Bina Safee Sdn Bhd v Tetap Yakin Sdn Bhd (WA-11ANCC-36-05/2017)

23.11.2015 30541 28637 14,628.00 10,000.00 (09.09.2016) 4,628.00 14.12.2015 30587 28667 21,942.00 - 21,942.00 28.01.2016 30650 28722 37,100.00 11,829.60 (15.06.2016) 25,270.40 15.04.2016 30777 28820 1,197.80 - 1,197.80 Jumlah 53,038.20 ” [4] The Plaintiff commenced an action against the Defendant by way of Writ together with a Statement of Claim both dated 24/1/2017 for the outstanding sum of RM53,038.20 (“outstanding sum”) and the interest 25 at the Kuala Lumpur Magistrate’s Court vide Suit No.WA-A72NCC- 4286-01/2017. 3 [5] The Defendant then filed a Notice of Application dated 5 8/3/2017 (encl.4) essentially for the following order -

that the Writ and Statement of Claim of the Plaintiff be set aside under O.12 r.10(1)(a) ROC 2012;

in the alternative, that the Writ and Statement of Claim of the Plaintiff be struck out under O.18 r.19(1)(b) and/or (c) and/or (d) 10 ROC 2012 and/or the inherent power of the Court. Findings Preliminary issue [6] The Plaintiff submitted that the Defendant did not state nor 15 raise any irregularity mentioned in r.9 of O.12 ROC 2012 in their application but instead raised the issue of forum non conveniens. The Plaintiff further submitted that the Defendant’s application should be under the Third Schedule of the Subordinate Courts Act 1948 (Act 92), para 2 where the Court may stay the proceedings upon 20 consideration of the following factors:

the cause of action arose, or

the defendant or one of several defendants resides or has his place of business, or

the facts on which the proceedings are based exist or are 25 alleged to have occurred. [7] O.12 r.10(1)(a) ROC 2012 reads as follows : “10 Dispute as to jurisdiction (O 12 r 10)

A defendant who intends to dispute the jurisdiction of the 30 Court in the proceedings by reason of any irregularity as is mentioned in rule 9 or on any other ground shall enter an appearance and, within the time limited for serving a defence, apply to the Court for - 35 4 5

an order setting aside the writ or service of the writ on him”. (Emphasis added) [8] The Defendant has chosen to dispute the jurisdiction of the Court and sought an order setting aside the writ or service of the writ 10 on the grounds that the Kuala Lumpur Magistrate’s Court has no territorial jurisdiction to hear the Plaintiff’s suit or alternatively, the Kuala Lumpur Magistrate’s Court is not the forum conveniens. In my judgment, the Defendant’s application vide O.12 r.10(1)(a) ROC 2012 is properly made by virtue of the phrase “or on any other ground” 15 found in para 1 of O.12 r.10. [9] There is no failure on the part of Plaintiff to state the irregularity mentioned in O.12 r.9 ROC 2012 as it is irrelevant and is not applicable in the present case. 20 [10] The case of Sing Lian Sdn Bhd & Ors v Lim Jit Teng @ Lim Tin Teng & Ors [2006] 7 MLJ 70 (cited by the Plaintiff) can be distinguished in this manner. The Plaintiff relied on the following dicta of Low Hop Bing J (as he then was) at p.88 para 77: 25 “[77] I would observe that O 12 r 7(1) is intended to enable a defendant to obtain an order to set aside the writ, eg where such defendant is claiming immunity from legal process and that the court had no jurisdiction to hear the plaintiffs claim: MBf Capital Bhd & Anor v Dato' Param Cumaraswamy [1997] 3 MLJ 300”. 30 It is crystal clear that His Lordship was merely quoting as an example of a ground to set aside the plaintiff’s writ under O.12 r. 7(1) Rules of the High Court 1980 with reference to the case of Dato’ Param Cumaraswamy (supra) and is certainly not meant to be an 35 5 authority for the grounds upon which O.12 r.10(1) of ROC 2012 are 5 to be used. [11] In my considered view the Defendant’s alternative argument of forum non conveniens cannot be a ground to set aside the Plaintiff’s Writ and Statement of Claim for the following reasons. O.12 r.10(1)

of the ROC 2012 is not the appropriate operating provision for such an application. Here I agreed with the Plaintiff’s submission that if there is a wrong forum, the proceedings ought to be stayed (not set aside or strike out) pending transfer to the proper Court having territorial jurisdiction. This is provided under the Third Schedule of the 15 Subordinate Courts Act 1948, para 2 alluded to above. [12] The aforesaid position is fortified in the case of Siti Nur Aishah binti Ishak v Golden Plus Holdings Berhad [2017] MLJU 413 where Mary Lim Thiam Suan JCA (delivering the judgment of the 20 Court of Appeal) when considering an appeal from the High Court which allowed the respondent’s application to strike out a winding-up petition made pursuant to s.23(1) of the Courts of Judicature Act 1964 (‘CJA’) and/or O.18 r.19 ROC 2012 and/or inherent jurisdiction of the Court. Her Ladyship said that the appeal turned on the narrow 25 issue of the jurisdiction of the High Court of Malaya in the winding-up petition; it being contended by the respondent that the winding-up petition fell outside the jurisdiction of the High Court of Malaya as conferred by s.23 of the CJA. In allowing the appeal, Her Ladyship at paras 34 and 35, amongst others, stated: 30 “[34] … The issue of forum conveniens does not arise where any one of the two High Courts is properly seised with local or territorial jurisdiction. That principle arises only where any of the two High Courts, having jurisdiction over the civil proceedings, is considering whether the 6 proceedings are more conveniently tried by the same High Court but 5 sitting in another part of its local jurisdiction or territory. [35] The issue of forum conveniens cannot arise where both High Courts have local or territorial jurisdiction over the same proceedings because of the peculiar terms of Article 121(1) conferring on both High Courts co- 10 ordinate jurisdiction. Where the principle of forum conveniens is correctly invoked, it frequently resounds in the order of a transfer of proceedings to the other Court”. (Emphasis added) Of great significance is the Court of Appeal’s observation that “Where 15 the principle of forum conveniens is correctly invoked, it frequently resounds in the order of a transfer of proceedings to the other Court”. [13] Another case in point and of relevance is the case of Sopiah bt Mukau v Majrany Corp Sdn Bhd 2010] MLJU 1150 (cited by the 20 Plaintiff) where the Court was considering an appeal against a Sessions Court Judge’s decision in allowing the respondent/ defendant’s application to strike out the action amongst others, on the ground of forum non conveniens in that the Sessions Court at Miri is not the natural and appropriate forum for the adjudication of the 25 dispute. Zulkifli Bakar J in determining this issue stated - “As for case authority referred to by the Respondent/Defendant, that is Supreme Court case of American Express Bank Ltd v Mohamad Toufic Al-Ozeir & Anor … I found it to be distinguishable from our instant case. The American Express case dealt with jurisdiction of the High Courts in 30 Malaysia to hear the action filed and whether in the circumstances of the case, the Malaysian High Court was or was not the forum non conveniens for that case. … In or case, it deals with lower court jurisdiction … which is subjected to territorial jurisdiction … therefore, I rule that forum non conveniens in this case is not a ground to strike out this action …”. 35 Territorial Jurisdiction [14] It is common ground between both the parties that the territorial jurisdiction of the Court is determined, amongst others, on where the cause of action arose. It is the Plaintiff’s contention that the cause 40 7 of action arose in Kuala Lumpur whilst the Defendant contended that 5 it arose in Kota Kinabalu. In so far as the territorial jurisdiction of the Magistrate’s Court is concerned, it is governed by s.76(2) of the Subordinate Courts Act 1948 which provides - “(2) Subject to this Act or any other written law, a Magistrates’ Court shall have jurisdiction to hear and determine any civil or criminal 10 cause or matter arising within the local limits of jurisdiction assigned to it under this section, or, if no such local limits have been assigned, arising in any part of Peninsular Malaysia: Provided that no Magistrate shall have jurisdiction to hear or determine any cause or matter arising in any State in and for which he has not been appointed to be 15 a Magistrate save in the manner and to the extent provided in the Criminal Procedure Code [Act 593] and the law for the time being in force relating to civil procedure”. (Emphasis added) 20 [15] The case of Taman Rimba (Mentakab) Sdn Bhd v Sin Yew Poh Tractor Works [2002] 5 MLJ 321 is instructive on the issue of “territorial jurisdiction” of a Magistrate’s Court, albeit it pertains to, amongst others, the issue of whether the Sessions Court in Ipoh has territorial jurisdiction to try the action, which subject matter took place 25 in Pahang and the defendant’s registered office is in Kuala Lumpur. The background facts giving rise to this issue, amongst others, is: With respect to the plaintiff’s claim in the Ipoh Sessions Court, the defendant filed an application to stay proceedings or alternatively, to transfer of the action to the Sessions Court in Kuala Lumpur. Relying 30 on the following grounds, the defendant stressed that the appropriate forum of convenience for trial of the action should be Kuala Lumpur:

at all material times, the defendant's registered address is and was in Kuala Lumpur, (b) witnesses of both parties in the action are in Kuala Lumpur, (c) the facts on which the plaintiff's case is based 35 have no relationship or connection with Ipoh, (d) and even the plaintiff's place of business is believed to be in Kuala Lumpur. 8 5 [16] In arriving at his reasoning that the Ipoh Sessions Court has no territorial jurisdiction to hear the action, James Foong (as he then was) at 327 B-G, elucidated on s.59(2) of the Subordinate Courts Act 1948 (which is in pari materia to s.76(2) and drew a distinction on the territorial jurisdiction of the Sessions Court vis-a-vis the High Court 10 which is instructive - “'Local limits', according to Ms Goh, is set out in the High Court Practice Direction 4 of 1993. There, the then Chief Justice of Malaya assigned to the Ipoh Sessions Court the territorial jurisdictional areas of Ipoh, Batu Gajah, Parit, Kampar, Sitiawan, Lumut, and Pantai Remis. 15 These areas designated to the Ipoh Sessions Court are certainly not the place where the cause or matter in this action arose. It was in either Mentakab or Kuala Lumpur. Unlike the High Court of Malaya sitting in various capital cites and towns in Peninsular Malaysia, the sessions courts throughout the country do not enjoy concurrent 20 territorial jurisdiction of each other. Though they are set up by His Majesty, the Yang di-Pertuan Agong under s 59(1) of the SCA, territorial jurisdictional boundaries are allocated to them. This is declared in s 59(2) of the SCA which says that the sessions court shall 'hear and determine any civil or criminal cause or matter arising within the 25 local limits of jurisdiction assigned to it'. The High Court of Malaya does not have such restrictions except that it cannot go beyond the shores of the Malay Peninsular, vice versa with the High Court of Sabah and Sarawak whose territorial jurisdictional limits are confined to the two states in East Malaysia. But within each of the High Courts' territorial limits, 30 a High Court Judge has concurrent and coordinate jurisdiction to try cases as his counter part in another city or town where there is a High Court. The rationale for this is, as explained by Justice Lim Beng Choon in Sova Sdn Bhd v Kasih Sayang Reality Sdn Bhd [1988] 2 MLJ 268 at p 270, the two respective High Courts have many branches. Thus, 35 a judge sitting in the High Court of Malaya at Kuala Lumpur has the same power and right to try a matter or cause arising in another part of West Malaysia. This set up is therefore different from the subordinate courts. The subordinate courts have the restriction of local limits of jurisdiction assigned to them. When a cause or matter 40 arises outside its local limits, then it has no jurisdiction to hear the substantive matter”. (Emphasis added) 45 9 The aforesaid observations by His Lordship are applicable in 5 the context of the territorial jurisdiction of a Magistrate’s Court, which is the subject matter at hand. [17] Further, the application of s.76(2) of the Subordinate Courts Act 1948 and its proviso has been clearly spelled out by the Supreme 10 Court of Public Prosecutor v. Rajappan Chinna Kounder [1986] CLJ (Rep) 217 at 229 g-h as follows: “In my view sub-section (2) makes it clear that the jurisdiction of the Magistrate's Court is limited to a cause or matter arising within the local limits of jurisdiction … 15 The proviso to sub-section (2) fortifies the fact that the Magistrate's jurisdiction is limited in that it shall have no jurisdiction even in respect of any cause or matter arising in any State in and for which he is not appointed to be a Magistrate …”. 20 (Emphasis added) [18] What can be culled from the authorities referred to, for purposes of the present case, the Kuala Lumpur Magistrate’s Court or the Kota Kinabalu Magistrate’s Court can only hear matters that 25 arose within the territorial limits of Kuala Lumpur or Kota Kinabalu respectively. [19] The Defendant averred that if payment were outstanding as alleged by the Plaintiff then, the cause of action arose 30 in Kota Kinabalu based on the Defendant’s place of business and registered address (paras 7 & 8 Defendant’s Affidavit in Support). In response the Plaintiff averred notwithstanding the same, “pembayaran adalah dibuat kepada akaun Plaintif yang berada di Kuala Lumpur, yang mana Defendan telah membuat bayaran secara 35 10 demikian pada transaksi-transaksi sebelum ini” (para 5 Plaintiff’s 5 Affidavit in Reply). [20] I find it is clearly pleaded in para 6 of the Statement of Claim that the Defendant was to make such payment into the Plaintiff’s account situated in Kuala Lumpur. I take cognisance that the 10 Defendant has not filed their Defence as they have correctly submitted that they are permitted under O.12 r.10(7) ROC 2012 to serve their defence within 14 days or such other period which the Court may order, after the dismissal of their application under O.12 r.10(1). 15 [21] Be that as it may, I agreed with the Plaintiff that this issue is still at large and to be tried as the Defendant has not filed their defence to deny or otherwise. The method of payment is fully within the Defendant’s knowledge as the Defendant “telah membuat bayaran 20 secara demikian pada transaksi-transaksi yang sebelum ini.” (para 6 of the Statement of Claim) and further pleaded “… Defendan telah membuat bayaran sebahagian seperti di atas dengan membayar kepada akaun Plaintiff yang berada di Kuala Lumpur” (para 8 of the Statement of Claim). 25 [22] All the Defendant averred was “Cek-cek bayaran Defendan kepada Plaintif telah didepositkan kepada akaun Plaintif melaui cawangan Maybank di Kota Kinabalu, Sabah.” and exhibited 2 cheque deposit receipts (para 9(c) Defendant’s Affidavit in Support). 30 The Plaintiff responded - “Berkenaan Perenggan 9 Afidavit Sokongan tersebut, saya menyatakan bahawa Defendan membuat pembayaran melalui cek yang dikeluarkan atas nama Plaintif yang beralamat di Kuala Lumpur untuk ditunaikan di 11 akaun Plaintif yang juga berada di Kuala Lumpur. Defendan telah gagal 5 membuat bayaran kepada Plaintif. Maka, tempat kegagalan menerima pembayaran daripada Defendan adalah di Kuala Lumpur dan oleh itu kausa tindakan berlaku di Kuala Lumpur”. (para 6 Plaintiff’s Affidavit in Reply). 10 [23] I find nothing turns on the Defendant’s submission that the Plaintiff has not exhibited the documents to support that the Plaintiff’s home branch account is in Kuala Lumpur for 2 reasons given by the Plaintiff which I accepted -

the Defendant has not raised this issue in any of their Affidavits 15 but merely raised it in the Submission stage;

the Plaintiff in their Affidavit in Reply stated that the Plaintiff maintained their account in Kuala Lumpur which positive averment was not rebutted by the Defendant in the Defendant’s Affidavit in Reply and therefore is deemed admitted by the Defendant (Ng Hee 20 Thoong & Anor v Public Bank Bhd [1995] 1 MLJ 281 (CA)) [24] The Defendant submitted that the cases of Shearn Delamore & Co & Anor v. Joseph Lee Henn Shen [1998] 3 CLJ 799 and Sogelease Advance (Malaysia) Sdn Bhd v. Kemajuan Tat Young 25 Sdn Bhd & Ors [1999] 5 CLJ 331 are distinguishable. With respect I disagreed as these cases are in point. In Shearn Delamore (supra), NH Chan JCA (as he then was) held - “[3a] the defendants here had asked to be paid in Kuala Lumpur and payment must therefore be made at the defendants’ address in Kuala 30 Lumpur. There was therefore a cause of action for breach of an agency contract which was in Malaya, namely, that the money had not been paid over to the defendants at their office at Kuala Lumpur”. (see p.813 g - p.814 a-c). 12 Similarly, in the present case as I have discussed earlier, the 5 Plaintiff has pleaded that the Defendant has to make payment into the Plaintiff’s account in Kuala Lumpur. [25] In Sogelease (supra), Abdul Aziz Mohamad J at p.332 Held 2 stated - 10 “[2] … The place where payment was to be made must be regarded as the place where the default in paying occurred. There was no failure to pay until the plaintiff failed to receive payment on the due date. Where there was failure to receive payment, the failure must be taken to have occurred at the place where, according to the 15 agreements, the payment was to be made”. [26] Based on the foregoing authorities, in my judgment, the cause of action arose when the Plaintiff failed to receive the payment made by the Defendant into the Plaintiff’s account in Kuala Lumpur and 20 not when the Defendant deposited the cheques as argued by the Defendant. Therefore the Magistrate’s Court in Kuala Lumpur has the territorial jurisdiction to try the action and not the Magistrate’s Court in Kota Kinabalu. 25 Conclusion [27] For the given reasons above, since I find there is no merit in the Defendant’s application (encl.4), I allowed the Plaintiff’s appeal as per para 2 above. 30 Dated: 31/5/2018 SGD. (LAU BEE LAN) Judge 35 13 5 Counsel for the Appellant/Plaintiff: Encik T H Tan Messrs Tai Hwa & Co. 10 Advocates & Solicitors No. 41A, 1st Floor Jalan Anggerik Vanilla N 31/N Kota Kemuning 40460 Shah Alam 15 Selangor Darul Ehsan Counsel for the Respondent/Defendant: 20 Encik Prathib Kumar Patmanabon Messrs Kandiah Partnership Advocates & Solicitors Suite 6.01, Level 6, Menara Choy Fook On 1B, Jalan Yong Shook Lin 25 46050 Petaling Jaya Selangor Darul Ehsan 30