Dato' Sri Andrew Kam Tai Yeow v 1. Tan Sri Dato' Kam Woon Wah (WA-22NCC-352-09/2017)

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NG PUI KUEN LEE SIEW KIN … DEFENDANTS JUDGMENT (Court enc. no. 216)

This is essentially a suit filed by a son against his father and companies allegedly controlled by the father. The plaintiff (Plaintiff) is the son and the first defendant (1st Defendant) is the Plaintiff’s father. 2

This Court enclosure no. 216 (Enc. 216) raises the following three issues:

whether a court order is effective under O 42 r 7(1) of the Rules of Court 2012 (RC) despite the fact that the order has not been drawn up, settled and perfected;

after the court has made an order to stay the filing of defence, can parties apply to court to re-visit the order?; and

whether there are special circumstances to stay the court’s pre-trial case management directions pending the disposal of appeals to the Court of Appeal against the High Court’s refusal to strike out this suit.

Khadijah binti Idris JC (1st Judge) first heard this case. On 27.9.2017, the 1st Judge dismissed the following three applications to strike out this suit (1st Judge’s Decisions):

court enclosure no. 12 (filed by fourth to eleventh defendants) was dismissed with no order as to costs;

court enclosure no. 13 (filed by 1st Defendant) was dismissed with costs; and

court enclosure no. 15 (filed by second and third defendants) was dismissed with costs. 3

Appeals to the Court of Appeal have been filed against the 1st Judge’s Decisions (Appeals) by the first to eleventh defendants (Defendants). The Appeals are still pending.

When the 1st Judge was transferred to the Muamalat and Admiralty Division of the Kuala Lumpur High Court (KLHC), this case was to be heard by Wong Chee Lin JC (2nd Judge) [who replaced the 1st Judge in KLHC’s Commercial Division].

The 2nd Judge recused herself from hearing this case on 24.4.2018. Consequently, on 27.4.2018 the then Managing Judge of KLHC’s Commercial Division (as her Ladyship then was) assigned this case to me.

On 17.5.218, during pre-trial case management of this case -

the Plaintiff’s learned counsel informed the court that the Defendants had yet to file their defence (Defence);

the Defendants’ learned counsel stated as follows -

after the 1st Judge’s Decisions were delivered, the Defendants’ learned counsel orally applied for the 1st Judge to stay the filing of Defence pending the disposal of the Appeals (Defendants’ Oral

the Plaintiff’s learned counsel did not oppose the Defendants’ Oral Application; and 4

the 1st Judge granted the Defendants’ Oral Application (1st

I informed all learned counsel that based on the “Court’s computer system” (please see the definition of “Court’s computer system” in O 63A r 1 RC), there is no record of the 1st Judge’s Stay. Nor is there a sealed order of the 1st Judge’s Stay in the Court’s computer system; and

in view of the above sub-paragraph (3), I gave pre-trial directions to set this case down for trial, including a direction for Defence to be filed by 7.6.2018 (Court’s Directions). B. Enc. 216

In view of the Court’s Directions, the Defendants filed Enc. 216 for, among others, an order that all the Court’s Directions be stayed pending the disposal of the Appeals.

The 1st Defendant has affirmed an affidavit on 27.9.2017 in support of Enc. 216 (1st Defendant’s Affidavit). Paragraph 4 of the 1st Defendant’s Affidavit has alleged that the Plaintiff’s learned counsel has consented to the Defendants’ Oral Application and hence, the 1st Judge’s Stay had been made (Paragraph 4).

Paragraph 4 has not been denied by the Plaintiff. Paragraph 5 of the Plaintiff’s affidavit affirmed on 31.5.2018 (in opposition to Enc. 216) (Paragraph 5) stated as follows: 5 “In response to [Paragraph 4], I am advised by my solicitors and I verily believe that after the [1st Judge] delivered [1st Judge’s Decisions], counsel on record for the 1st to the 11th Defendants applied for the filing of the [Defence] to be postponed pending the [Appeals], and my solicitor had no objections at that time to this request, having assumed that the [Appeals] would be disposed of within a reasonable time, particularly since they are interlocutory appeals. Contrary to the 1st Defendant’s averments, I am not aware that the [1st Judge] granted [1st Judge’s Stay] and to date, no such Order has been served on my solicitors. I verily believe that the [1st Judge] in fact directed that the [Defence] be postponed pending the [Appeals].” (emphasis added).

Based on Paragraphs 4 and 5, it is clear that the 1st Judge’s Stay has indeed been made. If otherwise, the Plaintiff would have applied to this court to enter a judgment in default of Defence against the Defendants. C. Effect of 1st Judge’s Stay

O 42 r 7(1) RC provides as follows: “Date from which judgment or order takes effect O 42 r 7(1) A judgment or order of the Court takes effect from the day of its date.” (emphasis added). 6

As provided in O 42 r 7(1) RC, once a judgment or order (Judgment/Order) is made by the court, the Judgment/Order takes effect from the date the Judgment/Order is made. Accordingly, pursuant to O 42 r 7(1) RC, the 1st Judge’s Stay has effect from 27.9.2017 until the disposal of the Appeals by the Court of Appeal. On this ground alone, Enc. 216 should be allowed to stay the filing of Defence until the Appeals have been decided by the Court of Appeal.

The fact that a Judgment/Order has not been drawn up, settled and sealed, does not prevent the Judgment/Order from having effect under O 42 r 7(1) RC. If I have decided otherwise, this will render O 42 r 7(1) RC redundant. Having said that, the perfection of a Judgment/Order is important if a party wishes to enforce the Judgment/Order.

There is another ground to uphold the 1st Stay Order. Once the court has decided a matter during proceedings, all parties are estopped from applying to the same court to re-visit the matter. I rely on the following trilogy of Court of Appeal decisions:

in Hartecon JV Sdn Bhd & Anor v Hartela Contractors Ltd [1996] 2 CLJ 57, at 65-66, it was decided as follows - “But, as we have earlier said, we choose to decide this appeal on quite a different basis. It is this. The learned judge, on 13 October 1993, was faced with an objection as to the form of proceedings which had been adopted by the appellants. He came to the conclusion that the form chosen by the appellants was not irregular. Although that was a decision made on an interlocutory matter which was 7 purely procedural in nature it was nevertheless binding on the court and on all parties to the lis until its reversal on appeal. In our judgment the decision of the learned judge overruling the respondent's preliminary objection rendered the point taken res judicata. If authority is needed for the proposition which has commended itself to us, it is to be found in Government of Malaysia v Dato Chong Kok Lim [1973] 2 MLJ 74 which was drawn to the attention of counsel during argument and in which there appears the following passage in the judgment of Sharma J (at p 76): In Satyadhyan Ghosel & Ors v Sint Deorajin Dobi and another AIR 1960 SC 941, the statement of the law on the subject is given thus: 'The principle of res judicata is based on the need of giving a finality to judicial decisions. What it says is that once a res is judicata, it shall be not adjudged again. Primarily it applies as between past litigation and future litigation. When a matter - whether on a question of fact or a question of law - has been decided between two parties in one suit or proceeding and the decision is final, either because no appeal was taken to a higher court or because the appeal was dismissed, or no appeal lies, neither party will be allowed in a future suit or proceeding between the same parties to canvass the matter again. This principle of res judicata is embodied in relation to suits in s 11 of the Code of 8 Civil Procedure; but even where s 11 does not apply, the principle of res judicata has been applied by courts for the purpose of achieving finality in litigation. The result of this is that the original court as well as any higher court must in any future litigation proceed on the basis that the previous decision was correct. The principle of res judicata applies also as between two stages in the same litigation to this extent that a court, whether the trial court or a higher court having at an earlier stage decided a matter in one way will not allow the parties to re-agitate the matter again at a subsequent stage of the same proceedings.' A decision given by a court at one stage on a particular matter or issue is binding on it at a later stage in the same suit or in a subsequent suit. (See Peareth v Marriott (1883) 22 Ch D 182, Hook v Administrator-General of Bengal & Ors LR 48 IA 187 and Re Trusts of the Will of Tan Tye (Deceased) Yap Liang Neov Tan Yew Ghee and Another [1936] MLJ 141 at pp 147-151). Parties cannot raise a second time in the same suit an issue that has already been determined either expressly or by necessary implication. (See Louis Dreyfusv Aruna Chalayya LR 58 IA 381).' (Emphasis added.) 9 A failure to adhere to the principle expressed in the judgment of Sharma J just quoted may lead to chaos in the conduct of civil proceedings. The facts of this very case afford a good illustration of such a consequence. We have here an earlier decision by the judge upon a procedural issue determining it in the appellants' favour. Then along comes the respondent at the adjourned hearing and applies to the judge to reopen the issue and review his earlier decision. The judge obliged and reversed himself. What was there to prevent the appellants from then an application to the judge to re-review his decision reversing himself? On the assumption of the law made by counsel before us, there would have been no bar to the judge undertaking such an exercise. The process could then be repeated ad infinitum with no conclusion. It would be a circular tail chasing exercise with no forward movement, proving to the man on the street that the maxim 'the law is an ass' is not without content. The absurd results that would ensue in accepting the contention of counsel demonstrates the inaccuracy of the propositon advanced. We cannot over emphasize the proposition that once a judge makes a ruling, substantive or procedural, final or interlocutory, it must be adhered to and may not be reopened willy-nilly.” (emphasis added);

Syarikat Telekom Malaysia v Business Chinese Directory [1997] 1 CLJ 596, at 599-600; and 10

Tenaga Nasional Bhd v Prorak Sdn Bhd & Anor [2000] 1 CLJ 553, at 563-566.

Based on the above two reasons, I have no hesitation to allow Enc. 216 to the extent of staying the Court’s Direction regarding the filing of Defence until the disposal of the Appeals. D. Whether Court Directions (other than filing of Defence) should be stayed pending disposal of Appeals

Section 73 of the Courts of Judicature Act 1964 (CJA) provides as follows: “An appeal shall not operate as a stay of execution or of proceedings under the decision appealed from unless the court below or the Court of Appeal so orders and no intermediate act or proceeding shall be invalidated except so far as the Court of Appeal may direct.” (emphasis added).

Rule 13 of the Rules of the Court of Appeal 1994 (RCA) states as follows: “An appeal shall not operate as a stay of execution or of proceedings under the decision appealed from unless the High Court or the Court so orders and no intermediate act or proceeding shall be invalidated except so far as the Court may direct.” (emphasis added). 11

Under s 73 CJA and r 13 RCA, the court has a discretion to stay “proceedings” pending the disposal of an appeal to the Court of Appeal.

Section 3 CJA has defined “proceedings” to mean “any proceeding whatsoever of a civil or criminal nature and includes an application at any stage of a proceeding”. Pre-trial case management directions are given by the court pursuant to O 34 rr 1(1), 2(2)(a) to (t) and 3 RC. I am of the view that the term “proceedings” in s 73 CJA and r 13 RCA includes pre-trial directions which have been given by the court. Hence, pursuant to s 73 CJA and r 13 RCA, the Defendants may apply to stay Court Directions pending the disposal of the Appeals.

The Court Direction regarding the filing of Defence has been stayed (pending the disposal of the Appeals) by reason of the 1st Judge’s Stay - please see the above Part C. However, there is no order from the 1st Judge to stay Court Directions (other than the filing of Defence) [Other Court Directions] pending the disposal of the Appeals.

The following cases have explained that the Defendants have the burden under s 73 CJA and r 13 RCA to satisfy the court that there exists special circumstances to stay the Other Court Directions pending the disposal of the Appeals:

the Court of Appeal’s judgment delivered by Mohd. Zawawi Salleh JCA (as his Lordship then was) in Jagdis Singh Banta Singh v Outlet Rank (M) Sdn Bhd [2013] 3 CLJ 47, at 58, and 12

Universal Trustee (M) Bhd v Lambang Pertama Sdn Bhd & Anor [2015] 7 MLJ 305, at paragraphs 21-23.

The Defendants have failed to satisfy me that there exists special circumstances to stay the Other Court Directions pending the disposal of the Appeals. As such, Enc. 216 is disallowed with regard to the Other Court Directions. E. Court’s decision

Premised on the above reasons, the following order is made:

pending the disposal of the Appeals, the Defence need not be filed;

there is no stay of the Other Court Directions; and

costs in the cause of RM5,000.00.

This judgment illustrates the importance for parties to draw up, settle and perfect all Judgments/Orders so as to avoid any dispute regarding the existence and scope of the Judgments/Orders. The Defendants could have easily averted the dispute regarding the 1st Judge’s Stay by drawing up, settling and perfecting such an order. WONG KIAN KHEONG Judge High Court (Commercial Division) Kuala Lumpur DATE: 27 AUGUST 2018 13 Counsel for Plaintiff: Encik Mahathir Abdullah (Messrs Mahathir) Counsel for 1st to 11th Defendants: Dato’ Seri Gopal Sri Ram, Mr. Wong Yee Chue, Mr. David Yii Hee Kiet & Mr. Damien Chan Kay Ding (Messrs YC Wong)