Afp Land Limited v Super Line (M) Sdn Bhd (JA-22NCC-76-07/2025)

Before this Court are two applications by the Defendant –

Enclosure 11 : the Defendant's application to set aside the Judgment in Default of Appearance ("JID") entered on 12.8.2025 in favour of the Plaintiff; and

Enclosure 16 : the Defendant's ex-parte application to stay the execution of the JID pending the disposal of Enclosure 11.

Both applications are fixed for decisions today. This Court shall now deliver the decisions.

The Plaintiff and Defendant were shareholders of Palm Resort Berhad ("the Company"). In 1997, they agreed to contribute SGD650,000.00 each as a shareholders' advance to settle the Company's outstanding interest on a syndicated loan.

The Plaintiff paid the full SGD1,300,000.00, including the Defendant's portion ("the Defendant's Advance"). By a letter dated 31.12.1997 (“the letter”), the Plaintiff confirmed that the Defendant's Advance would be due and payable upon demand. This arrangement was further recorded in a board resolution signed by the Defendant's own director.

The Defendant did not repay. On 1.7.2025, the Plaintiff demanded repayment. The action was filed on 11.7.2025. The Writ was served on 16.7.2025. The Defendant failed to enter appearance and the JID was sealed on 12.8.2025.

The Plaintiff then obtained a Writ of Seizure and Sale ("WSS") over the Defendant's shares. On 23.10.2025, this Court granted a conditional stay requiring the Defendant to deposit RM400,000.00. The Defendant failed to comply and the auction proceeded on 24.10.2025.

The Defendant contends that:

the JID is irregular due to defects in the Writ and improper service; and

it has meritorious defences on limitation and absence of agreement.

On irregularity, this Court finds that any defect in the Writ is purely technical and caused no prejudice to the Defendant. The Defendant's reliance on Maxland Sdn Bhd v. Timatch Sdn Bhd [2014] 7 CLJ 149 is misconceived. That case concerned Order 13 rule 6 of the Rules of the High Court 1980, which applies to mixed claims and requires the plaintiff to serve a statement of claim and proceed as if appearance had been entered. The Federal Court set aside the judgment because the plaintiff failed to comply with that mandatory requirement. Here, the Plaintiff's claim is for a liquidated demand only, and judgment was properly entered under Order 13 rule 1 of the Rules of Court 2012 (“ROC 2012”), which permits entry of final judgment upon default without such requirement.

As for service, the Writ was served at the Defendant's registered address by personal delivery and registered post. On this point, the presumption of service under section 12 of the Interpretation Acts 1948 and 1967 (Act 388), read with Order 62 rule 4 ROC 2012, is clearly engaged and not rebutted. Further, Clarion (Malaysia) Sendirian Bhd v Permintex Sanko Technologies Sdn Bhd [2019] MLJU 401 and IIC Hotels & Resorts Sdn Bhd v JP Heritage Sdn Bhd [2022] MLJU 3375 support the proposition that proof of posting by registered post is sufficient to establish service, absent cogent evidence to the contrary.

The Defendant's denial of receipt is difficult to accept when it admits receiving the JID served to the same address by the same method. In the Court’s judgment, the Defendant cannot accept one and deny the other.

The Defendant relies on Goh Teng Whoo & Anor v Ample Objectives Sdn Bhd [2021] 3 MLJ 159, Chung Wai Meng v Perbadanan Nasional Berhad [2017] MLJU 814, Tetuan G Ravi (sebagai sebuah firma guaman) lwn Siow Chien Fu [2021] MLJU 2549 and Tenaga Nasional Berhad lwn Lim Swee Kim dan satu lagi [2025] MLJU 348 for the proposition that AR Registered Post is required and that the AR card must be exhibited. However, all these cases concern service on individuals under Order 10 of the ROC

The Defendant is a body corporate. Order 62 rule 4 ROC 2012 specifically governs service on corporations, providing that service may be effected by leaving a copy at the registered office or by registered post. Order 10 rule 1 ROC 2012 is expressly 'subject to the provisions of any written law and these Rules' and is therefore inapplicable where specific provision exists. The Plaintiff complied with Order 62 rule 4 ROC 2012 by effecting personal service at the Defendant's registered address, which was duly acknowledged.

For completeness, the Defendant invokes the principle of ex debito justitiae, arguing that an irregular judgment must be set aside as of right, citing Tuan Ahmed Abdul Rahman v. Arab-Malaysian Finance Berhad [1996] 1 CLJ 241 and Putri Shazana Megat Abdul Rahim v. Selina Chong Abdullah [2024] CLJU 1628. This principle, while established, presupposes that the judgment was irregularly obtained. For the reasons set out above, this Court finds that the JID was regularly obtained - service was properly effected under Order 62 rule 4 of the ROC 2012 and the Defendant failed to enter appearance within the prescribed time despite having ample opportunity to do so. The ex debito justitiae principle is therefore not engaged.

On limitation, the Plaintiff relies on the express terms of the Letter dated 31.12.1997, which clearly states that the Defendant’s Advance “shall be due and payable upon the Plaintiff’s demand”. The Plaintiff contends that limitation only begins to run from the date of demand, which was 1.7.2025 and that the action filed on 11.7.2025 is therefore within time.

It is settled law that where payment is contingent upon demand, time runs from the date of demand. (See : Ramesh a/l Rajaratnam v Ravindran a/l Sivasubramaniam [2020] MLJU 898). Similarly, in Shinei Geotechnique (M) Sdn Bhd & Ors v Orix Credit (M) Sdn Bhd [2014] 5 MLJ 478, the Court of Appeal held that where a guarantee makes liability contingent upon written demand, time runs from the date of demand and not from the underlying breach.

In this case, demand was made on 1.7.2025 and the action was filed on 11.7.2025, well within the limitation period. Therefore, this Court finds that this defence fails.

On the alleged absence of agreement, this Court observed that the documentary evidence is clear. They are –

the banking documents evidencing payment of the full SGD1,300,000.00 by the Plaintiff;

the Letter confirming that the Plaintiff paid both its own and the Defendant’s portion of the advance and stipulating that the Defendant’s Advance is repayable on demand; and

the board resolution of 31.12.1997, signed by a director of the Defendant, authorising the Company to receive the total Shareholders’ Advance of SGD1,300,000.00.

On the other hand, this Court also finds that the Defendant has produced no evidence to the contrary. Therefore, Defendant’s bare denial does not amount to a bona fide defence.

Accordingly, this Court finds no basis to set aside a regularly obtained judgment where the Defendant has failed to show any arguable defence.

The Defendant seeks a stay of execution, alleging irregularities in the WSS process and undervaluation of its shares.

The application is premised on Order 45 rule 11 and Order 47 rule 1 ROC 2012. Order 47 rule 1(1) ROC2012 provides that when a judgment is for the payment of money, the Court may stay the execution by WSS if there are special circumstances which render it inexpedient to enforce the judgment, or if the judgment debtor is unable from any cause to pay the money.

Order 47 rule 1(2) ROC 2012 further provides that an application for stay of execution may be made at the time of judgment or “at any time thereafter”, and such application shall be supported by an affidavit setting out the grounds relied upon.

It is trite that a stay requires proof of special circumstances (see : Kosma Palm Oil Mill Sdn Bhd & Ors v Koperasi Serbausaha Makmur Bhd [2004] 1 MLJ 257). Therefore, the applicant must show where the greater risk of injustice lies.

The Stay Application seeks a stay of execution of the Judgment “pending disposal of the Setting Aside Application”. However, by the time the Stay Application came before this Court for substantive hearing, the following had occurred –

the auction had already taken place and the Shares had been sold; and

this Court had, on the same day, dismissed the Defendant’s Setting Aside Application in Enclosure 11.

Since there is nothing left to stay, this Court finds that this application has now become academic.

Even if it were not academic, in this Court's considered view, the Defendant's failure to comply with the conditional stay order weighs heavily against it. Having been given the opportunity to preserve its position by depositing RM400,000.00, the Defendant chose not to do so. It cannot now rely on the consequences of its own inaction to claim special circumstances.

Further, the Defendant has not demonstrated special circumstances. The Shares are commercial assets with pecuniary value, not items of sentimental value. Any loss, if the Defendant were to succeed in the Setting Aside Application, could be compensated by damages based on the market value of the Shares.

For the reasons above, the Court orders –

Enclosure 11 is dismissed with costs of RM 7,000.00 subject to allocator; and

Enclosure 16 is dismissed with costs of RM7,000.00 subject to allocator. Dated : 12 December 2025 -sgd-Dr Noradura Binti Hamzah Judicial Commissioner High Court Civil 2 Johor Bahru Solicitors for the Plaintiff : : Peter Neik Xiang Sheng together with Jazz Cheah Jeay Ying Messrs. Neik & Partners Solicitors for the Defendant : : Jessica Christophel a/p George Messrs. Julie Lim, Vasanthan & Co