1] Khew Keat Seen (No. Kp: 620501-10-5773) v 1] Khew Kok Seng (No. Kp: 721016-14-5467) (BA-22NCVC-462-08/2017)

This is an application by the Second Defendant under Order 18 Rule 19 (1)(a) and / or (b) and/ or (d) of the Rules of Court 2012 (“ROC 2012”) dated 16 October 2017 (enclosure 10) to strike out the Plaintiffs’ Writ of Summon and Statement of Claim. 2

The Second Defendant’s claimed that the Plaintiffs’ claim is frivolous and vexatious that amounts to an abuse of Court’s process;

The cause papers for this application are as follows :

The Statement of Claim dated 1 August 2017 against the Second Defendant (“the Claim”);

The Notis Permohonan filed by the Second Defendant pursuant to Order 18 rule 19 (“the

The Afidavit Sokongan Defendan Ke-2 affirmed by Khew Kok Seng on 11 October 2017 (“the

The Afidavit Jawapan affirmed by Khew Keat

The Afidavit Sokongan Defendan Ke-2 affirmed by Khew Kok Seng on 24 November 2017 (“the

The Afidavit Jawapan affirmed by Khew Keat Seen on 7 December 2017 (“the Affidavit In Reply No. 2”). 3

To simplify the above affidavits, the Plaintiffs’ claims that the building and things belonging to the Second Defendant are still on the Land and that the quit notice dated 20 July is valid, for a declaration that the Second Defendant is not a tenant but a trespasser, that the Second Defendant and the directors be ordered to demolish the building and deliver up vacant possession be demolished among other remedies.

Having gone through the pleadings and affidavits filed by the respective parties, I have concluded the facts below :

The First , Second, Third and Fourth Plaintiffs and the First Defendants were the directors and shareholder of the Second Defendant when the Second Defendant was incorporated on 29 May 2013;

Sometime on 12 August 2015, the Plaintiffs sold all of their shares to the First Defendant and/or his nominee Khew Chin Fatt pursuant to the Consent Judgment dated 25 June 2015;

Vide the Plaintiffs’ letters respectively dated 23 July 2015 addressed to the Second Defendant’s Board of Directors, the Plaintiffs had resigned as the directors of the Second Defendant; 4

One of the issues in the Plaintiffs’ suit concerns a piece of land under GM6009, Lot 809, Tempat Sungei Liam, Mukim Ulu Yam, Daerah Ulu Selangor, Negeri Selangor;

On 20 July 2017, the Plaintiffs’ solicitors had served a notice to evict the Second Defendant from the said Land and to demand for :-

the Second Defendant to deliver vacant possession of the said

(ii) the Second Defendant to demolish all structures erected on the said Land and “to clear the said Land of chattels and rubbish

The Plaintiffs thereafter commenced the present suit against the Second Defendant and had pleaded the following in their

that the Second Defendant is currently occupying the said Land and had refused to vacate the

(ii) the Second Defendant had failed and/or neglect in delivering vacant possessions of the Said Land to 5 the Plaintiffs;

(iii) the Second Defendant had used the Said Land for purposes of a factory where machines and machineries are brought into and used on the Said Land when the category of land use of the Said Land is for agricultural purposes only.

The reliefs sought by the Plaintiffs against the Second Defendant as pleaded in the Statement of Claim are as follows:-

a declaration that the Notice of Eviction dated 20 July 2017 is valid;

(ii) a declaration that the Second Defendant is not a tenant of the Said Land;

(iii) a declaration that the Second Defendant is a trespasser of the Said Land;

(iv) that the Second Defendant and its directors are ordered to demolish and remove the structures on the said Land within 14 days from the date of the Order. 6 THE LAW OF STRIKING OUT

The principles governing a striking out application are automatically set out in Bandar Builder Sdn. Bhd. & 2 Ors. v. United Malayan

1 MLRA 611 (FC). It is only in plain and obvious cases where it is clear that the claim is unsustainable is the power to summarily strike out a case exercised. Mohamed Dzaiddin SCJ delivering the judgment of the Federal Court as follows: “….the principles upon which the Court acts in exercising its power under any of the four limbs of O.18 r.19….are well settled. It is only in plan and obvious cases that recourse should be had to the summary process under this rule………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” …….The Court must be satisfied that there is no reasonable cause of action or that the claims are frivolous or vexatious or that the defence raised are not arguable……..”

The above case and principles was also followed in the Court of Appeal judgment in Enersafe Sdn. Bhd. v. Megarina Sdn. Bhd.

2 CLJ 1021 (CA), Zulkefli Makinuddin JCA (as he then was) had said this: “….(12) We find it is most appropriate here to state the well established principle in that the power of striking out pleadings under O.18 r.19…..as invoked by the appellant in 7 this case is too well known that it can only be exercised when the respondent’s claim on the face of it is obviously bound to fail……”

Similarly, in another Court of Appeal decision of Sivakumar a/l Varatharaju Naidu v. Ganesan a/l Retanam (2011) 6 MLJ 70, Abdul Malik Ishak JCA held that: “…….the summary procedure under Order 18 Rule 19 should only be resorted to when it is conspicuously clear that the Plaintiff’s claim, on the face of it, is obviously unsustainable. The court will always strike out a claim in plain and obvious cases and where the claim in obviously unsustainable. The power to strike out must be exercised by the court sparingly. It is a rule of thumb that if it can be shown that the pleadings do disclose some cause of action or that it has raised some question fit to be decided, then the case should be set down for argument notwithstanding that the chances of success are minimal. The pleadings must be entirely hopeless, baseless or without foundation in law or in equity before they can be struck out…….”

This court is always reminded by plethora of cases that the power to strike out summarily without a trial is a drastic power which should be exercised with utmost caution and should only be exercised in plain and obvious cases (see Tractors Malaysia Berhad v. Too Chee Hing (1975) 2 MLJ 1, Bandar Builders Sdn. Bhd. v. United Malayan Banking Corporation Bhd. (1993) 3 MLJ 36) . 8

Having scrutinized the above, I shall now consider the rival contentions of the parties. FIRST ISSUE Status of the Second Defendant? The Plaintiffs’ counsel had submitted that the Second Defendant is still occupying the said Property with its purported structures, machines and machineries on the said Property without any tenancy agreement nor paying any rental to the Plaintiffs. The counsel submitted as below: “…(6) The First Defendant issued a letter dated 29 January 2017 through his solicitor, Messrs. Tan Chap & Associates. See exhibit “C” in the Affidavit In Reply No. 1 This letter shows that there is dissatisfaction / disagreement by the Plaintiffs regarding the occupation of the Land by the Second Defendant without payment of any rental to the Plaintiffs, who are the joint beneficial owners of the Land. This letter clearly also admits that the Second Defendant as the person operating on the Land. It states as follows: “ ... your clients agreed to give our client full opportunity to resolve and settle his business and operation in the farm located in the Ulu Yam Land ...

(i)The Farm with its equipments and fixture in Ulu Yam Land belonged to Khaw Farming Sdn Bhd (Company No: 1047992-) which are now 100% owned by our client.” 9

In May 2016, the sales documents together with the deposit were returned to the purchaser’s solicitors, Messrs Jeffrey Wong, Noor & Lim and the Land was still occupied by the Second Defendant. The Second Defendant was operating a poultry farm.

The First Defendant is the alter ego of the Second Defendant and had vide letter dated 3 March 2016 issued by his solicitors, Messrs Tan Chap & Associates admitted, inter alia, as follows: “As your clients are aware, Khew Farming Sdn Bhd had erected the farm on the land with buildings, machines, equipment 85 tools thereon for the operation of the poultry farm, Since our client’s acquisition of Khew Farming Sdn Bhd from you clients, our client has purchased additional assets in the Farm. Therefore, our client proposes to appoint a reputable adjuster/valuer to value the assets of Khew Farming Sdn Bhd and to deduct the value of the assets thereon from the total purchase price and pay the same to our client. Therefore the balance purchase price after deduction the costs and expenses incurred in the said transaction shall be decided equally among the fie (5) siblings in equal shares.”

This letter is marked as exhibit “D” in the Affidavit In Reply No. 1and it is a clear admission of the buildings on the Land were erected by the Second Defendant and the 10 machines, equipment and tools thereon were / are there for the operation of the poultry farm. The photographs as in exhibit “J” in Affidavit In Reply No. 2 were taken on 10 November 2017. Photographs will not lie unless doctored………...”.

In considering this issue, I have read through the Plaintiffs’ Affidavit in Reply No. 1 dated 10 November 2017 which exhibited the search result of the status of Second Defendant from the Companies Commissions of Malaysia (CCM)(Exhibit B) that reflect the Second Defendant’s status as ‘dormant’. More so, in the Second Affidavit dated 24 November 2017 as to the Second Defendant’s Financial Statements dated 31 July 2017(Exhibit KKS-6)shows that the Second Defendant had sold all its assets save and except for 2 motor vehicles. There are no sales or purchasers by the Second Defendant or hardly any employees works for the Second Defendant. As such, it is my considered view that the purported structure, machines and machineries, live stocks, “forklifts”, “silo", compressors, containers, building materials, and chicken feed on the Said Land do not belong to the Second Defendant. If that is the case, what is there for the Plaintiff to take action against the second defendant as he is not occupying the said Land. SECOND ISSUE Reliefs sought against the Second Defendant? Is it justifiable? 11

The relief sought by the Plaintiffs’ against the Second Defendant are as follows: “Terhadap Defendan Kedua

Suatu deklarasi bahawa notis keluar bertarikh 20 Julai 2017 adalah sah;

Suatu deklarasi bahawa Defendan Kedua bukannya seorang penyewa terhadap Hartanah tersebut;

Suatu deklarasi bahawa Defendan Kedua adalah seorang penceroboh terhadap Hartanah tersebut;

Bahawa Defendan Kedua dan pengarah-pengarahnya diperintahkan meroboh dan mengalihkan binaan-binaan di atas Hartanah tersebut dalam 14 hari dari tarikh perintah;

Bahawa Defendan Kedua dan pengarah-pengarahnya diperintahkan member milikan kosong terhadap Hartanah tersebut dalam 14 hari dari tarikh perintah;

Bahawa Plaintif-plaintif dikuasakan merobohkan dan mengalihkan binaan-binaan di atas Hartanah tersebut, jika Defendan Kedua dan pengarahnya gagal mematuhi perintah di perenggan (d) di atas dan segala kos dibayar oleh Defendan-Defendan;

Bahawa Writ possesi dikeluarkan kepada Plaintif-Plaintif jika Defendan Kedua dan pengarah-pengarahnya gagal mematuhi perintah di perenggan

di atas; 12

As considered in the above paragraph, since the Second Defendant is not occupying the said land and the property on the said land does not belong to the Second Defendant, such action taken by the Plaintiff is highly questionable. The declaratory reliefs would not have any effect at all against the Second Defendant. In the case of: Lai Soon Onn v Tan Tian Sin &Ors(2017) 11 M LJ 47 6, High Court, Noorin Badaruddin JC held that: “……Subsequently, the third defendant filed an application to strike out the plaintiff’s SOC pursuant to O 18 r 19(1)(a) of the Rules of Court 2012 (‘the ROC’)(‘end 9’) on the ground that the claim disclosed no reasonable cause of action. The third defendant submitted that: (a) ss 357 and 360 of the CMSA did not entitled the plaintiff to the declaratory reliefs sought; (b) the declaratory reliefs sought by the plaintiff were academic in nature because even if the reliefs were granted, the plaintiff could not enforce the same by way of criminal prosecution as the declaratory reliefs sought were worded in such a manner as to declare that the defendants committed a criminal offence under the CMSA; (c) the plaintiff was not entitled to damages because s 357 of the CMSA was only actionable after the ruling by the Securities Commission (‘the SC’); and (d) the plaintiff’s failure to sue the joint tortfeasors tantamount to a release/discharge of the present suit against the defendants. It must be noted that the first, second and fourth defendants had filed similar applications (‘ends 21, 22 and 23’) as in end 9 and the same arguments in end 9 were forwarded.... ……………………….. 13

(51)Further, this court agrees with the third defendants’ learned counsel that the declaratory reliefs that the plaintiff is seeking are academic...

The above relief sought for are worded in such a manner as to declare that the defendants committed a criminal offence under the CMSA. Even if the declaratory reliefs are granted, the plaintiff cannot enforce it by a criminal proceeding. The plaintiff cannot ask this court to assert the constitutional right of the Attorney General as the public prosecutor in deciding for the prosecution in criminal matters. The principle that the court will not grant declaratory reliefs which are academic in nature was lucidly stated by the Court of Appeal in Ahmad Saidi bin Md Isa v Timbalan Menteri Hal Ehwal & Ors (2006) 3 MLJ 208 as follows: “……[4] We were entirely in agreement with learned senior federal counsel that the appeal was indeed academic. The subject matter of the appeal was the correctness of the restrictive residence order made against the appellant and to which he had been subject that order having come to an end, there was no longer a valid lis before us for adjudication. Any views we may express about the validity or otherwise of the order would be wholly academic in the circumstances of this case. It will simply have no effect at all. It will mean that we would act in vain. And it is settled law that a court will not act in vain. Equally it is also settled that the court will not grant academic 14 declarations, see Re Barnato [1949] Ch 258. There is therefore no alternative but to dismiss this appeal. (Emphasis added.) ……………………….. CONCLUSION [110] In view of the reasons alluded to in the above, it is the judgment of this court that the plaintiff is not entitled to the declaratory reliefs as he is not entitled to them under ss 357 and 360 of the CMSA and the reliefs sought are academic. The plaintiff is also not entitled to damages as s 357 of the CMSA is only actionable after the ruling by the SC. The release of the joint tortfeasors means the entire claim against the defendants is also not sustainable. Enclosure 9 was therefore allowed with costs of RM5,000 to the third defendant..”

In Ahmad Saidi bin Md Isa v Timbalan Menteri Hal Ehwal & Ors (2006) 3 MLJ 208 (CA), Gopal Sri Ram JCA delivering the judgment of the Court of Appeal: “…..(14) We were entirely in agreement with learned senior federal counsel that the appeal was indeed academic. The subject matter of the appeal was the correctness of the restrictive residence order made against the appellant and to which he had been subject That order having come to an end, there was no longer a valid lis before us for adjudication. Any views we may express about the validity or otherwise of the order would be wholly academic in the circumstances of this case. It will simply have no effect at all. It will mean that we would act 15 in vain. And it is settled law that a court will not act in vain. Equally it is also settled that the court will not grant academic declarations, see Re Barnato [1949] Ch 258. There is therefore no alternative but to dismiss this appeal……………” THIRD ISSUE Abuse of the Court process?

In view of the Second Defendant is not occupying the said land, to my mind the Plaintiffs’ claims is only academic in nature. It is purely an attempt by the Plaintiffs to vex the First Defendant as a result of the disputes arising between the Plaintiffs and the First Defendant. The Plaintiffs’ claim against the Second Defendant is therefore frivolous and/or vexatious as the present suit is not a genuine in seeking legal redress against the Second Defendant and tantamount to a blatant abuse of the court process. In the case of : Hadi Hassan v. Suria Records Sdn Bhd & Ors(2005) 3 MLJ 522, Abdul Malik Ishak (as he then was) : “…….(58) Striking out for being an abuse of the process of the court under O 18 r 19(1)(d) of the RHC envisages the situation where the process of the court has not been used in a bona fide manner and that it has been abused. It goes without saying that the court will prevent its machinery from being used improperly (Castro v Murray

10 Ex 213; and Dawkins v Prince Edward of Saxe Weimar, Willis v Earl Beauchamp (1886) 11 P 59 at 63)...”. 16 CONCLUSION

In the light of the foregoing and in the upshot, after hearing the submission by both parties, I hold that the Second Defendant’s application for striking out under Order 18 Rule 19(1)(a), (b) or (d) and is hereby allowed with cost of RM 5000.00. Dated 21 February 2018. (DATO’ HJ. MOHAMAD SHARIFF BIN HJ. ABU SAMAH) Judicial Commissioner (NCVC 6) High Court of Malaya Shah Alam, Selangor Darul Ehsan Counsel For the Plaintiff: H C Tan (Messrs. H C Tan & Zahani) For the Defendant: R K Sharma with SY Cheong (Messrs. Cheong Su Yin & Co.)