Lee Kwee Foh Sdn Bhd v Loke Kooi Chuan Properties Sdn Bhd (A-01(NCvC)(W)-490-07/2022)

PENGARAH TANAH DAN GALIAN, NEGERI PERAK [Dalam Perkara Dalam Mahkamah Tinggi Malaya di Ipoh Dalam Negeri Perak Darul Ridzuan, Malaysia Guaman Civil No. AA-22NCvC-111-08/2018] Antara Loke Kooi Chuan Properties Sdn Bhd (No. Syarikat: 8540-T) ...Plaintif

Lee Kwee Foh Sdn Bhd (No. Syarikat: 1781-H)

Pengarah Tanah Dan Galian, Negeri Perak

Kerajaan Negeri Perak ... Defendan-Defendan CORUM AZIZAH BINTI NAWAWI, JCA AHMAD ZAIDI BIN IBRAHIM, JCA COLLIN LAWRENCE SEQUERAH, JCA

(A) INTRODUCTION [1] The First Respondent (the Plaintiff in the High Court), filed a suit against the Appellant (First Defendant) and the Second Respondent (Second Defendant) together with two other parties (who are not parties in this Appeal) at the Ipoh High Court ("the Main Action"). [2] By way of the Main Action, the First Respondent ("R1") sought for prayers that it be registered as the owner to two pieces of land held under Geran 133275 Lot 5334 ("Lot 5334") and under Geran 135778 Lot 1054 ("Lot 1054") in Mukim Lumut, Daerah Manjung, Perak, and that a Court Order dated 3/11/2010 in respect of Lot 5334 and Lot 1054 be set aside. [3] After having filed its Defence to the Main Action, the Appellant later obtained leave on 23/10/2020 to file a Counter Claim against R1. [4] R1 subsequently withdrew the Main Action when it was set down for trial. [5] The Appellant however, continued with the Counter Claim. [6] After a full trial, the High Court dismissed the Appellant's Counter Claim on 22/6/2022. [7] The Appellant has thus filed this Appeal against the dismissal of its Counter Claim by the High Court.

(B) BACKGROUND FACTS [8] The pertinent background facts in summary, that led to the current state of affairs, commenced when the Appellant entered into a sale and purchase agreement dated 12/1/1977 ("SPA") pursuant to which the Appellant sold 22 lots of land at the purchase price of RM934,513.44 to R1. [9] R1 paid the last and final tranche of the purchase price under the said Agreement to the Appellant via a letter dated 29/4/1978 issued by the solicitors of R1. [10] The said 22 lots of land were transferred by the Appellant to the R1 vide two memorandum of transfers (Borang 14A) executed on 2/11/1978 and 8/11/1978 respectively. [11] There was an appraiser's report dated 3/7/1976 prepared on lands belonging to the Appellant which included the said 22 lots of land at RM1,102,894.00, and at RM1,121,894.00 with buildings and vehicles thereon.

(C) PARTIES CONTENTIONS Appellant [12] The Appellant submitted that it is entitled to the restitution of the 22 lots of lands which were transferred to R1 in 1978 premised on an impugned SPA dated 12.1.1977 and two (2) Memorandums of Transfer dated 2.11.1978 and 8.11.1978 ("MOTs"). [13] The Appellant submitted that the MOT's were not executed by its actual director or the liquidator, submitting further that it was R1's pleaded case that the Appellant was in Members' Voluntary Liquidation ("MVL") during the sale of the said Lands. [14] The Appellant's are thus contending by reason of the above matters that the MOT's are void or insufficient instruments and the Respondent's title to the 22 lots of land acquired through the same is voidable or defeasible pursuant to s 360(2)(1) and/or (b) of the National Land Code 1965 ("NLC"). [15] The Appellant therefore submitted that the registration of the R1's title pursuant to a forged/insufficient/void instrument excludes such registration from the indefeasibility protection of s 340 NLC. [16] In support they cited the cases of Tai Thong Flower Nursery Sdn Bhd v Master Pyrodor Sdn Bhd [2014] 9 CLJ 74, CA at para 55 and 56 and Tiagaraja A/L Palaniandy (as the Administrator for the estate of Palaniandy A/L Pichay Karan, Deceased) v Monganadas A/L Maniam A/L Kathan, Deceased) & Anor [2011] 7 MLJ 326, respectively. First Respondent ("R1") [17] R1 commenced its assault on the Appellant's case by contending that the Appellant had adopted inconsistent positions in its pleadings in the Counter Claim. [18] R1 submitted that on the one hand, the Appellant had pleaded it was never in MVL, while on the other hand, the Appellant pleaded that the SPA and the MOT's, Forms14A, are null and void because they were not executed by the liquidator, but by its directors including one Lee Nyan Chong (whom the Appellant averred to be a fraudster) as it was in MVL then. [19] R1 also descended into a brief history of legal proceedings in order to demonstrate the inconsistency of the stand taken by the Appellant. [20] In doing so, R1 submitted firstly, that in 2012, they initiated legal proceedings to extend a private caveat which it had entered on a piece of land (" Lot 5334") vide Saman Pemula No: 24-671-07/2012 at the Ipoh High Court ("the Caveat Proceedings"). [21] R1 stated that Lot 5334 together with another piece of land ("Lot 1054") were the subject matter of the Main Action, which R1 had withdrawn when it was set down for trial. [22] The Ipoh High Court allowed the extension of the private caveat but on appeal by the Appellant, the said decision was reversed by the Court of Appeal. [23] R1 submitted thus that the Appellant had expressly and/or impliedly confirmed the existence and validity of the SPA in the Caveat Proceedings. [24] R1 further submitted that quite apart from the Caveat Proceedings, the Appellant together with its Director by the name of Lee Nyan Chong had filed a suit in 2010 as the First and Second Plaintiffs respectively at the Ipoh High Court vide Saman Pemula No: 24-458-2010 to have the Appellant re-registered as the owner to Lot 5334 and Lot 1054 ("Saman Pemula No: 458") ("OS"). [25] R1 pointed out that the said Lee Nyan Chong had affirmed the supporting affidavit on behalf of himself and the Appellant in Saman Pemula No: 458 whereas in the Counter Claim, the Appellant averred that Lee Nyan Chong was not it's director but a fraudster. [26] A Consent Order dated 3/11/2010 was then recorded with the Appellant being re-registered as the owner to Lot 5334 and Lot 1054 ("the Consent Order"). [27] R1 said that the Saman Pemula No: 458 and the Consent Order were referred to unreservedly by the Appellant in the Caveat Proceedings. [28] R1 then submitted that before the Main Action was withdrawn by them, the Appellant had tried to strike the action out but failed at both the High Court and the Court of Appeal level ("Striking Out Action"). [29] R1 said that in its affidavits in support of the striking out application, the Appellant had again unreservedly made references to the Caveat Proceedings, Saman Pemula No:458 and the Consent Order, and by so doing had also expressly and/or impliedly confirmed the existence and validity of the SPA. [30] R1 therefore submitted that the doctrines of judicial estoppel as well as equitable estoppel would apply against the Appellant. [31] R1 said that the above doctrines would apply in particular where the Appellant had averred in the Counter Claim that the SPA was invalid because it was allegedly tainted by fraud as its directors had no authority to execute the same due to it being in liquidation, but adopted the contrary position that the SPA was valid in the earlier court proceedings. [32] R1 submitted that it was inequitable for the Appellant to now seek to invalidate the said Agreement after 46 years, having received the full purchase price. [33] In addition, R1 submitted that the Appellant's claim is also barred by limitation, acquiescence and laches. [34] R1 said that the Appellant could have initiated their claim as early as 1981 but had slept on their rights. [D] ANALYSIS AND DECISION [35] The Appellant's Counter Claim sought the restitution of 22 lots of lands, which were transferred to R1 in 1978 vide the SPA dated 12.1.1977 and two (2) MOT's dated 2.11.1978 and 8.11.1978. [36] The Counter Claim was dismissed by the learned JC (as he then was) in the High Court. [37] The Appellant's case in a nutshell is that the MOT's were not executed by its actual director but a bogus one and nor did the liquidator execute the same, as it was at the time in a Members Voluntary Liquidation ("MVL"). [38] The Appellant thus submitted that given that it was then in a MVL, both the SPA and the MOT's are void or insufficient instruments and thus voidable or defeasible pursuant to section 360 (2)(1) and/or (b) of the National Land Code 1965 ("NLC"). [39] The Appellant's pleaded case however, was that it was never in MVL. Not surprisingly, R1 pointed out the inconsistency in the Appellant's stated position. [40] It also bears recollection that in earlier court proceedings in 2012, R1 had initiated legal action to extend a private caveat which it had entered on a piece of land (" Lot 5334") vide Saman Pemula No: 24-671 07/2012 at the Ipoh High Court ("the Caveat Proceedings"). [41] Lot 5334 together with another piece of land ("Lot 1054") were the subject matter of the Main Action, which R1 had withdrawn when it was set down for trial. [42] As stated above, the Ipoh High Court allowed the extension of the private caveat but on appeal by the Appellant, the said decision was reversed by the Court of Appeal. [43] We agree with learned counsel for R1 that as a result of the above, the Appellant in contesting R1's application, had expressly and/or impliedly confirmed the existence and validity of the said Agreement in the Caveat Proceedings. [44] Further to this, the Appellant together with its Director by the name of Lee Nyan Chong had filed a suit in 2010 as the First and Second Plaintiff respectively at the Ipoh High Court vide Saman Pemula No: 24 458-2010 to have the Appellant re-registered as the owner of Lot 5334 and Lot 1054 ("Saman Pemula No: 458") (OS). [45] The said Lee Nyan Chong had affirmed the supporting affidavit on behalf of himself and the Appellant in Saman Pemula No:458 (OS). [46] To the contrary however, in its Counter Claim, the Appellant had averred that Lee Nyan Chong was not its director but a fraudster. [47] A Consent Order dated 3/11/2010 was eventually recorded which resulted in the Appellant being re-registered as the owner to Lot 5334 and Lot 1054 ("the Consent Order"). [48] In the Caveat proceedings, Saman Pemula No: 458 (OS) and the Consent Order were referred to unreservedly by the Appellant. [49] With regard to the action in the main suit, the Appellant had initially filed an application to strike out R1's claim but failed both at the High Court and on appeal to the Court of Appeal. [50] In its affidavits in support of the striking out application, the Appellant had again unreservedly made references to the Caveat Proceedings, Saman Pemula No: 458 and the Consent Order, and by so doing had expressly and/or impliedly confirmed the existence and validity of the said SPA. [51] With regards to the position of Lee as the director of the Appellant company, we agree with R1 that based on the documents in the Caveat action and in the OS action, the Appellants had maintained the validity of the SPA and the Consent Order was also based on Lee's affidavit as a director of the company. [52] The learned JC had in fact pursuant to section 73(1) of the Evidence Act 1950 conducted a signature comparison exercise and found that the signature of the said Lee Nyan Chong on the memoranda of transfer and in his sworn affidavits dated 3.9.2013, 6.3.2019 and 9.3.2010 to be similar. [53] We therefore agree with R1 that the Appellant is estopped from taking the position that Lee Nyan Chong was not a director. The Appellant cannot take an inconsistent position in different proceedings. [54] The learned JC had therefore correctly invoked the principle estoppel and of approbation and reprobation to disallow the Appellant from asserting that the said Lee Nyan Chong was never its director by reference to the earlier proceedings in the Consent Order dated 3.11.2010 in the OS in respect of Lot 1054 and Lot 5334. [55] In the case of Cheah Theam Kheng v City Centre Sdn Bhd (In Liquidation) [2012] 1MLJ 761 the Court of Appeal cited Sir Nicholas Browne-Wilkinson VC in Express Newspapers plc v News (UK) Ltd & others [1990] 3 All ER376 as follows: "There is a principle of law of general application that it is not possible to approbate and reprobate. That means you are not allowed to blow hot and cold in the attitude that you adopt. A man cannot adopt two inconsistent attitudes towards another: he must elect between them and, having elected to adopt once stance, cannot thereafter be permitted to go back and adopt an inconsistent stance". [56] The Appellant is therefore now barred from contending that the SPA was not valid because it was tainted by fraud and its directors had no authority to execute the same due to it being in MVL. [57] In respect of the allegation that the MOT was not executed by the liquidator, there was no evidence adduced to show that the said transactions were not with the consent of the Liquidator. [58] Further to this, the available evidence showed that the Appellant could have initiated its claim as early as 1981. The incontrovertible facts will show that it was only after R1 had filed the main action and the Appellant having failed to strike it out both at the High Court and the Court of Appeal, was the Counter Claim filed in 2020. [59] Therefore, both limitation and laches would apply here to bar/defeat the Counter Claim. [60] We also find ourselves in agreement with the learned JC (as he then was) that it would be most inequitable that the Appellant having received the benefit of the purchase price way back in the 1970's, be allowed to now invalidate the SPA and the instruments of transfer ("MOT's"). [61] This is so notwithstanding the Appellant's position that they stand willing to refund the purchase price. [62] It is pertinent to also note that the findings made by the JC (as he then was) were essentially findings of facts based upon his assessment of the evidence both oral and documentary at the trial. [63] These findings of fact are not to be lightly disturbed. Indeed after perusing the evidence and the grounds of judgment of the High Court, and having considered the Records of Appeal and the submissions of the parties, both written and oral, and for the reasons stated above, we are of the considered unanimous opinion that the learned JC was not plainly wrong in his decision. [64] The appeal is therefore dismissed with costs of RM20,000.00 to R1 and RM1,000.00 to R2. Dated: 10 June 2024 (COLLIN LAWRENCE SEQUERAH) JUDGE Court of Appeal Malaysia

Krishna Dallumah

Dato' Jason Chan Wan Chiang

Lee Xin Yi [S. MATHEWS & ASSOCIATES (SUBANG JAYA)]

Tan Khay Boon

Bargavilashini A/P Alakasvaran [K.B TAN KUMAR & PARTNERS (IPOH)]