Jurupro Sdn Bhd v Kkibs Sdn Bhd (WA-12BNCC-24-09/2024)

1st Defendant shall severally pay RM902,250.00 to the Plaintiff;

2nd Defendant shall severally pay RM700,000.00 to the Plaintiff;

3rd Defendant shall severally pay RM80,000.00 to the Plaintiff;

4th Defendant shall severally pay RM70,000.00 to the Plaintiff; making the cumulative total RM1,752,250.00. [3] The 2nd, 3rd and 4th Defendants were unrepresented and did not appear at the trial. They also did not appeal against the judgment of the learned Session Court Judge. [4] After hearing oral submissions from counsel and after considering all the relevant cause papers, I allowed the 1st Defendant’s appeal with costs. Background Facts [5] On 4.12.2020, the Plaintiff filed an action against the 1st Defendant claiming for the refund of RM902,250.00, purportedly paid pursuant to the Plaintiff’s purchase of 15,000 boxes of Nitrile Glove. [6] The Plaintiff’s pleaded claim against the 1st Defendant was premised on the cause of action for breach of contract. In support of its claim, the Plaintiff contended that:

the Plaintiff and the 1st Defendant had entered into an agreement whereby the 1st Defendant had agreed to sell and the Plaintiff agreed to buy 15,000 boxes of Nitrile Glove Paloma Brand (“Nitrile Glove”) at the price of RM902,250.00 (“the Contract”);

the Plaintiff made the payment of RM902,250.00 into the 1st Defendant’s bank account on 23.10.2020. In making the payment, the Plaintiff relied on the Proforma Invoice No. PRO038 dated 21.10.2020 of RM902,250.00 (“Proforma Invoice”) which carried the letterhead of the 1st Defendant and the signature of the 1st Defendant with its rubber stamp;

the 1st Defendant failed to deliver the 15,000 boxes of the Nitrile Glove to the Plaintiff on 26.10.2020, hence the breach. [7] In defence, the 1st Defendant contended that:

the 1st Defendant denied entering into the Contract with the Plaintiff for the sale and purchase of 15,000 boxes of Nitrile Glove. The 1st Defendant never dealt with the Plaintiff and in fact, the 1st Defendant was not even aware of the sale and purchase until one Datin Kelly Kok Sock Chin (“Datin Kelly”) (SP1’s wife) visited the 1st Defendant’s office on 30.11.2020;

the Proforma Invoice was a forged document as the 1st Defendant never issued such document;

the 2nd Defendant had approached the 1st Defendant’s chairman, SD1 and represented to the 1st Defendant about a sale and purchase transaction involving 300,000 boxes of Nitrile Glove for the sum of USD4,350,000.00 (“the Fraudulent Contract”). The 2nd Defendant further represented to the 1st Defendant that it would make a profit of USD435,000.00 from the Fraudulent Contract which the 2nd Defendant then requested the 1st Defendant to hold on its behalf;

The 2nd Defendant informed the 1st Defendant that the payment of RM902,250.00 which was made by the Plaintiff into the 1st Defendant’s account was part of the 2nd Defendant’s profit under Fraudulent Contract and directed the 2nd Defendant to disburse a total sum of RM850,000.00 to three parties, namely, a sum of RM 700,000.00 to one Faratravel (M) Sdn Bhd (in which the 2nd Defendant holds 99.99% shareholding and the 5th Defendant holds 0.01% shareholding), a sum of RM 80,000.00 to the 3rd Defendant and a sum of RM 70,000.00 to the 4th Defendant. [8] The learned Session Court Judge found that there was a contract between the Plaintiff and the 1st Defendant, relying heavily on the fact that the sum of RM902,250.00 was paid into the 1st Defendant’s bank account and the Proforma Invoice that was issued under the 1st Defendant’s letterhead. The learned Session Court also held that the 2nd Defendant was acting as agent of the 1st Defendant. Court’s Deliberations [9] With respect to the learned Sessions Court Judge, it is my judgment that the finding that there was a valid contract between the Plaintiff and the 1st Defendant is contrary to the evidence produced before the Court. [10] There was absolutely no evidence that the Plaintiff had dealt with the 1st Defendant at all regarding the sale and purchase of the 15,000 boxes of Nitrile Glove. During the cross-examination, SP1 admitted that he had only dealt with the 2nd Defendant concerning the sale and purchase of the 15,000 boxes of Nitrile Glove. There was not even a single correspondence between the Plaintiff and the 1st Defendant regarding the sale and purchase of the 15,000 boxes of Nitrile Glove. [11] In fact, SP1 admitted that:

the 1st Defendant never sent any quotation to the Plaintiff regarding the sale and purchase of the 15,000 boxes of Nitrile

the Plaintiff also never sent any purchase order to the 1st Defendant regarding the sale and purchase of the 15,000 boxes of Nitrile Glove;

there was also no written agreement signed between the Plaintiff and the 1st Defendant regarding the sale and purchase of the 15,000 boxes of Nitrile Glove;

the Plaintiff was communicating with the 2nd Defendant at all times on the sale and purchase of the 15,000 boxes of Nitrile Glove. This was admitted by SP-1 during cross examination. [12] The 1st Defendant was not even a company carrying on the business of selling nitrile glove. The 1st Defendant is in the business of providing total solutions to homeland security, environmental monitoring, natural resources management and health technology, remote sensing & geographic information systems (GIS), vehicle and cargo scanning, health & medical supplies. This was not disputed. [13] Given factual matrix that the 1st Defendant never made any offer to sell 15,000 boxes of Nitrile Glove to the Plaintiff, there was no intention to create legal relation, let alone any contract between the Plaintiff and the 1st Defendant. [14] The learned Session Court Judge, with respect, had erred in law when she referred to the Proforma Invoice and the Receipt/Delivery Order in support of her conclusion that there was a contract between the Plaintiff and the 1st Defendant. [15] Both the Proforma Invoice and the Receipt/Delivery Order were never admitted as exhibits at the trial. These documents were not proven and never admitted as evidence as the parties had agreed to place the same in Part C of the Bundle of Documents, i.e. that their authenticity and contents are disputed. They were marked as “ID” only and were never admitted as exhibits at the trial. [16] The 1st Defendant had led evidence to prove that both the Proforma Invoice and the Receipt /Delivery Order were indeed forgeries. SD1 in his testimony explained how the 2nd Defendant had dishonestly obtained the original Proforma Invoice for the sum of USD4,350,000.00 from the 1st Defendant. In this regard, SD1 testified that:

the 2nd Defendant had approached SD1 and represented that his company, Trace Tag International had secured a deal for sale and purchase of 300,000 boxes of Nitrile Glove amounting to USD4,350,000.00 with the end-buyer being the Plaintiff herein;

the 2nd Defendant further represented that the end-buyer would pay the purchase money directly to the supplier, Hartalega Holdings Berhad and the balance 10% (USD435,000.00) was his company’s profit margin;

the 2nd Defendant then requested the 1st Defendant to hold the 10% purchase price for his company, stating that his company was having some banking issue;

the 2nd Defendant then promised to pay USD43,500 to the 1st Defendant as commission if the 1st Defendant agreed to assist;

the 2nd Defendant agreed to help and at the request of the 2nd Defendant, had issued the Proforma Invoice;

unbeknown to the 1st Defendant, the 2nd Defendant never provided the Proforma Invoice USD4,350,000.00 to the Plaintiff, instead the 2nd Defendant forged the Proforma Invoice which reflected a sum of RM902,250.00 instead and the Receipt / Delivery Order for the value of RM902,250.00 and passed these two forged documents to the Plaintiff. [17] The testimony of SD1 regarding how the 2nd Defendant dishonestly obtained the original Proforma Invoice USD4,350,000.00 from the 1st Defendant was neither disputed nor challenged by the Plaintiff or its witness, SP1. SD1 was also not cross-examined on this matter. In fact, the Plaintiff did not produce any rebuttal evidence to deny or challenge the testimony of SD1 in this regard. [18] SD1 also testified that:

Based on the original Proforma Invoice for USD4,350,000.00, the 2nd Defendant subsequently forged the Proforma Invoice and the Receipt/Delivery Order;

(ii) The signature purported to be that of SD3’s and the company stamp purported to be that of the 1st Defendant on the forged Proforma Invoice and the forged Receipt/Delivery Order were, in fact, copied from the original Proforma Invoice USD4,350,000.00; and

(iii) The Proforma Invoice and the Receipt/Delivery Order were forged by the 2nd Defendant. [19] By comparing all three signatures and company stamp side by side, one will note that the signatures and company stamp from the three documents are identical. This is consistent with the 1st Defendant’s case that the Proforma Invoice and the Receipt / Delivery Order were forged as it is simply impossible for all the 3 documents purportedly executed at different times to be exactly the same. A simple visual inspection of the 3 documents will disclose the signature and the company stamp had been simply ‘cut and paste’ to create the forged documents: Original Proforma Forged Proforma Invoice USD4,350,000 Invoice RM902,250 Forged Receipt / Delivery Order DO RM902,250 [20] In fact, SD3, who handled matters related to the accounts and administration of the 1st Defendant testified that:

she denied ever preparing the Proforma Invoice. Furthermore, SD3 testified that the signature purported to be hers and the company stamp purported to be that of the 1st Defendant on the Proforma Invoice was in fact copied from the original Proforma Invoice USD4,350,000.0049 prepared by her previously;

(ii) SD3 also denied ever preparing the Receipt/Delivery Order and testified that it was a forged document. SD3 stated that the 1st Defendant never issued a document titled “Receipt/Delivery Order”. Instead, the 1st Defendant would only issue “Delivery Orders” in the ordinary course of business. SD3 produced samples of several original “Delivery Orders” previously issued by the 1st Defendant for inspection. Upon comparison, it is evident that the format of the 1st Defendant’s original “Delivery Order” is distinct and markedly different from the “Receipt/Delivery Order”;

(iii) SD3 lodged two police reports regarding the forgery of the Proforma Invoice and the Receipt/Delivery Order. [21] The testimonies of SD1 and SD3 regarding the forgery of the Proforma Invoice and the Receipt/Delivery Order are further corroborated by the 1st Defendant’s expert witness, SD4 who prepared the Chemistry Report, following a forensic examination of the signatures and company stamps on both the forged documents. SD4’s opinion confirmed that both the Proforma Invoice and the Receipt/Delivery Order were forged documents. [22] Crucially, the Plaintiff did not adduce any evidence to rebut the 1st Defendant’s contention that the Proforma Invoice and the Receipt/Delivery Order were forged document. [23] Notwithstanding the aforesaid, the Sessions Court Judge had made a finding that there existed a principal and agent relationship between 1st Defendant and 2nd Defendant. However, the existence of an agent-principal relationship between 2nd Defendant and 1st Defendant was never pleaded by the Plaintiff. This issue was also not included in the List of Issues to be Tried. [24] In any case, SP1’s oral testimony that the 2nd Defendant was an agent of the 1st Defendant openly clashed with the contemporaneous documents that the Plaintiff received from one Trace Tag International (Asia) Sdn Bhd (“Trace Tag International”). [25] By the Trace Tag International’s letter dated 23.12.2020 signed by the 2nd Defendant, it stated that Trace Tag International was responsible for fulfilling the Plaintiff’s Purchase Order, failing which Trace Tag International would refund RM902,250.00 to the Plaintiff. “Our company (Trace Tag International Sdn Bhd) will be held responsible to arrange payment to KKIBS (Plaintif) if we fail to deliver by the 14th working days from the date of checking and view of the good.” [26] By Trace Tag International’s letter signed by the 2nd Defendant on 8.1.2021, it also stated that the 2nd Defendant would be responsible for refunding RM902,250.00 to the Plaintiff. “As the Chief Executive Officer of the company, I, Ahmad Helmie Bin Mat Hassan will be held 100% responsibility to refund back the money for the sum of RM902,250.00 on Thursday, 14th Jan 2021 at 3pm. We sincerely apologized for the mess occurred regarding the delivery schedule for this particular PO. We will make sure to refund the money as said time and date to honor the deal we have made.” [27] In fact, the Plaintiff was in fact uncertain whether the 2nd Defendant was an agent, let alone the agent of the 1st Defendant as alleged. During the cross-examination, SP1 also stated that:

the 2nd Defendant never produced any name card or authority card to state that he was an agent of the 1st Defendant;

the Plaintiff never verified with the 1st Defendant whether the 2nd Defendant was an agent of the 1st Defendant. [28] In short, there was simply no evidence adduced before the Court at the trial to support the Plaintiff’s contention that the 2nd Defendant was acting as agent of the 1st Defendant in respect of the sale and purchase of the 15,000 boxes of Nitrile Glove. [29] To my mind, the totality of the evidence shows that the 1st Defendant was never aware of the sale and purchase of the 15,000 boxes of Nitrile Glove between the Plaintiff and the 2nd Defendant at all material times. The only fact that somehow connects the 1st Defendant to the Contract was the payment of RM902,250.00 into the 1st Defendant’s account. From this fact alone, without more, is insufficient to constitute the existence of a contract between the Plaintiff and the 1st Defendant. [30] Further, it is to be noted that the Plaintiff’s claim against the 1st Defendant was based only on a claim for breach of contract. There is no claim based on a cause of action for conspiracy to defraud. In any case, apart from the fact that the 1st Defendant had agreed to the request from the 2nd Defendant to allow money to be channelled into its account and being paid a commission for the same, there is no evidence that the 1st Defendant had knowledge of the 2nd Defendant’s dealings with the Plaintiff with regards to the sale and purchase of the 15,000 boxes of Nitrile Glove or that the 1st Defendant was involved in the fraud perpetrated by the 2nd Defendant. Conclusion [31] Accordingly, the appeal is allowed with costs. Dated the 25th day of February 2025 ONG CHEE KWAN Judge of the High Court of Malaya High Court of Kuala Lumpur, NCC2 & Admiralty Counsel:

Counsel for Appellant: Mr. C. K. Wai together with Mr. Derek Chin (Messrs. Low & Partners)

Counsel for Respondent: Ms. Nik Zamzani Binti Nik Ibrahim together with Ms. Fatin Dalila Binti Aripin (Messrs. Abdul Rahim & Co.)