Hartajaya Benteng Timur AMR Jeli JV Sdn Bhd v United Overseas Bank (Malaysia) Bhd (WA-22NCC-337-08/2017)

This is an application by the Plaintiff for accounts to be provided by the Defendant United Overseas Bank (Malaysia) Bhd pursuant to Order 43 of the Rules of Court 2012 (“ROC”). I had dismissed the application. These are the full reasons for my decision.

At all material times, the Plaintiff was a customer of the Defendant and maintained 2 accounts with the Defendant, namely current account No. 347-3011-3064 (“1st Account”) and current account No. 347-3011- 6799 (“2nd Account”) 2

By a letter dated 6.5.2005, the Plaintiff wrote to the Pengarah Kerjaraya JKR Negeri Sembilan and authorised the addressee to credit all contract proceeds from the contract referred to therein to the 1st Account maintained with the Defendant.

By various letters of mandate from the Plaintiff to the Defendant, the Plaintiff mandated the Defendant to deduct sums from the 1st Account in order to pay certain facilities granted to various companies who had been granted facilities by the Defendant. This included facilities granted to Benteng Timur Sdn Bhd and Saron Holdings Sdn Bhd.

The Plaintiff also authorised the Defendant to deduct the sum of RM200,000.00 from the proceeds of each progressive claim received and credited into the current account of Benteng Timur Sdn. Bhd to build up the sinking fund to reach an amount of RM4 million as mentioned in item 3.3 herein (there is no item 3.3 in the letter).

The Plaintiff also authorised the Defendant to deduct the sum of RM 10 million to be placed as fixed deposit in the name of Benteng Timur Sdn Bhd and charged to the Defendant to fully secure the PG facility, as mentioned in item 3.4 herein (there is no item 3.4 in the letter). 3

The Plaintiff alleged that between 2.8.2005 until 3.4.2012, the Defendant had transferred out a total sum of RM51,172,257.43 from the 1st Account. At the hearing, the Plaintiff counsel submitted that the last transaction on the 1st Account was in August 2010.

The Plaintiff alleged that in respect of the 2nd Account, in the month of August 2010, a total sum of RM1,842,139.47 was deposited into the said account and immediately withdrawn by the Defendant. In the month of December 2010 and January 2011, a total deposit of RM3,314,000.00 as on 30.12.2010 was deposited into the said account and all of it was withdrawn by the Defendant on 4.1.2011.

The Plaintiff also alleged that the Defendant had withdrawn all of the sinking fund of RM4 million and the fixed deposit of RM10 million without its approval.

The Plaintiff’s claim against the Defendant is for various accounts, and payments of sums withdrawn from its accounts.

In its defence, the Defendant admitted that it was a trustee of the monies in the said accounts maintained by the Plaintiff and that it was to 4 act with the monies in the said accounts as was mandated by the Plaintiff.

However, the Defendant contended that it had at all material times acted with the monies in the said accounts in the manner mandated by the Plaintiff.

The Defendant also relied on estoppel, as monthly statements of account had been forwarded to the Plaintiff and the Plaintiff was required therein to notify the Defendant within 60 days of the statement date failing which the entries and balances shown therein will be considered correct. The Plaintiff had never raised any queries with the Defendant as regards the statements of account forwarded to it.

The Defendant also relied on the defence of limitation. It can be seen that all the withdrawals were affected more than 6 years prior to the date the action herein was filed.

The Defendant filed an application to strike out the Plaintiff’s claim whereas the Plaintiff filed inter alia this application for accounts to be rendered by the Defendant. 5 The law

Order 43 provides inter alia as follows: “(1) Where a writ is endorsed with a claim for an account or a claim which necessarily involves taking an account, the plaintiff may, at any time after the defendant has entered an appearance or after the time limited for appearing apply for an order under this rule.

On the hearing of the application, the Court may, unless satisfied by the defendant by affidavit or otherwise that there is some preliminary question to be tried, order that an account be taken and may also order that any amount certified on taking the account to be due to either party be paid to him within a time specified in the order.” Findings Of This Court

I find that there are issues to be tried in this case. In the Defendant’s striking out application, I have held inter alia that this is not a plain and obvious case where the Plaintiff is estopped from challenging the entries in the statements of account forwarded by the Defendant to the Plaintiff over the years. The Defendant had been 6 providing the Plaintiff with statements of account all these years with a notation that the entries will be deemed correct unless queries are raised with the Defendant within 60 days of the statement date and the Plaintiff had never raised any queries with the Defendant. There is also an issue as to when the Suit is deemed to have been filed. This Suit was filed in August 2017 which means all the impugned withdrawals were made mor than 6 years prior to the date of filing of the Suit. However, there was a letter from the Plaintiff’s solicitors to the Defendant’s solicitors, when enclosing a Notice of Discontinuance of a previous identical suit against the Defendant, that the parties’ position with regard to limitation will be preserved as on the date the said previous suit was filed, in the event the suits are filed afresh. There was no response from the Defendant’s solicitors before me. If this Suit was deemed filed in August 2017 as it in fact was, then the Plaintiff’s claim would be time barred assuming the limitation period is 6 years, as the last transaction in respect of the 1st Account was in August 2010, as submitted by the Plaintiff counsel and the 2 sums deposited into the 2nd Account were withdrawn by 4.1.2011, and the sinking fund and fixed deposit were uplifted by 27.1.2010 or thereabouts which is more than 6 years prior to the date of filing of the Suit herein. 7

However, if the Suit is to be deemed to have been filed on the date the previous, discontinued suit was filed, the relevant date would be December 2015 and part of the Plaintiff’s claim would not be time barred. The issue of time bar would have to proceed to trial and even if part of the Plaintiff’s claim is not time barred, a large part of the Plaintiff’s claim would be time barred as many withdrawals were made more than 6 years prior to December 2015.

19.

The Plaintiff relied on section 22 of the Limitation Act to contend that limitation does not apply.

Section 22 (1) of the Limitation Act provides that no period of limitation prescribed by this Act shall apply to an action by a beneficiary under a trust, being an action in respect of any fraud or fraudulent breach of trust to which the trustee was a party or privy; or to recover from the trustee trust property or the proceeds thereof in the possession 8 of the trustee, or previously received by the trustee and converted to his use.

The Plaintiff has not pleaded any cause of action for fraudulent breach of trust. The Plaintiff only pleaded fraudulent concealment of the cause of action in reply to the plea of limitation. Whether the Plaintiff can rely on the other limb of section 22(1) is an issue which should be determined in a trial.

In the circumstances of this case, since there are issues to be tried, I find that this is not an appropriate case where I should grant an order for accounts to be taken. Accordingly, I dismiss the Plaintiff’s application with costs of RM3,000.00. Wong Chee Lin Judicial Commissioner Kuala Lumpur High Court Commercial Division Dated: 19th April 2018 9 Solicitors for the Plaintiff T Gunaseelan, Dennis Xavier, Keshrinjeet Singh & Vinod Messrs Gunaseelan & Associates Advocates & Solicitors Unit B-2-1, VIVA, No. 378 Jalan Ipoh 51200 Kuala Lumpur Tel : 03-4045 3421 / 4045 3091 Fax: 03-4045 3422 Solicitors for the Defendant Ng Sai Yeang & Wong Chee Chien Messrs Raja, Darryl & Loh Advocates & Solicitors Tingkat 18, Wisma Sime Darby