Imec Jaya Sdn. Bhd. v Greatearth Apg Sdn. Bhd. (BA-22NCvC-301-08/2020)

This is an appeal filed by the plaintiff. The plaintiff’s suit has been dismissed with costs.

Both the plaintiff and defendant have engaged in business since 2002. 24/04/2024 16:24:08

The plaintiff supplied and rented machinery to the defendant and provided servicing, repair work, and replacement parts.

The business started in the year 2002 and lasted till the year 2018.

According to the plaintiff, there was no formal appointment of the plaintiff as either the main contractor or on an ad hoc basis.

From 2002 to 2018, 3,731 invoices were issued, totaling

The plaintiff alleges that the defendant has paid a sum of

The plaintiff had filed this case against the defendant for

During the cross-examination stage, it was found that duplicate copies of the invoices had been filed as a common bundle of documents.

The plaintiff attempted to amend the pleadings, but this Court dismissed it.

The plaintiff filed an appeal against the Court’s decision and also applied for a stay of proceedings pending the outcome of the appeal. This Court dismissed both Applications. The plaintiff withdrew the appeal.

There has been a change of solicitors, and submissions have been filed for this Court to decide on this suit.

The plaintiff’s claim is for a declaration that the defendant breached the contract document, special damages for RM2,001,302,81, general damages, exemplary damages, punitive damages, interest, and costs.

Brief facts of the defendant’s case The defendant asserts that the plaintiff’s director was a former employee of the defendant, which was previously called APG Geo-Systems Sdn Bhd.

The defendant further contends that the plaintiff rendered services to the defendant on an ad hoc basis.

There was no contact between the plaintiff and the defendant regarding the services rendered.

The defendant put the plaintiff to strict proof of its case.

Issues to be tried

Whether the plaintiff and the defendant’s business relationship fell within the scope of a running account or whether it was on an ad hoc basis;

(ii) Whether there was an agreement between the plaintiff and the defendant for the services rendered and/or goods supplied by the plaintiff to the defendant;

(iii) Whether the plaintiff’s invoices before August 2014 are time-barred;

(iv) Whether the plaintiff has proven the special damages sought against the defendant for the sum of RM2,000,302.81. Decision of the Court Issue 1: Whether the plaintiff and the defendant’s business relationship fell within the scope of a running account or whether it was on an ad hoc basis.

The plaintiff contended that the business relationship between the parties was not on an ad-hoc basis but on a running account basis.

The plaintiff referred to the case Big Industrial Gas Sdn Bhd lwn Ewajaya Sdn Bhd [2023] 7 MLJ 176, which applied the Federal Court decision Bajaj Textiles v Gian Singh & Co Ltd [1968] 1 MLJ 279, which decided as follows: “[15] Konsep running account telah dipertimbangkan dalam Bajaj Textiles Ltd v Gian Singh & Co Ltd [1968] 1 MLJ 279, di mana Mahkamah Persekutuan menyatakan seperti berikut: … In my opinion, the amount due on a running account is a cause of action known to the common law. The authority for this view is Re Footman Bower & Co Ltd [1961] 2 All ER 161, where Buckley J said at p 165: In the case of a current account, where the debtor-creditor relationship of the parties is recorded in one entire account into which all liabilities and payments are carried in order of date as a course of dealing extending over a considerable period, the true nature of the debtor’s liability is, in my judgment, a single and undivided debt for the amount of the balance due on the account for the time being without regard to the several items which as a matter of history contribute to that balance. The trial judge found there was a running account in the present case between the plaintiffs and the defendants. He said: From the evidence I find that the dealings between the parties consisted mainly of goods sold and delivered by the defendants to the plaintiffs and of loans from one to the other. The account between them was kept in the ledger of the defendants and the defendants debited the plaintiffs with the costs of the goods as and when they were supplied and with the amount of the loans as and when they were made. The plaintiffs from time to time made payments to the defendants on account generally and credit was given in the ledger for these payments as they were made. The payments were made in varying sums and clearly were not made in respect of any particular debit. The plaintiffs also kept an account in the name of the defendants in which there was a series of credits and debits. The account between the parties is in fact a running account which to the knowledge of both parties is of that kind and kept in that way. The claim of the defendants is to recover from the plaintiffs the balance due on the running account but the defendants say that they do not owe anything to the plaintiffs and that in fact the defendants owe them on the running account. (Penekanan ditambah.) [16] Berdasarkan Bajaj Textiles Ltd, suatu running account akan wujud apabila hubungan pemiutang-penghutang direkodkan di dalam satu akaun, dan terdapat satu hutang yang tunggal dan tidak berbahagi, untuk jumlah yang tertunggak pada sesuatu masa.”

The defendant referred to the same case.

After perusing the principle enunciated in Bajaj Textiles v Gian Singh & Co Ltd [1968] 1 MLJ 279 and applying it to the current facts before this Court, I decided that there is no running account.

The defendant always made payments through invoices issued, although not within the stipulated time frame. This is unlike the facts in Bajaj’s case, which were discussed regarding accounts being kept.

In paragraph 11.2 of the statement of claim, the plaintiff stated that the defendant had made the last payment in 2018. If so, the plaintiff testified in Court that the plaintiff would deduct or cancel the invoices issued first. It is illogical and unacceptable that until 2018, payment was still due and not settled by the defendant as early as 2002.

The plaintiff’s attempt to introduce Bundle 31 (Enclosure 81) to prove that the statements of accounts have the characteristic of a running account is disbelieved by this case for the case in totality, as that particular document was prepared only for the year 2015, 2016 and 2017 and not from the year 2002 till 2017.

Upon perusing the statement of claim, it is pertinent to note that the summary of transactions between the plaintiff and the defendant is displayed in the form of invoices issued and not on a running account basis.

The chart table in the statement of claim summarizes the transactions allegedly carried out, but this does not prove that the business was conducted on a running account.

The facts presented before this court show that the business relationship between the plaintiff and defendant was purely on an ad hoc basis.

The fact that the business was on an ad hoc basis is further strengthened by the evidence of the plaintiff’s first witness during cross-examination as follows: [Refer to page 11, Notes of Proceeding] [Refer to page 51, Notes of Evidence] [Refer to pages 51 – 52, Notes of Proceeding] [Refer to pages 54 – 55, Notes of Proceeding] [Refer to pages 54 – 55, Notes of Proceeding] [Refer to page 56, Notes of Proceeding] Issue 2: Whether there was an agreement between the plaintiff and the defendants for the services rendered and/or goods supplied by the plaintiff to the defendant

About this issue, the plaintiff alleges that the case for plaintiff consisted of invoices, payment vouchers, and service reports from the year 2002 till 2018.

The plaintiff further contended in their submissions in paragraph 29 that the defendants had acknowledged the majority of service reports tendered by the plaintiff at the trial by placing their company chop and/or their representative’s signatures.

In paragraph 31 of their submission, the plaintiffs state that the defendant had only challenged and/or questioned or raised doubts that the acknowledgment for the said invoices and the service reports do not belong to the defendant.

Therefore, the plaintiff’s submission is that by not challenging the services rendered by the plaintiff to the defendant, it cannot be disputed that the plaintiff had not carried out the works for the defendant's benefit.

The Court is somewhat puzzled by the plaintiff's approach. At one stage, they admit that the defendant is challenging the acknowledgment of the invoices and service reports, but on the other hand, they say that the defendant cannot dispute the services rendered as they did not challenge them.

The Court held that the defendant's challenge to the acknowledgment of the invoices and service reports went without much deliberation, and the services rendered themselves were challenged.

Since the claim is for special damages, in the absence of any formal proof of agreement between the plaintiff and the defendant, every work done must be proved before a claim is made.

Issue 3: Whether the plaintiff’s invoices before August 2014 are time-barred Regarding the third issue, the plaintiff maintains that a running account existed between parties and that Section 6 of the Limitation Act 1953 does not apply to his case.

However, since the court has decided that there is no running account in this case, the plaintiff’s cause of action against the defendant accrued upon the expiry of the payment term as stipulated in the invoices issued by the plaintiff.

Regarding this, reference is made to the first plaintiff's evidence to sustain how the payment term was calculated. The evidence is as follows: [Refer to pages 46 & 47, Notes of Proceeding]

This cause of action was filed on 18.8.2020. All invoices dated from 2002 to 18.7.2014 are time-barred.

This court adopts the principle enunciated in the case of Aneka Melor Sdn Bhd v Seri Sabco (M) Sdn Bhd [2016] 2 CLJ 563, which decided as follows: “[15] The general rule in contrast is the cause of action accrues not when the damage is suffered but when the breach occurred. Consequently, the limitation period runs from the time the contract is breached and not from the time that the resulting damage is sustained by the plaintiff. [16] In Nasri v Mesah [1970] 1 LNS 85; [1971] 1 MLJ 32, the Federal Court per Gill FJ enunciated on the “date of accrual in the case of debt” as follows: This expression, ‘cause of action’, has been repeatedly the subject of decision, and it has been held, particularly in Hemp v Garland LR 4 QB 509 511, a decided in 1843, that the cause of action arises at the time when the debt could first have been recovered by action. The right to bring an action may arise on various events, but it has always been held that the statute runs from the earliest time at which an action could be brought.” … “[17] Three different reasons have been advanced by the courts to explain the purpose of limitation statutes. The first reason is that a plaintiff with a good cause of action should pursue it with reasonable diligence. The second one is that a defendant might have lost evidence to disprove a stale of claim. The third reason is that long-dormant claims have more cruelty than justice in them (See Halsbury’s Laws of England, 4th ed, para 605 at p. 266).” “[20] To all these, we can add that the policy behind the statute of limitations is to prevent unreasonable delay in the enforcement of legal rights and to protect against the risk of injustice. The rule provides an objective, reliable, predictable and relatively definitive rule that has long governed this aspect of commercial repose of disputes.” Issue 4: Whether the plaintiff has proven the special damages sought against the defendant for the sum of RM2,001,302.81

The statement of claim reveals that the plaintiffs seek special damages of RM2,001,302.81.

The plaintiff contends that since the defendant paid RM10 million until 2018, irrespective of the acknowledgment of documents, the defendant cannot raise any accuracy of the documents as they failed to do so within 14 days as stipulated in the documents.

The plaintiff referred to the case of Mat Jusoh bin Daud v Syarikat Jaya Seberang Takir Sdn Bhd [1982] 2 MLJ 71, which decided as follows: “[198] The Federal Court in Mat Jusoh bin Daud v Syarikat Jaya Seberang Takir Sdn Bhd [1982] 2 MLJ 71 held that the court could increase the special damages to an amount exceeding the sum pleaded in the statement of claim. Salleh Abas FCJ (as he then was) held at page 76: “The question which confronts me at the moment is this, i.e., whether I could increase the special damages to an amount exceeding the sum pleaded in the statement of claim. It must be observed that the amount of excess was not one that was not asked for Counsel for the plaintiff because of the mistaken view he formed of the matter asked for this amount as part of the plaintiff’s claim for general damages, and so he did not include it, nor did he rightly calculate the amount of special damages asked for it in the pleadings. In my view since the amount of loss was provided by evidence justice demands that I shoud ignore the figure pleaded. After all, if a judge can reduce the amount pleaded because of the effect of the evidence, he surely is entitled to increase the amount if the evidence warrants it.”

Using the above authority, the plaintiff submitted that the plaintiff had proved the special damages in the cause of the trial. However, there were issues with the duplicate invoices mistakenly tendered as evidence in Court.

The plaintiff also submits that the previous solicitor applied to amend the statement of claim to reduce the amount claimed from RM2,001.302.81 to RM1,690,232.41.

To support his case, the plaintiff referred to the cases of Mechnatech Engineering and Construction Sdn Bhd v Siegle & Epple (M) Sdn Bhd [2013] MLJ 443 and John Holland International Pty Ltd vYong Piling Contractor [1996] MLJU 579.

The claim in this case rests upon special damages.

The law on special damages is trite law.

In the case of Datuk Mohd Ali Hj Abdul Majid & Anor v Public Bank Bhd [2014] 6 CLJ 269, it was decided as follows: “[33] Therefore, in a claim for damages, it is not sufficient for the plaintiff to merely state the amount of damages that he is claiming, he must prove the damage that he had in fact suffered to the satisfaction of the court. This principle is borne out in the case of Bonham-carter v Hyde Park Hotel [1948] 64 TLR, where Lord Goddard CJ observed: Plaintiffs must understand that if they bring actions for damages, it is for them to prove their damages; it is not enough to write down the particulars, and, so to speak, throw them at the head of the court, saying: ‘This is what I have lost, I ask you to give me these damages.’ They have to prove it. This statement was cited with approval by Edgar Joseph JR FCJ in Tan Sri Khoo Teck Pual & Anor v Plenitude Holdings

During the trial, it was glaringly evident the plaintiff’s case consisted of the following impairment.

The plaintiff had adduced multiple instances of double entries and /or more than double entries concerning the duplicate invoices.

(ii) The plaintiff failed to prove that the services allegedly rendered to the defendant were rendered.

(iii) The plaintiff’s second witness worked with the plaintiff only from 2008 and admitted she had no personal knowledge of the affairs relating to the accounts before 2008.

The plaintiff's witnesses' testimonies were uncertain about the purported claim for special damages in the statement of claim.

Throughout the trial, the plaintiff successfully brought forward incomplete documents, uncertainty about whether the defendant received the documents, and many more irregularities, as follows.

The statement of account is not related to this trial. A reference statement of account issued on 31.12.2018, page 50 of Bundle B26, belongs to Imec Services, not the plaintiff.

(ii) The testimony of the first plaintiff admitted that there were blatant errors in the statement of accounts produced in court.

(iii) Reference is made to page 42 of the notes of proceedings as follows: [Refer to page 42, Notes of Proceeding]

(iv) This was also confirmed by the second witness evidence as follows: [Refer to page 73, Notes of Proceeding]

The plaintiff’s first witness also agreed with the defence counsel's assertion that the respective letters of demand issued by the plaintiff differed from the amount claimed by the plaintiff in this case.

(vi) The plaintiff’s second witness also testified that she was unsure as to the exact amount allegedly due and owing by the defendant to the plaintiff.

(vii) Reference is made to pages 9 and 65 of the notes of proceedings as follows: [Refer to page 9, Notes of Proceeding] [Refer to page 65, Notes of Proceeding]

(viii) The plaintiff's first witness admitted during cross-examination that some of the invoices and service reports do not acknowledge receipt by the defendant.

(ix) In light of the plaintiff’s admission as to uncertainty to some of the invoices and service reports not being proved to have been served on the defendant, the only inference that this Court can infer is that the defendant is not liable to make payments for which it does not know of.

During the trial, both the plaintiff’s witnesses were cross-examined extensively as to the multiple entries of the duplicate invoices relied upon by the plaintiff to compute its claim as detailed in paragraph 9.2 of the statement of claim.

(xi) The evidence adduced is as follows: [Refer to pages 110 – 114, Notes of Proceeding] [Refer to page 122, Notes of Proceeding]

(xii) The Court, upon perusing this evidence, has no choice but to fully agree with the defendant’s submission that the plaintiff has failed to prove the special damages claimed in the statement of claim.

Submission of no case to answer The plaintiff submitted that this Court ought to draw an adverse inference against the defendant for not giving any reason for not calling the defendant to provide evidence to rebut the evidence submitted by the plaintiff in respect of its case.

The plaintiff referred to the case Takako Sakao (F) Ng Pek Yuen

(F) & Anor [2009] 6 MLJ 751, which decided as follows: “The second consequence is that the court to have drawn an adverse inference against the first respondent on the amount of the appellant’s contribution to the purchase price as well as the existence and the terms of the mutual understanding of the agreement that she had with the first respondent. Where, as here, the first respondent being a party to the action provides no reason as to why she did not care to give evidence the court draw an adverse inference. See Guthrie Sdn Bhd v Trans-Malayan Leasing Corp Bhd [1991] 1 MLJ 33. See also Jaafar bin Shaari & Anor (suing as administrators of the estate of Shofiah bte Ahmad, deceased) v Tan Lip Eng & Anor [1997] 3 MLJ where Peh Swee Chin FCJ said: The respondents had chosen to close the case at the end of the appellants’ case. Although they were entitled to do so, they would be in peril of not having the evidence of their most important witness and of having an adverse inference drawn against them for failing to call such evidence should the circumstances demand it.’ There are two other authorities that are of assistance on the point. In Wisniewski v Central Manchester Health Authority of the Court of Appeal quoted from a number of authorities, including the following passage from the speech of Lord Diplock in Herrington v British Railways Board [1972] AC 877 The appellants, who are a public corporation, elected to call no witness, thus depriving the court of any positive evidence as to whether the condition of the fence and the adjacent terrain had been noticed by any particular servant of theirs or as to what he or any other servants either thought or did about it This is a legitimate tactical move under our adversarial system of litigation. But a defendant who adopts it cannot complain if the court draws from the facts which have been disclosed all reasonable inferences as to what are the facts which the defendants has chosen to withhold. Brooke LJ then went on to say this: From this line of authority, I derive the following principles in the context of the present case:

In certain circumstances, a court may be entitled to draw adverse inferences from the absence or silence of a witness who might be expected to have material evidence to give on an issue in an action.

If a court is willing to draw such inference, they may go to strengthen the evidence adduced on that issue by the other party or to weaken the evidence, if any, adduced by the party who might reasonably have been expected to call the witness.

There must be however, have been some evidence, however weak adduced by the former on the matter in question before the court in entitled to draw the desired inference: in other words, there must be a case to answer on that issue.

If the reason for the witness’s absence or silence satisfies the court, then no such adverse inference may be drawn. If, on the other hand, there is some credible explanation given, even it is not wholly satisfactory, the potentially detrimental effect of his/her absence or silence may be reduced or nullified. The other case is Crawford v Financial Institutions Services Ltd (Jamaica) [2005] UKPC 40, where Lord Walker of Gestingthorpe when delivering the advice of the Privy Council, said: It is well settled that in civil proceedings the court may draw adverse inferences from a defendant’s decision not to give or call evidence as to matters within the knowledge of himself or his employees. [5] Sarkar on Evidence (16th edn) at p 1837 states: It is the bounden duty of a party personally knowing the whole circumstances to give evidence and to submit to cross examination. Non-appearance as a witness would be the strongest possible circumstance to discredit the truth of his case Gurbakshah v Gurdial AIR 1927 PC 230.”

The plaintiff also referred to the case Yoong Sze Fatt v Pengkalan Securities Sdn Bhd [2011] 4 MLJ 805, which decided as follows: “[41] … I am of the opinion that the following guidelines may be taken as well settled. At the close of the plaintiff’s case, the first defendant chose to submit that there was no case to answer and preferred not to call a witness. It was a perilous course to take simply because all the evidence adduced by the plaintiff must be presumed to be correct. It is a sound general rule that a judge should not consider a submission of no case to answer unless the defendant (here, the first defendant) agrees not to call any evidence, whatever the outcome of the submission; thus, where a defendant is put to his election and elects not to call evidence, just like the present appeal. The result is this. That the trial is in effect truncated and the question for the judge to consider is whether the plaintiff has established his case by the evidence called on the balance of probabilities. If the plaintiff has not done so, then the judgment should be given to the defendant. If the judge chooses the latter course of action and gives judgment to the defendant, the judge may indeed be of the view that there is no case for the defendant to answer. But such a judgement should not be given unless the judge finds that the plaintiff has established his case by the evidence adduced on the balance on the balance of probabilities.”

The plaintiff also submitted that an adverse inference should be drawn against the defendant under Section 114 (g) of the Evidence Act 1950.

In reply, the defendant submitted that the plaintiff bears the burden of proving its case against the defendant on the balance of probabilities.

The defendant’s submission is that the plaintiff failed to adduce invoices duly acknowledged by the defendant on many of the items claimed, multiple entries of the duplicate invoices, and could not prove that the invoices forming the plaintiff’s claim correspond to the services rendered.

The defendant referred to the case Syarikat Kemajuan Timbermine Sdn Bhd v Kerajaan Negeri Kelantan Darul Naim [2015] 2 CLJ 1037, which decided as follows: “There are, however, two sets of circumstances under which a defendant may submit that he has no case to answer. In the one case, there may be a submission that, accepting the plaintiff’s evidence at its face value, no case has been established in law, and the other that the evidence led for the plaintiff is so unsatisfactory or unreliable that the Court should find that the burden of proof has not been discharged.”

This court decided that both sets of circumstances narrated in the case above applied to the current facts of the case.

The plaintiff's evidence regarding its claim before this Court has been unsatisfactory, confusing, and glitchy.

In the circumstances, this Court entirely agrees with the defendant's stand that there was no case to answer because the plaintiff failed miserably to prove its case on the balance of probabilities.

Conclusion In considering the evidence in totality and scrutinizing submissions filed herein, this Court decided that the plaintiff has failed to prove its case on the balance of probabilities.

The plaintiff’s case is dismissed with costs. Date: 24 April 2024 (INDRA NEHRU SAVANDIAH) Judicial Commissioner High Court of Malaya Shah Alam Decision date: 16 February 2024 Counsels: For the plaintiff: Gomathy Balasupramaniam [Messrs Ganeson Gomathy Fadzlin M. Nava & Co.] For the defendant: Habizan Rahman & Thevini Nayagam, [Messrs