are the Appellant who was the Defendant and the Respondent was the Plaintiff at the Session Court. [2] For ease of reference, in this judgment, the parties will be referred to as they were in the Session Court. Background Facts [3] The relevant factual background giving rise to this appeal based on the written submission of the counsels may be briefly stated as follows: (a) Seroja Anggerik Development Sdn Bhd., the Defendant in this case, is a limited company registered in Bandar Baru Bangi, Selangor, was appointed by the Public Works Department, Malaysia to carry out a construction project. The Plaintiff is a limited company registered in Malacca. (b) JKR was the Project owner via a Letter of Intent of 8.1.2014 offered a Project known as “menyiapkan baki kerja tertinggal bagi Projek membina jalan baru dari Lebuhraya Seremban Port Dickson ke laluan 5 di Pasir Panjang dan menaik taraf laluan 5 dari Pasir Panjang ke Linggi Negeri Sembilan (Seksyen 1)” known as “the said Project”. The Defendant had received the Letter of Intent of 8.1.2014 from JKR with the contract sum for the Project as RM27,680.114.45. (c) The Plaintiff claimed that the Defendant, the Main Contractor for the said Project had subcontracted through a letter of 29.01.2014, the said Project to the Plaintiff for the sum of RM 22,689,187.00 which is disputed in this case. The letter is exhibit P-11 (at pages 188-189 of the Appeal Record Jilid 2 Bahagian C). (d) The Plaintiff claimed that the Plaintiff accepted the offer by the Defendant and commenced preliminary works where the details as claimed by the Plaintiff in Table 1 below. (e) JKR via letter dated 27.3.2014 approved the tender of the said Project to the Defendant. The Plaintiff claimed that the said Project was offered to the Defendant by way of a Letter of Award to carry out the project for the sum of RM27,680,117.45. (f) The Plaintiff claimed that the Defendant refused to offer the said Project to the Plaintiff for the original agreed price but instead insist that the Defendant will be awarded only if the Plaintiff accept the new offer for the sum of RM21,680,114.45. The Defendant on the other hand stated that the Defendant had offered the Plaintiff a new contract value for the amount RM21,680,114.45 and Plaintiff did not accept the letter of intent nor the letter of offer from the Defendant. (g) The Plaintiff claimed that the Defendant breached the contract and Plaintiff had suffered loss amounting to RM 1,084,005.23 which is 4.5% from contract sum. The Plaintiff sued the Defendants for the expenses incurred by the Plaintiff for work done and damages for the wrongful termination and/or breach of promise. (h) The Session Judge allowed the Plaintiff’s claims as follows: (i) RM450,000.00 for the Works done; (ii) RM500,000.00 as compensation for breach of contract; (iii) Interest at the rate fiver per centum (5%) on the amount RM450,000.00 calculated from 1.04.2014 to full settlement; (iv) Interest at the rate five per centum (5%) on the amount RM500,000.00 and/or on the said judgment sum until full completion; and (v) cost for this action amounting to RM20,000.00. (i) Being aggrieved with the said decision, the Defendant appealed to this Court. Defendant’s Submission [4] The learned counsel for the Defendant orally submitted the three main grounds for appeal as provided in his written submission, namely: (i) No legally binding contract existed; (ii) Plaintiff failed to prove the preliminary works amounting to RM450,000.00; (iii) Defendant is not responsible to pay damages amounting to RM550,000.00. [5] Based on the memorandum of appeal, the Counsel for the Defendant submitted that the Session Judge had erred in law and facts in considering the existence of a contract, the Letter of Intent of 29.01.2015 (“exhibit P11”) as binding and relied on the case of Mascom (M) Sdn Bhd v Panju Keagungan Sdn Bhd (2011) I LNS 1607. [6] It was submitted that the Session Judge had erred in law and facts, failing to consider the fact that, one acceptance letter (Surat Setuju Terima) of 30.01.2014 (“exhibit P1”) failed to be returned to the Appellant within the stipulated time. [7] The Defendant submitted that the Session Judge had erred in law and facts in deciding that the Plaintiff had commenced preliminary works, based on the Summary Bill of Quantity (BQ) (“exhibit P8”), the Letter for Payment of Deposit (Surat Penerimaan Pembayaran Deposit) of 7.2.2014 (exhibit P9”), Deposit Letter for Supply of Construction Materials (Surat Pembayaran Deposit Untuk Membekal Bahan Binaan) dated 10.03.2016 (“exhibit P20”), Photos (“exhibit P19”) and witness’s testimony SP2 without considering matters as follows: 7.1 The exhibit P8 was an empty BQ without the stamp and signature of witness SP2. The SP2 had testified confirming the normal practice that the BQ will be prepared by SP2 that has the stamp or SP2’s signature; 7.2 There was no supporting document for exhibit P9, a cheque or Bank Account to prove that payment had been received by SP2 whom said that the payment would be received through cheque or cash; 7.3 The claim for Project Management Consultant (PMC) appointment to be RM 65,000.00 but the payment made from Respondent to SP2 reflected the amount of RM 40,000.00; 7.4 The maker for the document exhibit P20 was not called to testify the validity of exhibit P20; 7.5 The Plaintiff failed to bring other evidence to support for instance invoice, purchase order or the details to prove the same of the materials ordered amounting to RM 250,000.00. 7.6 The claim by Plaintiff on the same of the works and deposit made to supplier amounted to RM 350,000.00 but exhibit P20 only showed payment made was only for RM 250,000.00. 7.7 The photos as exhibit P19 are only photos of the site visit and meeting with Jabatan Kerja Raya (JKR) representative only and no other evidence to support exhibit P19 that the photos were taken at the Project site and the meeting held with JKR representative, without the date and time recorded. 7.8 that the General damages amounting to RM 550,000.00 to be given to the Plaintiff on the basis that Plaintiff had rejected other job offers whereas this was never proven by the Plaintiff in rejecting other offers. Learned counsel for Defendant relied on the authority where claim for damages must be proven as in the case of Popular Industries Ltd v The Eastern Garment Manufacturing Co Sdn Bhd [1990] 2 CLJ Rep 635 and Letrik Bandar Hup Heng Sdn Bhd v Wong Sai Hong [2002] 5 CLJ 170. Plaintiff’s Submission [8] The Plaintiff alleged that Defendant had offered by letter on 29.1.2014 to subcontract the said Project to the Plaintiff for the contract value of RM 22,689,187.00 and had stated that the contract value cannot be modified. The Plaintiff commenced the preliminary works based on the LOI 29.1.2014 as in Table 1 below: No. Particulars Amount 1. Site visits to ensure that the scope of the work is as stated in the Bill of Quantity. This includes making measurements at sites/exact measurement of the balanced work need to be done at the abandoned site. The number of visits to the site is approximately 10 times. RM20,000.00 2. Appointment of Project Management Consultant RM65,500.00 3. Attending meeting at Defendant’s Office(Seroja Anggerik Development Sdn Bhd) RM3,500.00 4. Attended Meeting with JKR, 7 times to get confirmation on the price adjustment, scope of work and work specification RM5,000.00 5. Making preliminary discussions with a number of supplier/provider/surveyor to establish reasonable rates, this is to maintain the increase in rates, especially the rate of work for premix and hence made a unrefundable deposit to the supplier RM350,000.00 6. Meetings with En Nazri political secretary to meet with the deputy minister for JKR RM2,000.00 7. Meeting with Secretary to the deputy minister to expedite the project RM3,000.00 8. Preparation for setting up “site office” near to the site. RM1,000.00 Total RM450,000.00 [9] The Plaintiff alleged that on 12 March 2014, the Defendant reduced the contract sum from RM 22,689,187.00 to RM 21,680,114.45. [10] The Plaintiff claimed for damages RM 550,000.00 which is 2 - 2.5% of the contract sum and relied on the case of Court of Appeal, Tanjung Tiara Sdn Bhd v Southwind Development Sdn Bhd [2011] 1 CLJ 105 at page 106. Decision of Session Court [11] The Session Judge allowed the Plaintiff’s claims as in paragraph 3(h) above and the decision is reproduced here in part as follows: “Alasan-alasan Penghakiman 1. Berdasarkan dari keterangan semua saksi dan eksibit-eksibit yang telah dikemukakan di dalam Mahkamah, Mahkamah mendapati bahawa Plaintiff mempunyai tuntutan yang kukuh dan gagal dicabar oleh Defendan di dalam tuntutan ini. Atas asas demikian, Mahkamah telah membenarkan tuntutan Plaintiff terhadap Defendan bersama-sama dengan kos. 2. Tuntutan Plaintif adalah untuk kerja-kerja yang telah dilakukan sebanyak RMK 450,000.00 dan juga gantirugi sebanyak RM550,000.00. Tuntutan Plaintif sebanyak RM550,000.00 telah berjaya dibuktikan melalui eksibit P-8. Eksibit P-9, eksibit P-19 dan P-20. SP-2, Encik Mustafa Bin Osman telah memberi keterangan bahawa beliau bertanggungjawab membuat/menyediakan Bill of Quantity bagi membuktikan kerja-kerja yang dilakukan oleh Plaintif. SP-2 telah memberitahu Mahkamah di dalam keterangan beliau sendiri dan juga beberapa siri lawatan telah dibuat. Bill of Quantity adalah merupakan satu keterangan utama, dan it is a prime evidence. Fakta ini gagal dicabar oleh Defendan dengan bukti yang menunjukkan sebaliknya.” THE COURT’S FINDINGS Whether There Is A Contract Between The Parties [12] It was the Plaintiff’s contention that the LOI formed the contract between the Defendant and the Plaintiff. The Plaintiff’s claims were allowed at the Session Court on two grounds: 12.1 the expenses incurred by the Plaintiff for work done; and 12.2 the damages for wrongful termination and/or breach of promise. [13] At this appeal, the Defendant contended that the LOI tendered as exhibit P-11 (at page 188 of the Appeal Record Jilid 2 Bahagian C) relied by the Plaintiff as binding contract was not a contract between the Defendant and the Plaintiff. [14] The learned counsel for the Defendant referred the Court to paragraphs 2 and 3 of the LOI exhibit P-11, the words, “sukacita dimaklumkan bahawa Jabatan Kerja Raya Malaysia melalui Seroja Anggerik Development Sdn Bhd telah berhasrat untuk melantik syarikat tuan melaksanakan projek tersebut di atas dengan harga 22 juta” was not an affirmed or a resolute offer. The counsel for the Defendant also pointed out to paragraph 4 of the LOI which clearly stated that it was only a letter of intent and that the learned Session Judge had failed to take into consideration to the phrase, “surat ini hanyalah satu Surat Niat dan hendaklah tidak ditafsirkan dalam apa-apa jua sebagai mengikat syarikat tuan ke atasnya”. [15] As the content of the LOI had expressly stated as such, the learned counsel for the Defendant submitted the authority Kokomewah Sdn Bhd v Desa Hatchery Sdn Bhd [1995] 3 CLJ 511 and quoted JCA Abu Mansor whom stated that, “On the first issue, we are of the view there is no merit in the appellant’s contention that there was a concluded contract in the Letter of Intent. We uphold the learned trial Judge’s finding, on the evidence, when he held as referred to above that the RM37,971,570.27 was not a finalized contract sum and that the Letter of Intent dated 3 April 1985 was not a concluded contract.” [16] The counsel also referred to a High Court decision in the case of Mascom (M) Sdn Bhd v Panju Keagungan Sdn Bhd [2011] 1 LNS 1607 quoting Justice Asmabi’s principle in interpreting a LOI with reference to an English case, “23. … the effect and significance of a Letter of Intent had been discussed in the case of Turiff Construction Ltd and Turiff Ltd v Regalia Knitting Mills Ltd 9 BLR 20 QBD (at page 22 para 3) where His Lordship Judge Fay had this to say: As I understand it such a letter is no more than the expression in writing of a party’s intention to enter into a contract at a future date. Save in exceptional circumstance it can have no binding effect.” [17] The counsel for the Defendant submitted that the Plaintiff failed to reply to the LOI within the 7 days requirement stipulated in the LOI and that the Plaintiff failed to prove at the trial court that the said LOI which is exhibit P1 (page 190 of Appeal Record Jilid 2 Bahagian C) was not returned to the Defendant within the stated period. [18] To this the counsel for the Defendant claimed that the LOI could not be binding as the Letter of Award (LA) by JKR was awarded only on 27.3.2014 to the Defendant as the Main Contractor (at page 197 of Appeal Record) where the Date of the Site Possession given was 28.4.2014. [19] The Defendant’s Counsel also submitted that proof of no contract was corroborated by the Plaintiff’s witness’s statement (at page 112 of the Appeal Record Jilid 1 Bahagian A & B) whom during the examination by the Defendant’s Counsel agreed that the LOI was only an expression of desire to appoint. To this the Defendant’s Counsel submitted to the Court that as there was no reply to the Letter of Acceptance of 12 March 2014 (exhibit P12) from the Plaintiff, such conduct tantamounts to a rejection of acceptance which is corroborated by the evidence of Plaintiff’s witness SP3 (at page 120 Appeal Record Jilid 1 Bahagian A & B) where upon questioning, “En Zahari setuju atau tidak Surat Tawaran 12 Mac ini telah ditolak oleh pihak plaintiff?”, the answer given was “setuju”. [20] The Plaintiff on the other hand submitted that the LOI was binding as the Defendant had stated that the price could not be changed. The Plaintiff relied on the authority in relation to concluding a contract that is the case of Sinar Wang Sdn Bhd v Ng Kee Seng [2004] 3 CLJ 679 at page 688 where the counsel submitted that there was a LOI by JKR to Defendant and to the Plaintiff and that before the contract is concluded, there was a lot of work where the BQ had to be prepared as materials’ price could fluctuate. Counsel further submitted that the only reason that the contract could not proceed was the contract price was reduced. [21] The Counsel for the Plaintiff went on to say that the law now leans in favour of upholding bargains and submitted two new cases to support her argument that was not in the bundle of authorities, the case of RS & L Marine Sdn Bhd v Bras Ventures Bhd & Anor [2016] 9 CLJ 56 and JNA Ikhtisas Sdn Bhd v Kerajaan Malaysia [2015] 3 CLJ 1100. Analysis [22] The heart of the matter is whether there was a contract between the parties to start with based on the LOI. It was not disputed that the Plaintiff received a LOI from the Defendant based on one letter of intent received by the Defendant from JKR of 8.1.2014 (exhibit P10A, at pages 183-184, Appeal Record Jilid 2, Bahagian C). [23] It is pertinent that the main content of the letter of intent by JKR (exhibit P-10A) being the owner of the said Project to the Defendant be reproduced here as follows: “ SURAT NIAT PROJEK: MENYIAPKAN BAKI KERJA TERTINGGAL BAGI PROJEK MEMBINA JALAN BARU DARI LEBUHRAYA SEREMBAN – PORT DICKSON KE LALUAN 5 DI PASIR PANJANG DAN MENAIKTARAF LALUAN 5 DARI PASIR PANJANG KE LINGGI NEGERI SEMBILAN (SEKSYEN 1) Dengan hormatnya, saya merujuk kepada perkara di atas dan surat Kementerian Kewangan Malaysia rujukan S/L.KEW/PK.KI 2/700/810209/157/51-3 JLD 3 SK 2(4) bertarikh 18 Disember 2013 adalah berkaitan. 2. Sukacita dimaklumkan bahawa Kerajaan Malaysia melalui Jabatan Kerja Raya telah berhasrat untuk melantik syarikat tuan untuk melaksanakan projek tersebut di atas dengan harga RM dan tempoh siap kerja selama 12 bulan. Walau bagaimanapun penerimaan tender tersebut adalah tertakluk kepada persetujuan tuan kepada syarat berikut:- 2.1.1 Pihak tuan tidak boleh membuat sebarang perubahan harga, skop dan tidak layak untuk membuat sebarang tuntutan perbelanjaan tambahan dan kerugian sekiranya tawaran ini disetujuterima oleh pihak tuan. 3. Sila nyatakan persetujuan tuan secara rasmi dengan menandatangani dan disaksikan dengan sempurnanya surat disertakan ini dalam tempoh tujuh (7) hari daripada tarikh penerimaan surat ini, pihak kami menganggap pihak tuan tidak bersetuju untuk menerima tawaran ini dengan syarat yang telah dinyatakan. 4. Surat ini hanyalah satu Surat Niat dan hendaklah tidak ditafsirkan dalam apa-apa jua sebagai mengikat Kerajaan ke atasnya.” [24] The LOI from Defendant to the Plaintiff of 29 January 2014 can be found in exhibit P-11 (at pages 188-189 of the Appeal Record Jilid 2 Bahagian C) where some of the contents are reproduced here for ease of reference as follows: “2. Sukacita dimaklumkan bahawa Jabatan Kerja Raya Malaysia melalui Seroja Anggerik Development Sdn. Bhd. telah berhasrat untuk melantik syarikat tuan untuk melaksanakan projek tersebut di atas dengan harga RM22,689,187.00 dan tempoh siap kerja selama 12 bulan. Walau bagaimanapun penerimaan tender tersebut adalah tertakluk kepada persetujuan tuan kepada syarat berikut: 2.1.1 Pihak tuan tidak boleh membuat sebarang perubahan harga, skop dan tidak layak untuk membuat sebarang tuntutan perbelanjaan tambahan dan kerugian sekiranya tawaran ini disetujuterima oleh pihak tuan. 3. Sila nyatakan persetujuan tuan secara rasmi dengan menandatangani dan disaksikan dengan sempurnanya surat yang disertakan ini dalam tempoh tujuh (7) hari daripada tarikh penerimaan surat ini. Sekiranya pihak tuan tidak mengembalikan surat persetujuan dalam tempoh masa tujuh (7) hari daripada tarikh penerimaan surat ini, pihak kami menganggap pihak tuan tidak bersetuju untuk menerima tawaran ini dengan syarat yang telah dinyatakan. 4. Surat ini hanyalah satu Surat Niat dan hendaklah tidak ditafsirkan dalam apa-apa jua sebagai mengikat syarikat tuan ke atasnya.” [25] On 12 March 2014, the Defendant offered to the Plaintiff a subcontract works for the agreed contract sum for RM21,680,114.45 and stated that the Bill of Quantity will be based on a provisional sum. The offer letter marked as exhibit P-12 (at page 195 of Appeal Record Jilid 2, Bahagian C) is reproduced here in parts as follows: “MENYIAPKAN BAKI KERJA TERTINGGAL BAGI PROJEK MEMBINA JALAN BARU….. PER: Surat Tawaran Kerja Sub-kontraktor Mohon saya merujuk mengenai perkara di atas. 2. Dengan ini pihak kami ingin menawarkan kerja-kerja sub-kontraktor di atas berdasarkan harga yang telah dipersetujui iaitu sebanyak RM21,680,114.45 (Ringgit Malaysia Dua Puluh Satu Juta Enam Ratus Lapan Puluh Ribu, Satu Ratus Empat Puluh Empat Dan Empat Puluh Lima Sen Sahaja). Seperti mana dilampirkan di dalam Senarai Harga (B.Q), berdasarkan kuantiti sementara (provisional sum). Ianya juga akan tertakluk sebagaimana surat tawaran daripada Jabatan Kerja Raya Malaysia. 3. Pihak syarikat (Seroja Anggerik Development Sdn. Bhd) bersetuju membuat pembayaran kepada pihak sub-kontraktor (MHNB REKA SDN BHD) secara ‘Deed of Assignment’ seperti dinyatakan di dalam lampiran kontrak Jabatan Kerja Raya Malaysia – ‘Lampiran J/C-7’. 4. Segala syarat-syarat lain akan dibincangkan kemudian, setelah pihak syarikat (Seroja Anngerik Development Sdn Bhd) mendapat surat tawaran dari Jabatan Kerja Raya Malaysia. 5. Pihak kami berharap agar pihak tuan dapat melaksanakan segala kerja-kerja di atas secepat mungkin dan mengikut segala keperluan spesifikasi Jabatan Kerja Raya Malaysia.” [26] JKR wrote to the Defendant on the approved tender on 27 March 2014 with the Letter of Acceptance known as ‘Surat Setuju Terima’ dated 27 March 2014 (exhibit P-21 at pages 197 – 209 of Appeal Record Jilid 2 Bahagian C). Briefly, among the salient requirements based on the tender acceptance and Letter of Acceptance are as follows: (a) Date of Possession of Site: 28.4.2014; (b) Completion Date: 27.4.2015; (c) Defect Liability Period: 12 months (d) Performance Bond at the rate of 5% from contract sum that is RM1,384,005.72 to be submitted before or not later from Date of Possession of Site; (e) Insurance Public Liability Policy to be borne by Contractor minimum RM1,000,000.00 for the period 28.4.2014 – 10.8.2016 within 30 days from Date of Cover Note; (f) Insurance Policy for the Works at RM27,680,114.45 to be available within 3 months from Date of Possession of Site. (g) The Contract Document must be signed within 4 months from the date of Letter of Acceptance and that the Defendant is to implement the formalization of the Contract Document and prior to that the tender and the Letter of Acceptance is considered as binding between the Defendant and the Government. (h) The Letter of Acceptance of 27 March 2014 stated at paragraph 3 that the Contract Value of RM27,680,114.45 is retained and does not change. (i) The Letter of Acceptance of 27 March 2014 was signed by the Defendant on 31 March 2014. [27] Based on the facts submitted, the events leading to this appeal can be unfolded into a chronology order. There was a LOI from the Defendant to the Plaintiff based on JKR’s LOI to the Defendant (exhibit P-10A). The JKR’s Letter of Intent clearly stated that the Government of Malaysia through JKR is desirous to appoint the Defendant on the condition to the acceptance of the tender that no change can be made to the price, value and additional cost or losses. [28] Paragraph 3 of the LOI exhibit P10A specifically stated that the Defendant is to return the letter accompanying the LOI which bears the same reference number and date in accepting the offer and non-returning of the letter will be assumed as non-acceptance. The letter was returned to JKR, filled and signed on 15 January 2014 (exhibit P10B, at page 185 of the Appeal Record Jilid 2 Bahagian C) by the Defendant. [29] The letter to accept the offer as returned again provides the statement that the Defendant will not make any changes to the contract sum, the scope and any claims for additional cost and losses: “Pihak kami juga tidak akan membuat sebarang perubahan harga, skop dan sebarang tuntutan perbelanjaan tambahan dan kerugian.” [30] In comparison to the Defendant’s LOI (exhibit P-11) received by the Plaintiff, my careful perusal finds that it is almost a perfect replica of the Letter of Intent exhibit P-10A. The exact words of no change to the contract value and that the letter of intent is not intended to be binding, is expressly provided. The standard notice to accept the LOI (at page 190 of Appeal Record Jilid 2 Bahagian C) accompanying the LOI is of similar format to JKR’s. [31] The LOI exhibit P-11 between Defendant and the Plaintiff clearly stated that the Defendant is desirous to appoint the Plaintiff as the sub-contractor for the contract value of RM22,689,187.00. The remaining words at paragraph 2 of exhibit P-11 informing Plaintiff that the tender acceptance is subjected to the Plaintiff’s agreement to the condition that the Plaintiff cannot make any changes to the price, scope (works) and is not qualified to make a claim for additional cost and losses in the event the offer is accepted by the Plaintiff. [32] The letter of intent is at the very early stage of negotiation where the tender has yet to be agreed upon and approved by JKR. The contractual relationship between the main contractor and its subcontractors as simply explained by Sundra Rajoo & Harbans Singh KS, ‘Construction Law in Malaysia’, 2012, unless expressly prohibited under the construction contract, the main contractor is free to sublet portions of works to other parties to carry them out for and on his behalf and may consist of various types of works depending on their particular method of appointment and the ultimate contractual arrangement entered into. [33] In most building contracts, it is a normal practice to see a fair amount of negotiation taking place over the terms of contract. The case of Hock Chuan Ann Construction Pte Ltd v Kimta Electric Pte Ltd [2000] 2 SLR 519 is instructive as the court was invited to make sense out of a mass of facts concerning the negotiations carried out by the parties with a view of determining whether a subcontract is formed as prescribed by the legal principles. [34] So much so, the elements pertinent to contract value or the price, the supply of construction materials and contractor’s responsibilities during contract period may take time to be finalized particularly involving government procurement within an approved budget before the offer or proposal can be extended to a party by the other. [35] At this juncture, if this line of argument by Plaintiff is to be followed that there was a contract, I cannot disregard the fact that the negotiation has yet to be finalized for the contract to be effectively implemented and operationalized by both parties. More particularly, the offer between Defendant and Plaintiff has to be certain as it must be in accordance with the terms specified by JKR before an acceptance can be communicated. [36] This is important as the offer is the first element in the chain of events leading to a construction contract. The offer must consist of a definite proposal in clear terms capable of resulting in a binding agreement once it is accepted as decided in the Federal Court in Preston Corp Sdn Bhd v Edward Leong [1982] 2 MLJ 22. In that case, the wording of the quotation issued to the customer and printing orders were studied in determining the formation of the contract. It was held that the printing order constituted an offer and its confirmation by the respondents constituted acceptance which concluded a contract. [37] Therefore the effect of a letter of intent depends upon the objective meaning of the words used. Based on the Defendant’s LOI to the Plaintiff, the construction of the words are clearly in plain language that it has no binding effect. The LOI by Defendant to the Plaintiff was based on JKR’s Letter of Intent which is subjected to the acceptance of tender and other conditions. [38] Invitations to tender are not offers but are invitations to treat. This tender process was aptly put by Bingham LJ in the case of Blackpool and Fylde Aero Club Ltd v Blackpool Borough Council [1990] 1 WLR 1195 at page 1202, “A tendering procedure of this kind is, in many respects, heavily weighted in favour of the invitor. He can invite tenders from as many or as few parties as he chooses. He need not tell any of them who else, or how many others, he has invited. …. The invitation to tender may itself, in a complex case, although again not here, involve time and expense to prepare, but the invitor does not commit himself to proceed with the project, whatever it is;….” Therefore this Court finds that the LOI which is subjected to the tender to be accepted by JKR could not be a concluded contract as yet. [39] A letter of intent which provides the statement “subject to contract” had been decided where in the words of Lord Denning in the case of Tiverton Estates Ltd v Wearwell [1975] Ch 146 at 159, “.. for over a hundred years, the courts have held that the effect of the words “subject to contract” is that the matter remains in negotiation until a formal contract is executed….” [40] I stand to be guided by the decision of the Supreme Court in the case of Ayer Hitam Tin Dreging Malaysia Bhd v YC Chin Enterprises Sdn Bhd [1994] 2 MLJ 7544 which had decided on the status of a letter of intent. In that case, YC Chin entered into negotiations with Malaysia Mining Corp Bhd, a majority shareholder of Ayer Hitam, to develop and construct low cost houses and shophouses for Ayer Hitam’s workers. On 19 September 1984, Ayer Hitam wrote to YC Chin accepting YC Chin’s proposals in undertaking the project but subject to certain terms and conditions stipulated in the letter. One of the terms was that there be a formal agreement in writing entered into between the parties incorporating all the terms proposed by Ayer Hitam. [41] The Supreme Court held that essential matters referred to the letter still remained to be settled between the parties and the condition that a formal written agreement be executed was yet to be fulfilled, the letter did not constitute a contract binding in law but was only a record of terms upon which they were agreed upon as a basis for the negotiation of a contract. [42] Interestingly the Counsel for the Plaintiff said that the law tends to lean in favour of upholding bargains and relied on two authorities to support her argument. However what the Counsel for the Plaintiff did not do was to make reference to the Supreme Court decision in Ayer Hitam Tin Dredging Malaysia Sdn Bhd v YC Chin Enterprise Sdn Bhd [1994] 3 CLJ 133 that was referred in the case submitted to this Court, JNA Ikhtisas Sdn Bhd v Kerajaan Malaysia [2015] 3 CLJ 1100. [43] Based on Ayer Hitam Tin Dredging (supra) case, it is settled law that when an arrangement is made “subject to contract” or “subject to the preparation and approval of a formal contract” and similar expressions, it will generally be construed to mean that the parties are still in a state of negotiation and do not intend to be bound unless and until a formal contract is entered into. [44] There is a striking difference between the case of JNA Ikhtisas Sdn Bhd (supra) and Ayer Hitam Tin Dredging (supra) case where in the former, the defendant clearly intended the plaintiff to render services under a direct negotiated contract. [45] Although the case of RS & L Marine Sdn Bhd v Bras Ventures Bhd & Anor [2016] 9 CLJ 56 was referred by the counsel for the Plaintiff, this Court takes the stand that the case must be read as a whole and not in extraction. The RS & L Marine Sdn Bhd (supra) case was about the defendant, Bras Ventures who were trying to secure a project with TNB expressed the desire to award a portion of the works known as ‘Kerja-Kerja HDD merentasi Sungai Manjung, Perak’ to the plaintiff, RS & L Marine as the sub-contractor. The plaintiff has the experience and equipment to carry out the works in particular the use of Horizontal Directional Drilling (HDD). While the terms of payment of the contract price were being negotiated, the defendant conveyed their intention not to proceed with the subcontract with the Plaintiff. [46] The Court of Appeal stated that when the defendant informed TNB that they had appointed the plaintiff as the subcontractor, it was nothing more than that and it does not tantamount to prove that all the fundamental elements of a valid contract had been established consensus ad idem on the terms of payment of the contract price. In that regard, the Court of Appeal held that there was no concluded subcontract reached between Bras Ventures and the plaintiff. [47] It is for the Plaintiff to prove that there was communication in accepting the LOI of the Defendant in order not to treat the negotiation between the parties as still open to process of bargaining. Based on the submission by the Defendant’s Counsel on proof of no contract, this Court finds that it is corroborated by the Plaintiff’s witness (see page 112 of the Appeal Record Jilid 1 Bahagian A & B) whom agreed that the LOI was only an expression of desire to appoint and not a contract. [48] Reverting to the evidence given by the Plaintiff’s witness, he admitted upon questioning, “Q: Maksudnya surat ini ditulis “Surat Niat” tetapi Encik Zahari baca tiba-tiba menjadi Surat Tawaran pula. Setuju? A: Surat Niat tetap surat niat. Q: Setuju atau tidak, Surat ini menyatakan bahawa Seroja Anggerik hanya berhasrat untuk melantik dan bukan melantik pihak Plaintiff. Setuju atau tidak?” A: Ya (witness nod his head).” [49] It is of the Court’s view that it is for the Plaintiff to prove on the balance of probabilities that the contract exist before this Court can delve into the second and third grounds of appeal. [50] Reverting to the dispute, the Plaintiff claimed that the Defendant offered to the Plaintiff via letter of 29.1.2014 for the price of RM22,689,187.00 and the Plaintiff claimed that it had accepted the offer. However the Plaintiff could not produce any evidence that the acceptance letter to the LOI was returned to the Defendant. [51] In the Defendant’s defence, it was stated that a meeting took place between the Defendant and the Plaintiff on 12.2.2014 where the contract value was discussed and Plaintiff was offered with a new contract price of RM21, 680,114.45. The Defendant had issued the offer letter of 12.3.2014 with the new contract price of RM21, 680,114.45. The Defendant claimed that there was still no acceptance from the Plaintiff. [52] Based on the facts and the evidence tendered, the letter 12.3.2014 (exhibit P-12 at page 195 of the Appeal Record Jilid 2 Bahagian C) was an offer letter to the Plaintiff for the subcontract work at the price of RM21, 680,114.45. It specifically stated that the Bills of Quantity (BQ) is based on provisional sum which is subjected to the offer letter of JKR, the payment to the Plaintiff will be by way of Deed of Assignment and the other conditions will be discussed at a later stage upon receiving the offer letter from JKR. [53] The Defendant’s counsel submitted that the Defendant had wrote to the Plaintiff on 4 April 2014 in reply to the Plaintiff’s letter of 25 March 2014 denying the preliminary works of RM450,000.00 as the Defendant has yet to be appointed by JKR (exhibit P-18 at page 210 of the Appeal Record Jilid 2 Bahagian C). The Defendant also submitted that the Plaintiff did not reply to the offer letter of the Defendant which is as shown in Defendant’s letter of 29 April 2014 (at page 213 of the Appeal Record Jilid 2 Bahagian C), the Plaintiff was given 3 days to reply to the offer made by the Defendant. [54] Based on the foregoing, the evidence produced proved that the Plaintiff did not accept the new offered price for the subcontract works. In addition, this Court is of the view that the Plaintiff in disagreeing initially to the contract value offered by the Defendant at RM22,689,187.00 may amount to a rejection of the Defendant’s offer. [55] If the Plaintiff disagreed and had introduced a new contract value or had insisted on the original price, he would then be making a counter-offer. A counter-offer not only fails as an acceptance but it also amounts to a rejection of the original offer: Malayan Flour Mills Bhd v Saw Eng Chee (Administrator of the Estate of Saw Cheng Chor, Deceased) & Anor [1997] 1 MLJ 763 at page 773. This Court finds that the Plaintiff had never accepted the new offer by the Defendant. [56] Generally a contract is formed when there is an offer that has been accepted and the terms agreed to must enable the parties to perform the contract. The acceptance of the offer should be absolute and unqualified to be effective in order to satisfy the need to achieve the consensus ad idem criteria following section 7(a) of the Contracts Act 1950. This point of law had been decided in the case of Rajeswari Thedshanamurthy v Kin Nam Realty Development Sdn Bhd [1993] 1 MLJ 88. [57] The case of RS & L Marine Sdn Bhd (supra) case is similar with the instant case with regards to the fact that the contract value and other vital terms of the contract particularly the site possession to commence with the works have yet to be finalized between Plaintiff and Defendant. JKR’s approved tender and the Letter of Acceptance of 27 March 2014 proved to show that no prior contract or agreement could exist as the site possession was given after the date of JKR’s Letter of Acceptance to the Defendant which is 28.04.2014. [58] In this regard, counsel for the Plaintiff’s submission of the case Sinar Wang Sdn Bhd v Ng Kee Seng (supra) cannot be relied upon as there was an offer made in this case after the issuance of LOI from the Defendant. The fact still remain that the Plaintiff could not prove acceptance of the offer and thus commencement of the preliminary works. Alternatively, the Plaintiff may have jumpstart the construction which is illegal but this matter was not pleaded on the Defendant’s part. [59] Given that the wordings in the LOI are clear and free from any ambiguity and that the acceptance was never communicated to the offer made, it must follow that there was no contract. The existence of a contract has yet to be proven by the Plaintiff. This translates to what is simply the fact that there was no judicial appreciation of the law by the learned Session Judge in deciding that the burden is on the Defendant when it was the Plaintiff who brought the suit claiming that a contract exist. In her first part of her decision she stated that, “Berdasarkan dari keterangan semua saksi dan eksibit-eksibit yang telah dikemukakan di dalam Mahkamah, Mahkamah mendapati bahawa Plaintiff mempunyai tuntutan yang kukuh dan gagal dicabar oleh Defendan di dalam tuntutan. Atas asas demikian, Mahkamah telah membenarkan tuntutan Plaintiff terhadap Defendan bersama-sama dengan kos.” [60] The initial onus of proving the case is always on the plaintiff. The plaintiff, at the start of the plaintiff’s case, has the legal burden of proving the existence of any relevant fact and the evidential burden of some evidence of the existence of such fact. The law on the burden of proof can be found in a plethora of cases and the decision of the Federal Court in Letchumanan Chettiar Alagappan @ L. Allagapan, M. Venkatachalam S/O Venkatachalam Chettiar v Secure Plantation Sdn Bhd No. 02-78-10/2014 had extensively discussed the burden of proof with sections 101 – 103 of the Evidence Act 1950 and made reference to an earlier Federal Court case of International Times & Ors v Leong Ho Yuen [1980] 2 MLJ 86. [61] Based on the Letchumanan Chettiar Alagappan @ L. Allagapan case (supra), section 101 is the burden to establish the case which rests throughout on the party who asserts the affirmative of the issue while the ‘burden of proof’ in section 102 of the Evidence Act 1950 is the burden to adduce evidence, to rebut the claim in order to discharge the burden of proof. The Federal Court Judge Salleh Abbas in the International Times case stated that, “The onus as opposed to burden is not stable and constantly shifts during the trial from one side to the other according to the scale of evidence and other preponderates. Such shifting is one continuous process in the evaluation of evidence. According to ss 102 and 103 of the Evidence Act, if the party with whom this onus lies whether initially or subsequently as a result of its shifting does not give any or further evidence or gives evidence which is not sufficient, such party must fail. It is this onus that we are concerned with in the present appeal.” [62] Based on the facts and the law before me, there was no valid contract, less so any breach thereof. The first issue has been answered in the negative and I can disregard the second and third issues as irrelevant to be answered. However for the purpose of completeness, I will give my grounds for the rest of the issues in my judgment. Preliminary Works Amounting to RM450,000.00 [63] The learned counsel for the Defendant submitted that the Plaintiff had failed to prove the preliminary works of RM450,000.00. The Counsel submitted in his written submission that the Session Judge had erred in law and in facts upon deciding that Plaintiff had successfully proven through the Summary Bill of Quantity as in exhibit P8, Letter of Payment of Deposit (Surat Penerimaan Pembayaran Deposit) of 7.2.2014” (exhibit P9), Letter of Deposit Payment for Supply of Construction Materials (Surat Pembayaran Deposit Untuk Membekal Bahan Binaan) of 10.3.2016 (exhibit P20), the photos (exhibit P19) and on the witness’s (SP2) statement. [64] The counsel for the Defendant submitted that the Plaintiff in claiming for the loss due to the preliminary works must prove loss and relied on a number of authorities: Ban Chuan Trading Co Sdn Bhd & Ors v Ng Bak Guan [2003] 4 CLJ 785, a Court of Appeal decision; Blue Sea Pools Swimming Centre (Klang) Sdn Bhd v Loo Ah Chew & Sons Sdn Bhd [2003] 1 LNS 121; Popular Industries Ltd v The Eastern Garment Manufacturing Co. Sdn Bhd [1990] 2 CLJ Rep 635; Letrik Bandar Hup Heng Sdn Bhd v Wong Sai Hong [2002] 5 CLJ 170. [65] The preparation of the BQ was claimed to be made by the Plaintiff’s witness (a diploma holder in Quantity Surveyor (QS)) whom stated that the BQ must be stamped by the person who prepared it. The counsel for the Defendant pointed out to the Court that no stamp was found on the BQ to show that the witness prepared the BQ (at pages 98 & 99 of Appeal Record) and therefore there was no proof that the BQ was prepared by the Plaintiff’s witness. The Counsel for the Defendant submitted that it was a mere empty BQ and the witness could not prove that he prepared the BQ. [66] The counsel for Defendant submitted on the evidence adduced by the Plaintiff as follows: (a) the photos tendered as exhibit P19 (at pages 230-242 of Appeal Record Jilid 2 Bahagian C) could not be proven as they were just pictures of a visit of the site and meeting with JKR only; (b) on the deposit for the appointment of a Project Management Consultant, no receipts were produced and the letter of 7.12.2014, only mentioned the amount of RM40,000 whereas the claim is for RM65,000 (at page 120 of Appeal Record Jilid 1 Bahagian A & B); (c) On Exhibit P20, the deposit for supply materials of RM250,000.00 no proof given for the deposit as paid (at page 194 Appeal Record Jilid 2). The maker of the letter was not called but upon questioned by the Defendant’s Counsel (at page 153 of Appeal Record Jilid 2), the reply was that the payment of deposit was partly by cheque and partly by cash. The Counsel for the Defendant submitted that it was such an enormous amount but no receipt could be produced in court and there is a discrepancy as the amount claimed was RM350,000.00. [67] Counsel for the Defendant relied on the authority PP v Azilah Hadri & Anor [2015] 1 CLJ 579 where it was held that when a document is sought to be proved to establish the truth of the facts contained in it, the maker has to be called and failure to call will result in the contents of the documents being hearsay. Analysis [68] The counsel for the Plaintiff’ had submitted in her written submission (at paragraph 10), stating that the Plaintiff prepared the BQ for RM27million which is “duly accepted by JKR”. However, this Court has difficulty in believing for the reason that the accepted tender was awarded to the Defendant only on 27 March 2014 and the given Date of Site Possession was 28 April 2014. [69] Richard Wilmot-Smith QC in ‘Construction Contract, Law and Practice’, Second Edition, explained that the BQ is a method of valuation where the contractor is provided with the means for work to be progressively valued. Indeed it is an important document. The English case of Convent Hospital Ltd v Eberlin & Partners (a firm) and others [1988] 14 ConLR 1 at page 6 explained the various purpose of a BQ where for instance in a tender process, it will be an investigation whether the employer will recommend the contractor for the work and whether the contractor will undertake the various items at the prices shown by the contractor. [70] The BQ is an important document which is part of the contract in construction projects and therefore it must be proven that the prices shown are as inserted and justified normally by a qualified Quantity Surveyor. In this case, the BQ was tendered by the Plaintiff but the contents could not be proven as there was no official stamp nor signature to prove that the BQ was prepared by Plaintiff’s QS. [71] For exhibit P9 and exhibit P20, there were no corroborated evidence to proof for the payment made. I have to agree with the counsel for the Defendant based on the case of PP v Azilah Hadri & Anor [2015] 1 CLJ 579, failure to call the maker of the document sought by the Plaintiff will result the contents of those documents as hearsay. [72] In relation to the photos (exhibit P9), my careful scrutiny of the photos find that there was no other evidence to corroborate that the photos had been taken at the site Project for the preliminary works to be carried out. There was no date and time recorded. In addition, the Plaintiff could not produce the site meeting minutes which would capture the discussion for the preliminary works to be carried out. [73] The Court had in her mind that if the Plaintiff could prove that the preliminary works had been carried out prior to formalization of a written contract, the Plaintiff would be able on the principle of quantum meruit claim for the actual work done. However the claim under principle of quantum meruit must be pleaded: Proton Edar Sdn Bhd and Multioto Assist Sdn Bhd [2015] MLJU 2017 which was not pleaded on the part of the Plaintiff. In addition, the principle of quantum meruit applies when there was no formal contract executed which is not as alleged by Plaintiff. [74] This Court finds that as there was no concluded contract and no proof for the preliminary works done, the claim for preliminary works must fail. Damages amounting to RM550,000.00 [75] It was the Plaintiff’s contention that the Plaintiff ought to have received the profit based on 15% of the contract value for the said Project. The Defendant’s Counsel submitted that the Defendant is not responsible for the damages of RM550,000.00 and the reason that the Plaintiff had rejected other offers was never proven by the Plaintiff. During the cross-examination, the Plaintiff submitted that he is claiming for 2.5% when he should be getting 15%. [76] The counsel for the Defendant submitted based on the number of cases relied, Popular Industries Ltd v The Eastern Garment Manufacturing (supra) and Letrik Bandar Hup Heng Sdn Bhd v Wong Sai Hong (supra) that there must be proof for damages. It was also submitted that the learned Session Judge had erred in law in relying on the case of Tanjung Tiara Sdn Bhd v Southwind Development Sdn Bhd [2011] 1 CLJ 105 in allowing the claim for damages of RM550,000.00. [77] In proving damages, real or factual evidence must be adduced as opposed to general estimations before a party can succeed in its claim: Lay Hong Food Corporation Sdn Bhd (Sebelum ini dikenali sebagai Lay Hong Poultry Processing Sdn Bhd (No Syarikat): 633683-X v Tiong Nam Logistics Solutions Sdn Bhd (No Syarikat: 043831-V) No: B-02(NCVC)(W)-1182-06/2016. [78] I wish to state here the famous words of Lord Goddard in Bonham-Carter v Hyde Park Hotel [1948] WN 89 which cannot be resisted, “Plaintiffs must understand that if they bring actions for damages it is for them to prove their damage; it is not enough to write down the particulars and, so to speak, throw them at the head of the court, saying: ‘This is what I have lost, I ask you to give me these damages’. They have to prove it.” [79] In this case, this Court finds that there was no evidence that a contract was ever concluded for the Plaintiff to claim for loss of profit or estimation of profit from the contract value. In addition, the Plaintiff did not produce any offers by others that had been rejected as claimed by the Plaintiff. [80] This Court disagrees with the Session Judge’s reference to the case Tanjung Tiara (supra) case as it differs from this case. In Tanjung Tiara (supra) case it was an appeal on the assessment of damages where the issue of liability was not decided before the Court of Appeal. Furthermore, the evidence adduced to support the plaintiff’s claim for damages in that case was based on defendant’s own computation in its third party contract as a basis. In the instant case, there was no method of calculation and it was the Plaintiff’s own basis to make the computation at 2.5%. As there is no proof on damages as claimed, the damages of RM550,000.00 must fail. [81] For the reasons stated above, I am unable to agree with counsel for the Plaintiff that there exist a contract between the parties. There was no concluded contract, the claim for preliminary works and damages must fail. The Plaintiff’s claim is dismissed with cost. Dated: 14 June 2017 (DATIN ZALITA BINTI DATO’ ZAIDAN) Judicial Commissioner Shah Alam High Court, Selangor Counsel for the Respondent/Plaintiff Florencia A/P Sandanasamy Messrs Florencia & Partners No.71-3, Plaza Damansara Jalan Medan Setia 1, Bukit Damansara, 50490 Kuala Lumpur Counsel for the Appellant/Defendant 1. Abdullah Az-Zubayr bin Awaluddin 2. Dayang Noor Ailani binti Puyungan Razali Tetuan Zulpadli & Edham No. 24, Jalan Perumahan Gurney 54000 Kuala Lumpur 2

Tika 2.6.0

BA-24-220-03/2017

PLAINTIF MUJUR ZAMAN SDN BHD DEFENDAN 1. CITRA TANI SDN BHD (NO. SYARIKAT: 189592-X) 2. PENDAFTAR HAKMILIK TANAH NEGERI SELANGOR

14/06/2017

YA DATUK AZIMAH BINTI OMAR

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=668cfec7-dee3-43cf-9908-b5b2ac5259b2&Inline=true

1 DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA SAMAN PEMULA: BA-24-220-03/2017 ANTARA MUJUR ZAMAN SDN BHD …PLAINTIF DAN 1. CITRA TANI SDN BHD (NO. SYARIKAT: 189592-X) 2. PENDAFTAR HAKMILIK TANAH NEGERI SELANGOR …DEFENDAN- DEFENDAN DAN 1. UMAR BIN ALI BASHAH @ ALI BASAH 2. ABD HAMID BIN JOHARI 3. MUTHOO A/L SEMBAN 4. ONG SAA KEE 5. ZAKARIA BIN TUKIMAN 6. JUPERI BIN LIAS 7. SIEW CHAP SING 8. KANAPATHY A/L RENGGASAMY 9. HAMID BIN SARIMAN 10. MOHD NOR BIN JURAMI 11. DAUD BIN AHMAD 12. RAMANAIDU A/L SIMANCHALAM 13. SAMIDAS @ FRANCIS A/L THOMAS 14. LEONG NYAT WONG 15. TAJUDDIN BIN KAMSAH (secara kolektif adalah ahli -ahli Jawatankuasa Bertindak Projek Terbengkalai Alam Mutiara dan Alam Utama yang mewakili 980 orang peserta-peserta Rancangan Revolusi Hijau Bukit Cherakah Peringkat II dan III di mana sebanyak 636 orang adalah berkenaan dengan Mujur Zaman Sdn Bhd) …PENCELAH-PENCELAH 2 ALASAN PENGHAKIMAN i. Kandungan 1 (Kandungan 26) ii. Kandungan 11 iii. Kandungan 14 iv. Kandungan 16 A. PENGENALAN [1] Pihak-pihak Plaintif dan Defendan Pertama di dalam kes ini bukanlah pihak-pihak yang kali pertama hadir di hadapan Mahkamah ini. Sebelum pemfailan guaman ini, pada tahun 2016 iaitu pada 6.12.2016 satu Saman Pemula (Saman Pemula BA-24-1299- 12/2016) telah dimulakan oleh Plaintif terhadap Defendan Pertama di hadapan Mahkamah ini. Di dalam Saman Pemula BA-24-1299- 12/2016 (Guaman 1299), Plaintif telah memohon daripada Mahkamah ini untuk mengeluarkan satu perintah supaya kaveat- kaveat persendirian yang dimasukkan oleh Defendan Pertama ke atas lima (5) bidang tanah di batalkan/ dipotong dan/atau diketepikan. [2] Mahkamah ini pada 14.2.2017 telah memutuskan bahawa Defendan Pertama tidak mempunyai kepentingan berkaveat ke atas kelima-lima bidang tanah tersebut lantas membenarkan permohonan Plaintif di 3 Kandungan 1 dan memerintahkan kaveat-kaveat persendirian yang dimasukkan oleh Defendan Pertama ke atas kelima-lima bidang tanah tersebut dibatalkan dan diketepikan. [3] Pada kali ini, melalui Saman Pemula yang difailkan pada 1.3.2017 Plaintif memohon untuk mendapatkan antara lain perintah-perintah berikut: i) Kaveat Amanah Perserahan No. 6412/2017 bertarikh 14/02/2017 di atas tanah yang dikenali sebagai PN100453 Lot 6234, Mukim Ijok, Daerah Kuala Selangor, Negeri Selangor Darul Ehsan. ii) Kaveat Amanah Perserahan No. 6427/2017 bertarikh 14/02/2017 di atas tanah yang dikenali sebagai PN100459 Lot 6421, Mukim Ijok, Daerah Kuala Selangor, Negeri Selangor Darul Ehsan. iii) Kaveat Amanah Perserahan No. 6415/2017 bertarikh 14/02/2017 di atas tanah yang dikenali sebagai PN100460 Lot 6242, Mukim Ijok, Daerah Kuala Selangor Darul Ehsan; iv) Kaveat Amanah Perserahan No. 6419/2017 bertarikh 14/02/2017 di atas tanah yang dikenali sebagai PN100461 Lot 6244, Mukim Ijok, Daerah Kuala Selangor Darul Ehsan; 4 v) Kaveat Amanah Perserahan No. 6415/2017 bertarikh 14/02/2017 di atas tanah yang dikenali sebagai PN100460 Lot 6242, Mukim Ijok, Daerah Kuala Selangor Darul Ehsan (kelima-lima kaveat amanah tersebut) yang kesemuanya didaftarkan oleh Defendan Pertama dipotong dengan serta merta; b) suatu perintah mengarahkan Defendan Kedua memotong kaveat- kaveat amanah tersebut yang berikut dengan serta-merta. c) suatu perintah menghalang Defendan Pertama sama ada melalui agen pengkhidmat mereka, wakil mereka atau selainnya ditahan daripada mendaftarkan sebarang kaveat selanjutnya di atas tanah- tanah yang dikenali sebagai PN100453 Lot 6243, PN100459 Lot 6241, PN100460 Lot 6242, PN100461 Lot 6244 dan PN100447 Lot 6228 kesemuanya di Mukim Ijok, Daerah Kuala Selangor, Negeri Selangor Darul Ehsan; d) Defendan Pertama membayar kepada Plaintif pampasan yang termasuk pampasan yang diakibatkan oleh Defendan Pertama untuk memasukkan kaveat-kaveat amanah tersebut yang akan ditaksirkan oleh Penolong Kanan Pendaftar/Timbalan Pendaftar; 5 e) kos bagi permohonan ini dan kos sampingan baginya ditanggung oleh Defendan Pertama; B. PIHAK-PIHAK [4] Plaintif di dalam kes ini adalah sebuah syarikat sendirian berhad bernama Mujur Zaman Sdn Bhd (Mujur Zaman). Defendan Pertama pula juga adalah merupakan sebuah syarikat sendirian berhad bernama Citra Tani Sdn Bhd (Citra Tani). Kedua-dua Mujur Zaman dan Citra Tani adalah anak syarikat atau syarikat-syarikat subsidiari kepada satu syarikat induk bernama Fountain View Development Berhad (FVDB). [5] Atas sebab mempunyai kepentingan di dalam prosiding ini seramai lima belas (15) orang pencelah telah dibenarkan oleh Mahkamah ini untuk mencelah di dalam prosiding ini. Kelima-lima belas Pencelah ini secara kolektif adalah ahli-ahli Jawatankuasa Bertindak Projek Terbengkalai Alam Mutiara dan Alam Utama yang mewakili 980 orang peserta-peserta Rancangan Revolusi Hijau Bukit Cherakah Peringkat II dan III yang mana 6 sebanyak 636 orang adalah berkenaan dengan Plaintif iaitu Mujur Zaman. [6] Defendan Kedua (Pendaftar Hakmilik Tanah Negeri Selangor) telah dijadikan sebagai pihak defendan atas kapasiti administratifnya sebagai Pentadbir Tanah yang telah mendaftarkan lima (5) kaveat amanah di atas kelima-lima tanah tersebut. C. LATAR BELAKANG KES [7] Latar belakang kes yang membawa kepada pemfailan Saman Pemula ini oleh Mujur Zaman (Plaintif) dan latar belakang guaman 1299 adalah sama. Namun, untuk tujuan jelas kefahaman, moleklah bagi Mahkamah ini untuk mengulanginya semula seperti berikut: 7.1 Plaintif adalah tuanpunya berdaftar kepada lima (5) bidang tanah berikut: i) tanah yang dikenali sebagai PN100453 Lot 6234, Mukim Ijok, Daerah Kuala Selangor, Negeri Selangor Darul Ehsan. ii) tanah yang dikenali sebagai PN100459 Lot 6421, Mukim Ijok, Daerah Kuala Selangor, Negeri Selangor Darul Ehsan. 7 iii) tanah yang dikenali sebagai PN100460 Lot 6242, Mukim Ijok, Daerah Kuala Selangor Darul Ehsan; iv) tanah yang dikenali sebagai PN100461 Lot 6244, Mukim Ijok, Daerah Kuala Selangor Darul Ehsan; v) tanah yang dikenali sebagai PN100447 Lot 6228, Mukim Ijok, Daerah Kuala Selangor Darul Ehsan; (Kelima-lima bidang tanah di atas akan dirujuk sebagai “hartanah- hartanah tersebut”) 7.2 Seperti yang telah dinyatakan awal tadi, Plaintif (Mujur Zaman) dan Defendan Pertama (Citra Tani) adalah anak-anak syarikat atau syarikat-syarikat subsidiari kepada satu syarikat induk bernama Fountain View Development Berhad (FVDB). 7.3 Sebagai satu cara pengurusan dalaman (internal management measure) di antara syarikat induk dan anak-anak syarikatnya, pada 15.3.2010 terdapat lima (5) Perjanjian-perjanjian Jual Beli (perjanjian-perjanjian jual beli tersebut) yang telah dimasuki di antara Plaintif dan Defendan Pertama berhubung dengan hartanah-hartanah tersebut. 8 7.4 Justeru itu, adalah menjadi fakta yang tidak dipertikaikan bahawa perjanjian-perjanjian jual beli tersebut telah ditandatangani bukanlah dengan niat untuk ianya dikuatkuasakan atau diberi kesan tetapi hanya sebagai suatu cara pengurusan dalaman (internal management measure) yang bertujuan membantu syarikat induk FVDB untuk menstruktur semula aset-aset (assets) dan tanggungan- tanggungan (liabilities) syarikat. Penstrukturan semula aset- aset dan tanggungan-tanggungan syarikat ini adalah bertujuan untuk mengelakkan syarikat induk terdedah kepada pemiutang- pemiutang. 7.5 Fakta penting (utama) berhubung dengan perjanjian-perjanjian jual beli tersebut adalah: (a) Tiada harga belian telah ditetapkan bagi penjualan hartanah-hartanah tersebut. (b) Tiada harga belian telah dibayar oleh Defendan Pertama kepada Plaintif sebagai balasan. 9 (c) Defendan Pertama telah bersetuju bahawa Plaintiff adalah dibenarkan untuk menjual hartanah-hartanah tersebut kepada mana-mana pihak ketiga. 7.6 Hartanah-hartanah tersebut juga mempunyai di atasnya kepentingan terhad (restriction in interest) yang menyatakan bahawa apa-apa transaksi urusniaganya (dealings) ke atasnya hendaklah memperolehi kelulusan daripada pihak berkuasa negeri terlebih dahulu. 7.7 Adalah menjadi satu fakta yang tidak dipertikaikan bahawa Defendan Pertama tidak pernah pada bila-bila memohon kelulusan daripada pihak berkuasa negeri. 7.8 Atas fakta ini juga, adalah jelas bahawa dalam keadaan yang sedemikian syarat bagi penjualan dan pembelian perjanjian- perjanjian jual beli tersebut yang bertarikh 15.3.2010 sememangnya tidak pernah dipenuhi dan Defendan Pertama. 10 Pihak Berkuasa Negeri tidak meluluskan Perjanjian-perjanjian jual beli tersebut dan tidak berhasrat/berniat untuk membenarkan atau meluluskan Perjanjian-perjanjian jual beli tersebut. 7.9 Pada dasarnya, Pihak Berkuasa Negeri Defendan sememangnya tidak berminat ataupun berhasrat untuk meluluskan perjanjian-perjanjian jualbeli tersebut yang dimasuki oleh kedua-dua pihak iaitu Plaintif dan Defendan Pertama. Pada tahun 2012, Pihak Berkuasa Negeri telah berhasrat untuk membuat pengambilan tanah terhadap hartanah-hartanah tersebut dan membuat pemberimilikan semula (re-alienate) hartanah-hartanah tersebut kepada Perbadanan Menteri Besar Selangor (Menteri Besar Incorporation “MBI”) untuk tujuan pembangunan. 7.10 Berhubung dengan pengambilan hartanah-hartanah tersebut oleh Pihak Berkuasa Negeri tersebut, Plaintif telah membawa pelbagai tindakan mahkamah sehingga sampai ke peringkat Mahkamah Persekutuan. Di dalam menentang pengambilan hartanah-hartanah tersebut juga, Plaintif juga telah memulakan prosiding semakan kehakiman (judicial review) terhadap Pihak 11 Berkuasa Negeri. Atas pelbagai tindakan undang-undang tersebut, pihak-pihak di dalam tindakan-tindakan tersebut telah menyelesaikan tindakan-tindakan tersebut melalui dua (2) Penghakiman Persetujuan yang direkodkan di hadapan Mahkamah Persekutuan pada 17.5.2016.Terma-terma relevan dan berkaitan dengan kedua-dua Penghakiman Persetujuan tersebut adalah pihak-pihak bersetuju bahawa hartanah- hartanah tersebut dijual kepada Paragon Pinnacle Sdn Bhd (PPSB) dan Pihak Berkuasa Negeri hanya akan membenarkan dan meluluskan penjualan hartanah-hartanah tersebut kepada PPSB. 7.11 Berikutan dengan kedua-dua Penghakiman Persetujuan tersebut, atas permohonan Plaintif, Pihak Berkuasa Negeri telahpun memberi kebenaran dan kelulusan bagi hartanah-hartanah tersebut (kepunyaan Plaintif) dipindahmilik kepada PPSB. 7.12 Sehubungan dengan itu juga, Defendan Pertama telah mengeluarkan surat bertarikh 13.7.2016 yang mengesahkan bahawa mereka tiada bantahan terhadap tanah-tanah yang dijual kepada Paragon Pinnacle 12 Sdn Bhd (PPSB). Di samping itu juga, melalui suratnya bertarikh 4.11.2016. Defendan Pertama telah menyatakan ketiadaan bantahannya ke atas pemindahmilikan hartanah-hartanah tersebut kepada PPSB oleh Plaintif. 7.13 Bertentangan dengan posisi yang diambilnya dan berdiri, seperti yang dinyatakan di awal penghakiman tadi, Defendan Pertama telah menyatakan bahawa perjanjian-perjanjian jual beli tersebut telah ditandatangani berikutan dengan keberhutangan Plaintif dengan syarikat induknya FVDV sebanyak RM 285,331,319.00 setakat 25.2.2010 yang mana sebahagian hutang tersebut sebanyak RM155,937,831.00 telah diserahhakkan (assign) kepada Defendan Pertama melalui surat persetujuan penyerahhakkan bertarikh 25.2.2010. Defendan Pertama juga telah menyatakan bahawa Defendan Pertama telah bersetuju dengan pembelian lapan keping tanah kepunyaan Plaintif termasuk hartanah-hartanah tersebut dengan harga berjumlah RM155,937,831.00 iaitu hutang yang diserahhakkan. Defendan Pertama telah menyatakan bahawa dengan persetujuan-persetujuan inilah yang telah menghasilkan atau terbitnya perjanjian-perjanjian jual beli tersebut dan satu Perjanjian 13 Penyelesaian dimasuki oleh Plaintif dan Defendan Pertama (Perjanjian Penyelesaian 2010). 7.14 Pada 9.8.2012, Defendan Pertama telah memasukkan kaveat-kaveat persendiriannya ke atas hartanah-hartanah tersebut. Di dalam memasukkan kaveat-kaveat persendirian tersebut Defendan Pertama telah bergantung sepenuhnya ke atas Perjanjian-perjanjian jual beli tersebut bagi pengujudan/pembangkitan kepentingan berkaveat Defendan Pertama ke atas hartanah-hartanah tersebut. 7.15 Di dalam Borang 19B (PERMOHONAN UNTUK MEMASUKKAN KAVEAT PERSENDIRIAN) bertarikh 9.8.2012/16.8.2012 jelas menyatakan berikut: 1. Kami, CITRA TANI SDN BHD (No. Syarikat 189592-X), sebuah syarikat yang ditubuhkan di Malaysia di bawah Akta Syarikat 1965 dan mempunyai alamat berdaftar di Unit 1005, Tingkat 10, Block E, Pusat Perdagangan Phileo Damansara 1, No. 9, Jalan 16/11, Off Jalan Damansara, 46350 Petaling Jaya, Selangor Darul Ehsan, dengan ini memohon supaya dimasukkan suatu kaveat persendirian ke dalam hakmilik tanah yang diperihalkan dalam Jadual di bawah ini supaya dimaksudkan untuk mengikut kepentingan tertentu yang diperihal dalam Jadual tersebut. 14 2. Alasan-alasan tuntutan kami atas kepentingan tertentu itu adalah:- a. Pada 15hb Mac, 2010, satu Perjanjian Jualbeli telah ditandatangani oleh kami dengan MUJUR ZAMAN SDN BHD (No. Syarikat 495108-T), sebuah syarikat yang ditubuhkan di Malaysia di bawah Akta Syarikat dan mempunyai alamat berdaftar di 13A, Jalan SS 21/56B, Damansara Utama, 47400 Petaling Jaya, Selangor Darul Ehsan untuk membeli sekeping tanah kosong yang dipegang di bawah Hakmilik H.S.(D) 5470 P.T. 9145 di Mukim Ijok, Daerah Kuala Selangor, Selangor Darul Ehsan (selepas ini disebut sebagai “Hartanah tersebut”) dengan harga belian Ringgit Malaysia Sembilan Belas Juta Lima Puluh Empat Ribu Lapan Ratus Lapan Puluh Enam (RM19,054,886.00) sahaja (“Harga Hartanah”) dan tertakluk kepada terma-terma dan syarat-syarat Perjanjian tersebut. Kami telah diberi kuasa yang sepenuhnya untuk mengikrarkan Surat Akuan ini bagi pihak Syarikat ini. b. Syarikat ini telah membayar Harga Hartanah sepenuhnya kepada MUJUR ZAMAN SDN BHD bagi pembelian Hartanah tersebut. Sesalinan Perjanjian Jualbeli tersebut dilampirkan di sini dan ditandakan sebagai Lampiran 1. c. Atas sebab pembayaran tersebut yang telah dibuat, Kaveat Persendirian ini harus dimasukkan untuk memelihara dan menjaga kepentingan Syarikat ini sebagai pembeli Hartanah tersebut seperti di dalam Akuan Berkanun pengarah Syarikat ini yang dilampirkan di sini. 7.16 Defendan Pertama seterusnya telah memasukkan kaveat persendirian ke atas hartanah-hartanah tersebut pada 2.9.2015 15 dengan bersandarkan alasan yang sama iaitu perjanjian-perjanjian jual beli tersebut membangkitkan kepentingan berkaveat Defendan Pertama ke atas hartanah-hartanah tersebut; 7.17 Di dalam Borang 19B (PERMOHONAN UNTUK MEMASUKKAN KAVEAT PERSENDIRIAN) bertarikh 26.9.2014 (perserahan didaftar pada 2.9.2015) jelas menyatakan berikut: 1. Kami, CITRA TANI SDN BHD (No. Syarikat 189592-X), sebuah syarikat yang ditubuhkan di Malaysia di bawah Akta Syarikat 1965 dan mempunyai alamat berdaftar di Unit 1005, Tingkat 10, Block E, Pusat Perdagangan Phileo Damansara 1, No. 9, Jalan 16/11, Off Jalan Damansara, 46350 Petaling Jaya, Selangor Darul Ehsan, dengan ini memohon supaya dimasukkan suatu kaveat persendirian ke dalam hakmilik tanah yang diperihalkan dalam Jadual di bawah ini supaya dimaksudkan untuk mengikut kepentingan tertentu yang diperihal dalam Jadual tersebut. 2. Alasan-alasan tuntutan kami atas kepentingan tertentu itu adalah:- a. Pada 15hb Mac, 2010, satu Perjanjian Jualbeli telah ditandatangani oleh kami dengan MUJUR ZAMAN SDN BHD (No. Syarikat 495108-T), sebuah syarikat yang ditubuhkan di Malaysia di bawah Akta Syarikat dan mempunyai alamat berdaftar di 13A, Jalan SS 21/56B, Damansara Utama, 47400 Petaling Jaya, Selangor Darul Ehsan untuk membeli sekeping tanah kosong yang dipegang di bawah Hakmilik LOT 6241 PN 100459 (dahulu dikenali sebagai H.S.(D) 5469 P.T. 9144) di Mukim Ijok, 16 Daerah Kuala Selangor, Selangor Darul Ehsan (selepas ini disebut sebagai “Hartanah tersebut”) dengan harga belian Ringgit Malaysia Dua Puluh Empat Juta Lapan Ratus Tujuh Puluh Enam Ribu Dua Ratus Empat Puluh Lima (RM24,876,245.00) sahaja (“Harga Hartanah”) dan tertakluk kepada terma-terma dan syarat-syarat Perjanjian tersebut. Kami telah diberi kuasa yang sepenuhnya untuk mengikrarkan Surat Akuan ini bagi pihak Syarikat ini. b. Syarikat ini telah membayar Harga Hartanah sepenuhnya kepada MUJUR ZAMAN SDN BHD bagi pembelian Hartanah tersebut. Sesalinan Perjanjian Jualbeli tersebut dilampirkan di sini dan ditandakan sebagai Lampiran 1. c. Atas sebab pembayaran tersebut yang telah dibuat, Kaveat Persendirian ini harus dimasukkan untuk memelihara dan menjaga kepentingan Syarikat ini sebagai pembeli Hartanah tersebut seperti di dalam Akuan Berkanun pengarah Syarikat ini yang dilampirkan di sini. [8] Atas kemasukkan kaveat-kavaet persendirian (perserahan- perserahan pada tahun 2012 dan 2015) oleh Defendan Pertama tersebut, pada 6.12.2016 Plaintif telah memulakan satu tindakan Saman Pemula BA-24-1299-12/2016 (SP 1299) untuk mendapatkan perintah supaya kaveat-kaveat persendirian tersebut dipotong/dibatalkan. 17 [9] Seperti dinyatakan awal tadi, atas permohonan Plaintif di dalam SP 1299, Mahkamah ini pada 14.2.2017 telah membatalkan/memotong kaveat-kaveat persendirian tersebut dengan keputusan bahawa Defendan Pertama tidak mempunyai sebarang kepentingan berkaveat ke atas hartanah-hartanah tersebut. Defendan Pertama telah merayu kepada Mahkamah Rayuan terhadap keputusan Mahkamah ini. [10] Namun, sebelum keputusan Guaman 1299 diputuskan oleh Mahkamah ini, pada 13.2.2017 dua orang pengarah Defendan bernama Goh Chee Keong (No. K.P: 711022-10-5841) dan Yong Loong Chen (No. K.P: 660819-10-6297) telah memperakukan dan menandatangani Surat Akuan di hadapan Pesuruhjaya Sumpah untuk menyokong permohonan Defendan Pertama untuk memasukkan kaveat amanah ke atas hartanah-hartanah tersebut. [11] Di dalam Borang 19E (PERMOHONAN UNTUK MEMASUKKAN KAVEAT AMANAH) nya, Defendan Pertama telah menyatakan alasan-alasan berikut untuk memasukkan kaveat-kaveat amanah tersebut: 18 1. Pada masa yang berkenaan iaitu dalam tahun 2010, kami CITRA TANI SDN BHD (No. Syarikat: 189592-X) dan syarikat MUJUR ZAMAN SDN BHD (495108-T (selepas ini dirujuk sebagai “Penghutang”) adalah anak syarikat sepenuh FOUNTAIN VIEW DEVELOPMENT BERHAD (No. Syarikat: 585360-T) (Selepas ini dirujuk sebagai “Pemiutang”). 2. Setakat tahun 2010, Penghutang telah berhutang kepada Pemiutang sebanyak RM285,331,319.00. 3. Pemiutang, Penghutang dan kami telah bersesama bersetuju bahawa Pemiutang akan menyerah hak jumlah hutang yang perlu dibayar oleh Penghutang sebanyak RM155,937,831.00 kepada kami sebagai benefisiari. Sesalinan segala surat penyerahan hak jumlah RM155,937,831.00 adalah dilampirkan di sini iaitu Eksibit bertanda “ii” – Resolusi Pekeliling Pengarah Penghutang bertarikh 25.2.2010, dan Eksibit bertanda “iii” – surat kami kepada Penghutang bertarikh 10.3.2010. 4. Berikutan itu, Penghutang telah menjadualkan lapan (8) keping tanah kepada kami untuk jumlah RM155,937,831.00 melalui lapan perjanjian jual beli bertarikh 15.3.2010 termasuk untuk tanah yang dipegang dibawah hakmilik dikenali sebagai PN100459 (dahulu HSD 5469)….. 19 (dahulu PT No 9144) Mukim Ijok Daerah Kuala Selangor Negeri Selangor (Hantar….untuk jumlah Ringgit Malaysia Dua Puluh Empat Juta Lapan Ratus Tujuh Puluh Enam Ribu Dua Ratus Empat Puluh Lima (RM24, 876,,245.00) sahaja (“Harga Pembelian tersebut”) Salinan Perjanjian Jual Beli bertarikh 15.3.2010 bagi harta tersebut adalah dilampirkan sebagai eksibit bertanda iv (“Perjanjian Jual-Beli tersebut”). 5. Sebagai pembayaran keseluruhan harga pembelian RM155, 937, 831.00, Penghutang menandatangani perjanjian penyelesaian bertarikh 15.3.2010 (“Perjanjian Penyelesaian tersebut”) mengakui penerimaan keseluruhan harga pembelian termasuk Harga pembelian tersebut. Salinan Perjanjian Penyelesaian tersebut adalah dilampirkan sebagai Eksibit bertanda “v”. 6. Adalah terma Perjanjian Jual Beli tersebut bahawa: (i) Klausa 4 – Transaksi yang dipertimbangkan ini adalah dianggap telah sempurna sebaik sahaja perjanjian jual beli ini ditandatangani dan selepas itu kami sebagai Pembeli adalah dianggap tuanpunya benefisial Harta tersebut. (ii) Klausa 5.4 – Untuk mengelakkan keraguan, adalah dengan ini dipersetujui dan diakui oleh Penghutang sebagai Penjual bahawa sebaik sahaja pembayaran atau penyelesaian harga jual beli Harta 20 tersebut, kami sebagai pembeli adalah dianggap sebagai tuanpunya benefisial yang mutlak terhadap Harta tersebut walaupun kebenaran pindahmilik dari Pihak Berkuasa Negeri masih tidak selesai atau tidak diperolehi dan walaupun bahawa harta tersebut mungkin masih lagi berdaftar atas nama Penghutang. 7. Adalah terma Perjanjian Penyelesaian bahawa: (iii)Klausa 4 – Kami sebagai Penerimahak adalah dianggap telah menyelesaikan sepenuhnya harga jual beli Harta tersebut apabila Perjanjian Penyelesaian ini ditandatangani dan Penghutang sebagai Pemilik Berdaftar harus terus dipenuhi tanggungjawab sebagai pemilik berdaftar seperti yang terkandung dalam terma- terma dan syarat-syarat Perjanjian Penyelesaian tanpa lewat dalam tempoh Tarikh Tamat (‘Cut-Off Date’). (iv) Klausa 5.5 – Seandainya Kebenaran Pindahmilik dari Pihak Berkuasa Negeri tidak diperolehi atau ditolak dapat waktu lanjutan Tarikh Tamat (“Cut-Off Date”), Penghutang sebagai Pemilik Berdaftar adalah memegang Harta tersebut sebagai Pemegang Amanah untuk kami sebagai Penerimahak dalam ketiadaan sebarang perjanjian bertulis yang berlawanan antara pihak-pihak. Seandainya Hartanah-Hartanah yang kemudiannya 21 terjual atau dipindahmilik kepada pihak yang lain, ianya mestilah dengan kebenaran bertulis dari kami sebagai Penerimahak dan segala keuntungan jualan atau pindahmilik Hartanah-Hartanah adalah kepunyaan mutlak kami sebagai Penerimahak kecuali sebaliknya dengan persetujuan kami. [12] Di dalam kemasukan kaveat-kaveat amanah tersebut, berbeza dengan kemasukan kaveat-kaveat persendirian pada tahun 2012 dan 2015 Defendan Pertama Pertama hanya bergantung kepada perjanjian-perjanjian jual beli tersebut bagi pembangkitan kepentingan berkaveat tetapi pada kali ini Defendan Pertama telah juga bergantung kepada klausa-klausa di dalam Perjanjian Penyelesaian 2010 bagi membangkitkan kepentingan berkaveatnya ke atas hartanah-hartanah tersebut. [13] Pendaftar Hakmilik kemudiannya pada 14.2.2017 telah mendaftarkan kaveat-kaveat amanah ke atas hartanah-hartanah tersebut dengan mendaftarkan perserahan-perserahan sewajarnya menurut seksyen 333 KTN. 22 [14] Atas kemasukkan kaveat-kaveat amanah oleh Defendan Pertama tersebut, Plaintif telah memfailkan Saman Pemula ini memohon antara lain supaya kaveat-kaveat amanah tersebut dibatalkan dan/atau diketepikan. Saman Pemula Plaintif ini telah disokong oleh afidavit-afidavit yang diikrarkan Dato’ Koh Foong Soon yang merupakan pengarah Plaintif. [15] Pada 25.5.2017, Pencelah-Pencelah yang dicadangkan telah memfailkan permohonan di Kandungan 20 untuk mencelah prosiding di hadapan Mahkamah ini. Pada 7.6.2017 Mahkamah ini telah membenarkan Kandungan 20. Bagi memberi kesan kepada kebenaran pencelahan tersebut Plaintif telah memfailkan Saman Pemula Terpinda di Kandungan 26. Kepentingan Pencelah-Pencelah terhadap tindakan Plaintif terhadap Defendan adalah bersandarkan fakta-fakta berikut: i. Pencelah-pencelah adalah mewakili peneroka-peneroka yang diberikan tanah di dalam rancangan pembangunan tanah (“Rancangan Revolusi Hijau Bukit Cherakah peringkat II dan III”) dan pada sekitar tahun 1987, peneroka-peneroka masing-masing telah diberikan hakmilik untuk tanah tersebut di Mukim Ijok, Kuala Selangor, Selangor. 23 ii. Peneroka-peneroka secara individu kemudiannya memajakkan tanah kepada Perbadanan Kemajuan Pertanian Selangor (PKPS) untuk tempoh 10 tahun iaitu sehingga tahun 1997. Pada sekitar 1997, Pajakan antara PKPS dan peneroka-peneroka masing-masing telah tamat dan sepatutnya dipulangkan kepada mereka. iii. Peneroka-peneroka kemudiannya dimaklumkan oleh Kerajaan Negeri Selangor bahawa tanah mereka akan dimajukan dalam pembangunan bersepadu oleh sektor swasta dan Plaintif dilantik untuk tujuan itu. iv. Peneroka-peneroka telah memasuki Perjanjian Pengurusan dengan Plaintif pada sekitar tahun 2000 di mana tanah mereka telah dijual kepada Plaintif. v. Pada sekitar 2002, setiap peneroka-peneroka memasuki Perjanjian Pengurusan Tambahan dengan Plaintif dan Mujur Zaman Properties Sdn Bhd dan sekitar tahun 2004, setiap peneroka-peneroka memasuki Perjanjian Jual Beli dengan MZ Development Sdn Bhd dan Plaintif untuk membeli sebuah rumah teres 2 tingkat. vi. Walaubagaimanapun projek bersepadu yang sepatutnya dibangunkan oleh Plaintif terbengkalai dan peneroka-peneroka hanya menerima 24 sebahagian sahaja daripada bayaran yang terhutang kepada mereka dan tidak menerima unit perumahan seperti yang dijanjikan. Pada 11.1.2016, pencelah-pencelah yang dicadangkan telah memasuki Perjanjian Penyelesaian dengan Plaintif dan Paragon Pinnacle Sdn Bhd (“PPSB”) untuk mencapai penyelesaian terhadap obligasi-obligasi Plaintif kepada peneroka-peneroka dan tanah yang dibeli oleh Plaintif daripada peneroka- peneroka akan dijual kepada PPSB. vii. Pada 17.5.2016, melalui Penghakiman Persetujuan di Mahkamah Persekutuan, Plaintif dan PPSB mengakujanji akan memenuhi obligasi- obligasi yang dinyatakan dalam Perjanjian Penyelesaian dengan Pencelah-pencelah yang Dicadangkan. viii. Pada 3.9.2016, PPSB telah mengeluarkan Sijil Kelayakan kepada peneroka-peneroka terhadap unit perumahan daripada PPSB. x. Apabila Defendan Pertama memasukkan kaveat-kaveat persendirian atas tanah-tanah yang sama di mana kaveat-kaveat amanah adalah perkara dalam Saman Pemula Plaintif bagi tindakan ini di Lamp.1. Kaveat-kaveat amanah Defendan Pertama ini akan menyebabkan kelewatan kepada pembinaan, penyiapan dan penyerahan unit-unit perumahan kepada kesemua 980 peneroka-peneroka yang menunggu unit-unit perumahan yang dijanjikan pada tahun 2000 lagi. 25 [16] Pencelah-pencelah di dalam kes ini telahpun memfailkan afidavit- afidavitnya bagi menyokong permohonan Plaintif. Pencelah-Pencelah juga telah menerimapakai hujahan-hujahan yang telah dikemukakan oleh peguam bijaksana Plaintif di dalam keempat-empat permohonan. [17] Sebelum Kandungan 1 (Kandungan 26) didengar dan dibicarakan, Defendan Pertama telah memfailkan tiga (3) notis permohonan iaitu Kandungan 11, Kandungan 14 dan Kandungan 16. [18] Kandungan 11 - adalah permohonan Defendan Pertama memohon supaya Saman Pemula Plaintif dan Afidavit Sokongan oleh Dato’ Koh Foong Soon dibatalkan menurut Aturan 18 Kaedah 19(1)(b),(c) dan (d) Kaedah-kaedah Mahkamah 2012 (KKM 2012), dan/atau secara alternatif Saman Pemula Plaintif dipindah dan disatukan dengan tindakan Writ Saman No.:BA-22NCVC-27-01/2017 bawah Aturan 4 Kaedah 1 KKM 2012. [19] Kandungan 14 - adalah permohonan Defendan Pertama diberi kebebasan untuk memeriksa balas Dato’ Koh Foong Soon atas 26 affidavit-afidavit yang diikrarkan pada 1.3.2017 dan 31.3.2017 menurut Aturan 38 Kaedah 2(2) KKM 2012. [20] Kandungan 16 - adalah permohonan Defendan Pertama untuk satu perintah bahawa Saman Pemula ditukarkan kepada suatu tindakan writ dan diteruskan seolah-olah ianya dimulakan melalui writ menurut Aturan 28 Kaedah 8 KKM 2012. D. KANDUNGAN 11 [21] Defendan Pertama telah memfailkan Kandungan 11 pada 16.5.2017. Di dalam Kandungan 11 ini, Defendan Pertama telah memohon supaya Saman Pemula Plaintif dan Afidavit Sokongan oleh Dato’ Koh Foong Soon dibatalkan menurut Aturan 18 Kaedah 19(1)(b),(c) dan (d) Kaedah-kaedah Mahkamah 2012 (KKM 2012), dan/atau secara alternatif Saman Pemula Plaintif dipindah dan disatukan dengan tindakan Writ Saman No.:BA-22NCVC-27-01/2017 (Guaman Writ 27) di bawah Aturan 4 Kaedah 1 KKM 2012. 27 [22] Permohonan Defendan Pertama di Kandungan 11 ini telah disokong oleh afidavit sokongan yang diikrarkan oleh Goh Chee Keong pada 15.5.2017. [23] Alasan-alasan Defendan Pertama di dalam membuat permohonan boleh disimpulkan seperti berikut: a. Plaintif yang sebelum memfailkan Kandungan 1 telahpun mempunyai adalah berpengetahuan mengenai Guaman Writ Saman 27 yang telah dimulakan oleh Defendan Pertama terhadapnya. Malahan, Guaman Writ Saman 27 Terpinda telah pun disampaikan kepada Plaintif pada 1.3.2017. Walaupun mempunyai pengetahuan penuh berhubung guaman writ 27 tetapi Plaintif masih juga meneruskan Kandungan 1. Memandangkan perkara subjek dan fakta-fakta dalam Guaman Writ 27 Terpinda adalah sama dengan Kandungan 1 Plaintif, maka Kandungan 1 Plaintif terhadap Defendan Pertama adalah satu tindakan yang mengaibkan, remeh atau menyusahkan; 28 b. persoalan undang-undang dan perkara fakta di dalam Kandungan 1 dan Guaman Writ 27 adalah sama, maka pemfailan Kandungan 1 adalah mengaibkan, remeh atau menyusahkan; c. terdapat pertikaian fakta-fakta yang substantial di dalam tindakan ini, maka tindakan melalui saman pemula oleh Plaintif adalah tidak sesuai dan ianya hendaklah dibatalkan; d. Kandungan 1 Plaintif terhadap Defendan Pertama ini telah menjejaskan, menghalang atau melengahkan perbicaraan Guaman Writ 27 Terpinda dengan adil; dan e. memandangkan hak untuk mendapat relief yang dituntut di dalam Kandungan 1 adalah berkenaan dengan atau berbangkit daripada transaksi atau siri transaksi yang sama dengan Guaman Writ 27, maka kedua-dua tindakan adalah sewajarnya disatukan. 29 UNDANG-UNDANG BERHUBUNG PEMBATALAN KES MENURUT ATURAN 18 KAEDAH 19 KKM 2012 [24] Di dalam kes Bandar Builder Sdn Bhd & Ors v United Malayan Banking Corporation Bhd [1993] 4 CLJ 7, prinsip-prinsip undang- undang mengenai kuasa budi bicara mahkamah di bawah A.18 k.19 KKM 2012 ini telah diterangkan dengan begitu jelas oleh Mohamed Dzaiddin HMA (YAA pada ketika itu) seperti berikut: “It is only in plain and obvious cases that recourse should be had to the summary process under this rule (per Lindley MR in Hubbuck & Sons Ltd v Wilkinson, Heywood & Clark Ltd), and this summary procedure can only be adopted when it clearly seen that a claim or answer is on the face of it “obviously unsustainable” (see AG of Duchy of Lancaster v L & NWRly & Co). It cannot be exercised by a minute examination of the documents and facts of the case, in order to see whether the party has a cause of action or a defence (see Wenlock v Moloney & Ors). The authorities further show that if there is a point of law which requires serious discussion, an objection should be taken on the pleadings and the point set down for argument under Order 33 r 3 (which is in pari material with our Order 33 r 2 of the RHC)(see Hubbuck & Sons Ltd v Wilkinson, Heywood & Clark Ltd). The court must be satisfied that there is no reasonable cause of action or that the claims are frivolous or vexatious or that the defences raised are not arguable.” 30 [25] Manakala Vincent Ng H (YA ketika itu) dalam kes Suppuletchemi v Palmco Bina Sdn Bhd [1994] 2 AMR 1191, di muka surat 1205 penghakimannya telah berkata: “But in an application under Order 18 r 19 or Order 14, it is still incumbent upon the court to determine whether issues could more appropriately have been decided, without the expence of a full trial with a witnesses and expenditure of the court’s invaluable time. No party in a proceeding is entitled to require the court to accord them valuable time of several days open court viva voce trial only upon mere or bare assertions in their affidavits. The crucial question the court would have to ask itself in applications under Order 14 or Order 18 r 19(1)-(d) is first, whether the piece or pieces of evidence essential to make out the reasonable prima facie cause of action or a prima facie triable issue of fact are of the nature such that they are adduceable by affidavit evidence; and secondly – if the answer to this question is in the positive – whether such essential prima facie evidence had been so adduced in the supporting affidavits. Such affidavits ought not to contain bare averments but must condescend or come definitely into particulars fro serious argument such that they are sufficient to satisfy the court that there is a reasonable prima facie cause of action or triable issue or issue of fact or law in the defence as the case may be. …the court must and ought to look at the whole situation and ask itself whether the plaintiff (in an application to strike off a claim) has satisfied the court that he has a bona fide or prima facie cause of action,…” 31 [26] Di dalam kes Mooney & Ors v Peat Marwick Mitchell & Co & Anor [1967] 1 MLJ 87 Raja Azlan Shah J (DYMM pada ketika itu) di muka surat 88 telah menyatakan seperti berikut: “It is firmly established that the power exercisable under r. 4 “is only appropriate in cases which are plain and obvious so that a judge can say at once that a statement of claim as it stands is insufficient, even if proved, to entitle the plaintiff to the relief of which he ask for”: See the judgment of Lindley MR in Hubbuck & Sons v Wilkinsons Heywood & Clark Ltd.(1) Where the situation arises, the pleadings and particulars alone shall be considered and all the allegations in it shall be presumed to be true, and it is only on that assumption that any statable case can be made for this application: see Peck v Russell.(2) The court cannot and indeed is not empowered to look behind the pleadings and particulars if it discloses a reasonable cause of action. So long as the statement of claim discloses some ground of action, the mere fact that the plaintiff is not likely to succeed on it at trial is no ground for it to be struck out: see Boaler v Holder.(3) A recent exposition of the law is afforded by the judgment of Danckwerts LJ in Wenlock v Moloney.(4): “Under the rule (ie. O. 25 r. 4) it had to appear on the face of the plaintiff’s pleadings that the action could not succeed or was objectionable for some other reason. Not evidence could be filed… But, as the procedure was of a summary 32 nature the party was not to be deprived of his right to have his case tried by a proper trial unless the matter was clear.’’ After stating that the former rules are now incorporated in the revised Rules of the Supreme Court, O. 18 r. 19, he continues: “But this summary jurisdiction of the court was never intended to be exercised by a minute and protracted examination of the documents and facts of the case in order to see whether the plaintiff really has a cause of action. To do that is to usurp the position of the trial judge.” …” UNDANG-UNDANG BERHUBUNG PENYATUAN TINDAKAN MENURUT ATURAN KAEDAH 4 KKM 2012 [27] Aturan 4 kaedah 1 KKM 2012 memperuntukkan berikut: Penyatuan kausa atau perkara (A. 4, k. 1) 1. (1) Jika dua atau lebih kausa atau perkara belum selesai, dan sekiranya ternyata kepada Mahkamah bahawa – (a) beberapa persoalan undang-undang atau fakta yang sama berbangkit dalam kedua-dua atau kesemua kausa atau perkara itu; 33 (b) hak untuk mendapatkan relief yang dituntut di dalamnya adalah berkenaan dengan atau berbangkit daripada transaksi atau siri transaksi yang sama; atau (c) Kerana sesuatu sebab yang lain adalah wajar dibuat suatu perintah di bawah kaedah ini. [28] Adalah menjadi undang-undang yang mantap dan jitu bahawa bagi menjimatkan masa dan kos, Mahkamah mempunyai bidang kuasa yang tidak terhad untuk memerintahkan supaya kausa atau perkara disatukan di dalam keadaan-keadaan berikut: (Sila lihat: i. Central Securities (Holdings) Bhd v Haron bin Mohamed Zaid [1978] 1 LNS 20; ii. Applied Creative Technology Sdn Bhd V. Mohamad Hashim Ali & Ors [2012] MLRHU iii. Del E Webb International Hotel Co V. Hotel Merlin Penang Sdn Bhd [1972] 1 MLRH 397) BANTAHAN PLAINTIF 34 [29] Permohonan Defendan Pertama ini telah dibantah dengan sekeras- kerasnya oleh Plaintif di atas alasan-alasan berikut: i. Permohonan Defendan Pertama untuk penyatuan tindakan dan pembatalan kes adalah satu taktik untuk melengah- lengahkan prosiding Saman Pemula Plaintif. ii. Defendan Pertama telah memohon untuk membatalkan Saman Pemula Plaintif semata-mata bersandarkan kepada alasan bahawa ia telah memfailkan tindakan writ terhadap Plaintif di dalam tindakan writ BA-22NCVC-27-01/2017 (Guaman Writ 27) dan alasan pemfailan Guaman Writ 27 ini bukanlah satu alasan yang membolehkan Saman Pemula Plaintif untuk membatalkan/mengenepikan kaveat-kaveat amanah yang dimasukkan oleh Defendan Pertama dibatalkan/ditolak menurut Aturan 18 kaedah 19 KKM 2012. ANALISIS DAN DAPATAN MAHKAMAH BAGI KANDUNGAN 11 [30] Berbalik semula kepada alasan-alasan yang dibangkitkan oleh Defendan Pertama bagi menyokong permohonannya untuk 35 membatalkan Saman Pemula Plaintif, benarkah seperti hujahan peguam bijaksana Defendan Pertama bahawa alasan-alasan yang telah dibangkitkan oleh Defendan Pertama tersebut menjadikan kes atau tindakan Plaintif di dalam Kandungan 1(26) ini satu kes yang sesuai dan patut bagi Mahkamah ini menggunakan kuasa budibicara di bawah A.18 k.19 untuk membatalkan kes Plaintif. [31] Berhubung dengan pemfailan Guaman Writ 27 oleh Defendan Pertama ini, Mahkamah ini perlu menekankan bahawa Defendan Pertama telah hanya memfailkan tindakan writ mereka terhadap Plaintif pada 18.1.2017. [32] Perjanjian-perjanjian tersebut telah ditandatangani oleh kedua-dua Plaintif dan Defendan pada 15.3.2010. Namun, setelah tempoh lebih daripada 6 tahun (15.3.2010 sehinggga 18.1.2017) berlalu selepas perjanjian-perjanjian jual beli tersebut dimasuki dan ditandatangani, Defendan Pertama baru kini mengambil posisi bahawa perjanjian- perjanjian tersebut mempunyai kesan kuatkuasa terhadap Defendan Pertama dan berhasrat menguatkuasakannya, yang mana Defendan Pertama telah memfailkan Guaman Writ 27. 36 [33] Mahkamah ini perlu juga menekankan di sini bahawa semasa pemfailan writ tersebut, kaveat-kaveat amanah tersebut masih belum wujud dan Defendan Pertama tidak pernah langsung mendakwa atau membangkitkan bahawa terdapatnya satu perlanggaran amanah di pihak Plaintif terhadap Defendan Pertama. [34] Apatah lagi di dalam kes ini, Plaintif telah memfailkan Kandungan 1 (Kandungan 26) ini pada 1.3.2017, dan di pihak Defendan Pertama walaupun Guaman Writ 27 difailkan pada 18.1.2017 lagi, Defendan Pertama telah hanya memilih untuk menyerahkan writ tersebut kepada Plaintif pada 1.3.2017 iaitu pada tarikh yang sama Saman Pemula Plaintif difailkan untuk memotong kaveat-kaveat amanah Defendan Pertama. [35] Untuk menentukan samada permohonan Plaintif ini telah dibuat di atas alasan-alasan bermerit ataupun sengaja bertujuan untuk melengah-lengah prosiding, Mahkamah ini akan merujuk kepada rentetan/kronologi peristiwa yang berlaku di hadapan Mahkamah ini. 37 35.1 Kandungan 1 telah difailkan oleh Plaintif pada 1.3.2017. Apabila kes dipanggil untuk pengurusan kes di hadapan Timbalan Pendaftar (TP) pada 7.3.2017, TP telah mengarahkan Defendan Pertama menjawab afidavit sokongan Plaintif pada atau sebelum 28.3.2017. Plaintif pula telah diarahkan untuk membalas afidavit jawapan Defendan Pertama pada atau sebelum 3.4.2017. TP kemudian telah mengarahkan bahawa kesemua afidavit hendaklah dimuktamadkan pada atau sebelum 4.4.2017 dan menetapkan tarikh pengurusan pada tarikh yang sama. Pada tarikh tersebut (4.4.2017), Defendan Pertama tidak langsung memberi indikasi yang mereka berhasrat untuk memfailkan permohonan untuk penyatuan tindakan/pembatalan tindakan. 35.2 Namun, tarikh pengurusan kes pada 4.4.2017 telah ditangguhkan ke 15.5.2017 kerana TP bercuti. 35.3 Setelah dua bulan setengah selepas pemfailan Kandungan 1 dan apabila kes dipanggil untuk pengurusan kes di hadapan TP pada 15.5.2017, pada pagi itulah peguam Defendan Pertama 38 telah memaklumkan kepada TP yang mereka akan memfailkan satu permohonan untuk membatalkan Saman Pemula Plaintif. TP telah memberi arahan supaya pihak-pihak memfailkan hujahan-hujahan bertulis mereka serentak pada atau sebelum 22.5.2017 dan hujahan balas pada atau sebelum 30.5.2017. TP juga telah menetapkan bahawa Kandungan 1 ditetapkan untuk perbicaraan di hadapan Hakim pada 14.6.2017. 35.4 Namun, pada 18.5.2017, Defendan Pertama telah memfailkan tiga permohonan iaitu Kandungan 11, 14 dan 16 (permohonan- permohonan tersebut). TP kemudian telah menetapkan Kandungan 11 ditetapkan untuk pengurusan kes pada 22.5.2017. 35.5 Apabila Kandungan 11 dipanggil untuk pengurusan kes pada 22.5.2017, peguam Defendan telah memohon Kandungan 11 didengar dahulu sebelum perlupusan Kandungan 1. 35.6 Mahkamah ini telah mengarahkan supaya ketiga-tiga permohonan Defendan Pertama dan Kandungan 1 Plaintif dibicarakan pada tarikh 14.6.2017. 39 [36] Daripada rentetan peristiwa ini, apa yang boleh dilihat melalui perlakuan Defendan Pertama adalah pertama; Defendan Pertama telah menunggu selama dua bulan setengah baru memfailkan Kandungan 11nya. Kedua, Defendan Pertama telah memilih untuk memfailkan Kandungan 11 di saat-saat akhir sebelum perbicaraan Kandungan 26 (Kand.1) didengar di mana arahan-arahan untuk Kandungan 26 (Kand.1) pemfailan hujahan bertulis bagi Kandungan 1 diberikan oleh TP dan pada tarikh 22.5.2017 peguam Defendan Pertama telah cuba memohon penangguhan perbicaraan Kandungan 26 (Kand.1) dengan alasan ketiga-tiga permohonan tersebut telah difailkan dan memohon permohonan-permohonan tersebut didengar dahulu sebelum Kandungan 26 (Kand.1) dibicarakan. [37] Di dalam hal ini, Mahkamah ini bersetuju dengan hujahan peguam bijaksana Plaintif bahawa perlakuan Defendan Pertama memfailkan permohonan-permohonan Kandungan 11, Kandungan 14 dan Kandungan 16 ini adalah sememangnya merupakan suatu taktik Defendan Pertama untuk melengah-lengah pendengaran Kandungan 26 (Kand.1). Perbuatan sebegini adalah satu perbuatan yang tidak boleh diterima oleh Mahkamah ini kerana ianya jelas adalah satu 40 penyalahgunaan proses dan perlakuan sebegini tidak boleh dibiarkan oleh Mahkamah ini. [38] Berhubung dengan taktik melengah-lengahkan pendengaran Kandungan 26 in, Mahkamah ini merujuk kepada kata-kata Mahkamah Persekutuan di dalam kes Hong Leong Finance Bhd v Low Thiam Hoe and Anor [2016] 1 MLJ 301 (kes yang dirujuk oleh peguam Plaintif) seperti berikut: “[18]… Nowadays the court recognises especially under the new case management regime that a different approach needs to be taken to prevent delay in the progress of a case to trial and for its completion. The progress of the case is no longer left in the hands of the litigants but with the court in the driver’s seat (see the case of Syed Omar bin Syed Mohamed v Perbadanan Nasional Bhd [2013] 1 MLJ 461; [2012] 9 CLJ 557). In particular when an application to amend the pleading is made at a very late stage as was done in the present case, the principles inYamaha Motor ought not to be the sole consideration. This is because an order for compensation by payment of costs in such a case may not be an adequate remedy and it would also disrupt the administration of justice which affects the courts, the parties and the other users of the judicial process (see http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.667806949123812&bct=A&service=citation&risb=21_T26601976731&langcountry=MY&linkInfo=F%23MY%23MLJ%23vol%251%25sel1%252013%25page%25461%25year%252013%25sel2%251%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.667806949123812&bct=A&service=citation&risb=21_T26601976731&langcountry=MY&linkInfo=F%23MY%23MLJ%23vol%251%25sel1%252013%25page%25461%25year%252013%25sel2%251%25 41 the case of Conlay Construction Sdn Bhd v Perembun (M) Sdn Bhd [2014] 1 MLJ 80). [26] It is to be stated here the requirement that a cogent explanation for such a delay must be furnished when making a late application to amend would be clearly in line with pre-trial case management procedures (introduced in year 2000). The management of cases by the courts prior to the trial is intended to ensure ‘just, expeditious and economical disposal’ of an action (see O 34 r 4(1) of the RHC 1980, now O 34 r 1(1) of the RC 2012) and the Practice Direction No 2 of 2014 issued by the Chief Judge of High Court in Malaya). Timely disposal of cases and the limitation of cost are now the primary considerations under the present regime. [27] In our instant case, there had been five case managements since 2011 and there was no indication at all that an amendment application was contemplated by the defendant. The only explanation given by the defendant in his affidavit for the delay was that he had only discovered that these new issues were not pleaded when preparing for trial. Such an explanation in our view surely cannot be acceptable. TACTICAL MANOEUVRE http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.6819864939643079&bct=A&service=citation&risb=21_T26601976731&langcountry=MY&linkInfo=F%23MY%23MLJ%23vol%251%25sel1%252014%25page%2580%25year%252014%25sel2%251%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.9938134883461169&bct=A&service=citation&risb=21_T26601976731&langcountry=MY&linkInfo=F%23MY%23USM_SL%23order%2534%25year%251980%25local-rule%25PUA0152%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.7582375473175127&bct=A&service=citation&risb=21_T26601976731&langcountry=MY&linkInfo=F%23MY%23USM_SL%23year%251980%25local-rule%25PUA0152%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.7582375473175127&bct=A&service=citation&risb=21_T26601976731&langcountry=MY&linkInfo=F%23MY%23USM_SL%23year%251980%25local-rule%25PUA0152%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.18540998834857847&bct=A&service=citation&risb=21_T26601976731&langcountry=MY&linkInfo=F%23MY%23USM_SL%23order%2534%25year%252012%25local-rule%25PUA0205%25 http://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.1635861217014577&bct=A&service=citation&risb=21_T26601976731&langcountry=MY&linkInfo=F%23MY%23USM_SL%23year%252012%25local-rule%25PUA0205%25 42 [28] Another factor which our courts have taken into consideration is whether the amendment application was made as a tactical manoeuvre. In the Court of Appeal case of Everise Hectares Sdn Bhd v Citibank Berhad the amendment application was disallowed as the application was a tactical manoeuvre to delay and prevent the respondent bank from completing the sale of land.” [39] Atas alasan perlakuan tactical manoeuvre Defendan Pertama yang sengaja melengah-lengah prosiding ini sahaja telah memberi kewajaran ke atas Mahkamah ini untuk menolak Kandungan 11 Defendan Pertama dengan kos. [40] Namun, untuk tujuan kesempurnaan, Mahkamah ini seterusnya akan menyentuh satu lagi alasan yang disandarkan oleh Defendan Pertama di dalam percubaannya untuk membatalkan tindakan saman pemula Plaintif iaitu pemfailan Guaman Writ 27 oleh Defendan Pertama terhadap Plaintif. [41] Peguam bijaksana Defendan Pertama telah menghujahkan bahawa di dalam kes ini Plaintif telahpun mempunyai pengetahuan mengenai guaman writ 27 dan pindaannya. Peguam Defendan Pertama telah 43 menghujahkan bahawa di dalam keadaan ini Plaintif tidak sepatutnya memfailkan Kandungan 26 (Kand.1)nya ini tetapi sewajarnya membela tindakan terhadapnya di dalam Guaman Writ 27 dan memfailkan tuntutan balas bagi melepaskan kaveat-kaveat amanah tersebut di dalam Guaman Writ 27 tersebut. [42] Peguam Defendan Pertama seterusnya menghujahkan bahawa pemfailan Kandungan 26 (Kand.1) oleh Plaintif ini adalah terjumlah kepada penyalahgunaan proses Mahkamah, membangkitkan pra sangka (prejudicial) dan merupakan penduaan tindakan. [43] Peguam Plaintif yang bijaksana telah berhujah di sebaliknya. Adalah menjadi hujahan peguam bijaksana Plaintif bahawa Defendan Pertama lah yang telah menyalahgunakan proses mahkamah berdasarkan kronologi berikut: 43.1 Perjanjian-perjanjian tersebut telah ditandatangani pada 15.3.2010. Pada tahun 2012 dan 2015 Defendan Pertama telah memasukkan kaveat-kaveat persendirian terhadap hartanah-hartanah tersebut. 44 43.2 Di dalam kemasukan kaveat-kaveat persendirian tersebut, Defendan Pertama telah mendakwa bahawa ia merupakan pemilik benefisial hartanah-hartanah tersebut. 43.3 Untuk membatalkan kaveat-kaveat persendirian yang dimasukkkan oleh Defendan Pertama, Plaintif pada 6.12.2016, telah memfailkan SP 1299 . 43.4 SP 1299 telah ditetapkan pendengaran oleh Mahkamah ini pada 20.1.2017. Pada 18.1.2017, Defendan Pertama telah memfailkan dua permohonan iaitu permohonan untuk menukarkan prosiding Saman Pemula kepada Writ dan permohonan untuk Pemeriksaan Balas Deponen dalam Affidavit Plaintif. 43.5 Kedua-dua permohonan tersebut telah difailkan oleh Defendan Pertama pada 18.1.2017, sedangkan Defendan Pertama telah mengetahui bahawa SP 1299 tersebut telahpun ditetapkan untuk pendengaran pada 20.1.2017. 43.6 Apabila SP 1299 dipanggil untuk perbicaraan di hadapan Mahkamah ini pada 20.1.2017, peguam Defendan Pertama telah memohon penangguhan perbicaraan SP1299 atas alasan bahawa dua permohonan lain telah difailkan oleh Defendan Pertama dan 45 memohon permohonan-permohonan yang difailkan pada 18.1.2017 tersebut didengar dahulu. 43.7 Setelah mendengar hujahan-hujahan pihak-pihak, Mahkamah ini telah menolak permohonan Defendan Pertama untuk penangguhan dan meneruskan pendengaran SP 1299 dan seterusnya menetapkan SP 1299 untuk keputusan pada 14.2.2017. 43.8 Pada 25.1.2017, Defendan Pertama telah memfailkan rayuan ke Mahkamah Rayuan untuk merayu terhadap keputusan Mahkamah ini yang tidak membenarkan penangguhan yang dipohonnya. 43.9 Defendan Pertama kemudiannya telah memfailkan satu permohonan untuk penggantungan prosiding SP 1299 di Mahkamah Rayuan sementara pelupusan rayuan untuk penangguhan prosiding dan pelupusan permohonan-permohonan bertarikh 18.1.2017. 43.10 Pada 6.2.2017, permohonan-permohonan bertarikh 18.1.2017 telah dipanggil untuk pengurusan kes di hadapan Penolong Kanan Pendaftar (PKP). PKP telah membatalkan permohonan-permohonan bertarikh 18.1.2017 di atas alasan bahawa permohonan-permohonan tersebut telah menjadi akademik berdasarkan fakta bahawa SP 1299 46 telah selesai didengar oleh Mahkamah ini pada 20.1.2017 dan keputusannya telahpun ditetapkan pada 14.2.2017. 43.11 Pada 14.2.2017, permohonan penggantungan prosiding di Mahkamah Rayuan telah dipanggil untuk perbicaraan. Mahkamah Rayuan telah menolak permohonan penggantungan prosiding tersebut. 43.12 Pada hari yang sama juga, Mahkamah ini telah membenarkan permohonan Plaintif di SP 1299. 43.13 Di dalam alasan penghakimannya, Mahkamah ini telahpun memutuskan bahawa di dalam kes ini tidak wujud amanah ketika itu. Apatah lagi, Defendan Pertama sendiri di dalam surat-suratnya bertarikh 13.7.2016 telah mengatakan bahawa Defendan Pertama tidak mempunyai sebarang bantahan terhadap pemindahan hartanah-hartanah tersebut oleh Plaintif kepada Paragon Pinnacle Sdn Bhd. 43.14 Pada 15.2.2017, Defendan Pertama telah memfailkan rayuan terhadap keputusan Mahkamah Tinggi bertarikh 14.2.2017. 43.15 Pada 20.2.2017, Defendan Pertama telah memfailkan permohonan menggantung penguatkuasaan perintah Mahkamah ini bertarikh 14.2.2017. 47 [44] Mahkamah ini bersetuju dengan hujahan peguam bijaksana Plaintif bahawa rententan pemfailan permohonan demi permohonan oleh Defendan Pertama, sebenarnya Defendan Pertamalah yang telah menyalahgunakan proses mahkamah di dalam perlakuan- perlakuannya yang telah digariskan di perenggan 43 di atas. [45] Malahan di dalam keadaan ini Mahkamah ini berpandangan bahawa perlakuan Defendan Pertama yang memfailkan permohonan demi permohonan ini pada sangat-sangat akhir sebelum perkara substantif didengar adalah satu perbuatan yang bukan sahaja satu penyalahgunaan proses Mahkamah tetapi juga adalah satu tindakan/perlakuan remeh-temeh dan menyusahkan. [46] Berhubung dengan hujahan peguam bijaksana Defendan Pertama bahawa persoalan undang-undang dan perkara fakta di dalam Kandungan 26 (Kand.1) dan Guaman Writ 27 adalah sama, adalah menjadi dapatan Mahkamah ini bahawa hujahan peguam Defendan ini tidak bermerit dan tidak berasas langsung. 48 [47] Adalah sangat jelas dan nyata bahawa bahawa Kandungan 26 (Kand. 1) Plaintiff adalah tindakan yang sangat berbeza daripada Guaman Writ 27 yang difailkan Defendan Pertama terhadap Plaintif. Guaman Writ 27 adalah tindakan Defendan terhadap Plaintif untuk menuntut antara lain relif-relif berikut: a) Suatu deklarasi bahawa Plaintif adalah pembeli Lima tanah tersebut dari Defendan di bawah Perjanjian tersebut; b) Suatu deklarasi bahawa Plaintif telah membayar keseluruhan harga pembelian Lima Tanah tersebut di bawah perjanjian penyelesaian tersebut; c) Suatu deklarasi bahawa walaupun Defendan adalah pemilik berdaftar Lima Tanah tersebut, pemilik benefisial mutlak Lima tanah tersebut adalah Plaintif; d) Satu deklarasi bahawa Defendan adalah sekadar pemegang amanah Lima tanah tersebut bagi Plaintif; e) Suatu deklarasi bahawa sebarang urusniaga termasuk penjualan Lima Tanah tersebut atau mana-mana 49 bahagiannya kepada pihak ketiga termasuk PPSB adalah tanpa persetujuan bertulis dari Plaintif dan adalah tidak sah. [48] Manakala tindakan saman pemula Plaintif adalah semata-mata satu permohonan untuk membatalkan kaveat-kaveat amanah yang telah dimasukkan oleh Defendan Pertama di mana isu yang harus diputuskan oleh Mahkamah ini hanyalah samada Defendan Pertama mempunyai kepentingan berkaveat ke atas hartanah-hartanah tersebut untuk membolehkan kaveat-kaveat tersebut terus kekal di atas hartanah-hartanah tersebut. [49] Adalah menjadi dapatan Mahkamah ini bahawa kes ini bukanlah suatu kes yang terang dan jelas untuk dibatalkan menurut Aturan 18 kaedah 19 (b), (c) dan (d) hanya semata-mata kerana Defendan Pertama telah memfailkan Guaman Writ 27. [50] Hujahan peguam bijaksana Defendan Pertama bahawa terdapatnya pertikaian fakta-fakta yang substantial di dalam tindakan ini dan justeru menjadikan tindakan Plaintif melalui Saman Pemula ini adalah 50 satu mod yang tidak sesuai dan tindakan ini sepatutnya hendaklah dibatalkan adalah tidak dipertahankan kerana jelas bahawa bersandarkan di mana asas kemasukan kaveat-kaveat amanah oleh Defendan Pertama adalah perjanjian-perjanjian tersebut yang mana Mahkamah di awal penghakiman telahpun menyatakan fakta-fakta yang merangkumi perjanjian-perjanjian tersebut (sila lihat perenggan). [51] Adalah menjadi dapatan Mahkamah ini tidak wujud pertikaian substantial di dalam kes ini yang boleh menjadikan mod Saman Pemula yang diambil oleh Plaintif untuk membatalkan dan/atau mengenepikan kaveat-kaveat amanah yang dimasukkan Defendan Pertama ke atas hartanah-hartanah tersebut adalah satu mod yang salah. [52] Berdasarkan alasan-alasan di atas, Oleh itu, Kandungan 11 Defendan Pertama ditolak dengan kos sebanyak RM10,000.00 kepada Plaintif. E. KANDUNGAN 14 51 [53] Di dalam Kandungan 14 ini Defendan Pertama telah memohon kepada Mahkamah ini supaya diberi kebebasan untuk memeriksa balas Dato’ Koh Foong Soon atas afidavit-afidavit yang diikrarkan oleh beliau pada 1.3.2017 dan 31.3.2017 menurut Aturan 38 kaedah 2(2) KKM 2012. [54] Di dalam afidavit sokongan yang diikrarkan oleh Goh Cheng Keong (Goh) yang menyokong Kandungan 14 Defendan Pertama, Goh telah menyatakan bahawa di dalam kes ini terdapat fakta-fakta dan/atau keterangan yang bercanggah dan telah membangkitkan isu-isu berikut: i. Sama ada Pelan Penyusunan Semula (Restructuring Plan”), pemindahhakkan Hutang yang diserahhakkan, SPA-SPA 2010 dan Perjanjian Persetujuan adalah untuk pengurusan dalaman semata- mata dan tidak mengikat (binding) seperti yang dikatakan oleh Plaintif? ii. Sama ada posisi Plaintif sebagai pemegang amanah sahaja (“bare trustee”) menolak kepentingan beneficial mutlak atas 5 Tanah- Tanah? 52 iii. Sama ada dalam pemfailan OS ini, Plaintif telah bertindak melanggar obligasi kontrak iaitu di bawah, antara lain, klausa-klausa 4 dan 5.4 SPA-SPA 2010 dan seksyen-seksyen 5.5 dan 11.2 of Perjanjian Penyelesaian? iv. Sama ada Plaintif memegang 5 Tanah-Tanah sebagai pemegang amanah sahaja bagi Defendan Pertama? v. Sama ada Plaintif sebagai pemegang amanah sahaja dan setelah melepaskan semua kepentingannya atas 5 Tanah-Tanah boleh mengekalkan (“maintain”) kepentingannya, jika ada, atas 5 Tanah- Tanah terhadap Defendan Pertama? vi. Sama ada Defendan sebagai pemilik benefisial mutlak 5 Tanah-Tanah memiliki hak in rem atas 5 Tanah-Tanah? [55] Adalah menjadi hujahan peguam bijaksana Defendan Pertama bahawa berdasarkan percanggahan yang digariskan tersebut, wujud fakta-fakta yang dipertikaikan di mana kesahihan fakta-fakta itu dicabar atas alasan bahawa terdapat beberapa perkara fakta yang telah dinyatakan oleh Dato’ Koh di dalam afidavit-afidavitnya berlaku 53 sebelum Dato’ Koh dilantik sebagai Pengarah Plaintif pada 25.2.2013. [56] Maka, menurut peguam bijaksana Defendan Pertama lagi, Dato’ Koh perlulah disoal balas akan kebenaran dan pengetahuan peribadinya mengenai perkara-perkara yang berlaku sebelum Februari 2013 kerana perkara-perkara yang berlaku sebelum Februari 2013 adalah relevan kepada isu-isu di mana Mahkamah perlu membuat keputusannya. UNDANG-UNDANG BERHUBUNG ATURAN KAEDAH 38 KAEDAH 2(2) KKM 2012 (A.38 k. 2(2) KKM 2012). [57] Prinsip undang-undang berhubung permohonan untuk menyoalbalas deponen menurut A38 k. 2(2) KKM 2012 adalah jitu dan mantap. Adalah satu undang-undang yang jelas bahawa di dalam apa-apa kausa atau perkara yang dimulakan melalui Saman Pemula dan atas apa-apa permohonan yang dibuat melalui Notis Permohonan, keterangan hendaklah diberikan melalui afidavit melainkan jika dalam kes apa-apa kausa, perkara atau permohonan apa-apa peruntukan Kaedah-Kaedah ini yang diperuntukkan selainnya atau diarahkan 54 selainnya oleh Mahkamah, tetapi Mahkamah boleh, atas permohonan mana-mana pihak, memerintahkan supaya orang yang membuat mana-mana afidavit sedemikian untuk hadir bagi pemeriksaan balas. [58] A.38 k.2 (2) KKM 2012 memperuntukan berikut: (2) Dalam apa-apa kausa atau perkara yang dimulakan melalui saman pemula dan atas apa-apa permohonan yang dibuat melalui notis permohonan, keterangan hendaklah diberikan melalui afidavit melainkan jika dalam kes apa-apa kausa, perkara atau permohonan apa-apa peruntukan Kaedah-Kaedah ini yang diperuntukkan selainnya atau diarahkan selainnya oleh Mahkamah, tetapi Mahkamah boleh, atas permohonan mana-mana pihak, memerintahkan supaya orang yang membuat mana-mana afidavit sedemikian untuk hadir bagi pemeriksaan balas, dan jika, selepas perintah sedemikian dibuat, orang dalam persoalan itu tidak hadir, afidavitnya tidak boleh digunakan sebagai keterangan tanpa kebenaran Mahkamah. [59] Kuasa budi bicara yang telah diperuntukkan di bawah A. 38 k.2(2) KKM 2012 adalah satu kuasa budi bicara yang luas dan tidak terhad, namun undang-undang telah menetapkan bahawa kuasa budi bicara tersebut hendaklah dilaksanakan secara kehakiman dengan 55 berpandukan prinsip undang-undang dan otoriti-otorit kes yang telah mengariskan pemakaiannya oleh Mahkamah. Justeru itu, molek kiranya Mahkamah ini merujuk kepada beberapa kes sebagai panduan. [60] Di dalam kes Tetuan Kumar Jaspal Quah & Aishah (suing as a firm) v The Co-Operative Central Bank Ltd [2007] 4 MLJ 638, telah diputuskan di perenggan [25] alasan penghakiman di dalam kes ini bahawa terdapat tiga pertimbangan utama yang perlu diberikan Mahkamah yang akan mempengaruhinya di dalam menggunakan kuasa budi bicaranya untuk membenar atau tidak membenarkan permohonan untuk menyoal balas deponen atas afidavitnya. Tiga pertimbangan utama tersebut adalah: i) the truth of the averment in the affidavit must be challenged or the issues of fact identified. ii) cross-examination would only be allowed if the disputed fact is relevant to the issue to be decided and must be limited to that issue only; and 56 iii) cross-examination would not advance the cause of justice and should be refused if there is sufficient affidavit evidence or contemporaneous documents to enable the court to property decide without the need of cross- examination. [61] Di dalam kes Regional Centre for Arbitration v Ooi Beng Choo & Anor [1998] 2 MLJ 383, telah diputuskan di muka surat 391 bahawa:- “It is settled law that the court retains an absolute discretion whether or not to allow to cross-examine a deponent on his affidavit. Generally, cross-examination will not be allowed unless there is a question of fact to be tried which requires viva voce testimony tested by cross-examination (see Arab- Malaysian Merchant Bank Bhd v City Properties Sdn Bhd [1992] 4 CLJ 2123), or where there are ‘special circumstances’” Re Smith & Fawcett Ltd [1942] 1 All ER 542; [1942] Ch 304. In the sphere of judicial review proceedings, it is matter for the 57 discretion of the court; it should not be allowed except where the court believes that it is necessary in order that justice may be done between the parties (per Lord Denning MR in George v Secretary of State for Environment & Anor (1979) 38 P & CR 609…” [62] Di dalam kes Leisure & Allied Industries Pty Ltd v Udaria Sdn Bhd [1980] 1 MLJ 189, Salleh Abas HMP, di dalam mempertimbangkan samada untuk menggunakan kuasa budi bicaranya berhubung permohonan responden di hadapannya untuk menyoal balas deponen, telah menyatakan di muka surat 190 seperti berikut: “It is necessary for me to see how the proposed cross- examination would be relevant to the issue in the appellant’s application. An examination of this issue is therefore essential…” [63] Di dalam kes Emporium Jaya (Bentong) Sdn Bhd v Emporium Jaya (Jerantut) Sdn Bhd (No. 2) [2002] 5 MLJ 675, Ramly Ali H, 58 (YA pada ketika itu) di muka surat 685 C-D telah menyatakan berikut:- “In order to enable me to exercise my judicial discretion as regards the present application made by the applicants in the present case, it is necessary for me to see how the proposed cross-examination would be relevant to the issue in the petition. An examination of this issue is therefore essential in order to enable me to determine whether the applications are made ‘without just cause, or motivated by desire to delay proceedings or without bona fide or sham or vexatious.” [64] Di dalam kes Indrani a/p Rajaratnam & Ors v Fairview Schools Bhd [2001] 4 MLJ 56, Mahkamah Rayuan telah memutuskan antara lain: (1) (Per Siti Norma Yaakob, NH Chan JJCA and KC Vohrah J concurring) As to whether the dismissal of the appellants' oral application fell within the ambit of ss 67(1) and 68 of the Courts of Judicature Act 1964 so as to be a judgment or order which was appealable, the instant case was 59 concerned with a substantive application under O 38 r 2(3) of the Rules of the High Court 1980 ('the RHC'). The lack of formal application here which the parties were prepared to do away with due to a constraint of time did not change the character of the application. As such, when the judge decided that the petition could proceed without the necessity of cross-examining any deponent, he had made an order on a substantive application for which a dissatisfied party could appeal (see pp 60H, 61D-E); Re Products Ltd [1985] 1 NZLR 710 distinguished. (2) (Per Siti Norma Yaakob JCA, KC Vohrah J concurring) The grant or refusal of an application under O 38 r 2(3) of the RHC was very much an exercise of a judge's power of discretion and the question which had to be determined was whether the judge had exercised his discretion judicially. He had taken into consideration that the appellants had never identified the issues for which they maintained cross-examination had become necessary, nor had they shown that the factual disputes which they 60 alleged were raised by the respondents' affidavits were relevant to their petition to warrant cross-examination. The judge had also taken into consideration the appellants' delay in making the application to cross-examine. Under these circumstances, the trial judge had not erred in law or in principle when he exercised his discretion, as he had put his mind to relevant considerations in deciding as he did (see pp 61F-I, 62A, C). (3) (Per KC Vohrah J, Siti Norma Yaakob JCA concurring) It was important to take into account all factors when considering an application for cross-examination and if it has little relevance or little weight to the issue which the judge has to decide, then cross-examination should not be permitted (see p 64B); Comet Products v Hawkex Plastics [1971] 1 All ER 1145 (folld) and Leisure & Allied Industries Pty Ltd v Udaria Sdn Bhd [1980] 1 MLJ 189 (folld) followed. The judge below had certainly considered the issue of relevancy. He was mindful that although the petition was grounded under s 218 of the Act, yet counsel for the https://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.11161023178603158&bct=A&service=citation&risb=21_T25109011358&langcountry=MY&linkInfo=F%23GB%23ALLER%23vol%251%25sel1%251971%25page%251145%25year%251971%25sel2%251%25 https://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.11161023178603158&bct=A&service=citation&risb=21_T25109011358&langcountry=MY&linkInfo=F%23GB%23ALLER%23vol%251%25sel1%251971%25page%251145%25year%251971%25sel2%251%25 https://www.lexisnexis.com/my/legal/search/runRemoteLink.do?A=0.637232566522607&bct=A&service=citation&risb=21_T25109011358&langcountry=MY&linkInfo=F%23MY%23MLJ%23vol%251%25sel1%251980%25page%25189%25year%251980%25sel2%251%25 61 petitioners had argued that cross-examination was necessary because the basis of the petition was not only mismanagement of the affairs of the company, which fell under s 218 of the Act, but also oppression of minority rights, which fell under a different provision, s 181 of the Act. Quite clearly, the bringing in of the ground of oppression of minority rights under s 181 of the Act was completely irrelevant (see pp 64H-65A). [65] Di dalam kes Wako Merchant Bank (Singapore) Ltd v Lim Lean Heng [2003] 5 MLJ 56), Abdul Aziz H (YA pada ketika itu) memutuskan antara lain bahawa: “It is, therefore, not true in every case that the court is equipped to deal with conflicts in affidavit evidence without resort to cross-examination. Where it is necessary to come to a determination of the matter that is the subject of a conflict of affidavit evidence and it is not possible to reject the evidence of one side for any of the stated reasons, the court is not equipped to deal with the conflict without resort to cross-examination.” 62 BANTAHAN PLAINTIF [66] Plaintif telah membantah Kandungan 14 ini dengan membangkitkan hujahan-hujahan berikut: a. di dalam kes ini tidak ada pertikaian fakta, maka persoalan samada Defendan Pertama mempunyai suatu kepentingan untuk berkaveat boleh diputuskan oleh Mahkamah ini melalui keterangan afidavit. b. Pihak-pihak telahpun memfailkan kesemua dokumen yang merupakan keterangan-keterangan yang material melalui afidavit- afidavit masing-masing dan melalui dokumen-dokumen/ keterangan- keterangan ini Mahkamah ini boleh memutuskan persoalan samada Defendan Pertama mempunyai suatu kepentingan untuk berkaveat atau tidak ke atas hartanah-hartanah tersbut. c. Justeru, tiada sebarang keperluan atau keadaan istimewa yang mewajarkan pemeriksaan balas ke atas Dato’ Kong walaupun Dato‘ Kong telah dilantik sebagai Pengarah Plaintif pada 23.2.2013, Dato’ Kong pada hakikatnya mempunyai pengetahuan mengenai perkara- perkara yang merangkumi perjanjian-perjanjian tersebut berdasarkan kepada dokumen-dokumen dalam milikannya dan Plaintif. 63 ANALISIS DAN DAPATAN MAHKAMAH [67] Di dalam kes ini, Mahkamah ini sangat berpandukan kepada prinsip- prinsip undang-undang dan otoriti-otoriti yang telah digariskan berhubung dengan penggunaan kuasa budi bicara yang telah diperuntukkan di bawah A.38 k.2(2) KKM 2012. [68] Di dalam kes ini, adalah jelas dan nyata bahawa di dalam menentukan samada permohonan Plaintif di Kandungan 26 (Kand.1) wajar dibenarkan atau tidak, Mahkamah ini hanya perlu mempertimbangkan dan memutuskan samada Defendan Pertama mempunyai kepentingan berkaveat ke atas hartanah-hartanah tersebut. Defendan Pertama telah mempertahankan kaveat-kaveat amanah yang dimasukkan dengan membangkitkan pengamanahan yang wujud daripada klausa-klausa perjanjian-perjanjian tersebut. [69] Di dalam perkara ini, adalah menjadi dapatan Mahkamah bahawa afidavit-afidavit yang bersamanya dieksibitkan keterangan- keterangan dokumentar yang difailkan oleh pihak-pihak di hadapan Mahkamah ini adalah keterangan-keterangan yang relevan, memadai dan mencukupi yang membolehkan Mahkamah ini menentukan dan 64 memutuskan samada Defendan Pertama mempunyai kepentingan berkaveat ke atas hartanah-hartanah tersebut untuk membolehkan kaveat-kaveat amanah tersebut terus kekal di atas hartanah-hartanah tersebut ataupun dibatalkan/diketepikan. [70] Di dalam kes ini alasan-alasan yang ditimbulkan oleh Defendan Pertama untuk menyoal balas Dato’ Kong di atas afidavit-afidavitnya adalah alasan-alasan yang tidak berasas serta tidak mempunyai merit. [71] Berdasarkan alasan-alasan di atas kandungan 14 Defendan Pertama ditolak dengan kos sebanyak RM 8,000.00. F. KANDUNGAN 16 [72] Kandungan 16 pula adalah permohonan Defendan Pertama untuk satu perintah bahawa Saman Pemula Plaintif ini ditukarkan kepada suatu tindakan writ dan diteruskan seolah-olah ianya dimulakan melalui writ menurut Aturan 28 Kaedah 8 KKM 2012. 65 [73] Defendan Pertama telah menggunakan alasan-alasan sama sepertimana permohonannya bagi Kandungan 14. UNDANG-UNDANG BERHUBUNG ATURAN KAEDAH 28 KAEDAH 8 KKM 2012 (A.28 k.8 (1) KKM 2012). [74] A.28 k. 8(1) KKM 2012 memperuntukkan berikut: Penerusan prosiding seolah-olah kausa atau perkara dimulakan melalui writ (A. 28, k. 8) 8. (1) Jika dalam hal suatu kausa atau perkara yang dimulakan melalui saman pemula, ternyata kepada Mahkamah pada mana- mana peringkat prosiding bahawa prosiding itu patut kerana apa-apa sebab diteruskan seolah-olah kausa atau perkara itu telah dimulakan melalui writ, ia boleh memerintahkan untuk prosiding itu diteruskan seolah-olah kausa atau perkara itu telah dimulakan sedemikian dan boleh, khususnya, memerintahkan bahawa pliding hendaklah diserahkan atau bahawa mana-mana afidavit hendaklah dijadikan sebagai pliding, dengan atau tanpa kebebasan kepada mana-mana pihak untuk menambah kepadanya atau untuk memohon bagi mendapatkan butir-butir mengenainya. 66 [75] Di dalam menyokong permohonannya untuk satu perintah untuk menukar Saman Pemula Plaintif kepada satu tindakan writ menurut A.28 k. 8(1) KKM 2012, peguam bijaksana Plaintif telah merujuk kepada Mahkamah kepdaa kes-kes berikut: i. Eng Mee Yong v. Letchumanan [1979] 2 MLJ Privy Council di dalam kes Eng Mee Yong telah memutuskan di muka surat 216B seperti berikut: “Their Lordships must therefore turn to the evidence that was before the High Court on the hearing of the application, bearing in mind that if there appears to be any conflict of evidence which is not on the face of it implausible, such a conflict ought not to be disposed of on affidavit evidence only. It leaves a serious question to be tried. Di muka surat 217G kes Eng Mee Yong ini, Privy Council telah menyatakan yang berikut: “It is for him to determine in the first instance whether statements contained in affidavits that are relied upon as raising a conflict of evidence upon a relevant fact have 67 sufficient prima facie plausibility to merit further investigation as to their truth.” ii. Ting Ling Kiew v. Tang Eng Iron Works Co Ltd [1992] 2 MLJ 217. Di dalam kes Ting Ling Kiew Mahkamah Agung di muka surat 227E-F dan 228E-F telah memutuskan: “Unquestionably, these conflicts in the evidence can only be properly and satisfactorily be resolved if oral evidence is adduced and witnesses cross-examined on their evidence, which, however, is not possible in proceedings begun by originating summons.” “In any case it is most inappropriate and iniquitos to decide disputed facts summarily by relying simply on affidavit evidence and in this respect we would echo the words of Lord Diplock in American Cyanamid v Etchicon Ltd at p 407: 68 It is no part of the Court’s function at this stage of the litigation to try to resolve conflicts of evidence on affidavits as to facts on which the claims of either party may ultimately depend nor to decide difficult questions of law which call for detailed argument and mature considerations. There are matters to be dealt with at the trial…” iii. Husli Mok v. Jundar Realty Development Sdn Bhd [2014] 2 CLJ 205, Di dalam kes Husli Mok ini, Mahkamah Rayuan telah memutuskan antara lain bahawa: “In our judgment, it is here that the learned High Court Judge, with respect, erred. In the light of the conflicts in the evidence, he should have acceded to thr appellant’s/plaintiff’s oral application and converted the originating summons action to a writ application and proceeded with the matter in the manner as prescribed by O. 28 r. 8 (1) of the Rules of the High Court 1980: to order 69 that the affidavits be deemed to be pleadings, with liberty to any party to apply for particulars; or alternatively, to issue directions to the parties to file their respective pleadings (Statement of claim, statement of defence, etc.)” iv. HSBC Bank Malaysia Bhd v. Wong Thien Boon [2008] 6 CLJ 381 Mahkamah Rayuan di dalam kes HSBC Bank Malaysia Bhd telah memutuskan bahawa: “Given the material that was places before him by way of affidavits a conflict of evidence emerged on several issues including, whether the defendants were either estopped or barred in making their demand due to the operation to equitable doctrine of laches. There also appears to be a serious dispute between the parties as to whether, and if so, when limitation set in. these are matters which require full argument and mature consideration. It is also plain that viva voce evidence is necessary to determine in which direction the balance of equity would turn.” 70 ANALISIS DAN DAPATAN MAHKAMAH [76] Mahkamah ini mengulangi sekali lagi bahawa adalah jelas dan nyata di dalam kes ini bagi menentukan samada permohonan Plaintif di Kandungan 26 (Kand.1) wajar dibenarkan atau tidak, Mahkamah ini hanya perlu mempertimbangkan dan memutuskan samada Defendan Pertama mempunyai kepentingan berkaveat ke atas hartanah- hartanah tersebut. Defendan Pertama telah mempertahankan kaveat- kaveat amanah yang dimasukkan dengan membangkitkan pengamanahan yang wujud daripada klausa-klausa perjanjian- perjanjian tersebut. [77] Naratif fakta-fakta yang merangkumi perjanjian-perjanjian tersebut daripada rentetan peristiwa yang bermula dengan perjanjian- perjanjian tersebut, perjanjian-perjanjian jual beli tersebut, tatacara perjanjian-perjanjian tersebut, perkara-perkara fakta yang merangkumi perjanjian-perjanjian jual beli tersebut dan posisi yang diambil oleh Defendan Pertama ke atas perjanjian-perjanjian jual beli tersebut (klausa 4 dan klausa 5. 4) klausa-klausa di dalam Perjanjian Penyelesaian 2010 (klausa-klausa 3.1, 4.1, 5.5 dan 11.2) tidak 71 langsung menimbulkan pertikaian-pertikaian substantial sepertimana yang dihujahkan oleh peguamcara bijaksana Defendan Pertama. [78] Mahkamah ini bersetuju dengan hujahan peguam bijaksana Plaintif bahawa tidak terdapat pertikaian fakta berbangkit dalam tindakan ini untuk Mahkamah ini menukarkan Saman Pemula Plaintif kepada kepada suatu tindakan writ dan diteruskan seolah-olah ianya dimulakan melalui writ. [79] Di dalam kes ini, kes-kes yang telah dirujuk oleh peguam Defendan Pertama bagi menyokong permohonannya di Kandungan 16 tidak dapat membantu Defendan Pertama langsung. Adalah menjadi dapatan Mahkamah ini bahawa di dalam saman pemula yang telah dimulakan oleh Plaintif perkara-perkara fakta yang merangkumi kes ini berhubung dengan isu samada Defendan Pertama mempunyai kepentingan berkaveat ke atas hartanah-hartanah tersebut. Adalah menjadi dapatan Mahkamah ini juga bahawa fakta-fakta di dalam kes ini tidak mewajarkan suatu perintah menurut A 28 k 8(1) KKM 2012 diberikan bagi memerintahkan prosiding Saman Pemula Plaintif ini diteruskan seolah-olah ia dimulakan dengan writ. 72 [80] Berdasarkan alasan-alasan di atas, Kandungan 16 Defendan Pertama ditolak dengan kos sebanyak RM 10,000.00. G. KANDUNGAN 26 (KANDUNGAN 1) [81] Berhubung dengan kemasukkan kaveat-kaveat amanah oleh Defendan Pertama ke atas hartanah-hartanah tersebut, Mahkamah ini perlu menekankan bahawa alasan-alasan Mahkamah ini yang membenarkan permohonan Plaintif membatalkan kaveat-kaveat persendirian yang dimasukkan di SP 1299 tidaklah boleh diketepikan atau tidak diambil peduli oleh Mahkamah ini bagi membuat keputusan terhadap permohonan Plaintif di dalam Kandungan 26 (Kand.1) dan keputusan berhubung kepentingan berkaveat Defendan Pertama. [82] Di dalam percubaan Defendan Pertama mempertahankan kaveat- kaveat persendirian yang dimasukkannya, di SP 1299 Defendan Pertama telah menegaskan bahawa perjanjian-perjanjian jualbeli tersebut telah membangkitkan kepentingan berkaveat Defendan Pertama ke atas hartanah-hartanah tersebut. 73 [83] Namun, Mahkamah ini di dalam membenarkan permohonan Plaintif untuk membatal/mengenepikan kaveat-kaveat persendirian yang dimasukkan Defendan Pertama tersebut, Mahkamah ini telah memutuskan di perenggan-perenggan [2], [3], [4], [7], [8], [9], [10] dan [11] Alasan penghakiman SP 1299 seperti berikut: “[2] Mujur Zaman Sdn Bhd (“Plaintiff”) and Citra Tani Sdn Bhd (“Defendant”) are both wholly owned subsidiaries of the parent company, Fountain View Development Berhad (“FVDB”). As an internal management measure between the parties, five Sale and Purchase Agreements dated 15.3.2010 (“SPAs”) were signed between the Plaintiff and Defendant regarding the Plaintiff’s Properties. However, although these SPAs do exist, it is utterly clear that these SPAs were entered into without any real intent for the sale and purchase to take effect. It is just a measure for the companies to restructure their assets and liabilities. No purchase price was ever fixed for the SPAs. In fact to date, no purchase price had ever been paid by the Defendant to the Plaintiff as consideration. In fact against the essence of the SPAs itself, the Defendant had written to agree that the Plaintiff is allowed to sell the same properties to another third party. 74 [3] It is pertinent to note that the Properties have with them a Restriction-in-interest which stipulates that any dealings against the properties require the consent of the state authority. The same restriction is incorporated as terms in all of the SPAs. It remains undisputed that this consent was never obtained by any of the parties, particularly the Defendant. Thus, the consequence of the Defendant not having any caveatable interest remains constant, irrespective of the fact that the SPAs were valid agreements or otherwise. The question of the SPAs legitimacy is already moot. Whether or not the SPAs were valid, the SPAs remain to be unenforceable as the State Authority had never consented to the SPAs. State Authority has not consented to the SPAs and has no intention to consent to the SPAs [4] It transpired that the State Authority has already stated that it is not at all interested to consent to the transfer under the SPAs between the parties. The State Authority instead circa 2012, intended to acquire the properties and re-alienate the properties to Pemerbadanan Menteri Besar Selangor (“MBI”) for purposes of development. The Plaintiff had since brought the acquisition to the Courts through multiple suits and applications stretching to the 75 Federal Court level in Federal Court Civil Appeal No. 01(i)-14- 04/2014(W). The Plaintiff also filed for judicial review in Application No. 25-252-11/2012 against the acquisition. In conclusion of the Federal Court appeal as well as the judicial review, it was agreed that the matter would be settled once and for all vide two Consent Judgments dated 17.5.2016 (“Consent Judgment”) recorded in the FC Appeal as well as the judicial review application. The salient terms of the Consent Judgment stipulate that the parties agreed that the Properties shall be sold to Paragon Pinnacle Sdn Bhd (“PPSB”) and that the State Authority shall only consent to the sale of the Properties to PPSB. [7] The Defendant, after abandoning the SPAs, now made a u-turn and contends that it is the beneficial owner of the properties as Purchaser under the SPAs. However, it is easy for this Court to find that the Defendant clearly has no caveatable or any registrable/beneficial interest in the Properties. This is simply because of the following facts. i. Even if the SPAs were valid, the State Authority had never consented and will never give the consent to transfer the Properties to the Defendant. Thus, however the stone is turned, the SPAs remain unforceable and the Defendant shall never be the owner or prospective owner of the Properties. 76 ii. The Defendant has itself admitted to the non-enforceability of the SPAs and the Defendant shall be estopped to contend against its own admission. [8] Firstly, it is trite law that no future rights or rights contingent to a future condition can be good basis of a caveatable interest. The restriction in interest attached to the Properties as well as the terms of SPAs stipulate that consent of the State Authority is required. It remains undisputed that to date, and at all material times, the consent of the State Authority was never obtained or even applied for in view of the SPAs. Thus, at the time when the Defendant lodged the caveats hinging on the SPAs, the Plaintiff was never in any position to transfer good title to the Defendant and the Defendant was never in any position to obtain good title over the Properties. At the time when the Caveats were lodged, the SPAs remain unenforceable. Clearly now, that no rights, be it registrable or beneficial rights, can ever be found in an agreement which in essense is entirely unenforceable. Thus this similarly should not allow such contention of a right as doing so would contradict the very fabric of the land law as well as the law of contract. [9] This finding is not without precedent. This Court finds valuable guidance in the decision of Mahadev Shanker J (as he then was) in 77 the case of Goh Hee Sing v Will Raja & Anor [1993] 3 MLJ 610 which had held the following: “In order to file a caveat, the caveator must have a caveatable interest. What is a caveatable interest has been the subject of many decisions, some of the most recent cases being Tan Heng Poh v Tan Boon Thong &Ors 1, Hew Sook Ying v Hiw Tin Hee 2, and Khoo Cheng Yee (f) in Khoo Teng Seong & Anor 3. To put it in a nutshell, on 29 September 1989, the plaintiff should have been able to claim title to the said land, or a right to such title by virtue of the deed of sale aforesaid. Alternatively, he should be a person who could validly claim a right to such title. The point however is that the claim must be to title or a right thereto in praesenti, and not to some contingent title or right thereto in futuro. This to my mind raises a question of paramount importance to the administration of land law in Malaysia, whenever the title contains a restriction in interest of the present kind. Because the prohibition in dealing with the land is total, nothing can happen without the consent of the pihak kuasa negeri. 78 Consequently, it must follow that a prospective purchaser, chargee, or lessee of such land can have no caveatable interest in such land until the consent of the pihak kuasa negeri has first been irrevocably obtained.” [10] The same principle was echoed by the Federal Court where YAA Arifin Zakaria CJ has decided in the case of Score Options Sdn Bhd v Mexaland Development Sdn Bhd [2012] 6 MLJ 475: It is also our considered view that the caveator under s 323(1)(a) of the NLC must have a present interest as opposed to a potential interest in the land. The registrable interest that the caveator is claiming for, must be an existing interest. The caveator under s 323 (1)(a) of the NLC must be limited to those who are claiming to an existing interest in the land or right to such existing interest and cannot include potential interest or interest in future”… … This principle is also applied by other jurisdictions where the Torrens system is in place, Shannon Lindsay in her book Caveats Against Dealings in Australia and New Zealand, the Federation Press Australia, 1995 at p 67 states that: “A caveator must have an interest in the land at the time that it lodges the caveat – it is insufficient that it has some potentially enforceable right 79 against the registered proprietor which has not yet ripened into an interest in particular land” [11] Similarly so in the present case, the Defendant’s claim for interest in the SPAs, not only has not yet ripened, in fact the Defendant’s claim in the SPAs has no chance at all to ripen as the State Authority has no interest to transfer the land to the Defendant.” [84] Pada kesimpulannya, Mahkamah ini di dalam membuat keputusannya di SP 1299 telah membuat dapatan-dapatan berikut: a. Borang 19B dan akuan berkanun yang menyokong kaveat-kaveat persendirian yang dimasukkan oleh Defendan Pertama ke atas hartanah-hartanah tersebut adalah berasas dan bersandarkan kepada kelima-lima perjanjian jual beli bertarikh 15.3.2010. b. berdasarkan keterangan-keterangan afidavit yang disokong oleh keterangan dokumentar, perjanjian-perjanjian jual beli yang bertarikh 15.3.2010 tersebut adalah perjanjian-perjanjian ‘sham’ yang telah dimasuki dan ditandatangani semata-mata sebagai cara pengurusan dalaman (internal management measure) yang 80 dibentuk oleh syarikat induk Fountain View Development Berhad (FVDB) ke atas kedua-dua pihak iaitu Plaintif dan Defendan Pertama yang merupakan anak-anak syarikatnya dengan tujuan utama mengelakkan pendedahan kepada pemiutang-pemuitang. c. Tidak terdapat bayaran atau balasan yang dibuat oleh Defendan Pertama kepada Plaintif untuk pembelian hartanah-hartanah tersebut. d. Terdapat restriction-in-interest ke atas hartanah-hartanah tersebut. Pemindahmilikan hartanah-hartanah tersebut daripada Plaintif kepada Defendan Pertama adalah tertakluk kepada kelulusan daripada pihak berkuasa negeri. Adalah suatu fakta yang tidak dipertikaikan bahawa Defendan Pertama tidak pernah memohon kelulusan yang diperlukan daripada pihak berkuasa negeri dan di dalam apa jua keadaanpun, tiada kelulusan telah diperolehi dan/ atau pihak berkuasa negeri tidak akan memberikan kelulusannya. Justeru, syarat terdahulu bagi penjualan dan pembelian perjanjian 15.3.2010 sememangnya tidak dipenuhi dan oleh itu Defendan Pertama tidak boleh dikatakan mempunyai kepentingan benefisial ke atas hartanah-hartanah tersebut yang membangkitkan suatu 81 kepentingan berkaveat Defendan Pertama terhadap hartanah- hartanah tersebut. [85] Sama seperti di dalam SP 1299, di dalam memasukkan kaveat- kaveat amanah ke atas hartanah-hartanah tersebut pula, Defendan Pertama juga telah bersandarkan kepada perjanjian-perjanjian jual beli tersebut, cuma pada kali ini Defendan Pertama telah menambah di dalam Borang 19Enya berkenaan Perjanjian Penyelesaian 2010 bagi menyokong penegasan bahawa Defendan Pertama mempunyai kepentingan berkaveat ke atas hartanah-hartanah tersebut. Adalah menjadi tegasan Defendan Pertama bahawa perjanjian-perjanjian jual beli tersebut dan Perjanjian Penyelesaian 2010 telah menjadikan Defendan Pertama sebagai benefisiari (beneficiary) hartanah- hartanah tersebut lantas mewujudkan suatu amanah di antara Plaintif dan Defendan Pertama. [86] Untuk penegasan tersebut, Defendan Pertama sama seperti di dalam SP 1299, telah sekali lagi merujuk dan bergantung kepada klausa 4 dan klausa 5. 4 perjanjian-perjanjian tersebut dan 82 menambah klausa-klausa di dalam Perjanjian Penyelesaian 2010 iaitu klausa-klausa 3.1, 4.1, 5.5 dan 11.2. [87] Adalah telah dihujahkan oleh peguam bijaksana Defendan Pertama klausa-klausa yang tersebut telah menjadikan Defendan Pertama sebagai pihak benefisiari yang mempunyai kepentingan benefisial ke atas hartanah-hartanah tersebut lantas membangkitkan atau mewujudkan amanah di antara Plaintif dan Defendan Pertama. [88] Defendan Pertama juga telah membangkitkan bahawa di dalam mempertahankan kepentingan benefisialnya terhadap hartanah- hartanah tersebut, oleh itu Defendan Pertama telah memfailkan Guaman Writ 27 berasaskan atau berpremiskan kepada keingkaran Plaintif mematuhi perjanjian-perjanjian jual beli tersebut dan Perjanjian Penyelesaian 2010. [89] Mahkamah ini di SP 1299 di dalam membuat dapatan bahawa Defendan Pertama tidak mempunyai kepentingan berkaveat ke atas hartanah-hartanah tersebut telah memutuskan bahawa perjanjian- perjanjian Jual Beli tersebut sememangnya dan pada hakikatnya 83 TIDAK BOLEH DIKUATKUASAKAN DAN DEFENDAN PERTAMA TELAH MELEPASKAN HAK-HAKNYA DI BAWAH PERJANJIAN- PERJANJIAN JUAL BELI TERSEBUT. H. SAMADA DEFENDAN MEMPUNYAI KEPENTINGAN BERKAVEAT KE ATAS HARTANAH TERSEBUT [90] Prinsip undang-undang berkaitan permohonan untuk membatalkan kaveat adalah jelas. Di dalam sesuatu permohonan untuk membatalkan kaveat, Mahkamah hendaklah menentu dan mempertimbangkan persoalan-persoalan berikut: i. samada pengkaveat mempunyai kepentingan berkaveat terhadap hartanah tersebut. ii. samada kepentingan berkaveat tersebut menimbulkan atau mendedahkan isu-isu serius untuk dibicarakan. iii. samada imbangan keselesaan memihak bahawa kaveat tersebut dikekalkan. 84 iv. samada terdapat keadaan istimewa di pihak pemohon yang melayakkan status quo diganggu/diubah. [91] Di dalam perkara berkaitan permohonan untuk membatalkan kaveat, Majlis Privy di dalam kes Eng Mee Yong & Ors v V Letchumanan [1979] 2 MLJ 212 telah memutuskan berikut: “This is the nature of the onus that lies upon the caveator in an application by the caveatee under section 327 for removal of a caveat; he must first satisfy the court that on the evidence presented to it his claim to an interest in the property does raise a serious question to be tried; and having done so he must go on to show that on the balance of convenience it would be better to maintain the status quo until the trial of the action, by preventing the caveatee from disposing of his land to some third party.” [92] Di dalam kes Kho Ah Soon V Duniaga Sdn Bhd [1996] 2 MLJ 181, Mahkamah Persekutuan telah sekali lagi menekankan berkenaan 85 prinsip undang-undang di dalam pembatalan kaveat di mana Peh Swee Chin, HMP telah menyatakan di muka surat 184 seperti berikut: “It is settled that in a matter of removal of a caveat as between a caveator and caveatee, as in the instant appeal, the onus is on the caveator to satisfy the Court that his evidence does raise a serious question to be tried as regards his claim to an interest in the land in question, and having done so he must show that, on a balance of convenience, it would be better to maintain the status quo until the trial of the action by preventing the caveatee from disposing of his land, as laid down by Lord Diplock in Eng Mee Yong & Ors v V Letchumanan [1979] 2 MLJ 212, and by analogy indirectly to American Cyanamid Co v Ethicon [1975] AC 396 as indicated by Lord Diplock, the serious question for trial referred to above could mean a question not being vexatious or frivolous”. [93]Di dalam perkara ini juga, Mahkamah Rayuan di dalam kes Luggage Distributors (M) Sdn Bhd v Tan Hor Teng [1995] 1 MLJ 719 telah menggariskan ujian-ujian yang harus digunapakai di dalam 86 menentukan dan menimbangkan sesuatu permohonan untuk membatalkan kaveat di mana mukasurat 724, Mahkamah Rayuan telah menyatakan berikut: “In considering an application for the removal of a caveat, the procedure to be adopted should be a simple and summary one. At first stage, the court will examine the grounds expressed in the application for the caveat to see whether they show a caveatable interest. Once the court is satisfied that the caveator’s claim amounts in law to a caveatable interest, it must then go on to consider whether the claim disclosed a serious question meriting a trial. After these two stages have been crossed, the court must decide where the balance of convenience” [94] Berhubung dengan kaveat amanah ini, persoalan samada siapa yang berhak untuk memasukkan kaveat amanah telah dijelaskan oleh Privy Council di dalam kes Registrar of Titles, Johore v Temenggong Securities Ltd [1976] 2 MLJ 44 yang memutuskan berikut: 87 “There are four classes of caveats: a “Registrar’s caveat,” a “private caveat,” a “lien holder’s caveat” and a “trust caveat.” The instant appeal is concerned with a Registrar’s caveat, and it is unnecessary for present purposes to say anything more about lien-holders’ and trust caveats, save to note that the letter are entered on the application of the settlor or trustees and not on the application of a beneficiary. An understanding of the nature and effect of private caveats, however, is in their Lordships’ view an essential aid to the construction of sections 319 to 321 which deal with Registrar’s caveats.” [95] Di dalam kes of Bank of Tokyo Ltd v Registrar of Title, Selangor [1990] 1 CLJ (Rep) 344, Hakim Abdul Razak di dalam suatu permohonan untuk membatalkan atau memotong kaveat amanah telah menyatakan berikut: “Maka jelaslah dari peruntukan-peruntukan di bawah s. 332 dan s. 344 itu, bahawa pihak yang berhak membuat tuntutan di 88 bawah s. 332 itu adalah tertentu kepada mereka-mereka yang namanya telah tercatit di dalam pendaftaran memorial itu sebagai Pemegang Amanah sahaja…” [96] Di dalam kes ini, Mahkamah ini sekali lagi mengulangi bahawa di dalam mempertahankan kaveat-kaveat amanahnya, Defendan Pertama masih bergantung kepada perjanjian-perjanjian jual beli tersebut dan juga Perjanjian Penyelesaian 2010, sedangkan perkara perjanjian-perjanjian jual beli hartanah-hartanah tersebut telahpun diputuskan oleh Mahkamah ini di dalam SP 1299. Mahkamah ini telahpun memutuskan bahawa perjanjian-perjanjian jual beli tersebut sememangnya tidak boleh dikuatkuasakan dan Defendan Pertama telahpun melepaskan hak-haknya di bawah perjanjian-perjanjian jual beli tersebut. Dengan keputusan tersebut, penggantungan dan sandaran Defendan Pertama ke atas Perjanjian Penyelesaian 2010 itu semestinya juga tidak dapat dipertahankan. Perjanjian Penyelesaian 2010 juga tidak boleh dikuatkuasa dan hak-hak Defendan Pertama yang ada di dalam Perjanjian Penyelesaian 2010 juga telah dilepaskan oleh Defendan Pertama sepertimana 89 perjanjian-perjanjian jual beli tersebut. Malahan di dalam kes ini perjanjian-perjanjian jual beli tersebut adalah asas kepada Perjanjian Penyelesaian tersebut, maka kalau sekiranya asas bagi Perjanjian Penyelesaian 2010 tersebut iaitu perjanjian-perjanjian jual beli telah rebah dan tidak ada kuatkuasanya apatah lagi dengan Perjanjian Penyelesaian 2010 tersebut yang pastinya tidak boleh berdiri lagi. [97] Adalah menjadi dapatan Mahkamah ini penggantungan Defendan Pertama kepada klausa-klausa perjanjian-perjanjian jual beli tersebut (klausa) serta Perjanjian penyelesaian 2010 (klausa-klausa) adalah satu penggantungan yang tidak memberi apa-apa kesan kerana perjanjian-perjanjian jualbeli tersebut dan Perjanjian Penyelesaian 2010 itu pada hakikatnya tidak boleh dikuatkuasakan dan Defendan Pertama telahpun melepaskan hak-haknya di bawah perjanjian- perjanjian tersebut. [98] Sekali lagi Mahkamah ini memutuskan bahawa Defendan Pertama sememangnya tidak mempunyai kepentingan berkaveat ke atas hartanah-hartanah tersebut dan amanah yang dilaung-laungkan oleh Defendan Pertama yang kononnya dibangkitkan atau diwujudkan 90 daripada perjanjian-perjanjian jual beli tersebut dan Perjanjian Penyelesaian adalah tidak boleh dapat dipertahankan. Apatah lagi melihat kepada kelima-lima Borang 19E Eksibit “A-1”, Kandungan 2 (Afidavit Sokongan Dato’ Koh Foong Soon) dan Surat Akuan menyokong kemasukan kaveat amanah, jelas menunjukkan bahawa kemasukan kaveat amanah oleh Defendan Pertama ke atas hartanah-hartanah tersebut adalah berasaskan kepada pengataan bahawa Defendan Pertama adalah benefisiari terhadap hartanah- hartnah tersebut dengan bersandarkan kepada kedua-dua perjanjian- perjanjian jual beli tersebut dan Perjanjian Penyelesaian. Sandaran atau penggantungan Defendan Pertama kepada kedua-dua perjanjian-perjanjian jual beli tersebut dan Perjanjian Penyelesaian tidak boleh dikuatkuasakan dan hak-hak telah dilepaskan yang memustahilkan pengwujudan atau pembangkitan amanah ataupun hak benefisial. [99] Justeru, adalah menjadi dapatan Mahkamah ini bahawa Defendan Pertama adalah pihak yang tidak mempunyai kepentingan berkaveat ke atas hartanah-hartanah tersebut dan kaveat-kaveat amanah 91 tersebut yang dimasukkan hendaklah dibatalkan atau dipotong serta merta. [100] Defendan Kedua di dalam kes ini tidak memfailkan apa-apa afidavit jawapan dan tidak mempunyai bantahan terhadap permohonan Plaintif. Pada dasarnya, Defendan Kedua mengambil pendirian bahawa ia akur dan bersedia mematuhi sebarang perintah yang dikeluarkan oleh Mahkamah ini. PENGATAAN TIDAK BERASAS DAN MELAMPAU OLEH GOH CHEE KEONG DI DALAM AFIDAVIT KANDUNGAN 9 [101] Di dalam kes ini juga, Mahkamah ini tidak boleh membiarkan atau tidak ambil peduli (ignore) pengataan-pengataan Goh Chee Keong (Goh) di perenggan-perenggan 8, 9 dan 10 di dalam Afidavit Jawapan Defendan Pertama (Kandungan 9) yang diikrarkan oleh Goh pada 27.3.2017. [102] Perenggan 8, 9 dan 10 di dalam Afidavit Jawapan Defendan Pertama (Kandungan 9) yang diikrarkan oleh Goh pada 27.3.2017 diperturunkan di bawah ini: 92 (8) Keputusan YA Datuk Azimah adalah berdasarkan sepenuhnya kepada bukti afidavit sahaja yang mana banyak fakta material adalah dipertikaikan. Isu samada wujudnya amanah antara Plaintif dan Defendan Pertama adalah satu isu serius yang perlu dibicarakan dan menerima keterangan viva voce; (9) Jika benar apa yang dialigasikan oleh Plaintif, keputusan Mahkamah Tinggi dalam OS 2016 tersebut bererti bahawa Plaintif boleh dan telah menjadualkan 5 Tanah tersebut sebanyak dua (2) kali kepada dua pihak yang berlainan dan menerima dua balasan berlainan iaitu tidak kurang RM155 juta bagi penjualan pertama kepada Defendan Pertama dan tidak kurang dari RM326 juga bagi penjualan kedua kepada pihak ketiga bernama Paragon Pinnacle Sdn Bhd (“PPSB”) yang keseluruhan berjumlah RM481 juta! ; dan (10) Saya sesungguhnya percaya bahawa wujud perkara yang busuk (‘something rotten’) dalam pengeluaran Perintah Potong Kaveat Persendirian tersebut jika ianya bererti dan mempunyai kesan seperti dalam perenggan 10(9) diatas. [103] Mahkamah ini perlu menekankan bahawa pengataan-pengataan Defendan Pertama di perenggan 8, 9 dan 10 (khasnya) adalah 93 pengataan-pengataan yang telah dibuat dengan niat yang jahat untuk mencemarkan integriti Mahkamah ini serta mempertikaikan ketelusan dan keadilan Mahkamah ini. Mahkamah ini menegaskan bahawa pengataan-pengataan Goh tersebut terjumlah kepada satu tuduhan yang tidak berasas dan tuduhan melulu. [104] Defendan Pertama nampaknya telah membuat tuduhan yang tidak tidak berasas dan tuduhan melulu dengan mengatakan bahawa terdapat perkara yang busuk (rotten) di dalam pengeluaran perintah pemotongan Kaveat-Kaveat Persendirian oleh Mahkamah ini di dalam SP 1299. [105] Mahkamah ini bersetuju dengan hujahan peguam bijaksana Plaintif bahawa tindakan Saman Pemula ini bukanlah forum bagi Defendan Pertama untuk menunjukkan ketidakbersetujuan Defendan Pertama terhadap keputusan Mahkamah bertarikh 14.2.2017 tersebut. [106] Adalah sesuatu undang-undang yang mantap dan jitu bahawa sebarang ketidakpuasan hati terhadap keputusan yang dibuat oleh 94 Mahkamah Tinggi, pihak yang tidak berpuas hati bolehlah merayu terhadap keputusan tersebut ke Mahkamah Rayuan. [107] Namun di dalam kes ini, Defendan Pertama telah mengambil pendekatan kotor dan busuk dengan membuat tuduhan yang tidak berasas dan melulu terhadap Mahkamah ini dengan mengatakan ada sesuatu perkara kotor disebalik perintah Mahkamah ini membatalkan atau memotong kaveat-kaveat persendirian yang dimasukkannya. Walhal, permohonan Plaintif untuk membatalkan/ memotong kaveat- kaveat persendirian tersebut telah dibicarakan di hadapan Mahkamah ini dengan pengemukaan keterangan-keterangan afidavit dan keterangan-keterangan dokumentar yang menyokongnya di samping hujahan-hujahan telahpun dikemukakan oleh kedua-dua pihak Plaintif dan Defendan Pertama. Justeru, perintah pemotongan kaveat-kaveat yang dimasukkan oleh Defendan Pertama telah dibuat berdasarkan kepada prinsip undang-undang dan keterangan- keterangan yang ada di hadapan Mahkamah ini. 95 [108] Pengataan-pengataan Defendan Pertama di perenggan 8, 9 dan 10 adalah pengataan-pengataan yang tidak mempunyai justifikasi dan sesuatu yang tidak sewajarnya (uncalled for). [109] Berdasarkan alasan-alasan di atas, Mahkamah ini membenarkan Kandungan 26 (Kand.1) Plaintif bagi perenggan-perenggan (a), (b), (c) dan (d). [110] Mahkamah ini juga, memerintahkan tuntutan-tuntutan balas Defendan Pertama di perenggan 51, Kandungan 9 ditolak dengan kos. KOS [111] Setelah mendengar hujahan ringkas pihak-pihak, Mahkamah ini memerintahkan Defendan Pertama membayar kos global bagi Kandungan 1 (Kandungan 26) dan tuntutan balas sebanyak RM40,000.00 kepada Plaintif, manakala kos sebanyak RM10,000.00 hendaklah dibayar oleh Defendan Pertama kepada Pencelah- Pencelah. 96 t.t. ..................................................... (DATUK AZIMAH BINTI OMAR) Hakim Mahkamah Tinggi Shah Alam (Saman Pemula) Selangor Darul Ehsan Bertarikh 14hb Jun 2017 Peguam Plaintif-Plaintif - Tetuan Mohanadass Partnership Tan Sri Cecil Abraham bersama En.Sanjay Mohan, En.Sunil Abraham, En.Gobinath Karuppan & En.Syukran Syafiq Peguam Defendan Pertama - Tetuan Lee & Lim Dato' Seri Gopal Sri Ram bersama Datuk Ben Chan, En. Lim Kien Huat, En.Chin Yu Yen & En. David Yei Peguam Defendan Kedua - Pejabat Penasihat Undang-Undang Selangor Tuan Mohd Abdul Hakim bin Mohd Ali

Tika 2.6.0

B54-6-12/2016

PLAINTIF ETIQA TAKAFUL BERHAD (266243-D) DEFENDAN 1. ) ADIBAH BINTI ZAINAL ABIDIN (No. K/P : 600404-03-5488) 2. ) MOHAMAD ROHAIZAD BIN ZUKI (No. K/P : 921219-03-5125) 3. ) NURHIDAYAH BINTI HAMIDON (No. K/P : 951129-01-5742) 4. ) NUR FAZILAH BINTI AHMAD (No. K/P : 951215-06-5762) 5. ) HAMIDON BIN MD SAID

14/06/2017

DATO' HABIBAH BINTI MOHAMED YUSOF

https://efs.kehakiman.gov.my/EFSWeb/DocDownloader.aspx?DocumentID=1d3840c8-10ac-4f63-9619-f7320f88e136&Inline=true

DALAM MAHKAMAH SESYEN DI KUANTAN DALAM NEGERI PAHANG DARUL MAKMUR, MALAYSIA SAMAN PEMULA NO : B54-6-12/2016 Dalam Perkara Seksyen 96(10 dan (3) Akta Pengangkutan Jalanraya 1987 DAN Dalam Perkara Seksyen 41 Relief Spesifik 1950. DAN Dalam Perkara Polisi insurans No. TGPC-01159214-BRTZHQT yang melindungi kenderaan No. WNL5657 bagi tempoh 02/11/2013 sehingga 01/11/2014 DAN Dalam Perkara kemalangan jalanraya pada 07/01/2014 di Antara motokar No. WNL5657 dan motosikal No. JKT 1706 di Jalan Pantai Hiburan, Rompin, Pahang ANTARA ETIQA TAKAFUL BERHAD (266243-D) ….PLAINTIF DAN 1. ADIBAH BINTI ZAINAL ABIDIN (No. K/P : 600404-03-5488) 2. MOHAMAD ROHAIZAD BIN ZUKI (No. K/P : 921219-03-5125) 3. NURHIDAYAH BINTI HAMIDON (No. K/P : 951129-01-5742) 4. NUR FAZILAH BINTI AHMAD (No. K/P : 951215-06-5762) 5. HAMIDON BIN MD SAID … DEFENDAN- DEFENDAN ALASAN KEPUTUSAN Pendahuluan [1] Ini adalah satu Saman Pemula di mana pihak Plaintif menuntut; (i) Masa (jika perlu) dilanjutkan untuk memfailkan Saman Pemula ini; (ii) Keseluruhan peruntukan polisi insurans bernombor TGPC-01159214-BRTZHQT yang melindungi motokar No WNL 5657 bagi tempoh 2.11.2013 sehingga 1/11/2014 adalah terbatal(“void”) dan tidak boleh dikuatkuasakan (“unenforceable”) terhadap Plaintif; (iii) Selanjutnya, Pemohon tidak bertanggungjawab (“not liable”) untuk menanggung sebarang perintah dan penghakiman di bawah Seksyen 96 Akta Pengangkutan Jalanraya 1987 untuk sebarang tuntutan yang difailkan di bawah polisi ini termasuk tetapi tidak terhad kepada mana-mana tindakan yang akan/atau telah difailkan berikutan kemalangan jalanraya itu. (iv) Lain-lain relief dan/atau perintah dan/atau arahan lanjut yang dianggap sesuai dan manfaat oleh Mahkamah Yang Mulia ini. (v) Kos. Latarbelakang Kes [2] Adibah bt Zainal Abidin, Defendan Pertama adalah pemilik berdaftar bagi sebuah kereta No WNL 5657 (kereta tersebut). Plaintif dalam kes ini telah mengeluarkan satu polisi insurans bernombor TGPC-01159214-BRTZHQT (polisi tersebut) bagi melindungi kereta tersebut bagi tempoh 2.11.2013 sehingga 1.11.2014. [3] Kereta tersebut yang dikatakan dipandu oleh Defendan Kedua telah terlibat dengan kemalangan jalanraya pada 7.1.2014 dengan sebuah motorsikal No JKT 1706 yang ditunggang atau dibonceng atau dimiliki oleh Defendan Ketiga, Keempat dan Kelima di Jalan Pantai Hiburan, Rompin, Pahang. [4] Berikutan itu Plaintif telah diserahkan dengan satu notis di bawah Seksyen 96(2) Akta Pengangkutan Jalan 1987(APJ) dan laporan-laporan polis berkaitan kemalangan itu. Satu guaman sivil juga telah difailkan oleh Tetuan Ravi Moorthi Noriza Mala & Partners di Mahkamah Sesyen Kuantan No: A53KJ-22-01/2015 bagi pihak Defendan-defendan Ketiga, Keempat dan Kelima yang menuntut gantirugi am dan khas. Kes Plaintif [5] Plaintif mengatakan bahawa pihaknya telah melantik penyelaras untuk menyiasat berhubung kemalangan itu. Siasatan mendapati kereta tersebut telah dijual oleh Defendan Pertama kepada anak saudaranya, Defendan Kedua pada 7.1.2014 tanpa pengetahuan Plaintif. [6] Defendan Kedua mengakui bahawa beliau telah membeli kereta tersebut daripada Defendan Pertama pada tahun 2011 atas dasar sambung bayar pinjaman bank Defendan Pertama dan hanya akan menukar nama selepas selesai keseluruhan pinjaman kereta tersebut. [7] Berdasarkan fakta di atas Plaintif mengatakan bahawa kereta yang diinsurankan oleh Defendan Pertama tidak berada di bawah kawalannya sebaliknya oleh Defendan Kedua pada setiap masa yang merupakan “unauthorized driver” pada masa kemalangan berlaku.Oleh kerana berlaku “transfer of interest” juga maka tidak terdapat “insurable interest”. [8] Selain itu Plaintif mengatakan bahawa keseluruhan polisi insurans yang dikeluarkan atas nama Defendan Pertama adalah terbatal dan tidak boleh dikuatkuasakan kerana polisi tersebut tidak dibeli untuk kereta WNL 5657 kerana kereta tersebut telah dijual pada 2011. Maka tuntutan Defendan Ketiga hingga Kelima tidak dilindungi di bawah insurans itu. Ini kerana telah berlaku kemungkiran terma dan syarat asas polisi tersebut yang menyebabkan ia tidak boleh dikuatkuasakan terhadap Plaintif. Kes Defendan [9] Defendan mengatakan isu-isu yang ditimbulkan oleh Plaintif antaranya bahawa polisi itu telah terbatal, pemindahan kepentingan dan pemandu yang tidak mempunyai kebenaran untuk memandu kereta tersebut adalah isu antara Defendan Pertama dengan agen Plaintif serta Plaintif sahaja dan tidak boleh mengatasi atau memberi kesan kepada perlindungan insuran pihak ketiga di bawah Akta Pengangkutan Jalan 1987(APJ). [10] Mengenai kemungkiran terma dan syarat asas polisi tersebut, Plaintif boleh mendapatkan remedi terhadap agennya atau Defendan Pertama. Syarat dan terma yang dikatakan dilanggar juga tidak dikemukakan. [11] Plaintif telah menerima Notis di bawah Seksyen 90(2) APJ dan telah melantik Peguamcara serta telah memfailkan pembelaan untuk Defendan Pertama dan Kedua maka Plaintif harus di tahan (“estopped”) daripada mendapatkan deklarasi pada tahap ini. [12] Seterusnya Peguam Defendan Ketiga hingga Kelima mengatakan Defendan Pertama telah pun memberi kebenaran kepada Defendan Kedua untuk menggunakan kereta tersebut. [13] Carian JPJ adalah carian rasmi yang muktamad menunjukkan Defendan Pertama adalah pemilik berdaftar kereta dan seharusnya mengikat pihak-pihak. Jelas dari carian JPJ, Defendan Pertama adalah pemilik kereta dan Plaintif sebagai penanggung insurans yang harus bertanggungan atas kemalangan kerana ia adalah satu “statutory liability”. Penilaian dan Keputusan Mahkamah [14] Adalah menjadi undang-undang yang mantap sepertimana dihujahkan oleh pihak Plaintif bahawa kontrak berkaitan polisi insurans adalah satu kontrak berasaskan prinsip “uberrima fide” atau “utmost good faith”. Kes-kes yang dipetik oleh pihak Plaintif sememang dengan jelasnya menunjukkan bahawa pihak insurans tidak mempunyai obligasi untuk menanggung rugi dalam keadaan berlakunya kegagalan untuk menyatakan fakta–fakta material (non-disclosure of material facts) serta berlaku pemindahan kepentingan (transfer of interest). [15] Bagi kes-kes insuran yang melibatkan kemalangan jalanraya dua perkara utama yang perlu diputuskan oleh mahkamah dalam menentukan samada pihak insurans perlu bertanggungan adalah samada kenderaan yang terlibat dengan kemalangan telah dipandu dengan keizinan “insured” dan wujud “insurable interest” semasa kemalangan berlaku seperti diputuskan dalam kes Nanyang Insurance Co. Ltd v Salbiah & Anor [1967] 1MLJ 94 yang dirujuk oleh pihak Plaintif. [16] Pihak Plaintif melalui afidavit Haslenda bt Md Moktar Rudin, Ketua Bahagian Tuntutan Motor di bahagian tuntutan Plaintif (pegawai Plaintif) bertarikh 6.12.2016 mengatakan bahawa penyelaras yang dilantik Plaintif telah membuat siasatan yang menyeluruh mendapati kereta yang terlibat dengan kemalangan yang diinsuranskan atas nama Defendan Pertama telah dijual pada masa kejadian kemalangan. [17] Dalam afidavit tersebut juga pihak Plaintif menyokong dakwaan mereka dengan mengemukakan dua surat akuan bersumpah dan satu laporan polis di ekshibit “HMM-4”. Kandungan ketiga-tiga dokumen ini yang dibuat oleh Defendan Pertama Adibah bt Zainal Abidin pada 3.11.2016 dan Defendan Kedua, Mohamad Rohaizad b Zuki bertarikh 14.10.2016 adalah sama pada asasnya. [18] Kedua-dua penama ini mengakui mereka mempunyai tali persaudaraan sebagai ibu saudara dan anak saudara. Seterusnya kedua-dua mereka mengakui bahawa Defendan Pertama telah menjual kereta yang terlibat dengan kemalangan itu pada tahun 2011 kepada Defendan Kedua dengan harga RM18 500.00 secara sambung bayar pinjaman bank di atas nama Defendan Pertama dan Defendan Kedua hanya akan menukar nama pada geran kereta tersebut setelah pinjaman dilangsaikan. [19] Defendan-defendan menafikan hal ini dengan mengemukakan afidavit oleh peguambelanya yang diikrarkan pada 21.2.2017 dan 18.5.2017 yang mengekshibitkan maklumat insurans kenderaan dari pihak Jabatan Pengangkutan Jalan Malaysia (JPJ) yang menunjukkan bahawa pada masa material kereta tersebut masih dimiliki Defendan Pertama. [20] Secara sepintas lalu jika Mahkamah menimbangkan fakta yang dikemukakan Plaintif sudah semestinya Mahkamah mesti mengatakan bahawa pihak Plaintif tidak lagi bertanggungan kerana berlakunya “transfer of interest” sekaligus ini bermakna tiada lagi “ insurable interest” serta berlakunya perlanggaran terma dan syarat asas kontrak iaitu “duty of disclosure” kerana penjualan kereta oleh Defendan Pertama kepada Defendan Kedua tidak dimaklumkan kepada pihak Plaintif. [21] Walau bagaimanapun Mahkamah melihat keterangan yang dikemukakan oleh pihak Defendan-defendan ketiga hingga kelima adalah lebih “credible” dan boleh diterimapakai serta mengatasi keterangan Plaintif dari segi nilainya. [22] Ini kerana akuan sumpah dan laporan polis yang dikemukakan kepada Mahkamah hanyalah dilampirkan sebagai ekshibit melalui afidavit pegawai Plaintif sedangkan penyelaras yang dikatakan telah membuat siasatan tidak dikemukakan affidavitnya di Mahkamah bagi menyokong fakta dan dakwaan ini. [23] Malah Plaintif mendakwa bahawa pihaknya telah mengarahkan penyelarasnya supaya membuat satu siasatan berkaitan kemalangan tersebut tetapi laporan hasil siasatan itu langsung tidak dikemukakan kepada pihak Mahkamah. [24] Tambahan lagi tiada penjelasan dalam afidavit pegawai Plaintif bagaimana surat-surat akuan sumpah yang dikatakan dibuat oleh Defendan Pertama dan Kedua serta laporan polis Defendan Kedua seperti di ekshibit “HMM-4” diperolehi. Mahkamah ini berpandangan penyelaras adalah individu yang selayaknya untuk mengemukakan dokumen-dokumen itu memandangkan beliaulah yang mempunyai maklumat langsung (firsthand knowledge) dalam hal ini. [25] Sedangkan di pihak Defendan-defendan pula, peguambela yang membuat carian tersebut telah mengemukakan sendiri maklumat dari carian rasmi dari pihak yang tidak berkepentingan menunjukkan fakta bahawa Defendan Pertama masih kekal sebagai pemilik kereta tersebut. [26] Apabila Mahkamah ini membuat dapatan bahawa tidak berlaku pemindahan kepentingan dan tanpa keterangan sebaliknya, dengan sendirinya bermakna bahawa kereta tersebut telah dipandu dengan keizinan pemiliknya sepertimana diputuskan dalam kes Lee Chong Keong v Cheang Kok Weng & Anor [1996] 4 MLJ 133 di mukasurat 134 (rujuk “held” di para 5). [27] Dalam kes ini tidak dipertikaikan bahawa pihak Plaintif telah menerima notis statutori di bawah Seksyen 96(2) APJ 1987 malah telah memasukkan pembelaan bagi pihak Defendan Pertama dan Kedua dalam kes A53KJ-22-01/2015 maka pada peringkat ini tidak sepatutnya Plaintif sebagai pihak penginsurans mengelakkan tanggungjawabnya. [28] Seterusnya walaupun Defendan Pertama dan Kedua tidak memasukkan sebarang afidavit membantah permohonan deklarasi Plaintif di sini, memandangkan permohonan ini melibatkan budi bicara Mahkamah, Mahkamah mengikuti keputusan Mahkamah Rayuan No: W-02(NCVC) (A)-1717-09/2016 Tirumenivar a/l Singara Veloo v Malaysian Motor Insurance Pool, 14 April 2017 sepertimana dalam hujahan pihak peguam Defendan Ketiga hingga Kelima dan memutuskan bahawa Mahkamah ini tidak sepatutnya memberikan perintah deklarasi terhadap Defendan Pertama dan Kedua semata-mata atas kegagalan kehadiran dan kegagalan memfailkan afidavitnya. [29] Maka atas sebab-sebab seperti di atas Mahkamah ini menolak permohonan Plaintif di Kandungan 3 dengan kos RM1 500.00 (DATO’ HABIBAH BINTI MOHAMED YUSOF) Hakim Mahkamah Sesyen 2 14hb Jun 2017 s.k . 1) Tetuan Ravi Moorthi Noriza Mala & Partners Peguambela dan Peguamcara A-3, Tingkat 1, Lorong Tun Ismail 10 Jalan Tun Ismail 25000 Kuantan, Pahang (RMNM/ACC/3528/14/H/Ros 2) Tetuan Sabarudin Othman & Ho No. C-8-2, Megan Avenue 11 No. 12 Jalan Yap Kwan Seng 50450 Kuala Lumpur. (SO/KL/L/ETIQA/4225/16) 14

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