Ilylia Diyana Binti Kamaruzaman v ENG LIAN ENTERPRISE SDN. BHD. (WA-12ANCvC-157-10/2023)

1.

ROBOTICIST SDN. BHD. [No. Syarikat: 201601025773 (1196712-M) ILYLIA DIYANA BINTI KAMARUZAMAN [No. K/P: 840125-14-5150] ….DEFENDAN-DEFENDAN [Diputuskan oleh Puan Azian binti Othman pada 22 September 2023] GROUNDS OF JUDGMENT Introduction [1] This appeal from the Sessions Court is about the service of process. The learned Sessions Court judge found that the Appellant/2nd Defendant 11/03/2025 13:14:25 WA-12ANCvC-157-10/2023 Kand. 20 had failed to serve the Notice of Application (referred to in her Grounds as “Enclosure 11”) on the Respondent/Plaintiff within the time stipulated in Order 42 rule 13 Rules of Court 2012. She proceeded to rule that the Appellant/2nd Defendant’s application to set aside the Default Judgment was incompetent, and dismissed the said application. [2] After reading the Appeal Record and the submissions of both sides as well as the Grounds of Judgment of the learned Sessions Court judge, I found no appealable error in the decision that she made. I also found that the Appellant’s affidavit failed to disclose a “defence on merits”. Hence, the Appellant/2nd Defendant’s appeal was dismissed. My reasons for dismissing the appeal are as stated below. Background Facts [3] The Respondent/Plaintiff is the proprietor of a commercial property bearing a postal address of Lot 2F-30, 2nd Floor, Bangsar Village II, Kuala Lumpur (“the Premises”). It is undisputed that the Premises was let by the Respondent/Plaintiff to the 1st Defendant by way of a tenancy agreement dated 24th October 2016 for a term of three years. [4] After the tenancy of the Premises expired on 30th September 2019, there was no written tenancy agreement signed to extend the term of tenancy. Instead, the 1st Defendant had continued to rent the Premises on a month-to-month basis at a rent of RM4,500.00 per month. The Respondent/Plaintiff pleaded that the 2nd Defendant, who was a director and shareholder of the 1st Defendant, had agreed to guarantee payment of rentals by the 1st Defendant. [5] As no payment was forthcoming from the 1st Defendant which was in default of payment of rent, a letter of demand was issued by the Respondent/Plaintiff’s solicitors on 30th March 2023 to terminate the monthly tenancy and demand vacant possession of the Premises to be delivered by 30th April 2023 and payment of RM126,750.90 being the amount in arrears then. [6] A letter dated 5th May 2023 (in good English) signed by the Appellant/2nd Defendant as a director of the 1st Defendant, was sent to the Respondent/Plaintiff in response to the said letter of demand. In the said letter, it was admitted that rentals, utility bills, etcetera, were in arrears but cited financial problems post-Covid19 pandemic, and she requested more time to pay up. This letter was exhibited and marked as “ILY-3” in the Appellant’s affidavit affirmed on 26th July 2023. [7] Failure by the Defendants to comply with the demand to return vacant possession of the Premises led to the Respondent/Plaintiff filing a Writ of Summons on 30th May 2023, seeking an order for vacant possession of the Premises, payment of the outstanding rentals and utility bills, mesne profits at RM9,000 per month (double the monthly rent of RM4,500.00) from June 2023 until the Premises is vacated, and the usual consequential orders for 5% interest on the judgment sum, costs, and any other relief deemed fit by the Sessions Court. [8] After the Writ was served, the Defendants failed to enter appearance in time. The Respondent/Plaintiff proceeded to file a Certificate of Non-appearance of the Defendants, followed by the said Default Judgment on 27th June 2023. [9] The Appellant/2nd Defendant’s Notice of Application (the said Enclosure 11) was filed on 26th July 2023 to set aside the Default Judgment. It was supported by her affidavit (mentioned above) that was affirmed on the same date. The Respondent/Plaintiff’s Notice of Application to strike out the Appellant/2nd Defendant’s Notice of Application [10] The Respondent/Plaintiff takes the stand that the Appellant/2nd Defendant’s application to set aside the Default Judgment was incompetent as the Notice of Application and supporting affidavit were sent by email to its solicitors and that hard copies were never served. A Notice of Application (identified as “Enclosure 13” in the Sessions Court) was filed by the Respondent/Plaintiff to strike out the Appellant/2nd Defendant’s application. [11] It transpired that the learned Sessions Court judge did not hear the said Enclosure 13. She read the submissions filed by counsel earlier and decided on 22nd September 2023 to dismiss the Appellant/2nd Defendant’s application (Enclosure 11 in the Sessions Court) with costs of RM3,000.00. [12] The learned Sessions Court judge held that since she had dismissed the said Enclosure 11, the Notice of Application (identified as Enclosure 13 in the Sessions Court) filed by the Respondent/Plaintiff to strike out Enclosure 11 was rendered academic. Thus, her Grounds of Judgment was in respect of Enclosure 11. The Appellant/2nd Defendant’s Position [13] Learned counsel for the Appellant/2nd Defendant pointed out that the Sessions Court had directed written submissions to be filed in respect of Enclosure 13 (the Plaintiff’s striking-out application) by 9th October 2023 and Reply Submissions by 16th October 2023, and had fixed it for delivery of her decision on 31st October 2023. [14] Thus, the Appellant is aggrieved that the learned Sessions Court judge had proceeded to consider the written submissions and decided to dismiss Enclosure 11 on 22nd September 2023. [15] For the appeal in this Court, several authorities were cited in the written submissions of learned counsel for the Appellant. Analysis of the Facts and Law [16] In all applications to set aside a default judgment, the preliminary question to be answered is whether the default judgment is regular. The Writ of Summons in this case was served personally on the 2nd Defendant whilst she was in Starbucks Cafe in a shopping mall. This was disclosed in her affidavit. Her complaint was that the person who effected service of process had embarrassed her by speaking loudly. A screenshot of para 5 of her said affidavit is shown below: [17] I find that the service of the Writ of Summons was regular. It was unfortunate that the service of the Writ of Summons on the Appellant/2nd Defendant whilst she was in Starbucks Cafe had caused her embarrassment. Since service of the Writ was effected on 8th June 2023, the Defendants had till 22nd June 2023 to enter appearance (see Order 12 rule 4(a) Rules of Court 2012). [18] As the Defendants did not enter appearance within the time limited for appearing, the Respondent/Plaintiff was justified to file a Certificate of Non-appearance, and thereafter to enter Default Judgment. This is permissible under Order 13 rule 1 & 4 Rules of Court 2012 as the prayer for liquidated demand and possession of immovable property in this case do not require any adjudication about the proprietorship of the Premises or any other triable issue. [19] Since the Default Judgment is a regular judgment, the only way for the Defendants to set it aside was to file and serve a Notice of Application to apply to set aside the Default Judgment by showing a “defence on merits”. The usual practice is to state the main points of defence and to exhibit a draft Defence in the supporting affidavit. In this case, the Appellant/2nd Defendant’s supporting affidavit appears to be sketchy. [20] The fatal point for the Appellant/2nd Defendant was that her Notice of Application (referred to as Enclosure 11 in the Sessions Court) was sent by her solicitors to the Plaintiff’s solicitors only by email. No hard copy of the Notice and the supporting affidavit were served. [21] The learned Sessions Court judge relied on Lim Kwee Fen & Anor v KT Home Mart Sdn Bhd [2022] 9 CLJ 943 as authority to rule that the Appellant/2nd Defendant had failed to serve the Notice of Application (the said Enclosure 11 in the Sessions Court) on the Respondent/Plaintiff’s solicitors. The relevant passages from the judgment of Amarjeet Singh J in Lim Kwee Fen & Anor v KT Home Mart Sdn Bhd (supra) are as follows: [12] Thus, the record of appeal can be served by any of the modes described in O. 62 r. 6(1) at that address. The issue now is whether by sending the record of appeal by email on 6 January 2022 and following up by leaving a hardcopy of the record of appeal at the business address of the respondent’s solicitors is one of the modes of service that is provided. [13] Counsel strenuously contended that the manner of service fell within the mode provided by O. 62 r. 6(1)(cc) or O. 62 r. 6(1)(d). Counsel for the respondent argued otherwise stating that what was done did not fall within the mode described in either of the paragraphs. Order 62 r. 6(1)(cc) [14] In my view, the reliance on O. 62 r. 6(1)(cc) as a mode of service was a futile act. The appellants argued that ‘email’ was a form of electronic communication envisaged by O. 62 r. 6(1)(cc) and therefore the service by email on 6 January 2022 was valid. The argument was most unbecoming. This is because the argument is based solely on the first part of the para. (cc) which states, “by means of electronic communication” which I accept ‘email’ is one but completely ignores the second part which states, “in accordance with any practice direction issued for that purpose”. Counsel could not say what the practice direction says because the practice direction has not been issued yet. It does not exist. In my view, without the practice direction, the mode of service under para. (cc) cannot be affected. A valid service can only be made in accordance with such practice direction and one must wait until that happens. In the meantime, there can be no valid service by way of email under para. (cc). In the circumstances, I had no hesitation in holding that the manner of service utilised by the appellants did not fall within the mode envisaged in O. 62 r. 6(1)(cc).” [22] I respectfully agree with Justice Amarjeet Singh’s reasoning in Lim Kwee Fen & Anor v KT Home Mart Sdn Bhd (supra), in that a Practice Direction is necessary to ‘activate’ the mode of service “by means of electronic communication” (which include emails) under Order 62 r. 6(1)(cc), and that since there was none at the material time, the Appellant/2nd Defendant had yet to serve its Notice of Application (Enclosure 11) on the Respondent’s solicitors. [23] Learned counsel for the Appellant had sought to rely on Order 1A of the Rules of Court 2012 to bypass the failure to serve Enclosure 11. The said rule states: “In administering these Rules, the Court or a Judge shall have regard to the overriding interest of justice and not only to the technical non-compliance with these Rules.” [24] However, learned counsel for the Respondent cited the judgment of the Federal Court in DYAM Tunku Ibrahim Ismail Ibni Sultan Iskandar Al-haj v. Datuk Captain Hamzah Mohd Noor [2009] 4 CLJ 329. In essence, if a substantive rule exists, it is not to be casually cast aside by applying Order 1A – especially when the party in default is choosing to ignore the substantive rule. Even though DYAM Tunku Ibrahim Ismail Ibni Sultan Iskandar Al-haj v. Datuk Captain Hamzah Mohd Noor (supra) was a decision on Order 1A of the Rules of the High Court 1980, the same words are found in the current Order 1A in Rules of Court 2012. I therefore stand guided by the following passages from the judgment of Zaki Tun Azmi CJ: “[44] Now to O. 1A RHC. This order relates to the administering of Rules of the High Court 1980. In order to invoke O. 1A RHC, parties must apply the object of the Rules first. [46] The technical non-compliance of any rule may be remedied where there is an accidental omission or oversight by a party. A general provision such as O. 1A RHC is for the court or judge to give heed to justice over technical non-compliance. It must not supersede a mandatory requirement of the Rules. O.1A RHC cannot be invoked when a party intentionally disregards in complying with the Rules. Otherwise, parties would be encouraged to ignore the Rules. [50] As I had mentioned in court, if O. 1A is sought to be invoked whenever a party fails to comply with any provision of the rules, then the whole of the Rules of the High Court 1980 would be rendered useless. For example, can failure to enter appearance or file defence within the specified period be considered as an irregularity? Of course, it cannot be. A party who is late in filing the relevant papers must obtain an order from the court to extend the time, if such extension is required and is permitted by the Rules.” [25] The requirement for a Notice of Application seeking to set aside a default judgement to be served by the applicant on the opposing party is expressly stated in Order 42 rule 13. Service of the Notice of Application is a mandatory requirement to bring it to the attention of the opposing party as early as possible. Order 42 rule 13 states: “Save as otherwise provided in these Rules, where provisions are made in these Rules for the setting aside or varying of any order or judgment, a party intending to set aside or to vary such order or judgment shall make an application to the Court and serve it on the party who has obtained the order or judgment within thirty days after the receipt of the order or judgment by him.” [26] As quoted above, the Federal Court in DYAM Tunku Ibrahim Ismail Ibni Sultan Iskandar Al-haj v. Datuk Captain Hamzah Mohd Noor (supra) held that “O.1A RHC cannot be invoked when a party intentionally disregards in complying with the Rules.” This ‘reminder’ is applicable in the present appeal because the Respondent’s solicitors had written to the Appellant’s solicitors on 1st August 2023 to request service of hard copies of the documents, i.e. Enclosure 11 and the supporting affidavit. A screenshot of their email (from the Appeal Record) is shown below: [27] Even though the above facts and law suffice for this Court to uphold the decision of the Sessions Court’s decision, I did bear in mind the provisions of S.29 of the Courts of Judicature Act 1964 that states: “All civil appeals from a subordinate court shall be by way of re-hearing, and the High Court shall have the like powers and jurisdiction on the hearing of appeals as the Court of Appeal has on the hearing of appeals from the High Court.” [28] With the said s.29 in mind, I had looked at the Appellant’s affidavit to see if it would be justified to dismiss the said Enclosure 11 on merits – to ensure that a dismissal of her appeal would not cause a miscarriage of justice. The following points are my findings. [29] First, there was no draft Defence exhibited in the Appellant’s affidavit. Though it is not a mandatory requirement, the practice of exhibiting a draft Defence in an affidavit supporting an application to set aside a regular default judgment assists the Court to determine if there is a chance of the applicant/defendant successfully defending herself, i.e. raising a “defence on merits”. [30] Secondly, the Appellant/2nd Defendant is not a stranger to the tenancy matter. As exhibited in her own affidavit, she wrote the letter dated 5th May 2023 to the Respondent, admitting delay in payment of rentals and utilities bills and was seeking the Respondent’s indulgence to reschedule outstanding payments. The Appellant is a businesswoman who had a vested interest in the tenancy matter, not a stranger who unwittingly gave a personal guarantee. She must surely know that a landlord is not obliged to grant continuous indulgence to a tenant. [31] One of the authorities cited by learned counsel for the Appellant was the Temporary Measures For Reducing The Impact Of Coronavirus Disease 2019 (Covid-19) Act 2020 (“the Covid19 Act”). Unfortunately for the Appellant, this statute is of no assistance to her because the Covid19 Act merely allowed tenants to defer payment during the Covid19 lockdown period, and did not discharge a tenant from her liability to pay rent in arrears. [32] As the Covid19 Act was published on 23rd October 2020, by virtue of s.1(2) thereof – which provided for a period of operation of two years from the date of publication – it was in operation till 22nd October 2022. It had ceased to be in operation in May 2023 when the civil suit was filed at the Sessions Court. S.1(2) states as follows: “Except where the date of commencement and period of operation have been provided in respect of the respective Parts in this Act, this Act shall come into operation on the date of publication of this Act and shall continue to remain in operation for a period of two years from such date of publication.” [33] Further, S.30 of the Covid19 Act prohibited a landlord from issuing a warrant of distress under s.5(1) of the Distress Act 1951 in respect of arrears of rent for the period from 18th March 2020 to 31st August 2020 only during the time when the said Act was in operation, not forever. The said s.30 states as follows: “For the purposes of the recovery of rent due or payable to the landlord by a tenant of any premises, a warrant of distress issued under subsection 5(1) of the Distress Act 1951, shall not include the distrain for the arrears of rent for the period from 18 March 2020 to 31 August 2020.” [34] A final point to mention here about the Covid19 Act is that s.29 thereof reduced the period of operation of s.30 to the period from 18th March 2020 until 31st December 2020. It reads: “This Part is deemed to have come into operation on 18 March 2020 and shall continue to remain in operation until 31 December 2020.” This is a final point that made it manifestly clear that the Covid19 Act would not afford the Defendants any defence. [35] It is my judgment that the Appellant ought to have vacated the Premises timeously upon receiving the letter of demand to avoid being saddled with mesne profits. A landlord’s right to claim mesne profits from a tenant who is holding-over a demised premises is statutorily provided in S. 28(4)(a) of the Civil Law Act 1956, i.e. to claim double the usual rent. Thus, the learned Sessions Court judge was justified in allowing the Respondent’s claim for mesne profits. Conclusion [36] I would conclude that the learned Sessions Court judge did not err in deciding as she did – by relying on the judgment of the High Court in Lim Kwee Fen & Anor v KT Home Mart Sdn Bhd (supra). The judgment of the Federal Court in DYAM Tunku Ibrahim Ismail Ibni Sultan Iskandar Al-haj v. Datuk Captain Hamzah Mohd Noor (supra) is authority to hold that the Appellant ought to have filed an application for extension of time. This Court should not condone any intentional non-compliance of the Rules of Court 2012. Counsel for the Appellant: Gobinath Karupanan SOLICITORS FOR THE APPELLANT: MESSRS KUMAR CHAMBERS Advocates & Solicitors Suite 202A, Kelana jaya Business Centre, 97 Jalan SS7/2, 47301 Petaling Jaya 50500 KUALA LUMPUR. Counsel for the Respondent: Preeti Shah SOLICITORS FOR THE RESPONDENT: MESSRS Preeti Shah & Associates Advocates & Solicitors No. 52, Jalan Cenderai 1, Taman Lucky, Bangsar, 59100 KUALA LUMPUR.

DYAM Tunku Ibrahim Ismail Ibni Sultan Iskandar Al-haj v. Datuk Captain Hamzah Mohd Noor [2009] 4 CLJ 329.

Lim Kwee Fen & Anor v KT Home Mart Sdn Bhd [2022] 9 CLJ 943.

Order 13 rule 1 & 4 Rules of Court 2012.

Order 42 rule 13 Rules of Court 2012.

S.29 of the Courts of Judicature Act 1964.

Temporary Measures For Reducing The Impact Of Coronavirus Disease 2019 (Covid-19) Act 2020 (“the Covid19 Act”).

S. 28(4)(a) of the Civil Law Act 1956.