Pendaftar Hakmilik Pejabat Tanah dan Galian Selangor v Lau Yong Ying (B-01(NCVC)(W)-141-03/2019)

PENDAFTAR HAKMILIK PEJABAT TANAH

KERAJAAN NEGERI SELANGOR … PERAYU-PERAYU 15 DAN 20 LAU YONG YING … RESPONDEN (Dalam Mahkamah Tinggi Malaya di Shah Alam (Bahagian Sivil) 25 Guaman Sivil No. 21NCVC-25-06/2015 Antara Lau Yong Ying … Plaintif 30 (No. K/P: 770501-05-5546) Dan

Pendaftar Hakmilik Pejabat Tanah Dan 35

Galian Selangor

Kerajaan Malaysia Kerajaan Negeri Selangor … Defendan-Defendan) CORAM 40 KAMARDIN HASHIM, JCA KAMALUDIN MD SAID, JCA LEE SWEE SENG, JCA 2 GROUNDS OF JUDGMENT 5 Introduction [1] This is the Appellants’ (Defendants in the Court below) appeal against the decision of the Learned High Court Judge (“the learned judge”) delivered on the 20.02.2019 in respect of an 10 award for damages only. [2] The Appellants were found negligent by virtue of a decision of this Court made on the 29.08.2018 [in which the decision of the High Court dismissing the Respondent's (Plaintiff in the 15 Court below), claim for negligence was reversed]. The matter was then ordered to be remitted to the High Court for an assessment of damages before the learned judge. [3] The said assessment of damages was thereafter attended to 20 by the learned judge and an award eventually made. The Respondent was awarded damages in the total sum of RM9,396,088.86 together with interests of 5% from the date of filing the Writ to date of payment and Costs of RM3,000.00 to be paid to the Respondent subject to allocatur. 25 The Background Facts [4] The Respondent had successfully bid for a property at a public auction held under the auspices of the Shah Alam High 30 Court in June 2012. 3 [5] This property was a 16,000 sq ft bungalow in the prestigious 5 neighbourhood known as Country Heights, Kajang. It sat on a piece of land approximately 21,000 sq ft in area. The auction price of the property is stated as RM3.51 million. The Respondent also claimed that she paid RM351,000.00 as 10% deposit. 10 [6] The Respondent obtained a loan from the Alliance Islamic Bank to finance the purchase of the property for RM3,211,900.00. [7] Before the transaction could be completed, the Bank of Punjab 15 (BOP) intervened, claiming ownership of the property by virtue of an AMLA Vesting Order. An Originating Summons (OS), was filed by the BOP in the Shah Alam High Court against, inter alia, both the Appellants and the Respondent. This OS was eventually successful. The Respondent and the Appellants 20 appealed this decision all the way to the Federal Court. The Appeals were unsuccessful. [8] The learned judge of the Shah Alam High Court who heard this OS made a finding that the Appellants were liable in 25 negligence as part of the decision delivered. [9] The reason why the Appellants were found negligent is because they failed to endorse a Notice of Seizure on the title to the property after having been served with the same by the 30 police. 4 [10] As it transpired, this property was purchased by a Pakistani 5 criminal using proceeds he obtained by cheating the BOP. The Malaysian police were asked to assist in the recovery of the assets involved, this property being one of them. [11] This is why the BOP had obtained a Vesting Order under 10 section 61 of the AMLA. The Respondent remained completely unaware of this Vesting Order, nor was she aware the property had been seized by the Malaysian police, prior to her successfully bidding for the same. 15 [12] Had the First Appellant endorsed the Notice of Seizure on the title to the property, none of this would have happened. [13] The Respondent suffered loss as a result of the Appellant's negligence. She claims for loss of her property and all associated 20 costs of acquiring it including payments of the bank loan, loss of the profit for re-sale of the property, lawyer’s fees and other miscellaneous payments made to upkeep the property whilst litigation was on-going. 25 This Appeal [14] The Appellants submitted that the total amount awarded by the learned judge was wrong and erroneous for failing to give due consideration to the fact that the claim is wholly baseless, without 30 sufficient evidence, unreasonable and contain an element of 5 double counting. The Appellants relied on the grounds stated in 5 their written submission. [15] The Respondent on the other hand submitted that the award by the learned judge ought not to be disturbed as it was clearly made on sound legal principles applied to the evidence of loss 10 made available through the viva voce evidence of witnesses on oath and the supporting documentation produced and marked as exhibits. The Respondent also referred to her written submission. 15 [16] We considered the parties’ submissions both oral and written. We made our decision which was unanimous that there is merit in the appeal. The Appellants’ appeal is partly allowed by reducing the damages from the total sum of RM9,396,088.86 awarded by the learned judge to the Respondent to RM4,862.791.26 and Costs of 20 RM5,000.00 to the Appellant. The Order of the High Court is set aside and substituted with damages ordered by this Court only as follows-

(i) Kehilangan atas nilai harta RM 3,690,000.00 25

(a) acted on the wrong principles; 9

(b) misapprehended the facts; and 5

(c) had for these or other reasons made a wholly erroneous estimate of his damages. [10] Secondly, it is fundamental and tried that a Plaintiff 10 claiming damages must prove his damage, …… [11] Thirdly, the assessment of damages in action in this nature does not admit of fixed rules and mathematical precision, but is a matter left to the sound discretion to 15 the judges .The fairness and reasonableness of the award cannot be subjected to any recognized test or measure by any certain standard. If the award is manifestly inadequate or excessive, or there are indications that the award was influenced by improper considerations or the 20 mistake was too plain, the Appellate Court should not hesitate to remedy the trial court's error. All the courts should do are to award sums which is reasonable, moderate and conventional”. 25 The Damages Claimed/Awarded [23] The learned judge summarised the Respondent’s claim for payment which was alleged to have incurred related to the said property as follows- 30 10 i) 10% deposit of the auction price: RM 351,000.00 5 ii) Loss of profit for resale of property: RM 3,690,000.00 iii) Monthly payments to Alliance Islamic Bank as at 3.12.2018: RM 1,139,986.55 10 iv) Stamp duty: RM 99,300.00 v) Redemption sum for the loan financing from Alliance Islamic Bank as at 24.8.2017: RM 2,912,272.01 15 vi) Maintenance, assessment and insurance premiums: RM 30,739.04 vii) Legal fees: RM 1,172,791.26 20 [24] The Respondent gave evidence and tendered documents marked as exhibits P1 to P11 to support the above claim. It was also stated that she had mitigated her loss. 25 [25] The Appellants disputed the Respondent’s claim and the learned judge summarised the Appellants’ grounds as follows-i. The Respondent is not entitled to the10% deposit of RM351,000.00 on the ground that this amount must be paid 30 to qualify her as a bidder in the auction sale. Since she had enjoyed the right to bid and eventually bought the property therefore, the amount cannot be claim as part of her loss. In 11 other words, there is no loss and without paying the amount 5 she would not be entitled to bid for the property. ii. The loss of profit for resale of property cannot be claimed on the basis that the Respondent’s claim is more for wasted expenditure. The Respondent can only claim the amount 10 spent in order to buy the property or alternatively, the loss of profit is caused by her own fault by giving wrong representation to the buyer, Lai Siew Fah. iii. For the monthly payment to the bank and redemption sum 15 to settle the loan of the property, it should not happened because the registrar caveat and private caveat are registered on the property which is shown in the Proclamation of Sale however, the Respondent went ahead to bid for the property. The Respondent took the risk and 20 the blame for the loss suffered cannot be put on the Appellants’ but by her own conduct and action. iv. Maintenance, assessment and insurance claim must be rejected on ground that all the related documents are from 25 1990 until December 2013 when the property was only acquired by the Respondent in 2012. v. The Respondent is not entitled to claim for legal fees of RM1,172,791.26 because there was no costs awarded by 30 the High Court and the Court of Appeal to the Respondent. 12 Under Order 59 rule 1 of the Rules of Court 2012, “Costs” 5 includes fee, charge, disbursements, expenses and remuneration. vi. The alleged loss and damages claimed by the Respondent is too remote. The Appellants cannot be held responsible 10 because it is not foreseeable on their part that the failure to register the seizure and vesting right over the property would result in the property been auctioned off and bought by the Respondent and later sold it to the third party. 15 vii. The Respondent failed to mitigate the loss. [26] The learned judge having considered the evidence and submissions of parties, made his finding that the Respondent is entitled to all her claims as shown above with the total amount 20 awarded is RM9,396,088.86. The finding of the learned judge is at paragraph 27, pages 19 to 26 of the grounds of judgment (see pages 28 to 35 of the Rekod Rayuan Tambahan (Bahagian A). Our decision 25 [27] The Appellants in the submissions made a second attack on the Respondent’s claim relying on the same grounds raised at the High Court as mentioned in the above paragraphs. We will examine the learned judge’s decision whether the finding on the 30 assessment of damages was erroneous based on the Appellants’ 13 complaint and that the Respondent’s claim are wholly baseless, 5 without sufficient evidence, unreasonable and contain an element of double counting. [28] The general rule as to the measure of damages is that sum of money which will put the party who has been injured, or who has 10 suffered, in the same position as he would have been if he had not sustained the wrong for which he is now getting his compensation or reparation. When a plaintiff claims damages from a defendant he has to show that the loss in respect of which he claims damages was caused by the defendant's wrong and 15 also that the damages are not too remote to be recoverable. And the plaintiff must prove their damage. Where precise evidence is obtainable the Court naturally expects to have it, where it is not, the Court must do the best it can. General difficulty of proof does not dispense with the necessity for proof. The case of Cheng 20 Hang Guan & 2 Ors v. Perumahan Farlim (Penang) Sdn Bhd & 3 Ors [1994) 1 CLJ 19 is cited. [29] In Liew Choy Hung v Shah Alam Properties Sdn Bhd (1997) 2 CLJ 601 the Court held that the general rules underlying the 25 assessment of damages is, so far as is possible by means of a monetary award, to place the plaintiff in the position in which he would have occupied if he had not suffered the wrong complained of, be that wrong a tort or a breach of contract. 30 14 [30] In this case, it is not disputed that the Respondent gave evidence 5 and tendered documents marked as exhibits P1 to P11 to support the claims. She has taken step to mitigate her loss. It was submitted that no rebuttal evidence was led by the Appellants. The learned judge accepted the Respondent’s evidence in toto and gave judgment to all the claims prayed for by the 10 Respondent. In some of the claims, there is no clear evidence that the Respondent had proved the claims and no clear explanations or reasons why the claims were awarded. [31] The appeal is by way of rehearing. Section 69 of the Court of 15 Judicature Act 1964 provides that appeals shall by way of re-hearing, and in relation to such appeals the Court of Appeal shall have all the powers and duties, as to amendment or otherwise, of the High Court. The Court of Appeal may draw inferences of fact, and give any judgment, and make any order which ought to have 20 been given or made, and make such further or other orders as the case requires. [32] The Courts had held that the Appellate Court may interfere with an award of damages if satisfied that the Judge has acted on a 25 wrong principle of law, or has misapprehended the facts, or has for these or other reasons made a wholly erroneous estimate of the damage suffered. 15 [33] Based on the evidence adduced and the facts of the case, we 5 examined the learned judge decision on the assessment of damages and gave our views as follows: -

(i) Deposit paid by the Respondent at the public auction-RM351,000.00 10 We agreed with the Appellants that the Respondent is not entitled to the claim for the 10% deposit of RM351,000.00. Having perused the Respondent’s Amended Statement of Claim, we found the amount claim is quite confusing. For example, in 15 paragraph 4, it was pleaded that she paid the auction price of the property for RM3,510,000.00, while in paragraph 7, the 10% deposit amount pleaded is RM351,000.00 and in the particulars of loss and damage, the amount pleaded is RM350,000.00. Even the learned judge also got it confused when he awarded the 20 amount as RM351,000.00 which was not the amount prayed for. We thought maybe it is a typo error, but surprisingly, the Respondent’s evidence in Court during cross-examination stated that she bought the property for RM3.15 million. The mistake if any was never corrected during the re-examination. At the same 25 time there is no contemporaneous documents to confirm the exact amount. In such a case, it must be accepted that the 10% deposit was RM315,000.00 following the Respondent’s evidence in Court. Clearly, the amount pleaded, prayed for and the evidence given were different which gave rise to confusion. The 30 learned judge also failed to explain the differences in the amount 16 in his grounds of judgment or failed to find that the Respondent 5 failed to prove the exact amount. PW1: I bought RM3.1 and then I get 90% loan. This one is my second property that’s why I get 90%. P/Def: 90%? 10 PW1: RM 3.15 million. It should be RM3. Something million. [see notes of evidence at page 28 of the Rekod Rayuan Tambahan Responden] 15 This is consistent with the loan of RM3,211,900.00 she took from the bank inclusive of legal documentation costs and other expenses imposed by the bank. The facility agreement was executed on 20.09.2012. 20 The 10% deposit is a pre-conditioned term in an auction sale which must be paid in order to qualify the Respondent as a bidder. It is not disputed that she had successfully bid for the property on 18.06.2012. Auction is very generally defined as a sale to the highest bidder, and this is the usual meaning. A sale 25 by public auction shall be complete when the auctioneer announces its completion by the fall of the hammer. A sale being concluded at the fall of the auctioneer’s hammer could only refer to that stage of the transaction of sale when there is concluded an agreement between the vendor and the highest bidder. 30 17 In this case, it cannot be disputed that there is evidence that the 5 property was transferred to her name which enable her to get 90% loan from Alliance Islamic Bank to part-finance the purchase of the property. The property was charged to the bank as security for the said loan on 30.10.2012. The loan taken was paid to the Senior Assistant Registrar of the High 10 Court on 02.10.2012 with the 10% deposit which was paid earlier to settle the full purchase price of the property. In other words, she had enjoyed the right to bid for the property and eventually successful in buying the property. 15 In awarding this amount the learned judge referred to the redemption statement (exhibit “SK-3”) issued by bank officer Sugumaran A/L Kasi dated 04.12.2018 (Exhibit P11). We found exhibit “SK-3” is nothing to do or is not related to the 10% deposit amount of the auctioned property. It is purely a redemption 20 statement issued by the bank. It is also held that the Respondent is entitled to the claim of the deposit because she did not get any benefit when she had lost the property to BOP. This decision is made without due regard to the other claim by the Respondent for the loss of profit on the resale of the property. If both claims are 25 allowed it will profit the Respondent which the law does not allow. In Subramaniam Paramasivam & Ors V Malaysian Airline System Bhd [2002] 1 CLJ 230, the Court held that: - 30 18 "In attempting to measure the damages that may be awarded to 5 the plaintiffs, two basic principles of assessment must first be understood. The first is with respect to its function. As Lord Blackburn said in Livingstone V. Rawyard Coal Co. [1880] 5 App. Cas 25 at 39, damages is: 10 "That sum of money which will put the party who has been injured, or who has suffered in the same position as he would have been in if he had not sustained the wrong for which he is now getting his compensation or reparation”. 15 The second is a corollary of the first - that in awarding damages, the plaintiff should not be allowed to profit by it..." Based on the above reasons, the 10% deposit amount cannot be 20 claimed as part of her loss. There is no loss and without paying the 10% deposit she would not be entitled to bid for the property. In our considered opinion, the assessments made by the learned judge on this claim is without any basis and wrong. 25 ii) Loss of profit for the resale of the property - RM3,690,000.00. We agreed with the learned judge in allowing this amount. There is a Sales and Purchase Agreement (S&P) executed between the Respondent and Lai Siew Fah dated 19.12.2012 to sell the 30 property at RM7.2 millions (exhibit P1). 19 The Appellants’ argument is that the loss of profit for resale of 5 property cannot be claim on the basis that the Respondent’s claim is more for wasted expenditure. The Respondent can only claim the amount spent in order to buy the property or alternatively, the loss of profit is caused by her own fault by giving wrong representation to the buyer, Lai Siew Fah. 10 Further, it was argued that the selling price of the property at RM7.2 millions is very unrealistic on 19.12.2012 when the property was only bought on 18.6.2012 barely within six months. Therefore, the value of the property cannot shoot up suddenly 15 from RM3.5 millions (RM 3.15 millions) to RM7.2 millions with an increased of 51% in value. It was submitted that, the most the Respondent can claim is the wasted expenditure for revoking the S&P. In the circumstances, it was submitted that the amount of compensation claim at RM3,690,000.00 is unreasonable and the 20 order of the learned judge in allowing this amount must be set aside. In our view “ wasted expenditure” has been clearly explained that it applies to breach of contract between the contracting parties. 25 See: Anglia Television Ltd v Reed [1972] 1 QB 60, Sime UEP Properties Bhd v Woon Nyoke Lin [2002] 3 CLJ 719 and Yeoh Eng Kong v Choo Kok Yeow & Anor [2018] 1 LNS 808. The situation in the present case is different, where the claim for damages arises from tort of negligence. Be that as it may, the 30 Respondent chose to claim for the loss of profit. 20 The Appellant submitted that the loss of profit is caused by her 5 own fault by giving wrong representation to the buyer, Lai Siew Fah. We were of the view that this argument should fail because when the hammer falls at the auction, she was declared the successful bidder and have right over the property which the title of the property eventually transferred into her own name. There is 10 evidence that she obtained the consent from PDRM to remove the Registrar caveat and also the private caveat which was successful. Therefore, as far as she is concerned, her title to the property during the material time is indefeasible under the National Land Code. There cannot be a contributory negligence 15 or wrong representation on her part since the issue of negligence has been decided wholly against the Appellants. It cannot be disputed that the S&P is valid and a stamped document. The Respondent is a real estates agent whose 20 profession is to buy and sell properties. She could have claimed for the selling price of RM7.2 millions irrespective of the increased in value. The selling price by Respondent and purchase price accepted by Lai Siew Fah at RM7.2 millions is a price of a willing seller and willing buyer situation. However, the Respondent only 25 claimed the amount less her purchase price. In our view, when she bought the property at RM3.5 millions (RM3.15 millions) for investment, later lost it on the negligence of the Appellants, then the loss in value of the property requested at RM3,690,000.00 is a very reasonable amount which must be granted as compensation. 30 21 We agreed with this amount of damages awarded by the learned 5 judge. We also agreed with the learned judge’s finding section 51(2) and

The document referred at pages 189-199 is under the 15 name of S. Daljit Singh s/o Sarjit Singh. The claim for cost of maintenance is very suspicious and there is no evidence that it relates to the Respondent. The learned judge did not make any reasonable finding except by 20 accepting the bills on the face value just because the bills were tendered as exhibit. In our view, the learned judge should have considered the Appellants’ complaint and verified the dates on the documents to ensure the claims made were correctly made based on the dates the property was bought by the Respondent. An 25 award of damages cannot be blatantly given without ascertaining whether the Respondent is entitled to the amount claimed in the first place, otherwise it may wrongly enrich the Respondent and caused injustice to the Appellants. 30 viii) Payment for legal fees - RM1,172,791.26 26 5 We affirmed the award by the learned judge because the amount had been agreed between the Respondent and her lawyer to do the legal work for her. The lawyers’ invoices at pages 206 to 214 clearly show that the invoices were addressed to her which means she has to pay or had paid the amount stated in the 10 invoices (Exhibits P6, P7, P8, P9). We did not agree with the Appellants’ suggestion that the overall fees were only RM321,142.18 based on the invoices at pages 202, 204, 205, 206, 207, 208 and 209 of the Rekod Rayuan 15

Siti Fatimah Talib for the Appellants (Pejabat Penasihat Undang-Undang Negeri Selangor)

Americk Sidhu for the Respondent (Messrs Americk Sidhu)