Ekar Lega Sdn Bhd v Central Spectrum (M) Sdn Bhd (BA-22NCvC-175-04/2022)

The case for the Plaintiff is that the Defendant has failed to deliver vacant possession as agreed under the terms of a sale and purchase agreement entered into between the Plaintiff and the Defendant and is thus entitled to damages. The Defendant, unsurprisingly, contends otherwise.

What is significant is the contention by the Plaintiff that it is entitled to the reliefs sought without a plenary trial of the action. Predictably, the Defendant takes the opposing view and argues that the matters or issues raised in this action can only be resolved after a full trial. 09/11/2023 08:12:42 BA-22NCvC-175-04/2022 Kand. 27

The Plaintiff has couched its Notice of Application pursuant to Order 14A and/or Order 33 rule 2 of the Rules of Court 2012. The Plaintiff seeks a determination of the following issues and/or questions, namely: and the Defendant Vendor’s response emails dated 4 September, 2021 and 18 February, 2022, as well as the Defence affirming that the Defendant is still in the process to deliver the water Reticulation System, has the Defendant failed to deliver vacant possession of the said Lot 5, phase 3A in accordance to clauses 10.1 and 13.1 of the Sale and Purchase Agreement dated 19 September, 2013; and Plaintiff is entitled for the liquidated damages pursuant to clause 13.2 of the Sale and Purchase Agreement dated 19 September, 2013, or in the alternative, directions be given by this Honourable Court for damages to be assessed, as prayed in the Statement of Claim.

The principal issues in this case are thus: Rules of Court 2012 at this stage of proceedings; and

Order 33 rule 2 provides as follows: Time of trial of questions or issues (O. 33, r. 2)

The Court may order any question or issue arising in a cause or matter, whether of fact or law or partly of fact and partly of law, and whether raised by the pleadings or otherwise, to be tried before, at or after the trial of the cause or matter, and may give directions as to the manner in which the question or issue shall be stated. [6] It is evident that a court is permitted to order any question or issue arising in a cause or matter to be tried before, at or after the trial of the cause of matter. [7] In the matter before this Court, what the Plaintiff is seeking from the Court is for it to order that the questions raised be tried before the trial. The plaintiff is amply entitled to seek such an order. In this regard, the answer to the first issue is in the affirmative. The Application of Order 14A [8] The issue relating to the application of Order 14A of the Rules of Court 2012 requires more in-depth scrutiny. [9] The relevant provisions in Order 14A of the Rules of Court 2012 read as follows: Determination of questions of law or construction (O. 14A, r. 1)

Order unless the parties have had an opportunity of being heard on the question. [10] As for the mandate in Order 14A rule 1(3) of the Rules of Court 2012, I have afforded the parties the right to be heard. [11] It is clear from the provision in Order 14A rule 1(1) of the Rules of Court 2012 that a Court may construe the provisions or terms in any document arising in any cause of matter. In the present application, this would include the sale and purchase agreement and the correspondences between the parties. [12] However, it is imperative that the exercise of the above discretionary power is subject to the following superseding riders, that is, (a) the construction of the documents concerned “is suitable for determination without the full trial of the action” and “such determination will finally determine the entire cause or matter or any claim or issue therein”. Both these provisos are to be read conjunctively. [13] The consequential and crucial issue for determination in this matter before this Court is whether this Court is able to construe the terms and provisions of the documents before it and arrive at a decision without the need to call for witnesses to testify at the trial. The Salient Facts and the Decision of This Court [14] The undisputed facts were that the Plaintiff in this action had entered into a Sale and Purchase Agreement with the Defendant as vendor and the Plaintiff as purchaser of a lot of land, whereby, according to the Plaintiff, it was agreed that under Clause 10, on Basic Infrastructure, the parties have agreed at Sub-Clause 10.1 that: “The Vendor shall at its own cost and expenses, construct or cause to be constructed the Basic Infrastructure more particularly specified in the Fourth Schedule hereto in accordance with the requirements and standards of the relevant authorities.”. The scopes of works are as set out in the Fourth Schedule. [15] Pursuant to Clause 13 on Delivery of Vacant Possession, it has been provided in Sub-Clauses 13.1 and 13.2 that: “The Vendor shall deliver vacant possession of the Lot to the Purchaser upon completion of the Basic Infrastructure provided in The Fourth Schedule herein. The vacant possession of the Lot shall be delivered to the Purchaser within thirty-six (36) months from the date of this Agreement.”; and “If the Vendor fails to deliver vacant possession of the Lot with the time stipulated in Clause 13.1 hereof, the Vendor shall be liable to pay to the-Purchaser liquidated damages calculated from the day to day at the rate of ten per centum (10%) per annum of the purchase price from the expiry of the time of vacant possession as in Clause 13.1 until the date the Purchaser is deem to have taken vacant possession of the Lot.” [16] The Fourth Schedule which set out the Basic Infrastructure to be Provided for the Lot includes “Water reticulation mains to the vicinity of the Lot.”. [17] According to the Plaintiff, pursuant to Clauses 10.1, 13.1 and 13.2 of the said Sale & Purchase Agreement, the delivery of vacant possession to the Plaintiff was upon completion of the basic infrastructure as provided in the Fourth Schedule under the said Sale & Purchase Agreement. The Plaintiff further underscored the point that the manner of delivery of vacant possession amongst others included in the basic infrastructure and the completion of water reticulation mains forms part of this basic infrastructure. [18] Henceforth, according to the Plaintiff, upon a reading of Clause 13.1, the date for delivery of vacant possession should be on or before 19 September, 2016. [19] The Defendant, via its Notice of Delivery of Vacant Possession dated 28 April 2017, had informed the Plaintiff that the basic infrastructure provided in the Fourth Schedule of the said Sale & Purchase Agreement had been completed, and the vacant possession of the said Lot were ready to be delivered to the Plaintiff. [20] It is also pertinent to point out that on or around 21 May, 2017, the Plaintiff had fully paid the Purchase Price to the Defendant. [21] Following the Plaintiff’s email dated 28 August, 2021 to the Defendant questioning the permanent water supply for Phase 3A that was not ready, the Defendant had by email dated 04 September, 2021 had amongst others, informed that the modification and rectification works as approved by AIR Selangor had tentatively been targeted to be completed by the end of October 2021. [22] Upon additional enquiries by the Plaintiff on the incomplete work and readiness of the permanent water supply to Phase 3A, the Defendant had again confirmed by email dated 18 February, 2022 on the continuous delay, in which the Defendant’s contractor was still in the final stage of the rectification works. [23] Based on the above, it was submitted by the Plaintiff that this was a straightforward case whereby this is a proper case for this Court to invoke Order 14A of the RC 2012 and that judgment may be entered in favour of the Plaintiff under Order 14A of the RC 2012. [24] This Court notes that the Plaintiff also cited section 47 of the Contracts Act 1950. This provision deals with the issue of time and place for performance. It provides as follows: 47 Time for performance of promise where no application is to be made and no time is specified. Where, by the contract, a promisor is to perform his promise, and no time for performance is specified, the engagement must be performed within a reasonable time. Explanation - The question "what is a reasonable time" is in each particular case a question of fact". [25] Reference was also made to section 56(1) and (2) of the Contracts Act 1950. [26] Last but not least, the Plaintiff highlighted the fact that at the time of the filing of these actions, there is still no permanent water supply available to the said Lot. [27] However, the Defendant urged this Court to not overlook Clauses 10.2 and 10.3 of the Sale and Purchase Agreement. [28] These relevant clauses provide as follows:

10.2 The parties hereto hereby agree that the Basic Infrastructure shall be deemed to be completed upon the practical completion of the same as certified by the Vendor’s consultants.

10.3 On completion of the construction of the Basic Infrastructure hereinbefore mentioned, the Vendor shall do everything possible within its powers to have the Basic Infrastructure taken over and maintained by the relevant Appropriate Authorities. [29] In addition to the above two clauses, the Defendant also drew this Court’s attention to Clause 13.3, which the Plaintiff has also omitted to mention. Clause 13.3 reads as follows:

13.3 It is hereby agreed that upon expiry of fourteen (14) days from the date of the notice from the Vendor requesting the Purchaser to take possession of the Lot, whether or not the Purchaser has actually entered into possession or occupation of the Lot, the Purchaser shall be deemed to have taken delivery of vacant possession of the Lot. [30] Based on the above three clauses, it was thus the Defendant’s contention that the water reticulation system had indeed been completed pursuant to Clause 10.2, as certified by their consultant, and that “completion” does not include handing over of the system to the Authorities. [31] It is trite that Order 14A is suitable despite the Court having to examine and construe documents or agreements involved in the matter. However, as noted earlier, this is subject to the overriding rider that the Court must be able to reach a decision without having to call witnesses to determine the true meaning or intention of the clauses. [32] A reading of the clauses cited by the Plaintiff suggests that this may be a proper case where Order 14A ought to be invoked. However, when these clause are construed together with the other clauses relied on by the Defendant, these clauses as a whole put a different complexion on the matter. [33] This Court is of the considered view that while the clauses cited and relied on by the Defendant do not determinatively resolve the dispute one way or another, they have nevertheless, raised questions which can only be answered at a trial. [34] This Court agrees that witnesses will have to be called and extrinsic evidence will have to be adduced to establish the veracity of the “defences” raised by the Defendant. [35] The application in Enclosure 9 is dismissed with costs. The Plaintiff to pay the defendant costs of RM5,000, subject to allocator. Postscript [36] The scope of the summary judgment procedure has widened considerably. In addition to the general summary judgment procedure laid down in Order 14 and the disposal of a case on questions of law or construction under Order 14A of the Rules of Court 2012, summary judgment for specific claims such as accounts and inquiries, actions for specific performance etc and summary proceedings for possession of land are provided for in Order 43, Order 81 and Order 89 respectively. Hence, the proposition that “trial, as a rule, must precede judgment” (Symons & Co v Palmer’s Stores (1903) Ltd [1912] 1 KB 259, 266) is no longer the “rule”. Be that as it may, summary judgment is not granted as a matter of cause when these Orders are invoked. [37] With the amendment of section 68 of the Courts of Judicature Act 1964, section 68(1)(d) now provides that “where a High Court dismissed any application for a summary judgment”, no appeal shall be brought to the Court of Appeal. When one examines this provision and those in section 68(1)(e) and (f), the rationale becomes obvious. A dismissal of an application for summary judgment does not mean that the applicant has failed in the action. The matter proceeds to trial. Likewise, when an application to strike out any writ or pleading is dismissed or an application to set aside a judgment in default is allowed, the matter proceeds to trial. In each of the above situations, section 68(1)(d), (e) and (f) now state that no appeal shall be brought to the Court of Appeal. [38] This Court has been made to understand that the Plaintiff in the instant case is appealing against this Court’s decision in dismissing the Plaintiff’s application for summary judgment. As explicated in the preceding paragraph, and in line with the provisions in section 68(1)(d) of the Courts of Judicature Act 1964, no appeal shall be brought to the Court of Appeal. [39] This Court has also been made to understand that the Plaintiff intends to argue that section 68(1)(d) only applies to dismissal of summary judgment applications made under Order 14. As this application is made pursuant to Order 14A, the Plaintiff will accordingly argue that the provision in section 68(1)(d) does not apply. [40] If the reasoning that section 68(1)(d) is only meant to apply to applications made under Order 14, then dismissal of applications for summary judgment under Order 14A, Order 43, Order 81 and Order 89 are all subject to appeal. [41] This Court is of the view that if indeed the intention of the Rules Committee is to limit the application of section 68(1)(d) to dismissals of any application for a summary judgment under Order 14, this would or should have been made clear in the said sub-section 68(1)(d). In view of the absence of the phrase “under Order 14” in the said sub-section 68(1)(d), summary judgment ought to be understood as to include all summary judgment applications under the various procedural rules of the Rules of Court 2012. [42] It is nevertheless granted that in certain circumstances, a determination of questions of law or construction of provisions in a statute or clauses in a contract or document pursuant to Order 14A of the Rules of Court 2012 may bring a matter to an end. In such a case the losing party ought not be prohibited from bringing an appeal to the Court of Appeal. The adoption of such an approach will correspond with the rationale behind the introduction of sub-section 68(1)(d), (e) and (f) of the Courts of Judicature Act 1964. [43] As for the present case, the dismissal of the Plaintiff’s Notice of Application for summary judgment under Order 14A does not result in the dismissal of the Plaintiff’s action. The dismissal of the Plaintiff’s Notice of Application for summary judgment under Order 14A does not result in judgment entered in favour of the Defendant. This Court is therefore of the view that the present case falls squarely within objective envisaged or intended by the introduction of the new paragraph (d) in sub-section 68(1) of the of the Courts of Judicature Act 1964. Henceforth, no appeal shall be brought to the Court of Appeal. However, that is a decision to be made by the Court of Appeal. Dated: 1 November, 2023 sgd [CHOONG YEOW CHOY] Judicial Commissioner High Court of Malaya Shah Alam Counsel: Fong Lip Jeen for the Plaintiff (Messrs. Wong & Ting) Deborah Lau for the Defendant (Messrs. Khairuddin Ngiam & Tan)