Damansara Realty Berhad v Bungsar Hill Holdings Sdn. Bhd. (W - 01 (IM) - 3 - 01 / 2015)

1.

PENTADBIR TANAH WILAYAH PERSEKUTUAN KUALA LUMPUR …RESPONDENTS [IN THE MATTER OF HIGH COURT IN MALAYA AT KUALA LUMPUR (CIVIL DIVISION) ORIGINATING SUMMONS NO. S3 (S1) – 21 – 90 – 2001 In the matter of Section 29(2) of the Land Acquisition Act, 1960 And In the matter of a land acquisition: 2 Type and Registration Number: Grant 10474 Lot No.: 8345 Mukim : Kuala Lumpur Registered Proprietor: Bungsar Hill Holdings Sdn. Bhd. Pentadbir Tanah Wilayah Persekutuan Kuala Lumpur …Applicant Heard together with IN THE HIGH COURT IN MALAYA AT KUALA LUMPUR (CIVIL DIVISION) CIVIL APPLICATION NO. S4 – 15 – 13 - 2003

BUNGSAR HILL HOLDINGS SDN BHD (REGISTERED PROPRIETOR) …THE FIRST APPLICANT

DAMANSARA REALTY BERHAD (LEASE HOLDER) …THE SECOND APPLICANT 3

SISTEM PENYURAIAN TRAFIK KL BARAT SDN. BHD. (CONCESSIONAIRE) …THE THIRD APPLICANT AND PENTADBIR TANAH WILAYAH PERSEKUTUAN KUALA LUMPUR …RESPONDENT] CORAM: MOHD ZAWAWI BIN SALLEH, JCA UMI KALTHUM BINTI ABDUL MAJID, JCA VERNON ONG LAM KIAT, JCA 4 GROUNDS OF JUDGMENT A.

This was an appeal by Damansara Realty Berhad (Damansara Realty/the Appellant) and the cross appeals by Bungsar Hill Holdings Sdn. Bhd. (Bungsar Hill/the 1st Respondent) against the decision of the learned Judicial Commissioner (JC) (as he then was).

The appeal arose from an appeal to the Judge in Chambers against the decision of the Deputy Registrar (DR) of the High Court who awarded pre-judgment interest of 8% per annum and post-judgment interest of 5% per annum on sums deposited into Court in respect of a land reference matter.

For the purpose of this appeal, parties will be referred to as they were at the High Court. B.

Bungsar Hill is the registered proprietor of a piece of land in Damansara, Kuala Lumpur. Part of the land was compulsorily acquired for the construction of the SPRINT Expressway sometime in December 2000.

Damansara Realty had in May 2001 applied to the Respondent/2nd Respondent/the Land Administrator Federal Territory of Kuala Lumpur 5 (the Land Administrator) claiming an interest in the land through a lease agreement.

There was a dispute between Damansara Realty and Bungsar Hill as to which party was entitled to the acquisition compensation as well as over the apportionment of the compensation.

The Land Administrator, pursuant to section 29(2) of the Land Acquisition Act 1960 (LAA), had on 28.6.2001 filed an application vide Kuala Lumpur Ex-Parte Originating Summons No. S3 – 21 – 90 – 2001 (S3 Action) and on 7.11.2001, the Court ordered that 75% of the compensation amount for the entire acquired land together with the 8% late payment charges be deposited in the High Court. The Land Administrator deposited in the High Court the said 75% of the compensation amounting to RM 6,856,597.50 together with the 8% late payment charges of RM 802,503.68, totalling RM 7,659,101.18.

A land reference proceeding was then initiated vide Kuala Lumpur High Court Land Reference No. S4 – 15 – 13 – 2003 (S4 Action) with Damansara Realty, Bungsar Hill and Sistem Penyuraian Trafik KL Barat Sdn. Bhd. (SPRINT) as the applicants and the Land Administrator as the Respondent. Subsequently, the parties resolved the issue of the compensation amount vide a Consent Order dated 22.11.2007 (Consent 6 Order). One of the terms of the Consent Order stipulated that a further compensation amount of RM 425,505.00 was to be paid and deposited in the High Court. The said sum was deposited on 17.1.2008. The Consent Order had also stipulated that there “be no order as to costs and interest”.

As such, the remaining issue between Damansara Realty and Bungsar Hill was to whom the deposits were payable and the apportionment of the said deposits.

Subsequently, the above mentioned issue became academic when the Federal Court, in another set of proceedings involving a contractual dispute between Damansara Realty and Bungsar Hill held that Damansara Realty’s rights over the land concerned were validly terminated by Bungsar Hill. (See Damansara Realty Bhd v Bungsar Hill Holdings Sdn Bhd & Anor [2011] 6 MLJ 464.)

However, on 11.3.2013, Bungsar Hill filed a Notice of Application in the S3 Action and the S4 Action respectively. These applications were premised on section 37 of the LAA, praying for the following orders:

11.1 the deposits be released to the Bungsar Hill (prayer (1));

11.2 Damansara Realty pays Bungsar Hill interest at 8% per annum (prayer (2)) on: 7

11.2.1 the said sum of RM 6,856,597.50 deposited in Court under the S3 Action beginning from 8.7.2002 to date of realisation; and 11.2.2 the said sum of RM 425,505.00 deposited in Court pursuant to the Consent Order in the S4 Action beginning from 22.11.2007 to date of realisation;

11.3 Damansara Realty pays Bungsar Hill costs of the proceedings and/or of the applications (prayer (3)).

The learned Senior Assistant Registrar of the Kuala Lumpur High Court had on 30.4.2013 allowed prayer 1 and accordingly ordered the said deposits to be released to Bungsar Hill.

Then, on 23.9.2013, the learned D.R. of the Kuala Lumpur High Court allowed prayer 2 and ordered, in respect of S3 Action, that Damansara Realty pay Bungsar Hill pre-judgment interest at the rate of 8% per annum on the sum of RM 6,856,597.50 from 8.7.2002 until 30.4.2013 and post-judgment interest at the rate of 5% per annum on the said sum of RM 6,856,597.50 from 1.5.2013 until the date of payment of the said sum of RM 6,856,597.50 to Bungsar Hill.

Meanwhile, in respect of the S4 Action, the learned D.R. ordered Damansara Realty to pay Bungsar Hill pre-judgment interest at the rate of 8 8% per annum on the sum of RM 425, 505.00 from 22.11.2007 until 30.4.2013 and post-judgment interest at the rate of 5% per annum on the said sum of RM 425, 505.00 from 1.5.2013 until the date of payment of the said sum of RM 425, 505.00 to Bungsar Hill.

On 7.2.2014, the learned D.R. made orders in respect of prayer 3 regarding costs, whereby Damansara Realty was to pay costs to Bungsar Hill for the respective applications in the amount of RM2,500.00 in respect of the S3 Action and S4 Action, but Bungsar Hill’s application for costs of the S3 and S4 proceedings was dismissed.

Vide Notice of Appeal to the Judge in Chambers, Damansara Realty appealed against the learned D.R.’s decision on interest and Bungsar Hill appealed against the learned D.R.’s decision on costs. C.

The learned JC, heard the said appeals and made the following orders in respect of the appeal in S3 Action:

(a) Bungsar Hill be paid interest on the sum of RM 7, 659, 101.18 at the rate of 2% per annum by the Accountant General pursuant to and in accordance with Order 90 rules 6 and 7 of the Rules of the Court 2012 (ROC) and Circular 1/1998 from 1.8.2002 to 30.9.2013; 9

(b) Damansara Realty pays to Bungsar Hill -

(i) pre-judgment interest at a rate of 3% per annum on the principal sum of RM 6, 856, 597.80 from 10.7.2002 to 30.4.2013;

Meanwhile, in respect of S4 Action, the learned JC ordered the following:

(a) Bungsar Hill be paid interest on the sum of RM 425, 505.00 at a rate of 2% per annum by the Accountant General pursuant to and in accordance with Order 90 rules 6 and 7 of the ROC and Circular 1/1998 from 1.2.2008 to 30.9.2013; and

(b) that there be no order as to interest or costs to Damansara Realty.

The learned JC found that the High Court does indeed have the jurisdiction to award both pre-judgment and post-judgment interests in respect of a compensation sum awarded under the LAA. 10

The learned JC also found that it is the Court’s discretion to award interest on sums paid into Court by the Land Administrator against a co-claimant in a land reference proceeding, notwithstanding that the co-claimant did not have the use of the money for the relevant period.

The learned JC also found that on a proper construction of the Consent Order in the S4 Action, the term of the Order on costs and interest precludes Bungsar Hill from claiming costs and interest in that action.

With reference to Order 90 rule 6 of the ROC, the learned JC found that since there was a delay on the part of the Bungsar Hill in applying for the release of the compensation sums immediately after the decision of the Federal Court on 11.10.2011, Damansara Realty ought not be made liable for pre-judgment interest for the period between 12.10.2011 to 11.3.2013.

The learned JC also supplemented the Orders of the learned Senior Assistant Registrar by ordering that interest at a rate of 2% per annum be paid to Bungsar Hill in respect of the sums deposited into Court in the S3 Action and the S4 Action.

Aggrieved by the decision of the learned JC, both Damansara Realty and Bungsar Hill filed their Notice of Appeal and the Notice of Cross Appeal respectively against that decision. 11

Damansara Realty, in respect of S3 Action only, appealed against part of the decision that ordered Damansara Realty to pay Bungsar Hill (i) pre-judgment interest at the rate of 3% per annum on the principal sum of RM 6, 856, 597.80 from 10.7.2002 to 30.4.2013; (ii) post-judgment interest at a rate of 5% per annum on the sum of RM 7,659,101.18 from 1.5.2013 to 21.10.2013; and (iii) costs of RM 40,000.00.

Bungsar Hill’s Notice of Cross Appeal, in respect of S3 Action, was on the percentage the pre-judgment interest payable to Bungsar Hill by Damansara Realty to be at the rate of 8% per annum or in the alternative at the rate of 6% per annum on the sum of RM 7,659,101.18 deposited into Court. Bungsar Hill’s Notice of Cross Appeal was, in respect of S4 Action, on the percentage the pre-judgment interest payable to Bungsar Hill by Damansara Realty to be at the rate of 8% per annum or in the alternative to be at the rate of 6% per annum on the sum of RM 425,505.00 deposited into Court; post-judgment interest at the rate of 5% per annum; and costs of Bungsar Hill’s application in Enclosure 39 and its appeal in Enclosure 49. D.

The crux of this appeal is whether the High Court sitting as the Land Reference Court under the LAA has the jurisdiction and the power to: 12

(a) award interest on the land acquisition compensation and on the 8% late payment charges both deposited into Court by the Land Administrator; and

(b) order a co-applicant to pay to another co-applicant such interest.

It was Damansara Realty’s contention that the LAA does not confer any jurisdiction on the Court to order the imposition of either pre-judgment interest or post-judgment interest on the sums deposited into the Court. The LAA also does not provide for an interested person to pay interest.

Reference was made to section 29A(5), section 32(1) and (1B) and section 48 of the LAA where these provisions clearly spell out in express terms late payment charges are to be paid by the Land Administrator.

Damansara Realty contended that any other form of remedy such as pre-judgment and post-judgment interests as sought by Bungsar Hill are not available in land acquisition cases.

In addition, Damansara Realty pointed out that the specified rate of 8% per annum for a specified period of time for late payment charges in section 29A(5), section 32(1) and (1B) and section 48 of the LAA implied the exclusion from land acquisition cases any imposition of pre-judgment interest and post-judgment interest on an interested person. 13

Damansara Realty further contended that Item 7 of the Schedule to the Courts of Judicature Act 1964 (CJA), in respect of interest, does not assist Bungsar Hill in claiming for the pre-judgment and post-judgment interests. Section 25 of the CJA provides that those additional powers given to the Courts, including the said Item 7, are only to be exercised in accordance with any written law or rules of court. In this appeal, the relevant written law is the LAA which only specifies for late payment charges to be paid by the Land Administrator whilst the relevant rules of court can be found in Order 90 rules 6 and 7 of the ROC read together with Circular 1/1998 both of which only provide for interest to be paid by the Minister of Finance/Accountant General.

Damansara Realty also contended that Bungsar Hill’s reliance on the Court’s inherent powers was misplaced as the inherent powers cannot be used to make orders which are outside the ambit of the LAA.

We agreed with the submissions of the learned counsel for Damansara Realty that the LAA does not confer any jurisdiction on the Court to order the imposition of pre-judgment and post-judgment interests and for an interested person under the LAA to pay interest. 14

We refer to the Court of Appeal case of Parkson Corporation Sdn. Bhd. v Fazaruddin bin Ibrahim (b/s Perniagaan Fatama) [2002] 4 AMR 3951 where this Court, per Gopal Sri Ram (JCA) (as he then was), had referred to the cases of Pasmore v Oswaldtwistle Urban District Council [1898] AC 387 and Wilkinson v Barking Corporation [1948] 1 KB 721 for the principles of statutory interpretation as follows: ‘The present case accordingly falls to be covered by the established principle, which deals with the consequences of Parliament providing novel or new remedy. The principle is ancient. It has been adverted to in numerous cases. We do not propose to go through them all here. Suffice that we mention the seminal cases. Of these the first is Pasmore v Oswaldtwistle Urban District Council [1898] AC 387, where (at p 394) the Earl of Halsbury LC said: “The principle that where a specific remedy is given by a statute, it thereby deprives the person who insists upon a remedy or any other form of remedy than that given by the statute, is one which is very familiar and which runs through the law.” The second is Wilkinson v Barking Corporation [1948] 1 KB 721, where at p724, we find Asquith LJ saying this: “It is undoubtedly good law that where a statute creates a right and, in plain language, gives a specific remedy or appoints a specific tribunal for its enforcement, a party seeking to enforce the right must resort to that remedy or that tribunal, and not to others.”’

Justice Gopal Sri Ram elaborated further in the same case at page 3961, lines 1 to 7,as follows: “If Parliament had wished to confer jurisdiction upon a court making an order under s 16 to also award damages, it would had said so expressly. It is therefore plain what Parliament intended was to only criminally punish the infringer of merchandising marks and the perpetrator of any other act or omission specifically proscribed by the Act. We therefore, with as much respect as we 15 can gather, reject the principle submission made by Encik Shaari Nor about the way in which s 16 should be construed.”

Applying those principles of statutory interpretation to this appeal, we found that section 29 A(5), section 32(1) and (1B) and section 48 of the LAA expressly specify “late payment charges” at the rate of 8% per annum for a specified period of time and nothing more. This would necessarily mean that the imposition of pre-judgment interest and post-judgment interest on an interested person in land acquisition cases are excluded. For ease of reference we reproduce sections 29A, 32 and 48 of the LAA as follows: “Withholding of twenty-five per cent of compensation

(1) Where the total amount of any award in respect of any scheduled land exceeds fifteen thousand ringgit, then, notwithstanding section 29, the Land Administrator shall, subject to subsection (2), make payment of only seventy-five per cent of the amount of the award, and shall withhold twenty-five per cent thereof until the amount of compensation is finally determined either by the Court under section 47 or, if there is an appeal or further appeal pursuant to section 49, on the appeal or further appeal, under the following circumstances—

(a) before the expiry of six weeks from the date of service of Form H on the Government, person or corporation on whose behalf such land was acquired; or

(b) if before the expiry of the said period such Government, person or corporation has made an objection under section 37 to the amount of compensation or any other objection which may affect such amount.

(1) When the amount of any compensation awarded under this Act in respect of any land is not paid or deposited on or before the due date, the Land Administrator shall pay the amount awarded with late payment charges thereon at the rate of eight per cent per annum from the due date until the time of such payment or deposit.

If the sum which in the opinion of the Court the Land Administrator ought to have awarded as compensation is in excess of the sum which the Land Administrator did award as compensation, the award of the Court may direct that the Land Administrator Land shall pay late payment charges on such excess at the rate of eight per cent per annum from the date on which the Land Administrator took possession of the land to the date of payment of such excess to the Court or to the person interested.” [Emphasis added.]

Moreover, it must be noted here that the imposition of interest had, vide legislation, been intentionally excluded from the land acquisition scheme in Malaysia. The Land Acquisition (Amendment) Act 1997 (Act A999), which came into force on 1.3.1998 [P.U.(B) 94/1998], had by sections 16, 17 and 26 specifically amended the LAA by substituting the words “late payment charges” for the word “interest” appearing in sections 29A(5), 32 and 48 of the LAA.

Thus, when an amending act alters the language of the principal statute, the alteration must be taken to have been made deliberately. (See D.R. Fraser & Co. v Canada Minister of National Revenue [1949] AC 24). We, therefore, with respect, found the learned JC had, in paragraph 18 21 of his Grounds of Judgment, erred in holding that “the principle enunciated in Parkson Corporation Sdn. Bhd. v Fazaruddin Ibrahim would not apply in the case of the LAA to preclude a party to claim interest on a compensation sum, even though such interest had not been specifically provided for in the LAA”.

With respect, we were also of the view that the learned JC had erred when he ruled that the interest payable under Order 90 rule 6 of the ROC accrued as of right to the beneficiary of the sum deposited into Court and the right of Bungsar Hill to the 2% interest per annum remains unaffected by the Consent Order in the S4 Action.

Item 7 of the Schedule to the CJA, in respect of interest, read together with section 25 (2) of the CJA, clearly shows that Item 7 is only to be exercised in accordance with any written law or rules of court. The same are reproduced herewith: “SCHEDULE (Section 25 (2)) Interest.

Power to direct interest to be paid on debts, including judgment debts, or on sums found due on taking accounts between the parties, or on sums found due and unpaid by receivers or other persons liable to account to the Court.” “Powers of the High Court.

25.

In this present appeal, the relevant written law is the LAA and LAA has clearly provided that late payment charges are to be paid by the Land Administrator.

In addition to that, Bungsar Hill’s reliance on the inherent powers of the Court on its claim for interest was misplaced as the Court cannot exercise its inherent powers beyond or outside the Court’s jurisdiction or where the Court has no jurisdiction. In this appeal, the Land Reference Court does not have the jurisdiction to award interest and as such, there was no inherent power in that context to begin with. We refer to the Federal Court case of Amalan Tepat Sdn Bhd v Panflex Sdn Bhd [2012] 2 MLJ 168 where Mohd Ghazali (FCJ) (as he then was) at paragraph [44], page 185, held as follows: “…We are also of the view that inherent powers of this court do not confer or constitute a source of jurisdiction. We would iterate that this court must not do anything unconstitutional…” 20

In the Supreme Court case of Karpal Singh & Anor v Public Prosecutor [1991] 2 MLJ 544, Abdul Hamid Omar (LP) (as he then was) at page 549, paragraph E left, held as follows: “…The inherent power apparently cannot be invoked to override an express provision of law or when there is another remedy available. Where the legislature has provided a particular mode of action or has vested an authority with powers to act in a particular manner and has prescribed the conditions limiting the scope of such action, the court cannot act outside those powers and conditions.”

It is also germane to note that the S3 and S4 Actions were proceedings initiated under the LAA. Both S3 and S4 Actions were not proceedings for the recovery of debts or damages. Thus, with respect, the learned JC had erred in law when he concluded that section 11 of the Civil Law Act 1956 (CLA) did not preclude interest being claimed in respect of a debt due from a party in circumstances where the person from whom interest is being claimed was responsible for the delay in the discharge of the debt. By referring to the Oxford English Dictionary on the meaning of “debt”, the learned JC concluded that “debt” shall include the compensation due to be paid to a claimant in a land reference proceeding. We found that the present appeal did not fall under the purview of section 11 of the CLA as there was no debt owing by Damansara Realty to Bungsar Hill nor were there monies belonging to Bungsar Hill being kept by Damansara Realty. The monies were in the deposit accounts of the 21 High Court and/or the Land Administrator. As such, there was no basis whatsoever for Damansara Realty to bear the interest on the said monies.

Further, section 11 of the CLA relates to a “cause of action” and a “judgment”. There was no cause of action as against Damansara Realty nor any judgment against the same in both the S3 and S4 Actions. Instead the S3 and S4 Actions were in respect of the release of compensation monies from the deposit accounts. Damansara Realty was not adjudged liable to pay the compensation monies. Thus, section 11 of the CLA could not to be relied upon by Bungsar Hill in its attempt to seek an award of interest against Damansara Realty.

It is also settled law that an order for the release of monies deposited into Court is not a judgment and does not attract the award of pre-judgment or post judgment interest. (See: Newall v Tunstall [1971] 1 WLR 105.) Cross Appeals

As the Cross Appeal in regard to the S3 Action raised similar issues as the appeal by Damansara Realty, we did not see the need to address said Cross Appeal specifically. We noted that in respect of the Cross Appeal in the S4 Action, Bungsar Hill had eventually decided not to pursue with the matter. 22 E.

Based on the aforementioned reasons, we unanimously allowed Damansara Realty’s appeal in respect of the S3 Action with costs. The High Court Order dated 2.12.2014 at paragraph (B) (i), (ii) and (iii) was set aside. We also unanimously dismissed the Cross Appeals in respect of the S3 and S4 Actions with costs of RM 70,000.00 for here and below to be paid by Bungsar Hill to Damansara Realty. No costs were awarded against the 2nd Respondent. We also ordered the deposit to be refunded. sgd (UMI KALTHUM BINTI ABDUL MAJID) Judge Court of Appeal Malaysia Putrajaya Dated: 6.04.2018 Counsels / Solicitors For the Appellant : Mr. Richard W.G Lee, Mr. Teh Eng Lay and Mr. Ong Ing Hoo from Messrs. Richard Lee. 23 For the 1st Respondent : Mr. Tommy Thomas, Mr. Alan Adrian Gomez and Ms Anita Natalia from Messrs. Tommy Thomas For the 2nd Respondent : Ms Narkunavathy Sundareson from the Attorney General’s Chambers, Putrajaya.