Tawfiq Ayman v Perbadanan Pengurusan One Menerung (WA-22NCvC-368-07/2023)

TAWFIQ AYMAN (IC No.: 460604-10-5637)

AZIZ AYMAN (IC No.: 850602-14-6463) …DEFENDANTS (In Counterclaim) Judgment [Enclosure 16] Introduction [1] The plaintiffs filed an application in Enclosure 16 to strike out several paragraphs of the Counterclaim of the 1st defendant contained in the Defence & Counterclaim of the 1st to 8th defendants dated 01-09-2023, [Enclosure 9]. [2] The 1st defendant is the Management Corporation of a high-end development in Bangsar, Kuala Lumpur known as One Menerung Condominium comprising of 229 units situated in six (6) blocks featuring single units in tower blocks, townhouses and 5-storey link homes. I shall refer to the 1st defendant as OMMC for clarity. [3] The 2nd to 8th defendants were the members of the Management Committee of the OMMC for the years 2022/2023 term. The 9th defendant is a proprietor of a unit at the One Menerung Condominium. He filed a separate Defence dated 29-08-2023, [Enclosure 8]. The 2nd to the 9th defendants are not involved in this striking out application. [4] During the hearing on 19-02-2024, after I have raised some queries in relation to the basis for the striking out, the plaintiffs’ counsel informed me that he agreed to reduce the number of paragraphs to be struck out to just paragraphs 49 to 49.6, 51.3 and 51.4 of the Counterclaim dated 01-09-2023. [5] The basis for the striking out application is that these paragraphs contain claims which were earlier filed by OMMC against the plaintiffs here in KLHC Suit No. WA-22NCvC-146-03/2019 (“Suit 146”), which has been discontinued by OMMC with no liberty to file afresh pursuant to a settlement agreement between OMMC and the plaintiffs here. [“Settlement Agreement”]. [6] The Amended Statement of Claim for Suit 146 can be seen in Enclosure 17 supporting affidavit at PDF page 63 at Exhibit TA-1. A joint Notice of Discontinuance by OMMC and the plaintiffs here to discontinue their respective claims in Suit 146 with no liberty to file afresh dated 24-02-2023 can be seen see in Enclosure 17 supporting affidavit at PDF page 191 Exhibit TA-3. [7] OMMC does not deny filing a discontinuance with no liberty to file afresh in Suit 146 but contends that it can refile afresh the same claim. When pressed by me for authorities in support, learned counsel for OMMC said he has no case in support. Issue before me [8] The issue therefore before me is whether a party who has discontinued a court claim with no liberty to file afresh can subsequently refile the same claim in Court. [9] After hearing counsel, I disagreed with OMMC’s position and struck out paragraphs 49 to 49.6, 51.3 and 51.4 of the Defence & Counterclaim dated 01-09-2023 with costs of RM 10,000.00 subject to allocatur. [10] OMMC has filed an appeal to the Court of Appeal on 06-03-2024. These are my Grounds of Judgment. Background facts [11] In the suit before me the plaintiffs have sued the nine defendants here pertaining to breaches of the Settlement Agreement that was entered into between the 1st plaintiff and OMMC. [12] The nine defendants are –

Perbadanan Pengurusan One Menerung

Teh Kean Ming

Tan Chia Ee

Jasmine Mohd Haneef

Ooi Chin Khoon

Yap Kian Tat

YAM Raja Juliana Ibni Sultan Idris

Lam Chung Ming

Yap Kim San [13] The Settlement Agreement relates to the discontinuance of three suits that involved the parties here. For purposes of this Judgment it is sufficient for me to identify these suits as Suit 146, Suit 44 and Suit 59. The salient terms of the Settlement Agreement are - i) OMMC to withdraw the main suit of Suit 146, and the plaintiffs to withdraw the Counterclaim in Suit 146, both of which are without liberty to file afresh; ii) The plaintiffs to withdraw suit 44 and 59 against OMMC; and iii) The plaintiffs are to receive a payment amounting to RM 250,000.00. [14] The settlement term as per item (i) above has been complied with. OMMC and the plaintiffs have filed a joint Notice of Discontinuance with no liberty to file afresh dated 24.02.2023 (see Enclosure 17 supporting affidavit at PDF page 191 Exhibit TA-3). [15] However, in breach of the Settlement Agreement OMMC decided not to pay the compensation of RM 250,000.00 to the plaintiffs. This caused the Plaintiffs to commence this current action against OMMC and the 2nd to 9th defendants. [16] OMMC besides filing a Defence filed a counterclaim on matters which had already been claimed by them in Suit 146, and later withdrawn with no liberty to file afresh. This fact is not disputed by OMMC. The similarities between Suit 146 and the Counterclaim in the suit before me have been set out in Enclosure 40 the plaintiffs’ written submissions at paragraph 4. [17] As I have mentioned earlier, it is OMMC’s position that it can refile the claim which was earlier filed in Suit 146 despite having filed a joint Notice of Discontinuance dated 24-02-2023 to discontinue its claim in Suit 146 with no liberty to file afresh. (See Enclosure 17 supporting affidavit Exhibit TA-3). Whether a party who has discontinued a claim with no liberty to file afresh can refile the same claim later? The law [18] The law is settled that where a plaintiff has entered into a consent order with the defendant to withdraw his suit 'with no liberty to file afresh' he cannot subsequently file against the same defendant a second suit based on the same facts or substantially the same facts. A consent order gives rise to a plea of res judicata. The plaintiff will also be estopped from filing the second suit against the defendant based on the doctrine of estoppel. [See Boustead Trading (1985) Sdn Bhd v Arab Malaysia Merchant Bank [1995] 3 MLJ 331 FC and Mayban Allied Bhd (formerly known as Phileo Allied Bank (M) Bhd) v Kenneth Godfrey Gomez & Anor [2011] 5 MLJ 219 CA]. [19] In Mayban Allied Bhd (formerly known as Phileo Allied Bank (M) Bhd) v Kenneth Godfrey Gomez & Anor [2011] 5 MLJ 219 CA the Court of Appeal said at – Held (3) … In respect of the first suit, the appellant and the respondent entered into a consent judgment or order dated 25 August 2003. The first suit was withdrawn by the appellant 'without liberty to file afresh' with a notice of discontinuance to be filed within one week from the date of the consent order. A consent order could give rise to a plea of res judicata. The doctrine of estoppel as expounded in Boustead Trading (1985) Sdn Bhd v Arab Malaysia Merchant Bank [1995] 3 MLJ 331 applied. To allow the appellant to file the second suit based on the same facts or substantially the same facts was unjust and grossly prejudicial to the respondents particularly when the counterclaim against the appellant had been withdrawn by the respondents… “[25] It must be noted that the appellant's letter dated 12 August 2003 to the respondents clearly proposed that the first suit be withdrawn 'without liberty to file afresh'. The respondents' reply to that letter, also affirmed that the said withdrawal was 'without liberty to file afresh'. The consent order dated 25 August 2003 also made no mention that the first suit was withdrawn 'with liberty to file afresh'. On the above strength and understanding, the respondents also withdrew their counterclaim against the appellant. It was a clear representation that there would be closure of the matter. Thus, the doctrine of estoppel as expounded in Boustead Trading (1985) Sdn Bhd v Arab-Malaysia Merchant Bank Bhd [1995] 3 MLJ 331 is applicable in the present case. The appellant ought to be estopped from filing the second suit against the respondents. In the circumstances, to allow the appellant to file a fresh action (the second suit) based on the same facts or substantially the same facts would be unjust and grossly prejudicial to the respondents particularly when the counterclaim against the appellant had been withdrawn by the respondents” [Emphasis added] [20] In Tang Choon Meng & Ors v Khoo Boo Lai & Ors [2023] MLJU 1189 HC Azizan Md Arshad JC said – [52] On the issue of res judicata, the court agrees with the Citors that there is no res judicata because the filing to the PA -22NCvC- 41- 03/2022 is different from the current action. Furthermore, the Citors have file an application to withdraw suit PA-22NCvC-41- 03/2022 and the order without liberty to file afresh only apply to the same cause of action. So, there is no res judicata. [Emphasis added] Application to facts [21] The reasons given by OMMC for not honouring the RM 250,000 payment earlier agreed by OMMC under the Settlement Agreement are – i. OMMC has wrongly agreed to the Settlement Agreement which is ultra vires the Strata Management Act 2013 and further is opposed to public policy. As a consequence, the Settlement Agreement is void and has no effect. [See Enclosure 44 OMMC’s written submissions at paragraph 25]. ii. The execution and completion of the Settlement Agreement was subsequently voted against by the majority of One Menerung proprietors at an Extraordinary General Meeting on 15-04-2023. [See Enclosure 44 OMMC’s written submissions at paragraph 27]. [22] With respect, I find counsel for OMMC has missed the point. Whether or not the reasons given by OMMC for not honouring the RM 250,000 payment earlier agreed by OMMC under the Settlement Agreement are valid or not, they are not a defence to the fact that having entered into the Settlement Agreement to discontinue their claim with no liberty to file afresh and thereafter filing a Notice of Discontinuance with no liberty to file afresh, OMMC cannot now refile the same claim in Court. [23] For the reasons given by the Federal Court in Boustead Trading

Sdn Bhd v Arab Malaysia Merchant Bank [1995] 3 MLJ 331 FC and the Court of Appeal in Mayban Allied Bhd (formerly known as Phileo Allied Bank (M) Bhd) v Kenneth Godfrey Gomez & Anor [2011] 5 MLJ 219 CA, I hold that the Counterclaim filed by OMMC is caught by res judicata and further OMMC ought to be estopped under the doctrine of estoppel from filing the Counterclaim against the plaintiffs. The court will not allow a party to take advantage of his own wrong [24] There is a further ground to rule against OMMC. There is a principle of high standing that the courts will not allow a party to take advantage of his own wrong. [25] Raja Azlan Shah Acting CJ Malaya (as His Majesty then was) said in Woo Yew Chee v Yong Yong Hoo [1979] 1 MLJ 131 FC at 133 - It is a universal principle of law that the court would not allow a party to take advantage of his own wrong (see Rede v Farr 105 ER 1188 1189). This principle was in the early cases applied to grants of leasehold interest where a lessee sought to take advantage of his own breach of covenant by calling into operation a clause which rendered the lease void in such an event. This principle has been extended to contracts generally (see Abouloff v Oppenheimer (1882) 10 QBD 295 303; Gallie v Lee [1969] 1 All ER 1062 1081). [Emphasis added] [26] In my view, this universal principle of law must be applied in this case. The Court cannot condone OMMC’s act to rely on its own wrong [assuming OMMC is correct in its contention which has yet to be decided at trial] to evade their agreement not to refile the claim again. [See also Sim Guan Boon v Koon Siew Lin & Ors [2023] MLJU 2022 HC]. Decision [27] I strike out paragraphs 49 to 49.6, 51.3 and 51.4 of the Defence & Counterclaim dated 01-09-2023 with costs of RM 10,000.00 subject to allocatur. …………(signed)…………. Leong Wai Hong Judicial Commissioner High Court of Malaya Kuala Lumpur (NCVC 10) Dated: 20th March 2024 COUNSEL: 1) Isweljet Singh Dhillon A/ L Harjinder Singh with Wan Muhd Ariff Ameer for plaintiffs. (Iswel Dhillon & Co. (Rawang)) 2) Saw Wei Siang for 1st, 2nd, 3rd, 4th, 5th, 6th, 7th and 8th defendants. (Nethi & Saw (Kuala Lumpur)) 3) Puthan Perumal for 9th defendant. (Perumal Brothers (Kuala Lumpur)) CASES REFERRED TO: 1) Abouloff v Oppenheimer (1882) 10 QBD 295 303. 2) Boustead Trading (1985) Sdn Bhd v Arab Malaysia Merchant Bank [1995] 3 MLJ 331 FC. 3) Gallie v Lee [1969] 1 All ER 1062 1081. 4) Mayban Allied Bhd (formerly known as Phileo Allied Bank (M) Bhd) v Kenneth Godfrey Gomez & Anor [2011] 5 MLJ 219 CA. 5) Rede v Farr 105 ER 1188 1189. 6) Sim Guan Boon v Koon Siew Lin & Ors [2023] MLJU 2022 HC. 7) Tang Choon Meng & Ors v Khoo Boo Lai & Ors [2023] MLJU 1189 HC. 8) Woo Yew Chee v Yong Yong Hoo [1979] 1 MLJ 131 FC.