Chantika Kelang Beras Sdn. Bhd v Padiberas Nasional Berhad (WA-22NCVC-381-06/2018)

By a Notice of Application dated 24.8.2018 (Enclosure 8), the Defendant applied to strike out the Plaintiff’s Statement of Claim (‘SoC’) dated 26.6.2018 and Reply to Defence dated 14.8.2018 under 2 O. 18, r. 19(1)(a), (b), (c) and (d) of the Rules of Court 2012 (‘RoC 2012’) and/ or O. 92, r. 4 RoC 2012.

Having heard oral submissions by learned counsels for the Plaintiff and the Defendant and having read the Affidavits and written submissions which had been filed, I dismissed the Defendant’s application with costs of RM5,000.00 subject to the payment of allocatur fees.

The Defendant has appealed against my entire decision in respect of Enclosure 8. I now set out my full grounds for the decision.

There are only three affidavits which pertain to Enclosure 8, namely -

the Defendant’s Affidavit In Support (‘AIS’) affirmed on 24.8.2018 (Enclosure 9); 3

the Plaintiff’s Affidavit In Reply (1) (‘AIR’) affirmed on 13.9.2018 (Enclosure 11); and

the Defendant’s AIR affirmed on 4.10.2018 (Enclosure 12). Background facts [5] According to the SoC, the Defendant is involved in the procurement and processing of paddy, warehousing, distribution and marketing of paddy seeds in Malaysia, as well as in seed and farming activities nationwide. [6] In early April 2007, the Defendant appointed the Plaintiff and four other companies as its paddy seed suppliers for the Paddy Seed Incentive Program known as “Rakan Benih”. The Plaintiff was to supply and sell paddy seeds to farmers across Peninsular Malaysia according to the following terms: 4

The Plaintiff was to purchase Foundation Seeds (Biji Benih Asas) from the Malaysian Agricultural Research and Development Institute (‘MARDI’). Foundation Seeds are the progency from the cultivation of a strain whose production is regulated according to a specific procedure to maintain the level of genetic purity and they are acknowledged to be in compliance with the required standard. The Foundation Seeds were at all material times produced by MARDI and the Plaintiff could only purchase them with the Defendant’s support made in writing.

Upon purchasing the Foundation Seeds, the Plaintiff would then cultivate the same into Registered Seeds (Biji Benih Daftar) which are the progency from Foundation Seeds. The production of Registered Seeds is regulated according to a specific procedure in compliance with the standard set by the Department of Agriculture (‘DoA’).

The Registered Seeds would be further cultivated and be subjected to inspection and certification by DoA. On approval, a 5 written certification known as SAP 10 would be given for the approved Certified Seeds (Biji Benih Sah). Upon such certification, the Plaintiff was then permitted to supply and sell the approved Certified Seeds to the farmers. [7] The Plaintiff was, at all material times, entitled to receive incentive payments from the Defendant for the Certified Seeds supplied and sold to the farmers. The amount of incentive payment for any given period was to be calculated and ascertained according to the quantity certified in SAP 10. [8] Based on paragraph 6 of the SoC, the Plaintiff claimed that the Defendant had made the following representations to the Plaintiff with regard to the Plaintiff’s supply and sale of Certified Seeds to farmers:

That although each appointed paddy seed supplier was given a quota for its supply and sale of Certified Seeds to farmers, other major suppliers except the Plaintiff were unable to meet the quotas given. 6

Accordingly, notwithstanding any term contained in the letter of appointment given by the Defendant to the Plaintiff, the Plaintiff was requested and/ or given permission by the Defendant to supply and sell the maximum quantity of Certified Seeds that it could produce for each particular period. Further, the Plaintiff was assured by the Defendant that it could receive incentive payments for any quantity of Certified Seeds supplied or sold to farmers. [9] It is the Plaintiff’s case that, at all material times it had acted on, and relied upon, the aforesaid representations by purchasing excess Foundation Seeds in order to maximize its supply and sale volumes and these purchases were supported by the Defendant in writing. It was also pleaded that at a certain point in time, the Plaintiff received incentive payments for supplying and selling Certified Seeds which exceeded the quota stated in the appointment letter. [10] Further and in the alternative, the Plaintiff pleaded that the Defendant had benefitted from the Plaintiff’s supply and sale of Certified Seeds and therefore it is unconscionable for the Defendant to deny the 7 Plaintiff its just entitlement to the incentive payments. The Defendant is said to be accountable to the Plaintiff, as a constructive trustee, for the incentive payments accrued to the Plaintiff for the supplies and sales of Certified Seeds to farmers pursuant to the “Rakan Benih” program. [11] The Defendant is alleged to have gone back on its assurances. As at the date of the Writ of Summons, the Plaintiff claimed that the total incentive payment that has yet to be paid by the Defendant is RM23,279,030.00 as particularised below: Harvest Season Quantity (metric tonne)(‘mt’) Incentive (RM/mt) Total Incentive (RM) Season 02/2008 14,030 1,030 14,450,900.00 Season 01/2009 8,571 1,030 8,828,130.00 Hence, by this action, the Plaintiff is seeking to recover the amount of RM23,279,030.00 with interest at 5% per annum from the date of the Writ until full settlement, or in the alternative, such other sum as compensation to be assessed by the Court. 8 [12] Without admission to the Plaintiff’s claim, the Defendant asserted that the same is time barred because the claim is for debts accrued in the years 2008 and 2009. The Defendant further denies having made the representations as alleged by the Plaintiff. It is also the Defendant’s defence that the Plaintiff had agreed that if the Plaintiff supplies Certified Seeds exceeding the quota given to it then the incentive payments for the excess supply would be subjected to the discretion of the Ministry of Agriculture and Agro-based Industry (‘MoA’). The Defendant’s Submission [13] The grounds for striking out relied upon by the Defendant are as follows:

The Plaintiff’s claim is time barred The Defendant submitted that the Plaintiff did not deny that its claim against the Defendant is for incentive payments for the Certified Seeds supplied in excess of the quota given to the Plaintiff for Seasons 02/2008 and 01/2009 as shown in the 9 table in paragraph 11 above. As such, the alleged debts were accrued in the years 2008 and 2009 and therefore this action is time-barred under paragraph 6(1)(d) of the Limitation Act 1953 [Act 254] (‘LA 1953’). Further, the Defendant submitted that assuming that the alleged representations were made, the Plaintiff’s claim is still caught by limitation because at paragraph 6 of the Plaintiff’s AIR, the Plaintiff said that the alleged representations were made during the 2007 to 2009 seasons. In such circumstances, the time frame within which the Plaintiff ought to have commenced a suit against the Defendant would then be on or before year 2013 to year 2015.

The Plaintiff did not plead the particulars in relation to the alleged representations Learned counsel for the Defendant referred to O. 18, r. 12 (1) RoC 2012 as the basis for the argument that the Plaintiff has to plead the material facts of when, how and who made the alleged representations. Since the Plaintiff has failed to do so in 10 the SoC, the Plaintiff cannot during trial seek to adduce evidence in this regard because such evidence would be inadmissible. It was also submitted that the Plaintiff cannot repair the defects in the pleadings via affidavit although this is what the Plaintiff sought to do vide paragraph 6 of the Plaintiff’s AIR. Mr. Frank Wong referred to the definition of “evidence” in the Dictionary of Law by L B Curzon (4th. ed) to mean “Testimony and production of documents and things relating to the facts into which the court enquires and the methods and relating to the establishing of those facts before the court” to support his contention that the said material facts are not evidence in support of the alleged representations.

The alleged representations do not exist Finally, the Defendant submitted that the alleged representations do not exist because the Plaintiff’s act and/ or the documentary evidence after the alleged representations in 11 2008 and 2009 seasons are inconsistent and/ or does not support the existence of the alleged representations. It was contended that both parties had agreed in the letters of appointment that payment of incentives for Certified Seeds supplied by the Plaintiff exceeding the quota given to the Plaintiff would be subjected to the discretion of MOA and that the Defendant would not be responsible for said incentives. Therefore, it is the Defendant’s case that the parties are bound by the terms in the letters of appointment and as such, the Plaintiff cannot rely on any alleged representation to vary, add or amend those terms. [14] Among the authorities relied upon by the Defendant in the course of submissions are Bandar Builder Sdn Bhd & 2 Ors v. United Malayan Banking Corporation [1993] 4 CLJ 7; Middy Industries Sdn Bhd & Ors v. Arensi-Marley (M) Sdn Bhd [2013] 3 MLJ 511; Chip Chong Sawmill Co Sdn Bhd & Ors v Chai Khium Fui [1978] MLJ 24; Tan Sri Dato’ Eric Chia Eng Hock v NKK Corporation (Japan) [2004] 7 CLJ 137; Vista Specialist Eye Center Sdn Bhd v Dato’ Loo Son Yong [2016] 1 12 LNS 1127; and Malaysian Rules of Court 2012, An Annotation, Volume 1, Lexis Nexis, 2012 at pages 359 and 360. The Plaintiff’s Submission [15] Naturally, the Plaintiff’s starting point relates to the trite law that a claim can only be struck out if it is on the fact of it obviously unsustainable. The Plaintiff submitted that it is also settled law that the unconscionable conduct of one party may prevent him from relying upon the plea of limitation to defeat another person’s just claim against him and the Federal Court decision in Asia General Equipment And Supplies Sdn Bhd & Ors v Mohd Sari Datuk Hj Nuar & Ors [2011] 8 CLJ 749 was cited in support of this point. [16] The Plaintiff further countered the Defendant’s argument regarding the application of LA 1953 by submitting that at a meeting held on 3.9.2013 on the invitation of MoA and attended by the representatives of both parties, it was agreed that an auditor would be appointed to verify the quantity of Certified Seeds supplied and sold by the Plaintiff 13 for the period between 2008 and 2009. This verification exercise would form the basis for the Plaintiff’s claim for incentive payments. [17] A firm of auditors was then appointed by MoA but no final report was published and disclosed to the Plaintiff. Nevertheless, a draft audit report from the appointed auditor was made available to the Plaintiff on or around 22.9.2014 (see exhibit “P-4” of the Plaintiff’s AIR). It is the Plaintiff’s contention that its claim for RM23,279,030.00 is supported by the findings in the said draft report. Hence, the Plaintiff’s right to bring the present action accrued when the Defendant failed or refused to act on the findings made by the appointed auditor. [18] Learned counsel for the Plaintiff also argued that the Defendant has unjustly enriched itself at the Plaintiff’s expense and therefore, a constructive trust may be imposed upon the Defendant to account for the incentive payments. The recovery of trust property falls under subsection 22(1) of LA 1953 where no period of limitation is prescribed. 14 [19] In reply to the Defendant’s submission concerning pleading, the Plaintiff contends that there are sufficient material facts pleaded in the SoC. Particulars of representations were pleaded in paragraph 6 of the SoC and in fact, the Defendant has filed its Defence without any problems. Up to the filing of Enclosure 8, the Defendant did not at any time request for further and better particulars of the Plaintiff’s pleading and thus, this shows that the Plaintiff has pleaded sufficient facts to allow the Defendant to understand the nature of its claim against the Defendant. [20] As for the issue on whether the representations were actually made, Dato’ Lim Choon Khim submitted that the existence or otherwise of the representations as pleaded is a question of fact which requires full trial. The legal consequence arising from the representations is a matter to be dealt with after trial. The Defendant’s denial, at this juncture, is insufficient to constitute a ground to strike out the Plaintiff’s claim as per Enclosure 8. Apart from Asia General Equipment And Supplies Sdn Bhd (supra), the other cases cited by the Plaintiff before this Court are Seruan Gemilang Makmur Sdn Bhd v. Kerajaan Negeri Pahang Darul Makmur [2016] 3 CLJ 1; 15 Omega Securities Sdn Bhd v Kok Fook Loy [2010] 9 MLJ 224; Koh Siew Keng & Anor v. Koh Heng Jin [2008] 3 CLJ 450 and Datuk M Kayveas v See Hong Chen & Sons Sdn Bhd & Ors [2014] 4 MLJ 64. The Law [21] In its application, the Defendant sought to rely on all the limbs under O. 18, r. 19(1) RoC 2012 conjunctively. This means that the onus is on the Defendant to satisfy this Court that the SoC and Reply to Defence disclose no reasonable cause of action; are scandalous, frivolous or vexatious; may prejudice, embarrass or delay the fair trial of the action; and is otherwise an abuse of the process of the Court. [22] In addition, the Defendant also cites O. 92, r. 4 RoC 2012 on the inherent powers of the Court to make any order as may be necessary to prevent injustice or to prevent an abuse of the process of the Court as a basis for the striking out application. 16 [23] The authorities which have discussed the legal principles on striking out are plentiful. For present purposes, it is suffice for me to refer to the Federal Court decision in Seruan Gemilang Makmur Sdn Bhd (supra) where the tests for a striking out application under O. 18, r. of the ROC, as adopted by the Supreme Court in Bandar Builder Sdn Bhd & 2 Ors v. United Malayan Banking Corporation [1993] 4 CLJ 7 are as follows:

it is only in plain and obvious cases that recourse should be had to the summary process under the rule;

this summary procedure can only be adopted when it can be clearly seen that a claim or answer is on the face of it “obviously unsustainable”;

it cannot be exercised by a minute examination of the documents and facts of the case in order to see whether the party has a cause of action or a defence; 17

if there is a point of law which requires serious discussion, an objection should be taken on the pleadings and the point set down for argument under O. 33, r.3 of the ROC; and

the court must be satisfied that there is no reasonable cause of action or that the claims are frivolous or vexatious or that the defences raised are not arguable. [24] Since the Defendant has sought to rely on O. 18, r. 12(1) RoC 2012, it is useful to mention that part of the provision which is relevant viz – “Particulars of pleading (O. 18, r. 12)

(1) Subject to paragraph (2), every pleading shall contain the necessary particulars of any claim, defence or other matter pleaded including, without prejudice to the generality of the foregoing words –

particulars of any misrepresentation, fraud, breach of trust, willful default or undue influence on which the party pleading relies; …”. 18 [25] The Defendant’s primary ground for its application is premised on paragraph 6(1)(d) of LA 1953 whilst the Plaintiff sought to bring its case within subsection 22(1) of the same statute. For ease of reference, both provisions are set out below: “Limitation of actions of contract and tort and certain other actions

(1) Save as hereinafter provided the following actions shall not be brought after the expiration of six years from the date on which the cause of action accrued, that is to say—

actions founded on a contract or on tort;

actions to enforce a recognisance;

actions to enforce an award;

actions to recover any sum recoverable by virtue of any written law other than a penalty or forfeiture or of a sum by way of penalty or forfeiture.”. 19 “Limitation of actions in respect of trust property

(1) No period of limitation prescribed by this Act shall apply to an action by a beneficiary under a trust, being an action—

in respect of any fraud or fraudulent breach of trust to which the trustee was a party or privy; or

to recover from the trustee trust property or the proceeds thereof in the possession of the trustee, or previously received by the trustee and converted to his use.

Subject as aforesaid, an action by a beneficiary to recover trust property or in respect of any breach of trust, not being an action for which a period of limitation is prescribed by any other provision of this Act, shall not be brought after the expiration of six 20 years from the date on which the right of action accrued: Provided that the right of action shall not be deemed to have accrued to any beneficiary entitled to a future interest in the trust property, until the interest fell into possession.”. Analysis and findings of the Court - Did the Plaintiff failed to plead the particulars of the alleged representations? [26] Apart from the particulars pleaded in paragraph 6 of the SoC, Mr. Chan Lye Yew, the Plaintiff’s Director had affirmed in his AIR as follows: “6. In answer to paragraph 9 of the said Affidavit, I respectfully state that the representations as pleaded 21 in the statement of claim were made by Encik Haji Azis bin Yasin in his capacity as Penolong Pengurus Besar, Bahagian Petani dan Pengeluaran Bernih, BERNAS, and by Tuan Syed Azarin bin Mahyiddin who was the assistant to Penolong Pengurus Besar (pegawai bahagian pengeluaran benih) at that time. To the best of my recollection, the representations were made some time around the period during the 2007 to 2009 seasons. The representations were made to me verbally. Encik Haji Azis, in particular, assured me that the plaintiff would be paid incentive if it could accommodate the shortage of supply caused by other participating suppliers.

The plaintiff acted on and in reliance upon the aforesaid representations. It then purchased excess foundation seeds in order to maximize its supply and sale volumes. The defendant, too, supported the plaintiff’s purchases in writing….”. 22 Copies of the letters of support dated 28.5.2007 and 11.1.2008, and memorandums dated 22.3.2007 and 11.6.2008 given by the Defendant for the Plaintiff’s purchases of Foundation Seeds were shown as exhibit “P-5”. [27] In her AIR, Puan Hasfazilah binti Mohd Yusof, Head of the Defendant’s Legal Department averred that: “9. Sebagai balasan kepada perenggan 6, 7, 9, 10, 11, 12, 14, 15, 16 dan 17 dalam AIR Plaintif, saya sesungguhnya menyatakan bahawa:

9.1 Plaintif tidak boleh menggunakan affidavit dan/ atau keterangan saksi-saksi untuk menambah kepada perkara-perkara yang tidak diplidkan dalam Pernyataan Tuntutan dan Jawapan;

9.2 dokumen-dokumen yang Plaintif lampirkan di eksibit P-5 dalam AIR Plaintif langsung tidak dapat membuktikan representasi secara lisan yang 23 kononnya dibuat oleh Encik Haji Azis Bin Yasin dan/atau Tuan Syed Azarin Bin Syed Zainal Abidin Jamalullail pada tahun 2008 dan 2009;

9.3 jika terdapat representasi lisan tersebut yang didakwa oleh Plaintif (di mana Defendan menafikan), ia tidak mengubah hakikat bahawa tuntutan Plaintif melebihi had masa untuk menuntut di bawah Akta Had Masa 1953;…”. The paragraphs from the Defendant’s AIR as quoted above clearly show that the averments relate to issues of law rather than fact. No affidavits were affirmed by Encik Haji Azis Bin Yasin and/ or Tuan Syed Azarin Bin Syed Zainal Abidin Jamalullail. In any event, it is not proper to conduct a trial by affidavits at this stage of the proceedings and to dispose of the present action summarily. [28] The Defendant contended that by virtue of O. 18, r. 12(1) RC 2012, the Plaintiff ought to plead when, how and who made the alleged 24 representations and in failing to do so in the SoC, the Plaintiff cannot repair defects in its pleadings via its AIR. [29] With respect to the learned counsel for the Defendant, I am unable to agree with his contention. Pleadings should contain particulars to ensure that the parties are informed with reasonable particularity as to the matters which are alleged against them in accordance with the principle that a party should not be taken by surprise. In addition, pleadings serve to limit and define the issues at trial, save unnecessary expense, inform the parties of the evidence they would have to prepare for trial and prevent the parties from going outside their pleadings without leave (see Malaysian Rules of Court 2012, An Annotation, Volume 1, Lexis Nexis, 2012 at page 332). In this case, the Plaintiff has pleaded sufficient particulars in the SoC to enable the Defendant to respond in these following terms in the Defence, which essentially amount to a denial that the representations as alleged by the Plaintiff were made at all: 25 “5. Perenggan 6 dan 7 dalam Pernyataan Tuntutan adalah dinafikan dan Defendan menyatakan seperti berikut:

5.1 Plaintif dan Defendan hanya diikat oleh terma-terma dalam surat-surat pelantikan;

5.2 Menurut surat-surat pelantikan tersebut:

Defendan telah memberikan Plaintif peruntukkan kuota pengeluaran padi bernih sah kepada Plaintif sebanyak 10,000 metrik tan untuk tahun 2007, 2008 dan 2009. Ini bermaksud Plaintif hanya berhak untuk menerima insentif benih padi sah daripada MOA melalui Defendan setakat 10,000 metrik tan bagi tahun 2007, 2008 dan 2009; dan 26

Plaintif juga setuju dalam surat-surat pelantikan bahawa Defendan tidak akan bertanggungjawab jika terdapat lebihan pengeluaran padi benih yang dikeluarkan oleh Plaintif yang melebihi kuota yang ditetapkan dan tuntutan insentif harga padi benih kepada pihak kerajaan ke atas lebihan kuota tersebut adalah tertakluk kepada kelulusan MOA.

5.3 Oleh itu, Defendan tidak dan/atau tidak pernah pada apa-apa masa material membuat representasi seperti mana yang didakwa oleh Plaintif di perenggan 6(i) dan 6(ii) dalam Pernyataan Tuntutan.”. [30] In these circumstances, the Plaintiff’s reliance on the case of Omega Securities Sdn Bhd (supra) is certainly not misplaced. In that case, a preliminary point was raised by the plaintiff that details of the forgery 27 or fraud must be pleaded. Mary Lim JC (now JCA) at page 231 of the report held that - “[5] … There are some particulars of these matters though not full. Nevertheless, the plaintiff was able to respond to these matters and file a reply. Specifically, at para 3 of the reply and defence to counter claim, the plaintiff averred that the allegations of the defence are allegations which are bare, doubtful, inaccurate and inconsistent with existing documents. The plaintiff never sought any further particulars on this plea nor was it hindered in responding to the plea. In the matter of falsification of signatures, I may add that all that is required is pleaded. Whether the defendant succeeds in leading cogent evidence to prove the plea is entirely a different consideration. That however cannot be reason to dismiss the plea at this outset….”. [emphasis added] 28 [31] Based on the above reasoning, I find that this ground for striking out the SoC and Reply to Defence is without merit. - Were the alleged representations actually made? [32] The letters of appointment issued by the Defendant to the Plaintiff dated 5.9.2007 for Season 1/2007 and 2/2007, and 25.8.2008 for Season 1/2008 and 2/2008 can be seen in exhibit “H-1” of the Defendant’s AIS. The salient terms and conditions in the latter letter of appointment are as shown below: “3.1 Kuantiti Yang Akan Dibekalkan 10,000 tan metrik benih padi sah yang telah mendapat pengesahan daripada Jabatan Pertanian Malaysia (Sijil SAP 7 artau SAP10).

3.2 Lebihan Pengeluaran Padi Benih BERNAS tidak akan bertanggungjawab jika terdapat lebihan pengeluaran padi benih yang dikeluarkan oleh pak tuan yang melebihi kuota yang ditetapkan dan 29 tuntutan insentif harga padi benih kepada pihak Kerajaan ke atas lebihan kuota tersebut adalah tertakluk kepada kelulusan Kementerian Pertanian & Industri Asas Tani Malaysia.”. [emphasis added] [33] The Defendant vide paragraph 11 of its AIS had exhibited letters that it had written to the Plaintiff dated 12.3.2009 (exhibit “H-3”), the Secretary General of MoA dated 30.7.2009, the Honourable Minister of MoA dated 9.7.2010 and the Most Honourable Prime Minister of Malaysia dated 12.3.2013 (collectively marked as exhibit “H-4”) to support its assertion that the Plaintiff has been paid the incentive payments due to it at the material time and the additional claims for 22,577,600 mt cannot be made by the Defendant without MoA’s certification (perakuan). [34] I have scrutinised the letters as aforementioned and I note (with emphasis added as shown below) that in exhibit “H-4”, – 30

the letter to the Secretary General of MoA mentions that “Dimaklumkan juga selain daripada Syarikat Chantika, Rakan Benih BERNAS yang perlu mendapat kuota juga ialah Syarikat Wengpha Rice Mill Sdn Bhd, MADA, Kilang Padi Maju, Kilang Padi Jelapang Selatan dan BERNAS sendiri. Jika bayaran insentif di buat ke atas tuntutan ini bermakna Rakan Benih yang lain tidak dapat membuat tuntutan. Juga dimaklumkan, Syarikat Chantika telah diberitahu jumlah kuotanya di awal tahun seperti lampiran. … Pihak Bernas tidak bersetuju bayaran dibuat ke atas tuntutan ini disebabkan Syarikat Chantika Kelang Beras Sdn Bhd telah pun dibayar melebihi daripada kuota yang telah diperuntukkan. Tuntutan insentif hanya boleh dipertimbangkan pada bulan Disember 2009 jika Rakan Benih lain tidak dapat memenuhi kuota mereka;

the letter to the Honourable Minister of MoA states that: “4. … pihak BERNAS telahpun membayar tuntutan insentif benih padi sah kepada Syarikat Chantika sebanyak RM15.37 juta bagi sepanjang tempoh tersebut. Jumlah bayaran insentif ini melibatkan 31 sebanyak 33,805 metrik tan benih padi sah. Jumlah ini telah pun melebihi sebanyak 3,805 metrik tan dari jumlah yang telah dipersetujui oleh kedua-dua pihak. Ini berdasarkan kepada kuota yang telah diperuntukkan kepada Syarikat Chantika yang berjumlah 10,000 metrik tan setahun yang menjadikan jumlah keseluruhan yang patut dituntut dihadkan pada 30,000 metrik tan sahaja.

Selain itu, Syarikat Chantika juga telah mengemukakan tuntutan tambahan insentif pengeluaran benih padi sah sebanyak 14,006 metrik tan lagi pada tahun 2009 (sila rujuk jadual dibawah). Jumlah ini sudah melebihi daripada kuota yang telah diperuntukkan kepada Syarikat Chantika. Pihak BERNAS telah menolak tuntutan tersebut memandangkan ianya akan memberi kesan kepada kuota Rakan Benih yang lain iaitu Syarikat Wengpha Rice Mill Sdn Bhd, SPPM, Kilang Padi 32 Maju, Kilang Padi Jelapang Selatan dan BERNAS sendiri.”; and

the letter to the Most Honourable Prime Minister of Malaysia contain a similar explanation as per the letter to the Honourable Minister of MoA and goes on to say the following: “5. Untuk makluman Y.A Bhg Tun juga, BERNAS telah memaklumkan kepada Kementerian Pertanian & Industri Asas Tani pada 30 Julai 2009 mengenai kedudukan tuntutan tambahan insentif oleh Syarikat ini. Namun begitu, Kementerian masih belum memberi jawapan di atas perkara ini. Pemberian kuota atau tambahan kuota adalah tertakluk dibawah bidang kuasa pihak Kementerian Pertanian & Indsutri Asas Tani.

Mengikut surat lantikan, BERNAS tidak akan bertanggungjawab terhadap bekalan yang melebihi 33 kuota yang ditetapkan lebih-lebih lagi tidak ada perakuan daripada Kementerian Pertanian & Industri Asas Tani. Tuntutan tanpa dokumen sokongan yang disahkan oleh Kementerian Pertanian & Industri Asas Tani, BERNAS tidak dapat memperakukan pembayaran insentif tersebut.”. [35] From the contents of these letters, it is apparent that –

the Plaintiff has, in the past, received incentive payments for the supply of Certified Seeds in excess of the quota allocated to it;

the Defendant itself has a quota for the supply of Certified Seeds and is thereby entitled to receive incentive payments as well; and

as at 12.3.2013, MoA has not given a reply to the Defendant as regards the Plaintiff’s claim for additional incentive payments. 34 [36] Furthermore, as the Defendant itself had submitted, the draft audit report confirmed that the incentives for excess supply claimed by the Plaintiff would be paid by MOA subject to the approval of the Ministry of Finance (‘MoF). “Laporan Tuntutan Insentif Padi Benih oleh Chantika Kelang Beras Sdn Bhd kepada Kementerian Kewangan Malaysia” dated 22.9.2014 prepared by MNZWAJ Associates, Chartered Accountants is shown in exhibit “P-4”. In order for the contents of the said draft report to be fully appreciated, it is necessary for me to quote the following excerpts (with emphasis added) from the Executive Summary: “… iii. CKBSB telah diperuntukkan kuota sebanyak 10,000 MT setahun bagi tempoh tersebut. Namun demikian, pengeluaran benih oleh CKBSB didapati telah membekalkan benih padi sebanyak 56,406.80 tan metrik berbanding kuota asal sebanyak 30,000 tan metrik bagi tempoh tiga (3) tahun, iaitu sebanyak 26,406.80 MT. 35 Dari jumlah tersebut BERNAS hanya memperakukan 3,805.08 MT sahaja untuk pembayaran insentif. Baki selebihnya sebanyak 22,601 MT telah tidak diperakukan dan dibayar oleh BERNAS. iv. Semakan kepada tuntutan-tuntutan pembekalan padi benih tambahan CKBSB berdasarkan Sijil Akuan Pengesahan (SAP) 10 mendapati jumlah tersebut memang wujud. Sepanjang tempoh pembekalan dari 2007 ke 2009, kelulusan pembekalan adalah berdasarkan SAP10 dan semakan untuk pembayaran dibuat oleh BERNAS sebagai syarikat payung. Dalam tempoh tersebut lebihan pengeluaran dan pembekalan benih padi oleh CKBSB berjumlah 22,601 MT tidak diperakukan oleh BERNAS untuk pembayaran, walaupun telah mempunyai SAP10. v. Berdasarkan terma lantikan, kami telah memeriksa invois-invois jualan benih padi dari tahun 2007 sehingga tahun 2009. Jumlah pembekalan mengikut 36 invois adalah 52,569.94 MT berbanding tuntutan yang telah dibayar sebanyak 33,805.08 MT. Terdapat perbezaan sebanyak 18,764.86 MT. vi. Kementerian hanya menguatkuasakan penggunaan invois dalam tuntutan bermula tahun 2010. Sebelum itu, tuntutan hanya berdasarkan kelulusan SAP10 dan semakan dan rekomendasi oleh syarikat payung. … viii. Impak kewangan terhadap tuntutan tambahan; a. Sekiranya tuntutan tambahan berdasarkan SAP10, peruntukan RM23.28 juta diperlukan untuk membuat pembayaran kepada CKBSB b. Bagaimanapun, sekiranya ianya merujuk kepada resit dan invois jualan, sejumlah RM19.33 juta 37 peruntukan diperlukan untuk membuat pembayaran kepada CKBSB ix. Kementerian Pertanian dan Industri Asas Tani serta Kementerian Kewangan perlu mengambil kira prosedur tuntutan insentif padi benih dalam tempoh 2007-2009 yang hanya mensyaratkan SAP10 dan kelulusan syarikat payung sahaja dalam membuat tuntutan. … xi. Oleh kerana tuntutan oleh CKBSB adalah untuk tempoh 2007 sehingga 2009, MOA dan MOF perlu menentukan sama ada kaedah pembayaran praktis pembayaran insentif bagi pembekalan pada tempoh tersebut atau mengikut seperti perjanjian pada tahun 2010 sehingga kini.”. 38 [37] In light of the above affidavit evidence, the Defendant’s stance that the parties are bound strictly by the terms in the letters of appointment is questionable. If MoF’s approval and/ or MoA’s certification as mentioned earlier is not forthcoming, the Plaintiff is at liberty to decide on the legal recourse it has against any of the parties. In this respect, the Plaintiff has chosen to file a civil suit against the Defendant founded on the alleged representations made by the Defendant’s personnel and on the basis of constructive trust, unjust enrichment and equitable compensation rather than the terms in the letters of appointment. To this end, viva voce evidence and mature arguments on the applicability of, among others, sections 91 and 92 of the Evidence Act 1950 [Act 56] are required. At this stage of proceedings, I am unable to make a conclusive finding that the representations as alleged were never made by the Defendant. [38] This Court cannot disregard the Plaintiff’s pleading in paragraphs 8, 9 and 16 in the SoC that, inter alia, the Defendant had acted unconscionably in allowing the Plaintiff to rely on the representations 39 and to act in a way detrimental to itself. This, to my mind, are triable issues and cannot be resolved by affidavit evidence. My conclusion is fortified with reference to the judgment by Ramly Ali FCJ in Seruan Gemilang Makmur Sdn Bhd (supra; at pages 12 – 13) where His Lordship held that: “[27] The Court of Appeal, in Sivarasa Rasiah & Ors v. Che Hamzah Che Ismail & Ors [2012] 1 CLJ 75; [2012] 1 MLJ 473; had adopted the well-settled principle of striking out in the following passage A striking out order should not be made summarily by the court if there is issue of law that requires lengthy argument and mature consideration. It should also not be made if there is issue of fact that is capable of resolution only after taking viva voce evidence during trial, (see Lai Yoke Ngan & Anor v. Chin Teck Kwee & Anor [1997] 2 MLJ 565 (Federal Court)). … 40 [29] The established rule on this point is that the court should not examine the evidence in this summary proceedings in such a way as to amount to conducting a trial on the conflicting affidavit evidence. As rightly said by Lord Diplock inn the House of Lords in American Cyanamid Co v. Ethicon Ltd [1975] AC 396 at p. 407: … The court no doubt must be satisfied that the claim is not frivolous or vexatious; in other words, that there is a serious question to be tried. It is no part of the court’s function at this stage of the litigation to try to resolve conflicts of evidence on affidavit as to facts on which the claims of either party may ultimately depend nor to decide difficult questions of law which call for detailed argument and mature consideration. These are matters to be dealt with at the trial… 41 This passage was cited with approval by the Privy Council in a Malaysian case of Eng Mee Yong v. Letchumanan [1979] 1 LNS 18; [1979] 2 MLJ 212.”. - Is the Plaintiff’s claim time-barred? [39] Flowing from my analysis in respect of the second issue as outlined above, this is not a case where the Plaintiff is relying on the four corners of the letters of appointment which would justify the Defendant’s contention that the 6 years limitation period should be counted from 2008 or latest, 2009. [40] I am satisfied that the Plaintiff, and to some extent the Defendant too by way of exhibit “H-4”, has provided evidence to support the contention that the Defendant had induced the Plaintiff to believe that its claim was still maintainable. At the “Mesyuarat Timbang Tara berkenaan Tuntutan Insentif Benih Padi Sah Oleh Chantika Kelang 42 Beras Sdn. Bhd. Bil. 2/2013” chaired by the Secretary General of MoA on 3.9.2013 (see exhibit “P-2”), it would appear that the Defendant did not deny the Plaintiff’s claim on the ground that it was a stale claim since the meeting agreed to the appointment of a firm of auditors to carry out a verification exercise. With such exercise, the parties must be taken to have agreed to await for its final outcome. I would thus agree with the Plaintiff’s submission that its cause of action, accrued only when it had access to the draft auditor’s report and that under the circumstances of the case viewed in its totality, the Plaintiff ought not to be allowed to rely on the plea of limitation to avoid trial. Conclusion [41] In the upshot, the Defendant has failed to satisfy this Court that the requirements for striking out the SoC and Reply to Defence under O. 18, r. 19(1)(a), (b), (c) and (d) RoC 2012 have been fulfilled and/ or that this is a case befitting of an exercise of the power of the Court under O. 92, r. 4 RoC 2012. The Defendant’s application in 43 Enclosure 8 was accordingly dismissed with costs of RM5,000.00 subject to the payment of allocatur fees. Dated: 29 March 2019 (ALIZA SULAIMAN) JUDICIAL COMMISSIONER HIGH COURT NCvC 1 KUALA LUMPUR Solicitors: For the Plaintiff : Dato’ Lim Choon Khim (Ms. Chin Yan Leng with him) Messrs. Chooi, Saw & Lim Advocates & Solicitors Unit 9-C, Level 9 Wisma Boon Siew 1, Penang Road 10000 Pulau Pinang For the Defendant: Frank Wong Messrs. Rahman Rohaida Advocates & Solicitors E-07-07, Menara Suezcap 2 KL Gateway No. 2, Jalan Kerinchi