1. ) Vantage Access Limited v 1. ) NT-2 Corporation Sdn Bhd (BA-22NCvC-471-11/2021)

VANTAGE ACCESS LIMITED

CARGO DAI VIET TRADING AND TRANSPORTATION CO LTD PLAINTIF-PLAINTIF DAN 1. NT-2 CORPORATION SDN BHD

N9 BUMI HOLDINGS SDN BHD

NG TAI YEE

SATHYA MURTY A/L PALANIAPPAN

SIA CHUAN HENG (NO. K/P: 760104-01-6069) DEFENDAN-DEFENDAN 08/04/2025 11:24:14 BA-22NCvC-471-11/2021 Kand. 163 GROUNDS OF JUDGMENT Introduction [1] The Plaintiffs brought this action against the Defendants to recover USD320,801.30 in special damages as well as general and exemplary damages to be assessed for breach of contract, negligent and/or fraudulent misrepresentation. The claim arose in connection with a contract for the supply of 3,000 cartons of nitrile powder free disposable gloves, of which only 1,300 cartons were delivered and found to be defective and recycled used gloves. They were sold by the 1st Defendant [2] It is convenient to refer to the Plaintiffs as P1 and P2 in this Judgment. The Defendants will be referred to as D1, D2, D3, D4 and D5. Initially, D1, D3, D4 and D5 were jointly represented, with D5 filing a separate defence from D1, D3 and D4. D2 was separately represented altogether. In the end, all of the Defendants were jointly represented as solicitors for D1, D3, D4 and D5 discharged themselves. Third party proceedings which were apparently taken out in 2022 by this set of defendants against D2 were not pursued. [3] The principal witness for P1 and P2 were David Yin Ti Wei (who PW2 PW3 respectively. It was not disputed that the Malaysian representatives of P2 were Teo Xing Yi Cindy, PW5 ) and Patrick Lim Meng Huat ( PW6 ). PW1 was a formal witness. The witnesses for the defence were D4 who testified for himself and D1 as DW1, D5 who testified as and Segar a/l Munusamy testified for D2 as DW D3 did not testify at the trial in his own defence. Background facts [4]

On 3-12-2020, D1 issued a delay notice to postpone delivery of the goods to 23-12-2020

On 11-1-2021, Patrick and Cindy inspected a sample of the gloves and found that the colour was wrong, and some cartons contained latex gloves. The goods were rejected

On 17-1-2021, D3 to D5 allegedly resolved the issues for 1,335 cartons fulfilling the Specifications. The 1,335 cartons were packed into a container for shipment.

D1 contended that Cindy had instructed D1 to revise the invoice, inspected the goods and accepted it ( ).

On inspection of D s invoice dated 18-1-2021, P1 claimed that its customer rejected the consignment referred to in that invoice on the grounds that the specifications of the 1,335 cartons were not compliant in terms of size and colour.

On 19-1-2021, while the container was still at the port, P2 terminated the Contract and issued a notice of refund.

D2 collected the container from the port in early February 2021. [9] Thereafter, the following events transpired:

On 2-2-2021, a zoom meeting attended by PW2 on behalf of P1 together with a director of D2, DW3 and D3 to D5.

On 3-2-2021, solicitors representing P2 wrote to D1 and demanded a refund

On 8-3-2021, solicitors repeated the demand for a refund and further claimed shipping and port charges in the sum USD5,419.30.

On 19-3-2021, P2 lodged a police report [10] The matter did not end there as on 23-3-2021, D4 and D5 offered 1,300 cartons of the gloves from the 1,335 rejected cartons. P1 pleaded that it reluctantly agreed to accept this offer to mitigate its losses due to the urgent need to satisfy its own customer demands, as legal actions were being taken against it in the USA. [11] There was a repeat of events in that the 1,300 cartons were to be shipped, this time to Saigon. P1 is said to have paid USD56,784.00 in shipping costs from Malaysia to Saigon ( ). As to whether this consignment had been inspected and accepted by Patrick and Cindy was again disputed. [12] Upon arrival of Shipment 2 on 27-4-2021, PW2 instructed an agent to conduct a cursory inspection on 27-4-2021 and found issues with the gloves. T solicitors then solicitors that the gloves in Shipment 2 were rejected in Saigon as they were defective with signs that they were recycled gloves, with no cuff, torn etc. Analysis and findings [13] Based on the pleadings, the issues to be determined are:

Whether P2 is an agent of P1

Whether D1 is an agent of D2

Whether there was any breach of the Contract

Whether D1 to D5 made false representations that P1 and P2 relied upon to their detriment

If false representations were made, whether they were made negligently and/or fraudulently.

Whether the damages claimed by P1 are recoverable Whether P2 is an agent of P1 [14] P1 is a Seychelles incorporated company operating in Taipei. P2 is a Vietnamese incorporated company. Based on the testimony of PW2 and as corroborated by PW P1 and P2 were both joined in this action as co-plaintiffs and advanced the claims here on the basis that P1 [15] The Contract was made between D1 and P2. The nature of the relationship between P1 and P2 does not absolve D1 from any liability for any breach of the Contract that it had admittedly entered into with P2. The only legal effect of the pleaded agency is that locus standi in response to the privity of contract point, and the recoverability of contractual damages not suffered by P2 in this action. [16] As a matter of law, it is trite that agency is an exception to the privity doctrine in that a third party who is the principal may sue to recover the benefit of the Contract entered into by his agent, and similarly be held liable on the obligations imposed thereunder. As observed in MAA Holdings Sdn Bhd & Anor v Ng Siew Wah & Ors [1986] 1 MLJ 170: It is not uncommon that in mercantile transactions one party acts as agent for an undisclosed principal. The law recognises that and the rights of the parties to a contract made by an agent of an undisclosed principal have been codified in sections 183 to 186 of the Contracts Act. Section 184 goes to the extent of providing that the undisclosed principal may require the performance of the contract even though the other party to the contract neither knew or had reason to suspect that the person he had dealt with was in fact an agent. [17] On the facts, D5 admitted that he was aware that Cindy and Patrick were representing the buyer of the gloves, and that they acted on instructions from PW2. By Shipment 2, it would have been clear from PW participation that P1 was involved in the transaction because this was disclosed during the Zoom meeting on 2-2-2021. Thereafter, solicitors representing P2 also made the relationship plain for the record on 8-3- Whether D1 is an agent of D2 [18] D1 acknowledged that D5 introduced P2 to it, but claimed that D1 order with D2. Unlike P1 and P2, the object of this plea of agency was not locus standi to enforce the Contract, but rather for D1 to disclaim any liability for the Contract on grounds that it was a mere agent of D2. [19] D1 and D2 cannot blow hot and cold on the issue of agency. As an ns and representations within the scope of the agency would be attributed to D2. However, in this case:

D2 contended that it only dealt with D1 and was not privy to pleaded case that it was an agent for D2 in the transaction.

D1 and D2 also disavowed the representations that each had made to the Plaintiffs [and those made by D3 to D5 to the Plaintiffs]. [20] This Court reviewed the evidence and found no factual support for was only a commissioned agent for D2 with no contractual liability arising from the Contract. As represented by D1 and D2, D2 supplied the gloves to D1 who supplied them to P2. The parties to the Contract were accordingly It follows that D2 is not liable to P1 or P2 on a contractual basis. Whether there was any breach of the Contract [21] The written and express terms of the Contract were unambiguous as to the Specifications and delivery schedule. There can be no dispute that D1 was contractually responsible for the delay and unavailability of the quantities of the original 3,000 cartons of gloves ordered. [22] This Court found based on the documentary evidence adduced at trial that the background facts above were satisfactorily proven to have transpired between 3-12-2020 and 30-4-2021. There were 3 key events:

the 11-1-2021 inspection by Patrick and Cindy and rejection of what was supposed to be the 3,000 cartons of gloves ordered for non-conformity with the Specifications;

the 18-1-2021 invoice discrepancy and rejection of the 1,335 (re-worked) cartons of gloves in Shipment 1; and

the 7-4-2021 shipment of 1,300 cartons of gloves to Saigon and its rejection for defects in Shipment 2. [23] The pleaded case relates principally to Shipments 1 and 2. Conformance to Specifications [24] On 13-1- there were latex gloves in the mix and gloves that were not family blue and grey in colour) were corrected. There was no substantive defence to the allegation that the reworked 1,335 cartons of gloves also did not conform to the Specifications. [25] During the Zoom call on 2-2-2021, D4 did not deny that the 1,335 cartons were non-compliant and made excuses about the difficulties encountered due to problems in the production line and shortage of stocks at the supply end. D4 proposed to furnish about 1,500 cartons of available stocks of latex gloves instead. [26] At the trial, D4 also agreed that the 1,335 cartons in respect of Shipment 1 did not conform to the Specifications. However, D4 testified that the non-conformity was on account of the gloves being re-routed to Los Angeles, USA instead of Ho Chi Minh, Vietnam. Apparently, only imported into the USA for sale and this was the reason for the rejection of the gloves by P2. [27] This Court could not make a finding what a lack of FDA 510K certification meant as there was no objective evidence led about what it . It was expressly mentioned during the zoom call that P1, P2 and their end customer were aware that the supply was for CE certif [28] However, it was objectively established on the evidence that there was a discrepancy between the Specifications and what was set out in dated 18-1-2021 for the 1,335 cartons which had been prepared and sent by D3: Specifications What D1 intended to ship as per the description on the commercial invoice prepared while the container of 1,335 cartons was already at port, was different from the Specifications. [29] D5 had initially 2.58 p.m, requested an amendment as the Proforma Invoice contained no customer in the USA who rejected the intended Shipment 1. There was no evidence that P1, P2 or their representatives approved the changes to the colours and sizes of the gloves. [30] Based on the above findings, it was not open for D1 to unilaterally decide to supply something different from the Specifications. The degree to which the goods supplied differ from the description is also irrelevant (Ipmuda Bhd v Bakitan Sdn Bhd & Ors [2010] 9 MLJ 429, Wee Lian Construction Sdn Bhd v Ingersoll-Jati Malaysia Sdn Bhd [2010] 3 MLJ 425). In these cases, the Courts cited Lord Atkin in Arcos Ltd v EA Ronaasen & Son: contract: there always must be some margin: and it is for the tribunal of fact to determine whether the margin is exceeded or not. I cannot agree. If the written contract specifies conditions of weight, measurement and the like, those conditions must be complied with. A ton does not mean about a ton, or a yard about a yard. Still less when you descend to minute measurements does 1/2 an inch mean about 1/2 an inch. If the seller wants a margin [31] Another way to determine if there is breach of a contractual description and the implied condition according to Section 15 of the Sale of Goods Act 1957 ( ) for the sale of goods by description is per Wee Lian Construction Sdn Bhd v Ingersoll-Jati Malaysia Sdn Bhd [2010] 3 MLJ 425 where it was held: whether the buyer could fairly and reasonably refuse to accept the goods proffered to him on the ground that their failure to correspond with that part of what was said about them in the contract makes them goods of a different kind from those he had agree [32] Based on the available evidence, this Court finds that there was a clear breach of Contract by D1 in respect of Shipment 1, and P2 did at this point on 19-1-2021, formally reject the 1,335 cartons and terminated the Contract for failure to meet the requirements of the Contract and demand a refund of the Contract price paid. [33] subsequent response seems to be that there was no breach of the Contract because regardless of their specifications, the gloves were inspected and accepted when ,335 cartons to be sealed in the container and despatched to the port for shipment. D1 relied on the clause in the Contract that obliges the buyer to pick up the goods at the factory upon inspection of goods and quantity and in particular the following clause: Risk of loss will be on the Seller until the time when the Buyer accept delivery at site/warehouse [34] The above clause relates to the passing of risk which usually coincides with the passing of property, but is not otherwise to be conflated with the issue of acceptance of goods after property has passed in the event of breach by the seller. Furthermore, whether the goods conformed to specifications is also separate issue from whether the Plaintiffs accepted the goods. Acceptance of the goods disentitles the Plaintiffs from subsequently rejecting the goods, but does not prevent them from claiming damages for breach. [35] Section 41 of SOGA provides that a buyer is not deemed to have accepted goods delivered until he has had a reasonable opportunity of examining them for the purpose of ascertaining whether they are in conformity with the contract. As a matter of law, there is no deemed acceptance of goods and the seller is not absolved from liability for breach of contract even if the buyer waived the contractual requirement to examine the goods before delivery. According to Section 42 of SOGA: intimates to the seller that he has accepted them, or when the goods have been delivered to him and he does any act in relation to them which is inconsistent with the ownership of the seller, or when, after the lapse of a reasonable time, he retains the goods [36] Admittedly, the Plaintiffs did not arrange for inspection of the 1,335 cartons of gloves prior to delivery as envisaged under the Contract. They attributed this to the then prevailing Covid-19 pandemic conditions. It was understood that there was no possibility of third party inspection and certification, which explained the inspection carried out personally by Patrick and Cindy on 11-1-2021. [37] There is no evidence of any notice given to Patrick and Cindy to attend an inspection. Patrick and Cindy testified that they did not have the opportunity to inspect the gloves on 17-1-2021 (Shipment 1 of 1,335 cartons). Due to MCO restrictions, they arrived too late to inspect the gloves which had been boxed, sealed and were being loaded onto the container by the time they arr . [38] On the facts of this case, this Court accepts that there was no reasonable opportunity for the 1,335 cartons of gloves to be inspected by D2 s warehouse, and they were rejected before shipment based on the invoice discrepancy which evidenced the non-conformance with Specifications. There is no evidence of any intimation of acceptance of the goods by the taking of delivery without inspection. [39] In any case, when the invoice discrepancy arose, the container with the 1,335 cartons of gloves was still at the port and had not been shipped. There is no counterclaim for wrongful termination of the Contract. On the contrary, D1 retrieved the container from the port citing to port authorities that the consignment did not follow customer specifications, thereby admitting that the goods were lawfully rejected. [40] The Plaintiffs argued that there was a second admission in -2-2021, where D1 offered to sell the gloves locally and refund the Contract price in 3 months. Counsel for the Defendants categorised it as a Part C document and objected to its admissibility on grounds of negotiations privilege as there was at that point, a threat of litigation on 3-2-2021 for breach of Contract after Shipment 1. [41] As stated by the Federal Court in Malayan Banking Bhd v. Foo See Moi [1981] CLJU 95; [1981] 1 LNS 95;[1981] 2 MLJ 17: law that letters written without prejudice are inadmissible in evidence of the negotiations attempted. This is in order not to fetter but to enlarge the scope of the negotiations, so that a solution acceptable to both sides can be more easily reached. But it is also settled law that where the negotiations conducted without prejudice lead to a settlement, then the letters become admissible in evidence of the terms of the agreement, unless of course the agreement has become incorporated in another document which would then be the evidence of the [42] In this case, no settlement emerged from the 10-2-2021 letter as the proposal therein was flatly rejected by the Plaintiffs through their -2-2021. Accordingly, it should have been expunged from the trial bundles at the outset on that ground. Instead, the 11-2-2021 letter that referred to it was not objected to, and the contents of the 10-2- 2021 letter was even referred in support of arguments made by the Defendants in post-trial submissions. [43] As observed in Dusun Desaru Sdn Bhd & Anor v Wang Ah Yu & Ors [1999] 2 CLJ 749, it is difficult for a judge to pretend that the privileged information which has been revealed has not been exposed. Here, solicitors had by their conduct, effectively waived any privilege This Court will just say that the content of the 10-2-2021 letter was not decisive on the question of whether the 1,335 cartons conformed to Specifications or the question of whether they were lawfully rejected by the Plaintiffs. Merchantable quality and fitness for purpose [44] The first indication of a development in the situation after the termination of the Contract and the demand for a refund came on 23-3- say that D2 had confirmed the availability of 1,300 cartons of nitrile -1-2021 and offered the same to P2 for the same price. Apparently, Cindy and Patrick were still in communication with D3 to D5. [45] Based on a letter from solicitors for P2 dated 24-3-2021, P2 agreed to accept the new offer of 1,300 cartons (out of the 1,335 cartons of nitrile gloves earlier rejected for non-conformance to Specifications). According to P1, it had reluctantly agreed to the proposal to accept the 1,300 cartons of nitrile gloves with specifications as detailed dated 18-1- 2021 for the same price. Without derogating from the original breach of the Contract and the second breach in respect of Shipment 1, this was a new agreement. [46] Like Shipment 1 however, Patrick and Cindy testified that they had no reasonable opportunity to examine the gloves before 7-4-2021 (Shipment 2 of 1,300 cartons) before they were shipped out. This Court finds that evidence to be credible, considering that there is no evidence led that Patrick and Cindy were forewarned to attend an inspection. There were delays since 23-3-2021. On 2-4-2021, D5 forwarded a fresh invoice for the 1,300 cartons of gloves but Shipment 2 was only ready on 7-4-

[47] This Court accepted the evidence of PW2 that by this late stage, P1 decided to accept Shipment 2 on faith based on representations made by D4 and D5 that the 1,300 cartons were of 18-1-2021. [48] According to Section 16 of SOGA, there is an implied condition as to quality or fitness of goods sold and in particular, where the goods are bought by description, there is an implied condition that the goods shall be of merchantable quality. Based on the case of Cammell Laird & Co v. The Manganese Bronze And Brass Co [1934] AC 402, goods are unmerchantable if they are of no use for any purpose for which such goods would normally be used and hence are not saleable under that description. [49] It was reported in a letter dated 30-4- that when the 1,300 cartons arrived in Saigon and cleared customs on 26- 4-2021, P2 had inspected the shipment on 27-4-2021 and discovered significant defects in terms of shortage of number of boxes in cartons and gloves in boxes and defective gloves. [50] An informal report with photographs were attached and the maker of this report attended Court as PW4 to testify to it ( ). PW4 was related to PW2 but the Court found no reason to discredit his testimony. It was consistent with the documented Informal Report which contained details that were not credibly challenged by D1. [51] The 1,300 cartons were rejected and notice was given to D1 to attend a joint inspection and remove the 1,300 cartons within 7 days failing which the goods would be disposed of. The Plaintiff referred to Section 43 of SOGA which provides that a buyer having the right to do so, is not bound to return rejected goods. It is sufficient if he intimates to the seller that he refuses to accept them. [52] As to whether P2 was entitled to reject the 1,300 cartons from Shipment 2, there is in addition to the Informal Report, an inspection report by Intertek Vietnam Limited who was engaged by P1 to conduct a formal inspection of the goods. The inspection report dated 6-5-2021 was prepared with attached photographs ( ). [53] The Defendants objected to the admissibility of the Inspection Report because the maker was not called. According to PW2, the maker of the Inspection Report, one Ms. Dang Thi Thanh Tham, was a Vietnamese inspector who refused to attend Court in Malaysia as it was not part of her scope of engagement. [54] On this issue, there are exceptions to the hearsay rule such as Sections 32(1)(a) to (h), 33 to 37, 73A(1),(2) and/or Section 90A(1) of the Evidence Act 1950. Further, it is now well established that according to Explanation 3 of Section 62 of the Evidence Act 1950, a document produced by a computer (in compliance with Section 90A of the Evidence Act 1950) is primary evidence (Damansara Realty (Pahang) Sdn Bhd v Om Cahaya Mineral Asia Bhd [2021] 5 MLJ 1). [55] As the Intertek inspector resides outside the jurisdiction and refused to attend Court, she was not compellable by a subpoena. It is thus appropriate for the Court to invoke Section 73A(2) Evidence Act 1950 to admit the Inspection Report. In addition, P1 and P2 further argued, and this Court is also inclined to agree, that an alternative mode of admission is via Section 90A of the Evidence Act 1950 as the e- representative with the Inspection Report attached was in evidence as computer evidence under that provision. [56] Based on the Inspection Report, Ms. Dang had concluded that the 1,300 cartons were overall non-conforming and defective. Of a sample size of 1,250 pieces of gloves inspected, the details of the defects were as follows: [57] The findings were not credibly disputed by the Defendants. There was no indignant reaction to the finding that the gloves were apparently recycled from used gloves, which leads this Court to believe that what D1 and D2 had sold to the Plaintiffs under the guise of Eureka branded disposable nitrile gloves fresh from a production line, were in fact recycled used gloves. As such, this Court finds on a balance of probabilities that the 1,300 cartons of gloves shipped to Saigon were not of merchantable quality or fit for purpose. Whether D1, D2, D3, D4 and D5 made the false representations attributed to them, whether P1 and P2 relied on them to their detriment and if D3, D4 and D5 are personally liable [58] In the narrative of the background facts, the following were facts in dispute:

What assurances if any were given by D1 to D5 that persuaded the Plaintiffs to transact with D1 for the glove supply

What transpired between 23-11-2020 and 26-11-2020 that led the Plaintiffs to pay the balance 50% payment

What assurances if any were given by D1 to D5 that persuaded P1 to accept 1,335 cartons for shipment to Los Angeles, USA

What assurances if any were given by D1 to D5 that persuaded P1 to accept 1,300 of the 1,335 cartons for shipment to Saigon [59] The Plaintiffs pleaded that P2 entered into the Contract, that P1 made payments and incurred expenses for the services of freight forwarders and the shipping lines, and that P1 persuaded its customer to accept the gloves manufactured by D2 and supplied by D1 to P2 in reliance upon the false representations of D1 to D5. [60] In essence, it was alleged that D1 to D5 represented that D2 had the capacity to manufacture and supply gloves of merchantable quality, in sufficient quantities and in accordance with the timelines and Specifications stated in the Contract. All of these representations turned out to be false based on the outcome of the transactions as detailed above. [61] The specific representations by D1 to D5 in evidence in the sequence of key events include the following: Representations before with D1 and payment of 50% of the Contract Price on 13-11-2020

On 8-11-2020, D2 issued its Technical Data Sheet and pictures of the boxes of Eureka brand of disposable gloves that show CE certification with AQL 1.5

On 11-11-2020, D2 issued its Certificate of FDA registration dated 27-8-2020 for import into the US, manufactured by D2 and that it will take 2 weeks to start shipping

On 8-11- al Data Sheet and pictures of the boxes of gloves that show CE certification with AQL 1.5

On 11-11- could be fulfilled within a 2-week delivery lead time

On 11-11-2020, D1 issued its quotation for Nitrile Disposable Gloves to P2 D3, D4

Introduced by D5 to Cindy and Patrick as directors of D1 for the procurement of gloves from D2 and liaised with Cindy and Patrick

On 12-11-2020, D3 signed the Contract Representations between 23-11-2020 and 26-11-2020 before payment of the balance 50% of the Contract Price ahead of the 26-11- 2020 delivery

On 19-11-2020, D1 issued its Full Corporate Offer to P2

On 17-11-2020, D2 issued its letter dated 17-11- 2020 confirming its continuing capacity to supply gloves

On 24-11-2020, D2 issued its Full Corporate Offer to D1

On 13-11-2020, D5 assured Patrick and Cindy the gloves were on the ground and being packed

On 17-11-2020, D5 forward the letter dated 17-11- 23 2020 from D2 confirming its continuing capacity to supply gloves

On 20-11-2020, D5 confirmed that the goods were photographs of a production line

On 21-11-2020, D5 gave the following assurance

On 24-11- Offer and voice messages and photographs of packed cartons.

On 23-11-2020, D4 forwarded photographs of packed cartons Representations before Shipment 1 of 1,335 cartons following the 3-12-2020 postponement of the delivery date and the inspection on 11-1-2021 (which led to the rejection of the goods)

On 11-12-2020, D2 issued a letter to D1 that said gloves were continuing to be manufactured and noted the arrangement for 3,000 cartons to be delivered by 18-12-2020

On 11-12-2020, D5 forwarded a letter from D2 to that said gloves were continuing to be manufactured and supplied

On 17-1-2021, D4 and D5 represented to Patrick and Cindy that 1,335 cartons had been sorted to comply with the Specifications and ready for shipment: Representations before acceptance of Shipment 2 of 1,300 cartons of nitrile gloves on 7-4-2021

On 2-2-2021, D4 represented that there were issues on stock availability due to MCO restrictions and offered latex gloves instead

On 23-3-2021, D4 informed that 1,300 cartons in -1-2021 were available for shipment

On 23-3-2021, D5 informed that 1,300 cartons in -1-2021 were available for shipment

On 1-4-2021, D5 issued new invoice for 1,300 cartons of nitrile gloves, which P1 accepted despite further discrepancies [62] Despite the above evidence, D2 contended that it never made any representations to the Plaintiffs. D3 and D4 disclaimed any personal responsibility as directors of D1 under the shield of the corporate veil. D5 representatives, but denied that he represented D1 or that he made any representations attributed to him. D5 also relied on the corporate shield by claiming to be an agent of D1. [63] In considering these defences, this Court referred to Md Zainudin bin Raujan v Public Prosecutor [2013] 3 MLJ 773 where the Federal Court held: [33] It is trite that the inherent probability or improbability of a fact in issue must be the prime consideration in deciding whether a witness is credible or not. It is the duty of the court to sieve the evidence and to ascertain what are the parts of the evidence tending to incriminate the [64] It is improbable that D2 did not know that its quotation, technical and promotional material and letters of assurances it generated were same. As testified by DW3 (Segar), D2 provided the Eureka box packaging and packaged the gloves that D2 purchased from others. No clarity was provided : DW3 claimed to have no knowledge of answers to questions posed to him, specific to the Contract despite the fact that it issued the Full Corporate Offer. [65] Regardless, D2 understood that the Plaintiffs believed D2 was the manufacturer of the gloves supplied. D2 received full payment from D1 for the 3,000 cartons that were not ready for delivery at any material time during the life of the transactions. D2 was also ultimately responsible as the source of the recycled used gloves packed and shipped to Saigon in the 1,300 cartons of gloves. Thus, this Court finds that D2 cannot avoid liability for misrepresentation on the facts established. [66] As for D5, his credibility was severely diminished by his bare denial in the face of the overwhelming evidence of his key role in the transactions as the party who conveyed much of the false information to Patrick and Cindy. D5 was an agent of D1 who collaborated closely with D3 and D4 from the supplier side. Again, it is improbable that D5 did not know that consumption and that there would be reliance on the same. Additionally, at no time before 26-11-2020 did D5 inform Patrick and Cindy of the position he took during the trial, that the 3,000 cartons were not ready at any point in time. [67] The sequence of events and the conduct of the Plaintiffs in proceeding with the transactions despite the many issues emanating from the supplier side, cannot be explained in any way other than as the result of the many assurances given by D3, D4 and D5 on behalf of D1, and by the written representations furnished by D1 and D2 and conveyed through them as aforesaid. If false representations were made, whether they were made negligently and/or fraudulently [68] In Letchumanan Chettiar Alagappan @ L Allagapan (as executor to SL Alameloo Achi Alias Sona Lena Alamelo Acho, deceased) & Anor v. Secure Plantation Sdn Bhd [2017] 5 CLJ 418: [2017] 4 MLJ 697, the Federal Court said: [18]...Fraud, in the contemplation of a Civil Court of Justice, may be said to include properly all acts, omissions, and concealments which involve a breach of a legal or equitable duty, trust or confidence, justly reposed, and are injurious to another, or by which an undue or unconscientious advantage is taken of another (Story, Eq Jur 187). All surprise, trick, cunning, dissembling and other unfair way that is used to cheat any one is considered fraud (Finch 439). Fraud in all cases implies a wilful act on the part of any one, whereby another is sought to be deprived, by illegal or inequitable means, of what he is entitled to (Green v. Nixon (1857) 23 Beav 530 at 535)" (Kerr on Fraud and Mistake 7th edn at p 1). "The concept of fraud is notoriously difficult to define" (Cavell USA Inc and another v. Seaton Insurance Company and another [2009] EWCA Civ 1363 per Longmore LJ, Mummery and Toulson LJJ in agreement). We would not hazard to define 'fraud'. We would just say that 'fraud' is a generic term which also covers all manner of cheat, deceit and dishonesty. Given its wide meaning, 'an action in fraud will usually include a number of distinct causes of action...' and 'claims to trace assets in equity or, perhaps, at common law' (Bullen & Leake & Jacobs Precedents and pleadings (18th Ed Vol 2) at 57-01) [Emphasis added] [69] More specifically, a false representation amounting to the tort of deceit is a fraud. As explained in Puncak Alam Housing Sdn Bhd v Menta Construction Sdn Bhd & Anor [2013] CLJU 148: [27] The House of Lords in William Derry, J.C. Wakefield, M.M. Moore, J.Pethick and S.J. Wilde v. Sir Henry William Peek, Baronet [1889] 14 App Cas 337, HL defined "fraud" as a false representation "made (i) knowingly or (ii) without belief in its truth or (iii) recklessly, without caring whether it be true or false". However, our section 17 of the Contracts Act 1950 defines fraud on a wider scope as compared to the common law meaning of "fraud" as stipulated by William Derry, J.C. Wakefield, M.M. Moore, J.Pethick and S.J. Wilde v. Sir Henry William Peek, Baronet (supra). Paragraphs (d) and (e) of section 17 of the Contracts Act 1950 stipulates that any act "fitted to deceive" another or "any such act or omission which the law specially declares to be fraudulent" may also constitute fraud under the said Act. Reference should also be made to such cases like M/s R.C. Thakkar v. (The Bombay Housing Board by its successors) now The Gujarat Housing Board [1973] AIR Guj 34; and Kamal Kant Paliwal v. Smt. Prakash Devi Paliwal and others [1976] AIR Raj 79. [70] Based on the preceding section of this Judgment on the false representations made by D1 to D5 to the Plaintiffs, this Court is prepared to find that they made those representations knowingly, or without belief in its true or recklessly, without caring whether they be true or false. They were made to deceive the Plaintiffs into paying for gloves that were not of merchantable quality. [71] The Plaintiffs have pleaded in the alternative that the misrepresentations were made negligently. Negligence per se cannot amount to fraud and involves a different state of mind. In this case, it is not necessary to consider if the misrepresentations made by the Defendants were negligent misstatements, as this Court having concluded that D3, D4 and D5 all had a dishonest state of mind in their dealings with the Plaintiffs. [72] It was plain on the totality of the evidence before the Court that the Defendants were all inter-connected parties who were not dealing at arms-length with each other. According to DW3, D1 bought a container of gloves every during each of Shipment 1 and Shipment 2. It could not have escaped D3, D4 and D5 as agents of D1, that:

the Quotation and Full Corporate Offer contained terms that were never intended to be fulfilled; and

the technical materials, photographs and representations they made about D2 were intended to falsely portray a legitimate manufacturing facility for disposable nitrile gloves. [73] The gloves supplied by D2 were not freshly manufactured gloves from a glove production facility, but comprised used or recycled gloves. The responses of D1 and D2 to the Inspection Reports of what Shipment 2 turned out to be were not the normal responses one would expect. As noted, there was no attempt to defend the product and no third party proceedings were taken out and/or maintained either by D1 against D2 or vice versa. [74] As noted earlier in this Judgment, D3 and D4 are directors of D1 while D5 admitted that he is an agent of D1 or a partner of D3 and D4 in the business dealings. The acts and omission of agents bind their principals and there was no suggestion that D3, D4 and D5 were on a frolic of their own in the transactions with the Plaintiffs. [75] Further, it is trite that in cases where there are signs, as there are in this case, that the separate personalities of companies are being used to enable persons to evade their contractual obligations or duties, the Court would lift or pierce the corporate veil. The Federal Court in Ong Leong Chiou & Anor v Keller (M) Sdn Bhd & Ors [2021] 3 MLJ 622 explained: of the well-recognised and accepted exceptions to the principle of the separate personality of a company is where the legal entity of a corporate body is utilised for fraudulent, dishonest or unlawful purposes. Those seeds of limitation were set out in the locus classicus of Saloman v Saloman itself by Lord Davey: order to achieve an object not permitted by the provisions of the [Companies] Act, the appropriate remedy (if any) would seem to be to set aside the certificate of incorporation, or to treat the company as a nullity, or, if the appellant has proceeded against civilly or criminally [3] In such circumstances the person or persons perpetrating such abuse cannot hide behind the separate corporate Our law journals are replete with case-law on this [Emphasis added] [76] In this case, this Court agrees that the corporate veil of D1 ought to be lifted to attribute personal liability to D3, D4 and D5 for the contractual and tortious liabilities of D1. Whether the damages claimed by P1 are recoverable [77] The USD320,801.30 in special damages claimed by the Plaintiffs comprised the following: Item Amount (USD) Full purchase price of the Contract 237,000.00 Freight forwarding charges from High Light Express in respect of 5,419.30 Shipment 1 Legal fees paid to Messrs Lee and Li to address customer claims against P1 in US, Taiwan and Malaysia 20,300.00 Wasted shipping charges to Saigon and import taxes 56,784.00 Inspection costs 1,298.00 TOTAL 320, 801.30 [78] Save for the Invoice for legal fees paid to Messrs Lee and Li dated 30-9- and substantiation for the other claims as they have been referred to and backed up with supporting documentation in the course of correspondence between solicitors since 3-2-2021. [79] As no other general damages were proved, and no particulars of exemplary damages were pleaded, no other award of damages is made. Conclusion [80] claim is allowed and Judgment is entered in the following terms:

The Contract dated 12-11-2020 and subsequent agreement for the supply of 1,300 cartons of nitrile gloves between D1 and the Plaintiffs are rescinded for breach;

A declaration that the corporate veil of D1 is pierced;

The following sums be paid by D1, D2, D3, D4 and D5 jointly and severally to the Plaintiffs: -

Damages in the sum USD300,501.30 for breach of contract and fraudulent misrepresentation;

Interest thereon at 5% from the date of the filing of the writ until full payment; and

Costs of RM100,000.00. Bertarikh : 8 April 2025 SGD ELAINE YAP CHIN GAIK PESURUHJAYA KEHAKIMAN MAHKAMAH TINGGI MALAYA SHAH ALAM Peguam Untuk Plaintif-Plaintif: Dhiren Norendra (with Saroop Rampal and Pooja Rai), Messrs Norendra & Yap Untuk Defendan-Defendan: Muthu A/L Suppiah (with Sivashankar A/L Sivanandam),