Kelington Technologies Sdn. Bhd. v Koh Chen Tien (BA-22NCVC-418-07/2017)

By Notice of Application dated 3 October 2017, the Plaintiff seeks Summary Judgment under Order 14 of the Rules of Court 2012 (Enclosure 7) in relation to its claim in these proceedings. It claims Summary Judgment for RM1,077,730-45 (US$250,958-90) at the 2 exchange rate USD1.00: RM4.29 on 14 July 2017 plus interest at the rate of 10% per annum on the sum of US$250,000-00 or equivalent to RM1,073,612-50 calculated from 14 July 2017 till realization being monies allegedly due under a Settlement Agreement reached between the parties, costs and other relief;

The Plaintiff’s claim is plain and obvious and the Defendant has no defence to the Plaintiff’s claim and there are not triable issues;

The cause papers for this application are as follows :

Plaintiff’s Notice of Application affirmed on 3

Plaintiff’s Affidavit in Support duly affirmed by Ng

Defendant’s Affidavit in Reply affirmed by Koh Chen

Plaintiff’s Affidavit in Reply duly affirmed by Ng Mun

Writ of Summon dated 14 July 2017;

Statement of Claim dated 14 July 2017;

Statement of Defence dated 20 September 2017;

Reply to the Defence dated 27 September 2017.

To simplify the above affidavits, the Plaintiff is premised on a Settlement Agreement dated 25 July 2016 entered into between the Plaintiff and the Defendant. The Defendant has failed to honour his obligations under the Settlement Agreement. 3

Having gone through the pleadings and affidavits filed by the respective parties, I have concluded the facts below :

At the request of AUSTRALIAN MARINE TECHNOLOGY (AMT) (Licence No. 631371) (DCCI No: 184436) by a Purchase Order No. 2170 dated 3 August 2015 (the Purchased Order), the Plaintiff has supplied and rendered services to AMT for the sum of US$743,347-00;

The Defendant and one, Eric Bob Bowra have executed a Guarantee dated 3 August 2015 wherein they have agreed upon demand to guarantee and to pay the Plaintiff as principal debtor and not merely as surety the sum of US$743,347-00 without any set off or deduction and notwithstanding any contestation or protest by AMT or any other third party and without proof or conditions;

An invoice was issued by the Plaintiff to AMT for the sum of US$743,347-00;

Due to a reduction in the scope of work, a credit note was issued and the sum payable by AMT is US$702,206-13; 4

AMT, Eric and the Defendant failed to pay the said sum of US$702,206-13 when demanded;

The Defendant then entered into the Settlement

Under the Settlement Agreement, in consideration of the Plaintiff forbearing to sue the Defendant, the Defendant agrees to pay the Plaintiff a sum of US$351,103-06 in 6 instalments as follows:

A sum of US$101,103-06 upon execution of the Agreement or on or before 31 July 2016, whichever is earlier;

The balance sum of US$250,000-00 shall be pain in equal 5 instalments of US$50,000-00 as follows - The First installment or before 30 June 2017; - The Second instalment on or before 31 December 2017; - The Third instalment on or before 30 June 2018; - The Fourth instalment on or before 31 December 2018 and 5 - The Fifth instalment on or before 30 June 2019.

The Defendant paid only the first instalment that is the sum of US$101,103-06 but failed to pay the rest of the instalments. DEFENDANT’S OPPOSITION TO SUMMARY JUDGMENT

In summary, the Defendant resisted the application for Summary Judgment on the following grounds :

Total failure of consideration by the Plaintiff due to the Plaintiff’s failure to carry out its obligation to commence legal proceedings against Bob Bowra and AMT;

As there was reciprocal promises, the Plaintiff has failed, refused and/or neglected to do so;

Plaintiff is attempting to benefit from its breach of the Settlement Agreement. PRINCIPLES GOVERNING ORDER 14 APPLICATION

The principles to be applied in determining whether or not to give Summary Judgment under Order 14 Rules of court are not controversial. The Court may give Summary Judgment in a plain and 6 obvious case where the Defendant plainly and obviously has no defence to the Plaintiff’s claim or part of the Plaintiff’s claim. See Bank Negara Malaysia v. Mohd Ismail Ali Johor & Ors. (1992) 1 CLJ 627; (1992) 1 CLJ (Rep) 14; (1992) 1 MLJ 400, Chen Heng Ping @ Tian Seow Hock & Ors. v. Intradagang Merchant Bankers

(M) Berhad (1995) 3 CLJ 690; (1995) 2 MLJ 363, United Malayan Banking Corp. Bhd. v. Palm & Vegetable Oils (M) Sdn. Bhd. & Ors. (1982) CLJ 547; (1982) CLJ (Rep) 358; (1983) 1 MLJ 206, and Abdul Rahim Abdul Hamid & Ors. v. Perdana Merchant Bankers Bhd. & Ors. (2000) 2 CLJ 457; (2000) 2 MLJ 417.

It is also a settled principle that in an application for Summary Judgment, the defendant will not be given leave to defend based on mere assertions alone, in Bank Negara (supra), the Supreme Court observed : “……Under Order 14 application, the duty of a judge does not end as soon as a fact is asserted by one party, and denied or disputed by the other on affidavit. Where such assertion, denial or dispute is equivocal, or lacking in precision or is inconsistent with undisputed contemporary documents or other statements by the same deponent or is inherently improbable in itself, then the Judge has a duty to reject such assertion or denial, thereby rendering the issue are not triable………….” 7

The standard to be applied was eloquently articulated by Laddie J in Microsoft Corporation v. Electro Wide Limited (1997) FSR 580, where he said at page 593 to 594 that : “…….It is not sufficient just to look at each factual issue one by one and to consider whether it is possible that the Defendant’s story in relation to that issue is credible. The Court must look at the complete account of events put forward by both the Plaintiff and the Defendants and…….look at the whole situation. The mere fact that the Defendants support their defence by sworn evidence does not mean that the Court is obliged to suspend its critical faculties and accept that evidence as if it was probably accurate. If, having regard to inconsistency with contemporaneous documents, inherent implausibility and other compelling evidence, the defence is not credible, the court must say so. It should not let the filing of evidence which surpasses belief deprive a Plaintiff of its entitlement to relief…….”

In an application for Summary Judgment, I am also guided by the principles laid down in National Company for Foreign Trade v. Kayu Raya Sdn. Bhd. (1984) 2 CLJ 220 (FC), George Seah FJ stated that : 8 “……We think it appropriate to remind ourselves once again that in every application under Order 14, the first considerations are (a) whether the case comes within the order and (b) whether the Plaintiff has satisfied the preliminary requirements for proceeding under Order 14. For the purposes of an application under Order 14, the preliminary requirements :

The Defendant must have entered an appearance;

(ii) The statement of claim must have been served on the Defendant;

(iii) The Affidavit in Support of the application must comply the requirements of Rule 2 of the Order 14 ……………………………… If the Plaintiff fails to satisfy either of these considerations, the summons may be dismissed. If however, these considerations are satisfied, the Plaintiff will have established a prima facie case and he becomes entitled to judgment. This burden then shifts to the Defendant to satisfy the Court why judgment should not be given against him……………….”

Similarly in the case of Cempaka Finance Bhd. v. Ho Lai Ying & Anor (2006) 3 CLJ 544 (FC), Steve Shim CJ (Sabah & Sarawak) in allowing the appeal has said that : 9 “………In an application under Order 14 RHC, the burden is on the Plaintiff to establish the following conditions:

that the Defendant must have entered an appearance; (ii) that the statement of claim must have been served on the Defendant; and (iii) that the Affidavit in Support must comply with Rule 2 of Order 14 RHC in that it must verify the facts on which the claim is based and must state the deponent’s belief that there is no defence to the claim. Once those conditions are fulfilled, the burden then shifts to the Defendant to raise triable issues. The law on this is trite…………..”

With the above principles in mind, I turn now to consider the Defendant’s position. Having read the Affidavits filed by both parties, it reveals to me that the proceeding would only involved one issue. ISSUE Whether there is total failure of consideration as the Plaintiff has failed to carry out its obligation to commence legal proceeding against AMT and Eric?

The Plaintiff’s claim herein is to claim for outstanding sum of US$250,958-90 based on the Settlement Agreement between the Plaintiff and the Defendant. The Defendant’s alleged that there is a total failure of consideration by the Plaintiff due to the Plaintiff’s failure 10 to carry out its obligation to commence legal proceedings against Rob Bowra and AMT, and/ or serve the cause papers on Rob Bowra and AMT pursuant to Clause 2.4 and 4.1(a) of the Settlement Agreement. “..2.4 Refund of Payment KTSB intends to take such action as is necessary to recover the Debt (together with interest and foreign exchange losses) from AMT and/ or Rob (hereinafter referred to as “Total Claim”) and KTSB agrees as follows:

If KTSB successfully recovers the Total Claim from AMT/ or Rob, KTSB agrees to refund the sum of USD351,103-06 to KCT and thereafter neither party shall have any further claims against the other;

If KTSB successfully recovers a part of the Total Claim which exceeds the sum of USD351,103-06, a refund will be made to KCT based on the following calculation: (Amount recovered from AMT and/ or Rob) + USD351,103-06 – Total Claim = Amount to be refunded to KCT) and upon KCT’s receipt of the refund, neither party shall have any further claims against the other. 11

4.1 Cooperation and assistance

KCT agrees to and shall cooperate and assist KTSB in doing or causing to be done all necessary acts and things to enable KTSB to collect and recover from AMT and/or Rob the Debt in any legal action initiated against AMT and/or Rob for recovery thereof…” As alleged by the Defendant that the Plaintiff has failed to perform their part of the bargain to serve the cause papers on Rob Bowra and AMT when in fact the Defendant has started performing his part of the bargain by assisting the Plaintiff to locate Rob Bowra and AMT.

The question that comes to my mind is whether the Plaintiff had commenced legal proceedings against AMT and Eric? Has the Plaintiff take any action to serve the cause papers? I have the opportunity to examine all Affidavits filed by parties and scrutinize all documents. In the First Affidavit in Support affirmed by Ng Mun Yee dated 3 October 2017, I noticed the following :

The Plaintiff’s Solicitor’s letter dated 23 May 2016 had been send via email and registered post to Rob

There was proof of International Posting Receipt;

Application to serve notice of writ of summons out of jurisdiction dated 4 November 2016 together with the Statement of Claim dated 5 November 2016; 12

An Order dated 24 October 2016 was obtained from the Deputy Registrar pursuant to the application and the Plaintiff be granted leave to serve a Notice of Writ Out of Jurisdiction; In the Second Affidavit in Support affirmed by Ng Mun Yee dated 1 November 2017, it revealed that :

The Plaintiff’s solicitor in their letter to the Federal Court dated 21 December 2016 had requested for the serving of Writ Summons, Statement of Claims, Court’s Order dated 24 October 2016 to the respective Defendants;

In view of the solicitor’s letter, the Federal Court through letter dated 21 December 2016 has requested the Ministry of Foreign Affairs’ assistance for the serving of the Writ;

Again, through the Plaintiff’s solicitor had send another letter dated 6 January 2017 to the Federal Court requesting the serving of Writ to Eric Bowra;

In another solicitor’s letter dated 31 January 2017 and 5 May 2017 to the Ministry of Foreign Affairs requesting the same;

An Order of Court dated 21 March 2017 for the extension of time of Writ summon; 13

Follow Up email from the Plaintiff’s solicitor dated 2 February 2017, 8 February 2017, 5 May 2017, 16 May 2017, 22 May 2017;

Letters dated 13 June 2017 from the Federal Court and the Ministry of Foreign Affairs informing such failure to served the Writ Summons on the

Several communications via email to Eric Bowra dated 24 November 2016 but without success. Having read the above, it is clearly shown that the Plaintiff had commenced legal proceedings against AMT and Eric Bowra and being foreign Defendants, the Plaintiff had to rely on the official channel to serve the cause papers on them. As such, the Defendant’s assertion that there is a total failure of consideration by the Plaintiff due to his failure is without merit and justification. As submitted by the Plaintiff’s counsel in the case of: Syarikat Binaan Utara Jaya (A Firm) v. Koperasi Serbaguna Sungei Glugor Berhad (2009) 1 CLJ 786 with regard to construction of a contract where the language employed is clear, which states as follows; “……(a) the Court must give effect to the plain meaning of the words, no matter how distasteful the result may be (The Central Bank of India Ltd. Amritsrar v. The Hartfort Fire Insurance Co. Ltd. [1965] AIR Vol. 52, 1288 SC) 14

where the language in the document is unambiguous and clear, the real nature of the document is to be determine solely by looking at its contents, uninfluenced by any intention of the parties (Nawab Major Sir) Mohammad Akhbar Khan v. Attar Singh and Others [1936] AIR Vol 23, 171 PC)

when the minds of the parties are expressed in an unambiguous manner, the court cannot override the declared intention of the parties, unequivocally expressed (K. Appukuttam Panicker and Another v. S.K.R.A.K.R Athappa Chettiar and Others [1966] AIR Vol. 53, 303 Karala) and;

there is no scope, at all, for drawing upon hypothetical considerations or the supposed intention of the parties when the words contained in the contract are clear and unambiguous (The Union of India v. Kishorilal Gupta and Bros. [1959] AIR Vol. 46, 1362 SC) CONCLUSION

In the light of the foregoing and in the upshot, after hearing the submission by both parties, the points made by the Defendant in its Affidavit has no substance or afford it a defence or constitute a triable 15 issue. Accordingly, I allow the Plaintiff’s application for Summary Judgment and costs of RM5,000 to the Plaintiff. Dated 22 January 2018. (DATO’ HJ. MOHAMAD SHARIFF BIN HJ. ABU SAMAH) Judicial Commissioner, NCVC 6 High Court of Malaya Shah Alam, Selangor Darul Ehsan Counsel For the Plaintiff : Jeffry Wong (Messrs. Jeffry Wong, Noorul, Ho & Li.) For the Defendant : Ashvinpal Kaur (Messrs. Gideon Tan RazaliZaini)