LIM Poh Kwee v LIM Choong Seng (J-02(NCVC)(W)-869-05/2017)

1 IN THE COURT OF APPEAL, MALAYSIA (APPELLATE JURISDICTION) CIVIL APPEAL NO: J-02(NCVC)(W)-869-05/2017 BETWEEN LIM POH KWEE (I.C. NO: 580606-01-5295) AND/OR ALL THOSE CLAIMING UNDER AND/OR ALL OCCUPANTS AT 22-1, JALAN HASHIM 84000 MUAR, JOHORE … APPELLANT AND LIM CHOON SENG SUING AS PUBLIC OFFICER (I.C. NO: 5307280-01-5247) ENG CHOON ASSOCIATION, MUAR, JOHORE (ENG CHOON HUAY KUAN, MUAR) (REGISTRATION NO: PPM–003–01–05021951) … RESPONDENT [In the Matter of the High Court of Malaya at Muar Civil No: J-02(NCVC)(W)-869-05/2017 BETWEEN Lim Choon Seng (I.C. No: 580606-01-5292) Suing as Public Officer Eng Choon Association, Muar, Johore (Eng Choon Huay Kuan, Muar) (Registration No: PPM–003–01–05021951) … Plaintiff 2 AND Lim Poh Kwee And/or all those claiming under And/or all occupants at 22-1, Jalan Hashim 84000 Muar, Johore … Defendant] CORAM: HAMID SULTAN BIN ABU BACKER, JCA BADARIAH BINTI SAHAMID, JCA MARY LIM THIAM SUAN, JCA JUDGMENT OF THE COURT [1] The respondent is an association whose members are of the Eng Choon clan. It sued for vacant possession of 22-1, Jalan Hashim, 84000, Muar, Johore [the said property]. There were 50 occupants who lived in premises located on the said property. [2] The respondent filed 50 separate but similar proceedings at the Sessions Court against the 50 occupants of the said property. The respondent entered judgment in default against 13 of the occupants. The remaining 37 cases were contested. These cases were however, 3 never consolidated. Instead, what had happened was the parties agreed to proceed with High Court Civil Suit No. 22NCVC-66-10/2015 as a test case, and that the decision in that suit will bind the remaining cases. [3] After a full trial, the respondent’s claim was allowed and the appellant’s counterclaim was dismissed. The appellant is the defendant in that test case. [4] On appeal, we allowed only the appellant’s appeal against the decision on the respondent’s claim. The appeal against the dismissal of the counterclaim was dismissed. These are our reasons in full. Factual background [5] According to the pleaded case, the appellant is a yearly tenant on the said property. The respondent initiated eviction proceedings against the appellant upon the appellant’s failure to settle its annual rent of RM286.55 for the year 2011. The respondent alleged that the appellant’s failure to pay the annual rent amounted to a breach of the tenancy agreement. Consequently, the respondent issued the appellant a notice to quit and for vacant possession of the said property. [6] In defence, the appellant denied that it was in default as it had paid all dues. The appellant claimed that as occupants of the said property, his family was obliged to settle their portion of the annual quit rent for the said property; which quit rent had been duly settled and the respondent 4 had issued receipts to the appellant and the other occupants for such payments. The appellant further challenged the respondent’s title to the said property. The appellant claimed that his family had in fact, built a house on the said property with the permission of and/or without any protest from, the respondent. [7] The appellant then set about explaining in substantial detail the establishment of the respondent, that it was established on 5.2.1951 as an association for members of the Eng Choon clan; and how the said property was purchased in 1926 by 10 individuals who then held the said property in trust for the 50 odd Eng Choon inhabitants who lived on the said property at that time. A trust deed was said to have been drawn up on 23.3.1936 to reflect this trust. The appellant alleged that the trust was one in perpetuity [dikekalkan selama-lamanya] as the Land Office had on 8.4.1936, registered the 10 individuals as “trustees with survivorship” before it was changed to “Trustees kepada Eng Choon Huay Kuan otherwise known as Eng Chin Hoe Kuan Association”. [8] The appellant alleged that on 8.4.1936, one-tenth of the said property was transferred by one Gan Tian to his son who then transferred it to one Lim Tai Chong for $1020. The appellant denied that the respondent were the real owners of the said property, claimed that the respondent had inter alia falsified certain trust documents and had fraudulently transferred or by false misrepresentation cause to be transferred the said property to its name. The appellant claimed that the respondent could not have afforded the purchase of the said property at that price as in 1934, the respondent had debts amounting to $2800. 5 [9] The appellant also challenged certain decisions taken at the Annual General Meeting of the respondent as being invalid on inter alia grounds of conflict of interest, and that the respondent was never properly authorized to instruct solicitors to initiate action for the purpose of evicting the appellant from the said property. The appellant counterclaimed praying for inter alia an order declaring himself together with the other occupants of the said property as the owners of the said property, that the Land Office do register them as the joint owners of the said property. [10] To this defence and counterclaim, the respondent responded, explaining that the Association was set up in 1894, and that pursuant to a letter dated 10.4.1939, the Registrar of Societies Johore had exempted the respondent from registration under section 4(1) of the Societies Enactment. At that time, amongst the two pieces of property that the respondent owned was land held under G.6163 which was held by 10 individuals as trustees and which was rented out to various occupants who built smoke-houses and huts on that land. The trustees had vide trust deed dated 23.3.1936 agreed that G.6163 was purchased with the respondent’s funds and that they would hold G.6163 as trustees for the respondent. [11] At paragraph 6 of the Reply and Defence to the Counterclaim, the respondent pleaded quite categorically that its relationship with the appellant is that of landlord and tenant, and that the building of a house on the said property by the appellant and/or his family, did not alter the basis of that relationship, and that it was entitled to seek vacant possession of the said property. 6 [12] Now, it appears that as a result of the appellant’s counterclaim for certain declaratory and injunctive orders, the whole case was transferred to the High Court. Decision of the High Court [13] The learned Judge distilled 5 issues for determination; namely: a. whether the respondent were the legal owners or trustees of the said property; b. whether the said property was registered in the respondent’s name based on correct documents; c. whether the appellant were owners, buyers or tenants of a part of the said property; d. whether the trust deed of 23.3.1936 is valid and enforceable; e. whether the appellant had any locus standi to bring the counterclaim. [14] The learned Judge found that since the appellant had alleged fraud, the burden was on the appellant to prove his allegations. After considering the evidence and submissions, the learned Judge found the burden not discharged, that the appellant’s case was not proven in that the appellant had failed to adduce evidence to show how the appellant’s family is descended from the 50 odd families that had originally occupied 7 the said property in which the case, the appellant had no locus standi to assert any right of occupation on the said property. The reliefs sought were also not pleaded. [15] In contrast, the learned Judge found the respondent’s case proved and the appellant was ordered to vacate the said property. There were, however, no reasons offered to explain how her Ladyship reached this conclusion. Findings and determination [16] With respect, we found the arguments unnecessarily protracted and to a large extent, misplaced. We found this to be due to the failure to appreciate the basic and real claims between the parties. We are unanimous in our view that from the factual matrix of the case, the respondent’s case could not succeed in law on a claim for vacant possession. [17] The respondent’s pleaded claim was one for vacant possession of the said property. This is evident from the testimony of SP1 and the submissions made by the respondent. [18] Such a claim was filed in the Sessions Court, against not just the appellant but all 37 tenants. According to paragraph 3 of the respondent’s Statement of Claim, the appellant was a yearly tenant of premises built on a portion of the said property. The appellant paid a princely sum of RM286.55 as annual rental. At paragraph 4, the 8 respondent alleged that the appellant had failed, refused and/or neglected settling the said annual rental of RM286.55 for the year 2011. [19] As a consequence of such breach, the respondent caused its solicitors to issue the appellant with a notice to quit dated 13.12.2013. That notice which was served on the appellant on 24.12.2013, required the appellant to vacate the said property by 31.12.2014 or before the end of the tenancy period. Despite such notice, the appellant failed, refused and/or neglected to vacate the said property. [20] As pointed out, the appellant had denied being in breach and had claimed that it had paid all dues. In support of its defence, the appellant had testified that the annual rental of RM286.55 was actually the appellant’s share of the quit rent and assessment for the said property, and that the appellant together with the other residents of the said property had in fact been making such payments. The appellant adduced evidence of payment in the form of the receipt for the year 2011 – see page 543 to 584 of the records of appeal. At page 555, it is evident that the occupants of the said property paid the quit rent for the year 2011 and the proportion borne by the appellant was RM286.55. [21] Since the claim for vacant possession is premised on the appellant’s failure to pay the annual rental of RM286.55 and such claim has turned out to be untrue, the respondent’s claim ought to have stood dismissed. [22] Learned counsel for the respondent urged this Court to examine the contents of its Notice to Quit dated 13.12.2013, that it was actually a 9 letter giving the appellant a year’s notice to quit the said property. By that notice, the appellant was required to vacate the said property on 31.12.2014 or at the end of the period of tenancy expiring next. By that said notice, the appellant was notified that the respondent would commence “appropriate eviction proceedings” against the appellant should the appellant “fail, refuse and/or neglect to quit and deliver vacant possession of the demised premises” or the said property. [23] With respect, any examination of any degree of that Notice to Quit cannot alter the position of the pleaded claim of the respondent; that it is a claim premised quite simply on a failure to pay the annual rental for 2011 of the sum of RM286.55. That such failure, refusal or neglect is a breach of the terms of the yearly tenancy. And, it is for this reason and no other, that the respondent issued a Notice to Quit and when the appellant failed to vacate the said property, the respondent sought vacant possession of the said property. The respondent’s case is entirely dependent on an alleged default of the appellant which gave rise to the respondent’s right to require the appellant to quit and vacate the said property. From the pleaded claim, it is not a notice to quit issued for any other purpose. [24] The law reports are replete with a consistent line of firm and binding authorities on the principle that the parties are bound by their pleadings; that the Courts must adjudge a claim or defence or counterclaim based on what is pleaded. See for instance, Dato’ Tan Chin Woh v Dato Yalumallai v Muthusamy [2016] 8 CLJ 293. 10 [25] It is not the business or function of the Court, under guise of doing justice, that the Court refashions a claim or defence for any of the parties, regardless of the evidence. We do not see how the respondent can resile from its pleaded claim and invite the Court to consider some other reason for the line of action taken by the respondent, let alone allow the respondent to attempt to improve on its claim which had obviously failed. [26] Since the appellant had proven that it was not in default of its annual rental which the respondent accepted was actually in the form of the appellant’s share of the annual quit rent and assessment, licensing the appellant and the other occupants to stay on the said property, the respondent’s case was obviously unsustainable and must necessarily fail. In the face of such evidence, the learned Judge had clearly misdirected herself and ought to have dismissed the respondent’s claim. Since the learned Judge did not, that decision is plainly wrong and we are compelled to intervene to allow this part of the appeal. The learned Judge’s decision on the respondent’s claim is accordingly set aside. [27] As for the counterclaim which essentially were for declaratory orders emanating from an alleged breach of trust of joint ownership rooted in the trust deed of 23.3.1936, we agree with the learned Judge that there was no evidence to prove the appellant’s locus standi as a descendant, be it of the 10 initial trustees of the said property, or of the original families that had been allowed to stay on the said property upon the creation of the trust. No letters of administration or any other document of authority was offered in evidence – see Federal Court decisions in Jigarlal Kantilal Doshi v Amanah Raya Berhad [2011] 9 11 CLJ 361, Chor Phaik Har v Farlim Properties Sdn Bhd [1997] 4 CLJ 393, Deraman & Ors v Mek Yam [1977] 1 MLJ 52. [28] Learned counsel for the appellant had further conceded that no evidence was led to establish this continued line of interest and capacity and to prove locus standi in order to obtain the particular reliefs that were prayed for in the counterclaim. At best, the appellant was undeniably a yearly tenant. On that score, it was in the position to defend the claim; he was not, however, cloaked with the necessary capacity to bring the counterclaim. [29] We further found that the appellant is not and neither did he claim to be a member of the respondent association, although we were made to understand that one of the occupants involved in the remaining 37 cases, is a member of the association. That being so, the appellant was in no position to challenge the decisions taken by the respondent, including those taken at its AGM. For these reasons, we must dismiss the appeal against the dismissal of the counterclaim. [30] In addition, we made no order as to costs for the proceedings here and below. The order of costs at the High Court is set aside. Dated: 12th October 2018 (MARY LIM THIAM SUAN) Judge Court of Appeal Malaysia 12 Counsel/Solicitors For the appellant: Tunku Amiruddin bin Tunku Yusof [William Wong Lian Chin & Quek Kia Peng with him] Messrs Tunku Amiruddin & K.K.Chew 46, Tingkat Satu Jalan Dato’ Lee Fong Yee 70000 Seremban, Negeri Sembilan For the respondent: Tan Koon Heo & Tan Joes Nan Messrs K.H Tan & Co No. 5-18, 1st Floor Jalan Ibrahim 84000 Muar, Johore