Schedule
Jadual 3 to the Administration of Native and Small Estates Ordinance and section 74 of the Sabah Land Ordinance (“the Land Ordinance”). [15] The agreed issues to be tried by the High Court were as follows: (1) Whether the transfers of ownership and related transactions of the respective approved lands from each or any one of the 1st to 98th respondents to the appellant ought to be set aside on any or all or a combination of the following grounds, namely: (a) Misrepresentation as pleaded by the 1st to 48th respondents; (b) Forgery as pleaded by the 49th to 98th respondents; (c) Non est factum as pleaded by any or all of the respondents; (d) Inequality of bargaining power as pleaded in the statement of claim and in particular at paragraphs 1, 2, 8, 9, 10, 11, 18, 21, 22 and 25; (e) Material irregularities or anomalies for individual approved lands as pleaded in paragraph 21 (f) of the statement of claim; and/or (f) Further or alternatively to the above grounds, the appellant, being a Chinese businessman, was not able to deal with or own native lands alienated to the native plaintiffs. (2) Whether the 1st to 98th respondents’ causes of action against the appellant were statute barred under the Sabah Limitation Ordinance (“the Limitation Ordinance”) in that the respondents 6 ought to have commenced their action within 3 years either of receipt of the payment of the alleged purchase price or knowledge that the 1st respondent had collected the title deeds as respectively pleaded in paragraph 11 and 14(b) of the amended defence of the appellant. [16] Before us however, the native status of the appellant (Ground 1(f)) was no longer in issue as the respondents accepted that the appellant is a holder of an Anak Negeri certificate and as such is recognized as a native of Sabah. The appellant had earlier written to the court for an adjournment of this appeal pending the determination of his status as a native of Sabah by the Board of Officers pursuant to section 3(3) of the Interpretation (Definition of Native) Ordinance. [17] It was agreed between the parties that the evidence of PW1 to PW27 all of whom were the respective respondents, would be representative of the other respondents save for the 1st respondent, and that to save judicial time there was no need to call them individually. [18] In resisting the respondents’ claim, the appellant relied on the power of attorneys, the sale and purchase agreements, the memorandums of transfer executed by each of the respondents and the registration of interest in his name in the land registry based on such documents and dealings. The appellant is now holding on to the 98 land titles and defends his registration of interest as owner of the lands based on these documents and dealings. [19] After a full trial of the action, the learned judge allowed the respondents’ claim in terms of prayers (a)(i) to (iv) & (ix), (b)(i) and (c)(i) 7 of the statement of claim, hence the present appeal by the appellant. Having heard arguments by both sides, we reserved judgment to a date to be fixed. We have now reached a unanimous decision and this is our judgment. [20] We must point out at the outset that on all crucial issues of fact, there was a sharp conflict of evidence between the appellant and the respondents and the learned judge made it clear in his grounds of judgment that he preferred the evidence of the respondents. We reproduce below what the learned judge said at paragraph 15 of his judgment: 15. Having heard and considered the evidence and the conflicting versions of the events and witnesses of the Plaintiffs and the 1st Defendant, I prefer the evidence of the Plaintiffs over that of the 1st Defendant, as I find that the 1st Defendant’s version of events is not credible. I noted that the Plaintiffs denied that they agreed to sell the Lands to the 1st Defendant. I find that it is most unlikely that any person who wanted to give away land for free, would for RM100 each piece of land take the trouble to prepare so many sets of documents and to get them executed, for the benefit and advantage of the other party, in a language which he does not understand at all and which none of the plaintiffs understand. [21] Of particular significance to note is the learned judge’s finding that the appellant was an “evasive and untruthful” witness. We have no basis to disagree with the learned judge’s assessment of the appellant’s credibility as a witness. Nor do we have any basis to say that his assessment of the appellant’s credibility was plainly wrong and that he had failed to take proper advantage of his having seen and heard the appellant giving evidence first hand and in real time. 8 [22] This appeal therefore involved, at its core, the issue of the credibility of the witnesses. The principles on which an appellate court should act in reviewing the decision of a judge of first instance on a question of fact, especially where the question involves the issue of the credibility of the witnesses are well settled. Suffice it if we refer to the oft-cited judgment of the House of Lords in Powell and wife v Streatham Manor Nursing Home [1935] AC 243, 249 where Viscount Sankey LC said this: What then should be the attitude of the Court of Appeal towards the judgment arrived at in the court below under such circumstances as the present? It is perfectly true that an appeal is by way of rehearing, but it must not be forgotten that the Court of Appeal does not rehear the witnesses. It only reads the evidence and rehears the counsel. Neither is it a reseeing court. There are different meanings to be attached to the word 'rehearing' For example, the rehearing at Quarter Sessions is a perfect rehearing because, although it may be the defendant who is appealing, the complainant starts again and has to make out his case and call his witnesses. The matter is rather different in the case of an appeal to the Court of Appeal. There the onus is upon the appellant to satisfy the court that his appeal should be allowed. There have been a very large number of cases in which the law on this subject has been canvassed and laid down. There is a difference between the manner in which the Court of Appeal deals with a judgment after a trial before a judge alone and a verdict after a trial before a judge and jury. On an appeal against a judgment of a judge sitting alone, the Court of Appeal will not set aside the judgment unless the appellant satisfies the court that the judge was wrong and that his decision ought to have been the other way. Where there is a conflict of evidence the Court of Appeal will have special regard to the fact that the judge saw the witnesses: see Clarke v. Edinburgh Tramways Co. per Lord Shaw, 1919 S.C. (H.L.) 35, 36, where he says: When a judge hears and sees witnesses and makes a conclusion or inference with regard to what on balance is the weight of their evidence, that judgment is entitled to great respect, and that quite irrespective of whether the judge makes any observations with regard to credibility or not. I can of course quite understand a Court of Appeal that says that it will not interfere in a case in which the judge has announced as part of his judgment that he believes one set of witnesses, having seen them and heard them, and does not believe another. But that is not the ordinary case of a cause in a court of justice. In courts of justice in the ordinary case things are much more evenly divided; witnesses without any conscious 9 bias towards a conclusion may have in their demeanour, in their manner, in their hesitation, in the nuance of their expressions, in even the turns of the eyelid, left an impression upon the man who saw and heard them which can never be reproduced in the printed page. What in such circumstances, thus psychologically put, is the duty of an appellate court? In my opinion, the duty of the appellate court in those circumstances is for each judge of it to put to himself, as I do now in this case, the question, Am I - who sit here without those advantages, sometimes broad and sometimes subtle, which are the privilege of the judge who heard and tried the case - in a position, not having those privileges, to come to a clear conclusion that the judge who had them was plainly wrong? If I cannot be satisfied in my own mind that the judge with those privileges was plainly wrong, then it appears to me to be my duty to defer to his judgment. [23] From paragraph 16 onwards of his grounds of judgment, the learned trial judge had explained in great detail why he found the 1st respondent’s version of events to be credible and why he disbelieved the appellant’s version of events. It is clear to us that there was no mishandling of the facts or the law by the learned judge to warrant appellate intervention. [24] As for the appellant’s claim that it was the 1st respondent who arranged for the preparation and execution of the documents, i.e. the power of attorneys, the sale and purchase agreements and the memorandums of transfer, the learned judge’s firm finding of fact was that the documents were prepared by third parties on the instruction of the appellant. [25] The evidence in fact shows that the appellant instructed the law firm of Messrs Tan Pang Tsen & Co, the same law firm that represented him in the High Court and before us in this appeal, to prepare the legal documents for him. The respondents on their part did not have the benefit of professional legal advise. [26] Now we come to the crucial point of law. The learned judge’s view was that even if the respondents had knowingly and willingly executed the 10 various legal documents, i.e. with eyes wide open, the circumstances of the case would attract the common law doctrine of inequality of bargaining power, citing the following passages in the judgment of this court in Saad bin Marwi v Chan Hwan Hua & Anor [2001] 2 AMR 2010; [2001] 3 CLJ 98 where Gopal Sri Ram JCA (as he then was) delivering the judgment of the court said: Suffice that I refer to what I think is the leading case upon the subject. It is Credit Lyonnais Bank Nederland NV v Burch [1997] 1 All ER 144. In that case, Nourse LJ said (a p 151): “On that state of facts it must, I think, have been very well arguable that Miss Burch could, directly against the bank, have had the legal charge set aside as an unconscionable bargain. Equity’s jurisdiction to relieve against such transactions, although rarely exercised in modern times, is at least as venerable as its jurisdiction to relieve against those procured by undue influence. In Fry v Lane, re Fry, Whittet v Bush (1889) 40 Ch D 312 at 322; [1886- 90] All ER Rep 1084 at 1089, where sales of reversionary interest at considerable undervalues by poor and ignorant persons were set aside, Kay J, having reviewed the earlier authorities, said: ‘The result of the decisions is that where a purchase is made from a poor and ignorant man at a considerable undervalue, the vendor having no independent advise, a Court of Equity will set aside the transaction. This will be done even in the case of property in possession, and a fortiori if the interest be reversionary. The circumstances of poverty and ignorance of the vendor, and absence of independent advise, throw upon the purchaser, when the transaction is impeached, the onus of proving, in Lord Selbourne’s words, that the purchase was “fair, just and reasonable”.’ ………………………………. The position in Australia is the same as that in England. It is exemplified by the decision of the High Court in Commercial Bank of Australia Ltd v Amadio (1983) 152 CLR 447. It is sufficient that I quote from two passages in the report. The first is in the judgment of Gibbs CJ at p 459: ‘In my opinion it should not be held that this was the case of an unconscientious bargain of the kind which equity would set aside, even in the absence of fraud, misrepresentation or 11 undue influence. Of course, the bank and the respondents did not meet on equal terms, but that circumstance alone does not call for the intervention of equity, as Lord Denning MR clearly illustrated in Lloyds Bank v Bundy [1975] QB 326, 336. A transaction will be unconscientious within the meaning of the relevant equitable principles only if the party seeking to enforce the transaction has taken an unfair advantage of his own superior bargaining power, or of the position of disadvantage in which the other party was placed.’ (emphasis added) [27] Learned counsel for the appellant however contended that the court in that case did not expound and apply the common law doctrine of inequality of bargaining power, but rather the more established doctrine of unconscionable bargain. With due respect to the learned counsel, although Gopal Sri Ram JCA spoke of unconscionable bargain, the unanimous decision must be understood in the context of the following pronouncement by the learned judge at page 114: In my judgment, the time has arrived when we should recognize the wider doctrine of inequality of bargaining power. And we have a fairly wide choice on the route that we may take in our attempt to cystallise the law upon the subject. The position is that after 1956, we are at liberty to fashion rules of common law and equity to suit our own needs and are not to treat ourselves as being bound hand and foot by English cases. [28] It was contended that in any event Saad bin Marwi was wrongly decided as the court did not consider the fact that the Contracts Act does not provide for rescission of a contract on the ground of inequality of bargaining power. It was argued that the Contracts Act only provides for rescission of a contract where there was “undue influence” as stipulated by section 16 which reads: “Undue influence” 12 16. (1) A contract is said to be induced by “undue influence” where the relations subsisting between the parties are such that one of the parties is in a position to dominate the will of the other and uses that position to obtain an unfair advantage over the other. (2) In particular and without prejudice to the generality of the foregoing principle a person is deemed to be in a position to dominate the will of another- (a) Where he holds a real or apparent authority over the other, or where he stands in a fiduciary relation to the other; or (b) Where he makes a contract with a person whose mental capacity is temporarily or permanently affected by reason of age, or mental or bodily distress. (3) (a) Where a person who is in a position to dominate the will of another, enters into a contract with him, and the transaction appears, on the face of it or on the evidence adduced, to be unconscionable, the burden of proving that the contract was not induced by undue influence shall lie upon the person in a position to dominate the will of the other. (b) Nothing in this subsection shall affect section III of the Evidence Act 1950 [Act 56]. [29] According to learned counsel, what one has to establish to prove “undue influence” under section 16 of the Contracts Act is unconscionable conduct and not inequality of bargaining power. The argument presupposes that the doctrine of inequality of bargaining power comes under the regime of undue influence, with respect to which there is already a written law in force in Malaysia, namely section 16 of the Contracts Act. With due respect to learned counsel we do not think that is correct. While unconscionable conduct is a necessary component of the doctrine of inequality of bargaining power, inequality of bargaining power is not a component of undue influence. 13 [30] Therefore section 16 of the Contracts Act, which deals with undue influence, is not such written law within the meaning of section 3(1)(b) of the Civil Law Act 1956 (“the Civil Law Act”) that has the effect of excluding the application of the common law doctrine of inequality of bargaining power in Sabah. We shall come back to this provision later in this judgment. [31] Section 16 of the Contracts Act speaks of a relationship where one party is in a position to “dominate the will” of the other and uses that position to obtain unfair advantage over that other. It is not a section that deals with inequality of bargaining power between two contracting parties. [32] There is a subtle but real difference between dominating a person’s will and taking unfair advantage of one’s superior bargaining power over that person. It was not the respondents’ case that the appellant dominated their will. Their complaint was that the appellant had taken unfair advantage of his superior bargaining power over them. [33] Perhaps we should reproduce again subsection 16(2) of the Contracts Act to illustrate the point: (2) In particular and without prejudice to the generality of the foregoing principle a person is deemed to be in a position to dominate the will of another- (a) Where he holds a real or apparent authority over the other, or where he stands in a fiduciary relation to the other; or (b) Where he makes a contract with a person whose mental capacity is temporarily or permanently affected by reason of age, or mental or bodily distress. 14 [34] Paragraph (a) speaks of authority over the other or standing in a fiduciary relation to the other. Paragraph (b) speaks of mental incapacity. Both have nothing to do with inequality of bargaining power. The common law doctrine of inequality of bargaining power is not only about domination of will by one person over another. Over and above that, the doctrine is concerned with unconscionable bargain, of taking unfair advantage of a person’s superior bargaining power, or of the position of disadvantage in which the other party was placed: Commercial Bank of Australia Ltd v Amadio (1983) 152 CLR 447; [1983 HCA 14. [35] It was urged upon us not to follow Saad bin Marwi but to follow the decision of another panel of this court in American International Assurance Company Ltd v Koh Yen Bee [2002] 4 CLJ 49; [2002] 4 MLJ 301 where Abdul Hamid Mohamad JCA (as he then was) writing for the majority said at page 67: Learned counsel for the respondent relied heavily on the provision of s. 3(1) of the Civil Law Act 1956 and the decision of this court in Saad bin Marwi v Chan Hwan Hua & Anor [2001] 3 CLJ 98. That case appears to be the first case in this country in which the court applied the doctrine of inequality of bargaining power independently of the well-established doctrine of undue influence. In Datuk Joginder Singh & Ors v Tara Rajaratnam [1983] 2 MLJ 196 (FC) a case involving a solicitor and his client, where the word “unconscionable” was used in passing, the issue was considered under the head of “undue influence”. We do not wish to enter into an argument whether the doctrine of inequality of bargaining power or unconscionable contract may be imported to be part of our law. However, we must say that we have some doubts about it for the following reasons. First is the specific provisions of s. 14 of the Contracts Act 1950 which only recognizes coercion, undue influence, fraud, misrepresentation and mistake as a factor that affect free consent. Secondly, the restrictive wording of s.3(1) of the Civil Law Act 1956, in particular, the opening words of that subsection, the cut-off date and the proviso thereto. Thirdly, that fact 15 the court by introducing such principles is in effect “legislating” on substantive law with retrospective effect. Fourthly, the uncertainty of the law that it may cause. [36] What needs to be pointed out first and foremost with regard to this case is that the majority did not decide that the common law doctrine of inequality of bargaining power does not apply in Malaysia. They merely had “some doubts” about it. Secondly, although the majority had “some doubts” about the doctrine, they acknowledged that the facts in Saad bin Marwi clearly support such a decision “if justice were to prevail”. [37] Thirdly and perhaps more importantly, under section 3(1)(b) of the Civil Law Act, the common law of England and the rules of equity, together with statutes of general application as administered or in force in England on 1 December 1951 “shall” be applied by the court in the State of Sabah “save so far as other provision has been made or may hereafter be made” by any written law in force in Malaysia. [38] To provide context, we reproduce in full below section 3(1) of the Civil Law Act: Application of U.K. common law, rules of equity and certain statutes 3. (1) Save so far as other provision has been made or may hereafter be made by any written law in force in Malaysia, the Court shall – (a) in Peninsular Malaysia or any part thereof, apply the common law of England and the rules of equity as administered in England on the 7 April 1956; (b) in Sabah, apply the common law of England and the rules of equity, together with statutes of general application, as administered or in force in England on 12 December 1951; 16 (c) in Sarawak, apply the common law of England and the rules of equity, together with statutes of general application, as administered or in force in England on 12 December 1949, subject however to subparagraph (3)(ii): Provided always that the said common law, rules of equity and statutes of general application shall be applied so far only as the circumstances of the States of Malaysia and their respective inhabitants permit and subject to such qualifications as local circumstances render necessary. (emphasis added) [39] What the provision means in its application to Sabah is that if there is no written law in force in Malaysia on the common law doctrine of inequality of bargaining power or any other common law doctrine after the coming into force of the Civil Law Act in Sabah on 1 April 1972, the court “shall” apply such common law of England as administered or in force in England on 1 December 1951, subject to the proviso to the section. [40] In dealing with this provision in Chung Khiaw Bank Ltd v Hotel Rasa Sayang Sdn Bhd & Anor [1990] 1 MLJ 356; [1990] 1 CLJ 675; [1990] 1 CLJ (Rep) 57 Hashim Yeop Sani CJ (Malaya) delivering the judgment of the Supreme Court said at page 66: Section 3 of the Civil Law Act, 1956 directs the Courts to apply the common law of England only in so far as the circumstances permit and save where no provision has been made by statute law. The development of the common law after 7 April 1956 (for the States of Malaya) is entirely in the hands of the Courts of this country. We cannot just accept the development of the common law in England. [41] If today Parliament were to amend the Contracts Act by including the doctrine of inequality of bargaining power as part of Malaysian contract law, then the common law doctrine would still apply throughout Malaysia but in the form of a written law. In fact, the law on undue influence which 17 learned counsel for the appellant referred to is a common law doctrine which has since been made our written law through section 16 of the Contracts Act. [42] It must be remembered that the common law doctrine of inequality of bargaining power had been administered or in force in England even before 1 December 1951, the cut-off date for the application of such common law in Sabah. This can be deduced from the case of Fry v Lane, re Fry, Whittet v Bush (1889) 40 Ch D 312; [1886-90] All ER 1084. The case citation indicates that it was decided in the late 1880’s. [43] Although the court in that case did not use the term “inequality of bargaining power”, it is obvious that Kay J was speaking in terms of the doctrine. We do not agree with learned counsel for the appellant that the notion of “inequality of bargaining power” first arose from the English Court of Appeal case of Lloyds Bank Ltd v Bundy [1975] QB 326 where Lord Denning MR used the term “inequality of bargaining power” but which the House of Lords 10 years later in Natwest Bank Plc v Morgan [1985] 1 AC 686 rejected outright by saying that if any such view had gained currency, “let it be destroyed now once and for all”. [44] It was on the strength of this indictment by the House of Lords that learned counsel for the appellant contended that the common law doctrine of inequality of bargaining power does not exist. But there has been no outright rejection of the doctrine in Malaysia. In the Federal Court case of Affin Bank Berhad v Mohd Kassim Ibrahim [2013] 1 CLJ 465, the majority did not touch on the doctrine of inequality of bargaining power but Zainun Ali FCJ in her dissenting judgment adopted the English and Australian positions when Her Ladyship said: 18 [130] On the facts it is clear that the appellant and the respondent did not meet on equal terms, although that circumstance alone does not call for the court's intervention on equitable or other grounds and whilst this doctrine (of the inequality of bargaining power) may be a new jurisprudential approach in our jurisdiction, it has gained popular approval in both England and Australia. [131] In Australia (at least), the test to be applied as to whether equitable relief is applicable if unconscientious advantage is taken of a party who is at a special disadvantage in a contractual dealing (as happened in the instant appeal) is manifold. The first requirement is that there has to be existence of circumstances which amount to a special disadvantage; the second is that the court concerns itself with the conduct of the stronger party, rather than with the reality of the weaker party’s consent. In other words, the conduct of the stronger party will be seen as being unconscionable if he knew or ought to have known of the special disadvantage and took advantage of it to further his interests. Thirdly, it relates to evidence of the value of the transaction; fourthly to lack of independent advise and lastly if it can be shown that the stronger party can clearly discern, at the time of the contract, that the weaker party is sufficiently weak, as to make it prima facie unfair for the stronger party to accept the contract. [132] The above situation was described neatly as a form of “contractual imbalance” by Lord Brightman in Hart v O’Connor [1985] AC 1000. [45] The position in Singapore can be seen from the High Court case of Lim Geok Hian v Lim Guan Chin [1994] 1 SLR 203. There too the court did not reject the doctrine of inequality of bargaining power when it said: The concept of ‘inequality of bargaining power’ was insufficient in itself, in the absence of any unconscionable conduct, to justify the setting aside of a contract. Three principles in deciding whether an agreement was unconscionable and should be set aside are: (a) poverty (as in a member of a lower income group) and ignorance (as in less highly educated), (b) sale at an undervalue and (c) lack of independent advise. 19 [46] Presently there is, as far as we are aware, no written law in force in Malaysia on inequality of bargaining power after the coming into force of the Civil Law Act in Sabah on 1 April 1972, nor does Sabah have its own common law on such doctrine of law after that date. Therefore, the common law doctrine of inequality of bargaining power, being the common law that was administered or in force in England on 1 December 1951, is the law to be applied in Sabah, subject of course to the proviso to section 3(1) of the Civil Law Act. [47] In the absence of any written law in force in Malaysia on inequality of bargaining power after the coming into force of the Civil Law Act in Sabah on 1 April 1972, there is no reason why in our view the common law doctrine of inequality of bargaining power should not be adopted as the common law of Sabah. The factual matrix of the present case fits in perfectly well with the doctrine. [48] The proviso to section 3(1) of the Civil Law Act provides that the said common law of England shall be applied so far only as the circumstances of the States of Malaysia and their respective inhabitants permit and subject to such qualifications as local circumstances render necessary. We do not see how it can be said that the common law doctrine of inequality of bargaining power does not meet those requirements in so far as the State of Sabah is concerned. [49] On the contrary, we are inclined to think that the application of the doctrine in Sabah is necessary if justice were to prevail. It will prevent unscrupulous and unconscientious parties from taking unfair advantage of their superior bargaining power over the inhabitants of Sabah in their hour of need, such as had happened in the present case. 20 [50] The application of the common law doctrine in Sabah will, in our opinion, ensure that those with superior bargaining power will act conscientiously, fairly, justly and reasonably in their contractual dealings with those whom they know are in weak bargaining positions. Whether those having superior bargaining power have taken unfair advantage of their superior bargaining power to warrant intervention by equity must be determined based on the facts and circumstances of each case. [51] We have mentioned earlier that the House of Lords in Natwest Bank Plc shot down Lord Denning’s attempt to propagate the doctrine of inequality of bargaining power by destroying it “once and for all”. The House of Lords had its own reasons for taking that stand, but in its application to the circumstances of the State of Sabah and its inhabitants, we think that the common law doctrine will serve justice rather than stultify it. It will promote fair play in the market place. [52] In the present case, the reasons why the learned trial judge found the doctrine to be applicable to the facts and circumstances of the case can best be explained in his own words, which we reproduce below: [a] The plaintiffs are by and large fishermen or housewives who are illiterate. Only a handful of them read and write Bahasa Malaysia. The 1st Plaintiff as their ketua kampong and leader in the dealing with the 1st Defendant, was educated up to primary 6 only. The Plaintiffs were under financial pressure and time constraint to find the necessary funds to pay for survey of the Lands before the titles to the Lands could be issued to them. [b] The 1st Defendant admitted in cross-examination that at the meeting in the year 2002, the 1st Plaintiff requested him to advance a sum of money to pay the survey fees for the Lands and that he, the 1st Defendant had agreed to advance the money. The 1st 21 Defendant also admitted that he had informed the 1st Plaintiff that he would require the Plaintiffs to sign some agreements and power of attorney and that these documents were required to enable him to liase with the relevant authorities. I find the nature of the agreements signed by the Plaintiffs in response to the 1st Defendant’s said request is radically different from what was represented as the Plaintiff were asked to sign sale and purchase agreements for the said Lands when they did not intend to sell the Lands to the 1st Defendant, at that material time. [c] The 1st Defendant testified that the price for each of the Plaintiffs’ respective individual land measuring approximately 10 acres is RM100. I find that such value of the Lands was grossly undervalued, unrealistic and not capable of belief. I prefer the evidence of the Plaintiffs that the sum of RM100 was “saguhati” and were given as inducement to the Plaintiffs, to sign the various documents and not meant as the purchase price for the Lands. [d] There was no independent advise offered to any of the Plaintiffs before the documents were given to some of them to sign or thumbprint. I find that various documents were not prepared by the Plaintiffs but by third parties under the directions of the 1st Defendant and furthermore the various documents were in the English language, I find that there was also no evidence that someone explained the true contents to those of the Plaintiffs who had signed the documents. I do not believe that the 1st Plaintiff and/or the other Plaintiffs would take the trouble to prepare the various documents if the purchase price for their individual lot of lands is only RM100. [e] I find that the Statutory Declarations of nearly all the Plaintiffs, which were affirmed in the months of September and October 2006, and attested by Encik Rashid [DW2] who is a 2nd Class magistrate at Beluran, declaring that the 1st Defendant had purchased the Lands from each plaintiff for the price of RM100 which he had paid and that each of the respective plaintiffs had no claim against him, to be no evidential value as I find that there was no credible evidence that those Plaintiffs who signed the said Statutory Declaration knew what they were signing nor was there any credible evidence that the contents of the said Statutory Declarations were explained to the relevant Plaintiffs. Further I find the demeanour and testimony of DW2, unconvincing and not credible. [f] I find that the evidence showed the survey fees were paid by one Ayub Khan through his company Pembinaan Klias Sdn Bhd and that the quit rent was paid by the 1st Plaintiff, from money borrowed from Ayub Khan, and not by the 1st Defendant. 22 [53] Learned counsel for the appellant raised the point that the learned judge should not have allowed the respondents to raise the defence of inequality of bargaining power as it was not pleaded in the first place. In response, learned counsel for the respondents pointed out that although it was not pleaded, it was an agreed issue to be tried as set out in paragraph 1(d) of the Agreed Issues. We agree with the respondents. The appellant cannot approbate and reprobate. [54] It was further submitted by learned counsel for the respondents that they did not depart from their pleaded case of misrepresentation, forgery, non est factum and inequality of bargaining power and that the evidence at the trial was a necessary development of their pleaded case. Reference was made to the then Supreme Court case of Superintendant of Lands and Surveys, 4th Division & Anor v Hamit B. Matusin & Ors [1994] 3 CLJ 567, where it was held as follows: (2) the rule that if a party is taken by surprise by evidence which departs from pleaded material facts, he must object then and there at the point of time when such evidence emerges, in order for such evidence to be disregarded by the Court. It will be too late when it is objected to later on, as in final submission at the close of the evidence, as happened in the instant case. [55] In the present case, no objection was taken by the appellant when evidence of inequality of bargaining power was introduced by the respondents at the trial. It is therefore too late for the appellant to raise the objection now. [56] With regard to the issue of forgery, the 9th, 14th, 16th, 21st, 34th, 49th, 52nd, 61st and 62nd respondents testified in unequivocal terms that they 23 never thumb-printed the documents that the appellant brought over to Kampung Keniogan for them to execute, yet the appellant without any reasonable explanation, chose not to call the person who purportedly attested the documents to give evidence. The evidence was that this person was an unnamed second class magistrate of the District of Paitan. [57] The learned judge was therefore entitled to draw adverse inference against the appellant under section 114(g) of the Evidence Act 1950 for not calling the mysterious second class magistrate as a witness. The adverse inference would be that this person is either not a magistrate or if he is a magistrate, he never attested to the signing or thumb-printing of the documents by the aforesaid respondents. [58] The learned judge had further found the appellant’s act of signing each of the land titles as holder of the power of attorneys to be in breach of section 97(1) of the Land Ordinance as his signature on the power of attorneys was not attested by a person duly qualified under that provision. We reproduce below section 97(1) for ease of reference: 97. (1) The signature of each party to every memorandum and title shall be attested by any officer specially appointed by the Minister or by one of the following persons – (a) in Sabah – a Magistrate, Justice of the Peace, Notary Public, Commissioner for Oaths, an Advocate or the Collector; (b) in any place within Malaysia other than Sabah or in any place within the Commonwealth - a Magistrate, Justice of the Peace, Notary Public or Commissioner for Oaths; (c) in any other place – a Malaysian Consular Officer; 24 Provided that in the case of a document executed under seal of a company incorporated or registered under the laws of Malaysia and bearing the signature of the secretary and at least one director of the company, attestation shall not be required. [59] The person before whom the appellant purportedly signed the power of attorneys was one “Johny S Maling, Kerani Tanah, Beluran”, i.e. a land clerk and therefore not a qualified person under section 97(1) of the Land Ordinance. It is interesting to note that the title deeds for all 98 pieces of land were registered in one day by this person on 22.8.2006. [60] Each of the title deeds has an express term that the transfer or sublease of the title is prohibited unless the written consent of the Director of Lands and Survey was first obtained. There was no such consent by the Director in the present case. The purported registrar of native lands had apparently signed a blank memorial with no particulars on each of the land titles. [61] Despite the defects, the appellant somehow managed to register the purported approval by the Director of the amendment to the terms of all 98 pieces of land and to register the transfer of all 98 titles into his name in one day on 15.9.2006. Clearly something was seriously wrong with the registration of the lands into the appellant’s name. It is therefore not surprising that the learned judge found the registration of the memorandums of transfer to be “plainly unlawful and invalid”. [62] The appellant had also raised the issue of limitation. It was his contention that the respondents’ causes of action against him were statute barred by virtue of the Sabah Limitation Ordinance (“the Limitation Ordinance”) in that the respondents failed to commence their action within 25 3 years either after receipt of the payments of the alleged purchase price or knowledge that the appellant had collected the title deeds. The appellant’s argument was that items 93 and 94 of the Schedule to the Limitation Ordinance should apply to bar the respondents from prosecuting the action. [63] In rejecting the defence, the learned judge found that the respondents’ claim did not fall under items 93 and 94 of the Schedule to the Limitation Ordinance. He opined, rightly in our view, that the item that applied is the omnibus item 97, which provides that the limitation period is 6 years from the time the right to sue accrues, citing Asia General Equipment and Supplies Sdn Bhd & Ors v Mohd Sari bin Datuk OKK Hj Nuar [2011] 1 LNS 833 and Nasri v Mesah [1971] 1 MLJ 32. [64] Thus, the earliest date for the respondents to sue would be when the appellant signed as owner of the lands on 22.8.2006 or the registration of the appellant’s interest as owner on 15.9.2006. The 6 year period which commenced from that date would only expire on 22.8.2012 or 15.9.2012. The respondents’ action was therefore filed within time. [65] For all the reasons aforesaid, the appeal is dismissed with costs of RM20,000.00 to the respondents, subject to payment of the allocator fee. The deposit is refunded to the appellant. ABDUL RAHMAN SEBLI Judge Court of Appeal Malaysia. Dated: 9 November 2017. 26 For the Appellant: Edwin Tsen of Messrs Tan Pang Tsen & Co. For the Respondents: Roland Cheng and Nadia Chung of Messrs Roland Cheng & Co.