Helen Lee v Encorp Strand Garden Office Jmb (BA-12A-37-08/2023)

There are two appeals before me, Appeal No 37 and Appeal No 38. I heard both Appeals on 14 December, 2023.

These appeals have brought into focus situations involving claims, counterclaims and interlocutory applications initiated by the same parties and these claims and applications are intertwined.

The task of this Court is to unravel these supposedly interrelated claims and applications and decide on the overriding issues presented in these two appeals.

The Appellant (the Defendant in the Sessions Court), Helen Lee, is the owner of a Penthouse unit. The Appellant had purchased the property from a Developer after having entered into a Sale and Purchase Agreement with the latter. The Appellant had also signed a Deed of Mutual Covenants with the said Developer.

The Respondent (the Plaintiff in the Sessions Court), Encorp Strand Garden Office JMB, is a Joint Management Body.

The Respondent had commenced an action against the Appellant in the Sessions Court on 21 December, 2022, claiming for maintenance 3 and sinking fund fees/costs against the Appellant, as owner of the Penthouse unit.

The Respondent had successfully obtained summary judgment against the Appellant in the Sessions Court. This appeal, that is, Appeal No 37, is against the decision of the learned Sessions Court Judge in granting summary judgment to the Respondent.

In a separate Action before the Shah Alam High Court (“Suit 343”), the Appellant had filed a suit against the Developer and the Respondent, seeking a declaration that the Sale and Purchase Agreement and the Deed of Mutual Covenants that the Appellant had signed with the Developer is null and void.

The Respondent successfully applied to the High Court for the action against it in Suit 343 to be struck out.

Suit 343 is ongoing, between the Appellant and the Developer.

In Suit 343, the Respondent had also filed a counterclaim. That counterclaim by the Respondent against the Appellant was for the payment of maintenance and sinking fund fees/costs owed by the Appellant. As the Respondent had succeeded to have the claim against it struck out in Suit 343, the Respondent was advised to withdraw the counterclaim and to file the counterclaim via a fresh and separate action.

As noted in paras [6] and [7] above, the Respondent commenced a fresh action in the Sessions Court against the Appellant on 21 December,

Through a Notice of Application dated 11 April, 2023, the Respondent applied and succeeded in obtaining summary judgment at the Sessions Court. [13] The present Appeal No 37 by the Appellant is an appeal against the decision of the learned Sessions Court Judge in granting summary judgment to the Respondent. [14] Before the Sessions Court, the Appellant had also applied to the learned Sessions Court Judge to stay the proceedings, on the ground that there is Suit 343 before the High Court. It was the Appellant’s contention that the matter before the Sessions Court should be stayed until Suit 343 has been decided. The application for stay was made on 14 June, 2023. The learned Session Court Judge refused to grant the stay order. [15] Both the decisions in granting summary judgment and in refusing to grant an order for a stay was made on 24 July, 2023. [16] The present Appeal No 38 by the Appellant is an appeal against the decision of the learned Sessions Court Judge in refusing to grant a stay order. The Issues [17] The primary issue in Appeal No 37 is whether the learned Sessions Court Judge had erred in fact and in law in granting summary judgment to the Respondent. [18] Arising from this main issue are the following subsidiary issues, namely:

Whether a counterclaim is a defence or a set-off; and

Whether limitation has set in to bar part of the claim and thus rendering the granting of summary judgment as inappropriate. [19] As for Appeal No 38, the principal poser is whether the learned Sessions Court Judge was correct in refusing to grant the stay order as sought by the Appellant. Appeal No 38 [20] This Court shall first deal with Appeal No 38. [21] The Appellant’s case, in seeking a stay order, is premised on the argument that if she were successful in Suit 343, she will not be liable for the claim brought by the Respondent against her. [22] The Appellant relied on Teguh Majuria Sdn Bhd & Ors v Atsa Architects Sdn Bhd & Ors [2022] 10 CLJ 492; [2022] MLJU 2384; [2022] MLRHU 2022 where the High Court had propounded “the efficient and fair resolution of the dispute as a whole” test. In addition, the Appellant also cited the case of Ong Koh Hou v Da Land Sdn Bhd & Ors [2018] 5 AMR 269; [2019] 4 CLJ 622; [2018] MLJU 778; [2018] 5 MLRA 648. [23] In reply, the Respondent pointed out that even if the Appellant were to be successful, her rights are not affected nor is she prejudiced. According to the Respondent, the Appellant has a right to seek indemnity from the Developer. [24] The Respondent further alluded to the fact that the Appellant had only sought an order for a stay of proceedings after a lapse of 7 months. On this ground of delay, the Respondent relied on the case of Ajaib Singh v Jeffrey Fernandez [1971] 1 MLJ 139. [25] The Respondent cited Universal Trustee (M) Bhd v Lambang Pertama Sdn Bhd & Anor [2014] 5 AMR 57; [2014] 1 LNS 1437; [2015] & MLJ 305; [2014] MLRHU 458 and MCAT Gen Sdn Bhd v Celcom (M) Bhd [2007] 6 AMR 168; [2007] 10 CLJ 375; [2007] 8 MLJ 107; [2007] 1 MLRH 199 for the proposition that a party seeking an order for stay of proceedings will need to show the existence of special circumstances. [26] The Respondent also referred to Jadgis Singh a/l Banta Singh v Outlet Rank (M) Sdn Bhd [2013] 3 CLJ 47; [2013] 4 MLJ 213; [2013] 3 MLRA 104 which enumerated the principles governing the stay of proceedings and drew this Court’s attention to the “rare and compelling circumstances” prerequisite as explained by the Court of Appeal and High Court in Ptotasco Bhd v Tey Por Yee & Anor Appeal [2018] 5 CLJ 299; [2018] 1 MLJU 993; [2018] 6 MLRA 674 and Kerajaan Malaysia v Golden Citrus Sdn Bhd & Ors [2022] 6 AMR498; [2022] 7 CLJ 631; [2022] MLJU 1464; [2022] MLRHU 1294 respectively. The Decision of this Court [27] On the delay point, the Appellant clarified that Suit 343 had originally been scheduled for trial from 6 – 9 June, 2023. However, she was informed on 6 June, 2023 that the trial had to be adjourned to 19, 25 and 26 April, 2024. If the trial of Suit 343 as originally scheduled for June, 2023 had taken place, the Appellant said that there would not have been a need for her to apply for a stay of proceedings. Nevertheless, upon learning of the development that had taken place, she then filed the stay application. [28] This Court is satisfied that the delay ground as raised by the Respondent has been satisfactorily explained by the Appellant. [29] On the substantive issue as to whether the Appellant’s application for a stay of the proceedings ought to be granted, the result would depend on the factual matrix of the case. [30] The Respondent is at liberty to pursue its remedy against the Appellant. Likewise, the Appellant is entitled under the law to seek recourse against the Developer. There are a number of ways in which the Appellant could have exercised or enforced her rights against the Developer. One such avenue is by way of third-party proceedings. Even though the Appellant had chosen not to invoke Order 16 of the Rules of Court, 2012, her rights to seek the appropriate remedy against the Developer is not in any way affected by the outcome of the case brought against her by the Respondent. [31] In view of the reasoning, Appeal No 38 is dismissed with costs. [32] The Appellant is to pay the Respondent costs of RM10,000, subject to allocator. Appeal No 37 [33] In appealing against the decision of the learned Sessions Court Judge in granting summary judgment to the Respondent, the Appellant has raised a number of grounds. [34] The crux of the arguments advanced by the Appellant is that there are triable issues warranting a trial. In other words, there exists issues or questions which ought to be tried within the meaning of Order 14 rule 3 of the Rules of Court 2012. Accordingly, the Appellant argued that summary judgment should not have been entered in favour or the Respondent. Two of the grounds raised by the Appellant to support her appeal to overturn the learned Sessions Court Judge’s decision to enter summary judgment in favour of the Respondent that warrant consideration in this appeal are addressed in the ensuing paragraphs. [35] The first relates to the counterclaim by the Appellant. The contention in the counterclaim here is that since the Respondent had failed to discharge their duties and obligations pursuant to section 5 of the Strata Titles Act 1985 and section 21 of the Strata Management Act 2013 in maintaining the property, the Appellant is entitled to claim damages against the Respondent. The allegations here relate to, inter alia, the maintenance of the glass bubble lift, leaking ceilings and a litany of other complaints relating to the maintenance of the property/premises. [36] This raises the question of whether the counterclaim amounts to a triable issue. [37] The Appellant also raised the point that part of the Respondent’s claim is time barred. The Appellant relied on section 6(1)(d) of the Limitation Act 1953 and argued that “any amount claimed for the period of time prior to 22 January, 2016 is time-barred and should not be allowed, and the amount should be deducted from the total claim” by the Respondent. The Appellant also cited the case of Golden Expansion Sdn Bhd v Dubon Bhd [2018] AMEJ 0687; [2018] 1 LNS 837; [2018] MLJU 797; [2018] MLRHU 678. [38] On the other hand, the Respondent submitted that its claim is not barred by the Limitation Act 1953. The Respondent relied on section 105(2) of the Strata Management Act 2013. The relevant section 105 provides as follows:

The Tribunal shall have the jurisdiction to hear and determine any claims specified in Part 1 of the Fourth Schedule and where the total amount in respect of which an award of the Tribunal is sought does not exceed two hundred and fifty thousand ringgit or such other amount as may be prescribed to substitute the total amount.

For the avoidance of doubt, the Limitation Act 1953 [Act 254] shall not apply to the proceedings of the Tribunal.

The jurisdiction of the Tribunal shall not extend to any claim in which the title to any land, or any estate or interest in land, or any franchise, is in question. [39] The Respondent acknowledged that section 105 is concerned with the jurisdiction of the Strata Management Tribunal established under Part IX of the said Act and matters that are heard and determined by the Tribunal, as opposed to the Court. However, as the Respondent is at liberty pursuant to section 34(2) of the Strata Management Act 2013 to commence a dispute before the Tribunal or the Court, the Respondent reasoned that section 105 should equally apply to a matter before a Court. [40] Section 34 of the Strata Management Act 2013 governs the procedure on recovery if sums due and sub-section (2) reads as follows: If any sum remains unpaid by the purchaser or parcel owner at the end of the period specified in the notice under subsection (1), the developer or the joint management body, as the case may be, may file a summons or claim in a court of competent jurisdiction or in the Tribunal for the recovery of the said sum or as an alternative to recovery under this section, resort to recovery under section 35. [41] The Respondent drew further support from the following cases, namely, Saujana Triangle Sdn Bhd v JMB Perdana Exclusive and Tropics [2017] 1 LNS 1035; [2017] MLJU 1020; [2017] MLRHU 685 (“Saujana Triangle”), Badan Pengurusan Bersama Kompleks Pandan Safari Lagoon v Tam Cheng Meng [2018] 3 AMR 597; [2018] 8 CLJ 361; [2018] 8 MLJ 574; [2018] MLRHU 394 (“Tam Cheng Meng”), and Badan Pengurusan Megan Avenue I v Harcharan S Sidhu & Anor [2017] 4AMR 711; [2017] 9 CLJ 563; [2017] 11 MLJ 736]; [2017] 6 MLRH 64 (“Badan Pengurusan Megan Avenue I”). These cases have decided, by logical implication, that section 105(2) of the Strata Management Act 2013 shall apply with equal force when a developer of a joint management body opts to file an action in a court of competent jurisdiction. [42] Last but not least, the Respondent also relied on the concept of “a running account”, as a cause of action known to the common law. In this regard, the Respondent cited the case of Bajaj Textiles Ltd v Gian Singh & Co Ltd [1968] 1 MLJ 279. [43] In response to the above authorities, the Appellant urged this Court to refer to the section 106 of the Strata Management Act 2013. That section states as follows: Section 106 Exclusion of Jurisdiction of Clause

Where a claim is filed with the Tribunal and the claim is within the Tribunal’s jurisdiction, the issues in dispute in that claim, whether as shown in the initial claim or as emerging in the course of the hearing, shall not be the subject of proceedings between the same parties in any court unless— a) the proceedings before the court were commenced before the claim was filed with the Tribunal; or b) the claim before the Tribunal is withdrawn, abandoned or struck out.

Where paragraph (1)(a) applies, the issues in dispute in the claim to which those proceedings relate, whether as shown in the initial claim or emerging in the course of the hearing, shall not be the subject of proceedings between the same parties before the Tribunal unless the claim before the court is withdrawn, abandoned or struck out.

For the purpose of this section, a claim shall be deemed to have been made with the Tribunal when section 108 has been complied with. [44] On the basis of this section 106 of the Strata Management Act 2013, the Appellant argued that “when a claim that falls under the jurisdiction of the tribunal is brought to a court of law, such exclusivity no longer applies to the claimant”. [45] It is also significant that the Appellant had also referred to the decision of the Federal Court in Dubon Ltd (in liquidation) v Wisma Cosway Management Corp [2020] 5 AMR 33; [2020] 6 CLJ 589; [2020] 4 MLJ 288; [2020] 3 MLRA 555 (“Dubon”), which she submitted had reaffirmed the decision of the High Court in Golden Expansion Sdn Bhd v Dubon Bhd [2018] AMEJ 0687; [2018] 1 LNS 837; [2018] MLJU 797; [2018] MLRHU 678. The High Court had held that section 6(1)(d) of the Limitation Act 1953 applied in that case. The Decision of this Court [46] On the issue of the counterclaim, the learned Sessions Court Judge very ably dealt with this question at paragraphs [29] – [45] of his Ground of Judgment. [47] It is trite that a counterclaim does not give rise to a triable issue. Reference can be made to Permodalan Plantations Sdn Bhd v Rachuta Sdn Bhd [1985] 1 MLJ 157 and Ronald Quay Sdn Bhd v Maheswary Sdn Bhd [1987] 1 MLJ 322. [48] The arguments advanced, together with the authorities cited, by both the Appellant and Respondent relating to the limitation ground demand serious deliberation. [49] It is vital that Dubon, being a decision of the apex court, is carefully examined and understood. [50] The sole question before the Federal Court in Dubon was “Whether the right of a Joint Management Body or a Management Corporation to collect and receive payment from a proprietor under sections 33 and 77 of the Strata Management Act 2013 respectively, gives it a lawful preference as a secured creditor over the assets of a company in liquidation?” The question of the application or exclusion of the Limitation Act 1953 was not considered by the Federal Court. Dubon is not authority to support the Appellant’s contention that since the claim in this case is before the court and not the Strata Management Tribunal, section 105(2) of the Strata Management Act 2013 will not apply. [51] This Court is persuaded by the reasonings set out in Saujana Triangle, Tam Cheng Meng and Badan Pengurusan Megan Avenue I. [52] In view of the above findings, section 6(1)(d) of the Limitation Act 1953 does not apply to the present case and this limitation ground has no bearing on the summary judgment application. [53] The Decision of the learned Sessions Court Judge is affirmed. [54] However, the interest awarded should be amended to 5% per annum and compounded interest will also be adjusted accordingly. [55] Appeal No 38 is dismissed with costs. The Appellant is to pay the Respondent costs of RM10,000, subject to allocator. Dated: 16 January, 2024 sgd [CHOONG YEOW CHOY] Judicial Commissioner High Court of Malaya Shah Alam Counsel: Manpal Singh Sacdev a/l Manjit Singh with Helmi bin Zaharin for the Appellant (Messrs. Manjit Singh Sachdev Mohammad Radzi & Partners) S. Sivanesan with Noreha binti Othman for the Respondent (Messrs. Nesan Cheng & Co.)