Leong Kim Siong v Gan Boon Tian (BA-22NCvC-269-05/2018)

GAN BOON TIAN (No. K/P: 681010-10-5495)

TAN LI TEEN (No. K/P: 940427-10-6200) dan CHIN KIUN FOONG (No. K/P: 731110-10-5604) [Wakil kepada harta pusaka Gan Seow Ling, simati] (No. K/P: 720116-10-5126)

GAN KOOI ANN (No. K/P: 750120-10-5433)

4.

HUAT HING CORPORATION SDN BHD (No. Syarikat : 479809-P)

PENDAFTAR HAKMILIK TANAH NEGERI SEMBILAN …DEFENDAN-DEFENDAN 20/02/2024 15:47:03 BA-22NCvC-269-05/2018 Kand. 215 GROUNDS OF JUDGMENT Introduction [1] The Plaintiff was the owner of 210,000 shares in the 5th Defendant company and as well as the registered owner of two pieces of lands in Jelebu, Negeri Sembilan until the shares and lands were transferred to the deceased 2nd Defendant and the 5th Defendant by way of a share sale agreement and memorandum of transfers in 2012 and 2015 respectively. He now challenges the execution of these documents on various grounds. [2] He claims that he was misrepresented on the contents of the share sale agreement which he executed together with a deed of settlement. As a result of the misrepresentation, he incurred a loss by being mistaken as to the value of his shares. He now seeks to be compensated for the amount he ought to have received. As for the transfer of the lands, he denies executing the memorandum of transfer. His claims his signature was forged. He seeks to set aside the transfer and to have the lands re-registered in his name. Background facts [3] The Plaintiff was a director in Huat Hing Corporation Sdn. Bhd. (“D5”) from its date of incorporation 25.3.1999, until his resignation on 31.5.2012. The business of the company was that of sawmillers and dealers in timber and wood products. At the material time, the Plaintiff owned 210,000 shares in D5. [4] The deceased 2nd Defendant, one Gan Seow Ling (“GSL”) together with the 1st, 3rd and 4th Defendants were siblings. GSL passed away after the suit was instituted and the executors of her estate have since been substituted as the 2nd Defendant. The 1st Defendant and GSL were also the directors of D5 at the material time. [5] Sometime in May 2012 the Plaintiff requested for a loan from D5 to finance his daughter’s education abroad. The request was made to the 1st Defendant (“D1”), who refused his request. [6] Instead, parties agreed that the Plaintiff was to sell his shares in D5 to GSL. For this purpose, the Plaintiff and GSL executed a Share Sale Agreement (“SSA”), the material terms of which were as follows:-

the Plaintiff’s shares were valued at RM 310,000.00;

(ii) the Plaintiff acknowledged that he owed D5 the sum of RM 225,679.00 comprising of:-

loans made to him amounting to RM 45,679.00 whilst a director of D5;

RM 120,000.00 which was a fine imposed by KESEDAR caused by the failure and neglect of the Plaintiff himself; and

RM 60,000.00 being the cost of removing debris from the factory belonging to D5 in Gua Musang which was operated by the Plaintiff.

(iii) taking into consideration his liabilities as aforestated, the balance sum payable to him from the sale of shares was RM 86,321.00. This amount was to be paid to the Plaintiff in 5 monthly instalments. [7] Simultaneous with the execution of the SSA, the Plaintiff also executed a Deed of Settlement (“DS”) with D5 on 1.6.2012. The material terms of the SSA were reproduced in the DS, in particular, the indebtedness of the Plaintiff. In addition, it was provided that the Plaintiff’s liability of RM 225,679.00 was to be taken over by GSL, and the Plaintiff would be released from all his obligations to D5. Further, the Plaintiff agreed to accept the payment of RM 18,000.00 in order to cease all further involvement with D5 including his resignation as a director. [8] The Plaintiff has since received the payments due to him under the SSA and DS. [9] The Plaintiff does not deny executing the agreements. However, he claims that he was misrepresented as to the contents therein. [10] As he is illiterate, he was not aware that by executing the agreements, he had acknowledged his indebtedness to D5. He disputes the deduction of RM 45,679.00 for a loan taken by him as he had never borrowed from D5. [11] He was also led to believe he was responsible for the KESEDAR fine and the costs of clearing the debris in the Gua Musang factory. He contends that the fine imposed by KESEDAR of RM 120,000.00 is an obligation to be borne by D5 instead. In addition, he was also misrepresented as to the market value of his shares. The share price was grossly undervalued at RM 312,000, as its value was RM 1,154,828.00.00 at the material time. In essence, his cause of action against D1-D5 in respect of the SSA and DS lies in misrepresentation and mistake. [12] The Plaintiff was also the registered proprietor of two pieces of land in Jelebu identified as Geran 75354, Lot 2145 (“Lot 2145”), Mukim Pertang and Geran 75357, Lot 2148, Mukim Pertang (“Lot 2148”). I shall hereinafter refer to Lots 2145 and 2148 as the said lands. [13] Sometime in 2016, the Plaintiff wanted to transfer the said lands to his children. He then conducted a search at the land office in Jelebu. To his shock and dismay, he discovered that the said lands had been transferred to D5 vide two Memorandum of Transfer (“Form 14A”) dated 15.5.2014. The consideration for the said lands was RM 524,280.00 and RM 527,880.00 respectively. [14] The Plaintiff however, denies having executed any Form 14A to effect the transfer of the said lands to D5. Upon examining the relevant documents, he claims that his signature had been forged. Further, his signature was purportedly witnessed to by Mr. Chee Beng Wah (PW 4), an advocate and solicitor in Messrs. Chee Amimi & Adrian Han. Upon due enquiries with PW4, the latter informed him that he had never attested to the signature of the Plaintiff. [15] At the material time, the said lands were charged to Hong Leong Bank Berhad (“HLB”). The presentation of the Form 14A in respect of the said lands as well as the discharge of charge was handled by the firm of solicitors Messrs. Sidek, Teoh, Wong & Dennis (“D7”) which was representing HLB, the chargee. [16] However, the Plaintiff claims that D7 committed breach of trust, breach of duty and fraud in their conduct of the transfer and discharge as he did not execute the Forms 14A and neither did he receive the consideration sum stated therein. [17] He further claims that D7 conspired with the other defendants to defraud the Plaintiff of the said lands in the presentation of the transfer documents to procure the registration of the lands in the name of D5. [18] Upon discovering that said lands have been registered in the name of D5, the Plaintiff sought the advice of his counsel in this case who advised the filing of the instant suit. After the commencement of this suit, the Plaintiff lodged police report on 2.2.2019 at the Sentul Police Station, claiming that the transfer of the said lands to D5 was fraudulent and that he had been deprived of his land. [19] The Plaintiff’s pleaded case against the Registrar of Titles (“D6”) is in negligence in registering the transfer without ascertaining that he had in fact executed the Forms 14A. [20] In this action, the Plaintiff seeks the following reliefs:-

compensation for the actual market value of the shares he sold less the sum already received by him;

(ii) a declaration that the transfer of Lots 2145 and 2148 is null and void and that the Plaintiff is the rightful owner of the said lands;

(iii) specific performance for D5 to transfer said lands in the name of the Plaintiff, failing which the Registrar of the High Court be empowered to execute the Form 14A;

(iv) a mandatory injunction to prohibit D5 from dealing with the land;

D6 to do all acts necessary to give effect to the transfer of the lands in the Plaintiff’s name; and

(vi) damages against D7. [21] The defence of D1 to D5 is that the Plaintiff understood the contents and effect of the SSA and DS he executed. The Defendants did not misrepresent the facts to the Plaintiff. [22] In relation to the said lands, D1 to D5 contend that the said lands were originally registered in the name of the Plaintiff on the understanding that the Plaintiff was to hold the lands in trust for D5 for so long as he remained a director of D5. In the event of his resignation, the lands had to be transferred to D5. The purchase price for the said lands was fully borne by D5, and on this account, it was the true and beneficial owner of the said lands. The said lands together with three other pieces of land which were purchased simultaneously were charged to various financial institutions to obtain working capital for D5. [23] D1 to D5 dispute the Plaintiff’s claim that he did not execute the Form 14A. Instead, they contend that the Plaintiff appended his signature on the forms and there was no forgery as alleged. In its Statement of Defence, a counterclaim was pleaded by D5 seeking a declaration that it was in fact the owner of the said lands. [24] D6’s defence is that it has no obligation to ensure that the signature on the transfer forms was that of the Plaintiff. [25] As for D7, their defence is that they do not owe a duty of care to the Plaintiff. The Plaintiff was not their client. Instead, they were appointed by HLB, the chargee of the said lands. To preserve the integrity of the charge they were requested by HLB to oversee the transfer of the said lands. They attended to the preparation of the Form 14A which they gave to D5 for its necessary action. Thereafter they presented the forms at the office of D6 for registration. D7 denies any conspiracy or fraud on their part in the registration of D5 as the owner of the said lands. [26] To safeguard against the consequences of the Plaintiff succeeding in its suit, D7 filed a notice of indemnity against D5, seeking to be indemnified in the event liability is found against it. Issues for determination [27] Arising from the competing contentions of the parties, the issues to be resolved are quite confined. They are principally factual issues which turn on the evidence adduced by the parties in support of their respective case and are as follows :-

whether there was misrepresentation/fraud/mistake in the execution of the SSA and the DS;

(ii) whether the Plaintiff’s signature on the Form 14A was forged;

(iii) whether D6 was negligent in registering the transfer of the said lands in the name of D5; and

(iv) whether D7 breached its duty of care/trust/committed fraud in its handling of the presentation of the transfer forms in respect of the said lands. [28] The ancillary issues that arise in determining the above issues will be discussed in the analysis of the evidence put forth by the parties. Analysis and decision of this court [29] It is trite law that the Plaintiff bears the onus of proving his case, and the 5th Defendant its counterclaim, and the existence of those facts which would establish their respective case. (See: sections 101 and 103 of the Evidence Act, 1950 and Letchumanan Chettiar Alagapan (as executor to SL Alameloo Achi (Deceased) & Anor v Secure Plantation Sdn. Bhd.) [2017] 5 CLJ 418). Whether there was misrepresentation/mistake/fraud in the execution of the SSA and DS [30] The essence of the Plaintiff’s cause of action is pleaded in his Statement of Claim. He alleged fraudulent misrepresentation against D1 to D4. He complained that he was led to believe that he was to be personally responsible for the KESEDAR fine of RM 120,000.00 and also the costs of debris removal of RM 60,000.00 when such penalty and costs was to be borne by D5 instead. [31] The law on actionable misrepresentation was enunciated in Sim Thong Realty Sdn Bhd v The Kim Dar @ Tee Kim [2003] 3 MLJ 460 where Justice Gopal Sri Ram (JCA, as he then was) said, Now the elements of an actionable misrepresentation are well settled. They are set out as follows in Professor McKendrick's Contract Law (3rd Ed), a leading work on the subject: A misrepresentation may be defined as an unambiguous, false statement of fact which is addressed to the party misled and which materially induces the contract. This definition may be broken down into three distinct elements. The first is that the representation must be an unambiguous false statement of fact, the second is that it must be addressed to the party misled and the third is that it must be a material inducement to entry into the contract. Section 18 of our Contracts Act 1950, defines 'misrepresentation' as follows: 'Misrepresentation' includes —

the positive assertion, in a manner not warranted by the information of the person making it, of that which is not true, though he believes it to be true;

any breach of duty which, without an intent to deceive, gives an advantage to the person committing it, or anyone claiming under him, by misleading another to his prejudice, or to the prejudice of anyone claiming under him; and

causing, however innocently, a party to an agreement to make a mistake as to the substance of the thing which is the subject of the agreement. This section is ipsissima verba s 18 of the Indian Contract Act 1872. It is to be noted at once that the definition in that section is inclusive or open-ended and not exclusive. Hence, the circumstances set out under each of its three paragraphs are not the only instances of misrepresentation to which the section is confined. In our judgment, it is the duty of a court to find the facts and then determine whether those facts fall within one or more of the three paragraphs under s 18. If they do, then the statement complained of is an actionable misrepresentation. [32] As the Plaintiff also pleaded fraud in the representations made to him by D1-D4, reference is made to the Federal Court case in Alw Car Workshop Sdn Bhd v Axa Affin General Insurance Bhd [2019] 4 MLJ 561 where the court held that fraudulent misrepresentation is a species of both fraud and misrepresentation as follows, [45] On this point, we agree with the Court of Appeal in its findings, as stated in para 33 of its judgment, that: Whether any particular claim is tainted with fraudulent intent is a question of fact to be inferred from the surrounding circumstances. Making a false statement in the belief that it is true constitutes misrepresentation. However, making a false statement with the knowledge that it is false or not believing it to be true and the intention to deceive amounts to fraudulent misrepresentation. The test of fraudulent misrepresentation as enunciated by the Privy Council in Baron Akerheilm v Rolf De Marc [1959] AC 789 PC is as follows: The question was not whether the defendant in any given case honestly believed the representation to be true in the sense assigned to it by the court on an objective consideration of its truth or falsity, but whether he honestly believed the representation to be true in the sense which he understood it albeit erroneously, when it was made. [33] Premised on the principles enunciated, it is incumbent on the Plaintiff if he is to succeed, to satisfy the three essential elements of misrepresentation namely, a statement of fact made to the Plaintiff which is false, and which induced him to enter into the contract. The question as to whether an act constitutes fraudulent misrepresentation is a question of fact, to be deduced from the circumstances of the case. [34] Apart from alleging that he was misled to believe he was responsible for the KESEDAR fine and removal of debris costs, I am no clearer as how he was misled or misrepresented. He vaguely alluded to the fact that D1 to D4 “memutar belit fakta yang terkandung di dalam Deed of Settlement and Perjanjian Jual Beli Saham” several occasions throughout his written testimony. However, there is not a jot of evidence as to what was said to him, and in particular by whom, and how the alleged misrepresentation induced him execute the SSA and DS. [35] The terms of the SSA which he signed had clearly stipulated that he acknowledged his debt of RM 225,679.00 which comprised of the RM 45,679.00 loan advanced by D5, RM 120,000.00 being KESEDAR fine and RM 60,000 being costs for debris removal. I fail to see how this acknowledgment can arise from any misrepresentation. [36] If he claims that D5 should be responsible for these costs, then the burden is on him to prove it to be so. There is absolutely no evidence tending to show that the representation was false, and that had he been aware that the fine and costs was not his responsibility, he would not have entered into the SSA and DS. [37] I am of the view the factual matrix of the Plaintiff’s case does not support a cause of action in misrepresentation. Putting it another way, the Plaintiff’s case of misrepresentation is totally misconceived. [38] Apart from misrepresentation, the Plaintiff has also pleaded mistake. He claims that he entered into the agreements as he was mistaken in fact and in law. This averment was contained in a single paragraph of the Statement of Claim sans particulars. [39] From the evidence at the trial, I surmise the mistake relied on appears to be his ignorance as to the contents, particularly the value of his shares which was worth much more than RM 312,000.00, a fact he later discovered. [40] However, I find the Plaintiff’s claim that he was mistaken as to the contents, incredulous. Although he was at pains during the trial to portray himself as illiterate, his demeanor at the trial and his ability to appreciate the questions asked of him suggests otherwise. His testimony was given in Mandarin but on several occasions whilst being cross-examined, I note that he was able to comprehend the questions asked in both English and Malay without the assistance of the interpreter. [41] Contrary to what he would have the court believe, he has extensive experience in the commercial world. At the time of execution of the SSA and DS, he was a director of D5. He is also a director of Kimwing Trading Sdn Bhd since 1996. Documentary evidence was adduced showing that he signed the financial report of the said company as a director. In addition, the records of the Companies Commission of Malaysia show him to be a partner of a business entity named as KS Leong and Son Enterprise. [42] In view of his involvement in business matters, one would expect him to be prudent enough to be satisfied as to the contents of any document before signing it. Contrary to what he would have the court believe, I find him to be capable of appreciating the contents of the SSA and DS. The agreements pertain to the sale of his property, namely, his shares and it is therefore not a trifling matter. It is unlikely that he would have acknowledged his liability or agreed to sell his shares for RM 312,000.00 unless he had agreed to it. It is both implausible and imprudent for a businessman to have blindly executed documents without being appraised of the contents first. I do not find him to be as ignorant as he made himself out to be. [43] In his evidence he said that as he was financially strapped and desperate to obtain funds at the material time, he signed the SSA and DS on the representation of D1 to D4. He was not given the opportunity to consider the matter further nor seek independent advice. To my mind, if he signed the agreements as he was desperate for a solution to his financial woes, it is not open to him to later complain, upon discovering that he signed an unfavourable deal, that he was mistaken as to the contents. [44] To bolster his case of mistake and misrepresentation, the Plaintiff claims that his 210,000 shares was grossly undervalued. Instead, the shares were worth approximately RM 1.1 million and not RM 312,000.00. Having found that he was neither illiterate nor mistaken as to the contents, the actual value of shares is irrelevant. The agreements he signed must be given effect to. [45] In any event, the Plaintiff did not adduce by credible evidence, that his shares were in fact worth RM 1.1 million. [46] I have weighed the Plaintiff’s testimony against that of D1, the director of D5, who explained that the offer to sell his shares was mooted by the Plaintiff himself. The Plaintiff had requested for a loan, but as there had been previous loans in the past which had not been repaid, the Plaintiff’s request was refused. As he was in urgent need of funds then, he offered to sell his shares to GSL and resign as a director of D5. [47] Parties then negotiated the terms for the sale of the Plaintiff’s shares, after which the Plaintiff executed both the SSA and DS. Having observed D1 at the trial, I find no reason to disbelieve his testimony. His evidence was also not discredited in spite of lengthy cross examination by the Plaintiff’s counsel. In the circumstances, having found the agreements to have been voluntarily executed by the Plaintiff, he is bound by the agreements. [48] The Plaintiff’s attempts to now challenge the execution of the SSA and DS on unmeritorious grounds is but an afterthought. The fact that the Plaintiff took almost 6 years to challenge the sale of his shares is a fact not to be taken lightly too. The Plaintiff has thus failed to discharge the burden of proof of fraudulent misrepresentation and mistake. [49] Consequently, there is no merit to the relief sought that D1-D4 is to pay the Plaintiff RM 1.1 million less the amount of RM 86,321.00 received by him pursuant to the SSA and DS. whether Plaintiff’s signatures on Forms 14A were forged [50] At the outset, it needs to be stated that the standard of proof of forgery in a civil case is that laid down in Sinnayah & Sons Sdn. Bhd. v Damai Setia Sdn Bhd. [2015] 5 MLJ 1, where the Plaintiff is required to prove the allegation on a balance of probabilities. [51] The Plaintiff denies having executed Form 14A in respect of the said lands. He claims his signatures were forged. The Plaintiff’s case of forgery is based primarily on the evidence of his handwriting expert (PW2) whose report was tendered in evidence. [52] PW2 was provided with copies of the relevant Form 14A. He referred to the signatures therein as the questioned signatures “Q1-A” and “Q2-A” respectively. He compared these signatures with a sample signature of the Plaintiff. He then concluded as follows, “On comparison I found that the questioned signatures “Q1-A” and “Q2-A” show significant differences in handwriting characteristics from the specimen signature “S”. As such and due to the questioned signatures been photocopied and great variation observed amongst the specimens, I am of the opinion these questioned signatures probably not written by the writer of the specimens. “However, my findings have limitation as the examination was based on photocopied questioned signatures. Original documents need to be provided for confirmation.” [53] It appears that PW2 made a significant concession. He admitted that his findings have limitation as he did not examine original documents. More importantly, he agreed with the defence counsel in cross examination that his findings were not conclusive as he examined only photocopies of disputed documents. [54] Whilst the evidence of an expert is relevant evidence, the court is not bound to wholly accept his evidence. An expert’s opinion is merely to assist the court in forming its opinion on disputed issues. It is to be used by the court for the purpose of assisting rather than compelling the formulation of judgments. His findings and his basis in arriving at this conclusion must still be evaluated to determine its probative value. Ultimately the court is to come to its own opinion (See: Wong Swee Chin v Public Prosecutor [1981] 1 MLJ 212, Dr Shanmuganathan v Periasamy s/o Sithambaram Pillai [1997] 3 MLJ 61). [55] As the opinion of PW2 is not unequivocal on the issue of forgery, other evidence adduced by the Plaintiff in support of the allegation of forgery will have to be considered. [56] To further substantiate his claim of forgery, the Plaintiff called the attesting solicitor, Mr Chee Beng Wah (PW4) who affirmed an independent affidavit on 2.1.2019 stating that the signatures on both the Forms 14A were not his notwithstanding that the rubber stamp of his name was affixed to the forms. The same was repeated in his oral testimony. [57] Forms 14A was dated 15.5.2014, some 8 years prior to this trial and 5 years before PW4’s affidavit was affirmed. Whilst I do not doubt the truthfulness of PW4, the period of time that had elapsed since the Form 14A cannot be overlooked. It is not unreasonable for recollection of events of a witness to diminish with time. [58] PW4 stated that he is both a conveyancing and litigation lawyer. I would expect a conveyancing lawyer to have signed numerous documents in a span of 5 years. There is nothing exceptional or significant about the documents for PW4 to be certain about not having signed them. In any event, apart from denying the signatures were his, there was no cogent reason proffered by him as to his basis for so saying. There was no explanation given as to how his rubber stamp came to be affixed on the Form 14A. I would therefore be cautious in wholly accepting his evidence on this issue. [59] To refute the Plaintiff’s denial that the signature on the Form 14A was his, the defence called DW2. At the material time, DW2 was the Chief Administration Officer of D5, and had been in the service of D5 for 15 years. [60] She testified that after D7 had prepared the Form 14A, she contacted the Plaintiff to hand over the forms for execution. The Plaintiff then came over to the office of D5 to collect the transfer forms from her. Sometime later, the Plaintiff came again to the office with the duly executed Form 14A which she noted had been attested to by Mr. Chee Beng Wah, evident from the rubber stamp affixed therein. She appeared to me to be a truthful witness. [61] Although she did not witness the signature of the Plaintiff, she received the Form 14A from the Plaintiff after it was signed. In the absence of any cogent evidence suggesting otherwise, the natural inference is that the Plaintiff did in fact sign the Form 14A. In the result, upon considering the totality of the evidence pertaining to the issue of forgery, I am not convinced on a balance of probabilities that the Plaintiff’s case of forgery had been made out. [62] The defence does not dispute that the said lands prior to the transfer to D5, were previously registered in the Plaintiff’s name. However, the Plaintiff was merely a trustee of the said lands for D5. [63] D1 testified that in 2003, the said lands were bought together with Lots 1912, 1913 and 1914. The purchase of the 5 pieces of land was financed by D5. Prior to the registration in the Plaintiff’s name, GSL and the Plaintiff both of whom were the directors of D5, agreed that they were to be the registered proprietors for Lots 1912, 1913 and 1914 and the said lands respectively. It was further agreed that if they relinquish their post of a director, the lands would have to be transferred to D5. [64] Documentary evidence was furnished to show that the lands were paid from the funds of D5. Payment vouchers and cheques issued by D5 were adduced to show payment for the deposits and balance purchase price in respect of the said lands. Stamp duty for the said lands was also paid by D5. More importantly, the Plaintiff himself admitted in his oral evidence that the purchase price was funded by D5. [65] Where the purchase price was funded by another party, the party funding the purchase retains beneficial ownership of the property in question in the absence of an intention to gift the said property. The transfer of the property confers no legal ownership to the transferee who merely holds the property on trust. (See: Tay Choo Foo @ Tay Chiew Foo v Tengku Mohd Saad @ Tengku Arifaad bin Tengku Mansur & Ors (all acting as administrators of the estate of Tunku Mansur bin Tunku Yaacob, deceased) and another appeal [2009] 1 MLJ 289, Court of Appeal) [66] In an attempt to rebut the defence position that the Plaintiff held the said lands on trust, the Plaintiff contend that it was given to him as part of the profit distribution of D5. However, save for his oral assertion, no documentary evidence was furnished in support of this assertion. In cross examination, the Plaintiff candidly admitted that there were no documents evidencing such profit distribution. [67] In view of the conflict of evidence between the Plaintiff’s version that until the transfer, he was the rightful owner and D5’s version that the Plaintiff was merely a trustee, I am guided by authorities that the documentary evidence would be of aid in resolving this conflict and to assist me in ascertaining the truth. (See: Lim Hai Ling & Anor (as the representative of the estate of Lim Sitt Min @ Lim Chin Seng, deceased) v Lim Tuck Thien [2014] 1 MLJ 246) [68] Having considered the defence explanation particularly the documents evidencing the purchase of the said lands by D5, I find that there was an arrangement whereby the said lands were allowed to be registered in the Plaintiff’s name on the understanding that he was to hold the said lands on trust. The defence version lends credibility to their contention that the signature of the Plaintiff was not forged as he was obliged to transfer the said lands to D5 upon his resignation as a director. [69] I also find it strange that having discovered the lands were registered in the name of D5 in 2016, it was not until two years later that this suit was commenced. I would have expected some haste in enforcing his rights. [70] As matters stand, the said lands are now registered in the name of D5. By virtue of section 340 of the National Land Code, the title of D5 is indefeasible unless set aside in the circumstances set out in section 340(2). In the instant case, the Plaintiff attempted to do so on the grounds of forgery. Having found that the Plaintiff’s case of forgery fails, the title of D5 to the said lands is indefeasible. [71] In view of my findings, the Plaintiff’s relief to nullify the transfer of the said lands from him to D5 must necessarily fail. Similarly, all other consequential orders in relation thereto cannot be granted. whether D6 was negligent in registering D5 as the proprietor [72] The pleaded case against D6 is found in paragraph 26 of the Statement of Claim. Essentially, D6 is alleged to have been negligent for his failure to verify the Plaintiff’s signature on Form 14A. However, there was a telling absence at the trial to lead any evidence against D6. In any event, the pleaded case against D6 is totally devoid of any merit as D6 has no statutory obligation to verify the signature of the Plaintiff. On the face of it the Plaintiff’s signature on Form 14A was attested to by an advocate and solicitor. [73] In the circumstances, I am obliged to conclude that no case against D6 has been established. whether D7 is liable in fraud/breach of trust/breach of duty of care in the presentation of the Forms 14A for registration at the land office [74] The Plaintiff’s evidence against D7 is based primarily on the evidence of the Plaintiff himself who denied the execution of the Form 14A, and the inference he attempts to draw based on the documents available at the trial. [75] On the other hand, D7 called as its witness, Mr. Eric Leong Kai Meng (DW3) the solicitor handling the relevant documentation at the material time. He testified as follows. [76] On 15.1.2007, the said lands were charged to Hong Leong Bank Berhad (“HLB”) by way of a First Third Party Charge. A Second Third Party Charge was created on 19.11.2012. D7 was the solicitor engaged by HLB to prepare the documentation in respect of the Second Third Party Charge. [77] Upon HLB being informed of the proposed transfer of the said lands, it issued a letter of consent dated 4.2.2013 for the transfer. D5 then contacted D7 to assist in the preparation of the legal documentation for the transfer, as it was HLB’s solicitor for the Second Third Party Charge. [78] D7 then prepared the requisite number of Form 14A, delivered it to a representative of D5 vide letter dated 8.7.2013 for the execution by the parties named therein. DW3 was informed by GSL that he was not required to attest the Plaintiff’s signature as the Plaintiff will be consulting his own lawyer for the purpose. [79] On 16.7.2013, 2 copies of the Form 14A was returned to D7. On the face of it, the forms were signed by the Plaintiff and attested to by Chee Beng Wah. However, D7 did not proceed with the adjudication and stamping of the Form 14A until it received written instruction from HLB on 24.2.2014 as D7 was the solicitor appointed by HLB to protect its interest as the registered chargee. [80] On 14.11.2014, D7 proceeded to present the Form 14A for registration at the office of D6 after being satisfied that the said forms were fit and proper for presentation. [81] The Plaintiff’s case against D7 for fraud/breach of trust/breach of duty is premised on the following facts:-

the Forms 14A forms were presented at the land office without the knowledge of the Plaintiff;

(ii) the amendments on the forms were made without his knowledge or consent; and

(iii) the transfer forms were presented for registration even though D7 knew that the Plaintiff had not received the consideration sums of RM 524,280.00 and 527,888.00 respectively. [82] I find the case against D7 totally baseless for the following reasons. I shall deal first with the issue of breach of duty. To allege breach of duty on the part of D7, the Plaintiff’s case presupposes that a duty of care is owed by D7 to him. [83] For a duty of care to arise, the elements necessary to be present are foreseeability, proximity and policy considerations. (See: Pushpaleela R Selvarajah & Anor v Rajamani Meyappa Chettiar & Other appeals [2019] 3 CLJ 441) I do not find these ingredients to be present. The Plaintiff was not a client of D7. D7 was, at all material times, acting for HLB. D7 was also not involved in the execution and attestation of Form 14A as the Form 14A was handed over to D5 to attend to, for that purpose. [84] The relationship was therefore not sufficiently proximate to impose a duty of care on the part of D7. I do not find it foreseeable that any irregularity in the execution and attestation of Form 14A, or amendment to the form, which D7 was not responsible to oversee, would cause harm to the Plaintiff. It is also not just or reasonable to expect D7 to ascertain if the Plaintiff had consented to the presentation of the Form 14A at the land office. [85] There are numerous decided authorities which have shown the court’s reluctance to impose a duty of care on solicitors acting for third parties. (See: Pushpaleela R Selvarajah & Anor v Rajamani Meyappa Chettiar & Other appeals (supra), Tetuan Abdul Aziz & Associates v Sunshine Haven Sdn Bhd [2016] 4 MLJ 439). [86] In any event, the Plaintiff’s case of breach of duty against D7 is closely intertwined with his allegation of forgery. Having found that his signature was not forged and that it was attested to by Chee Beng Wah, the Plaintiff’s case founded on breach of duty, ipso facto falls. [87] As for the allegation of breach of trust, I find it to be baseless as I fail to see how it can arise in the circumstances of this case. [88] In the upshot, the Plaintiff’s claim against D7, as with the other defendants in this suit, fails. [89] For the sake of completeness, I should also address the counterclaim of D5 which seeks a declaration that D5 is the lawful owner of the said lands and that the Plaintiff be directed to execute the requisite transfer forms to give effect to the declaration. This relief is sought in the event the court finds the signature on the Form 14A to be a forgery. [90] To my mind, although the counterclaim may seem incongruous as it is dependent on whether forgery is proven, I find it to have been pleaded out of abundance of caution. The facts supporting the counterclaim is in effect, a defence to the action. In view of my finding that there is no forgery as alleged, the relief sought in the counterclaim becomes academic. Conclusion [91] Premised on the foregoing reasons, I make the following orders :-

the Plaintiff’s case against all the Defendants is dismissed;

(ii) the Plaintiff is to pay costs as follows:-

RM 30,000 to D1 to D5;

RM 2,000 to D6; and

RM 15,000 to D7. Dated: 19th day of February 2024 -sgd- ....………………..….... Alice Loke Yee Ching Judge High Court in Malaya at Shah Alam Counsel for the Plaintiff : Mr. Danny Ng Yeong Chong Messrs. Danny & Co. Counsel for D1, D2, D3, : Mr. Wilson Lim (Miss Amely Chong D4, D5 with him) Messrs. Wilson Lim Counsel for D6 : Puan Marsilawati binti Mohamad Shah Pejabat Penasihat Undang-Undang Negeri Negeri Sembilan Counsel for D7 : Mr. Syed Fadzil bin Hashim Alhabshi (Miss Ili Ariena binti Mahzan with him)