Ms Five Auto Parts Sdn. Bhd. v Law Yik Hoa (BA-22NCvC-275-07/2025)

LAW YIK HOA

LIEW YEE MEI (NRIC NO.: 940924-08-5228) ...DEFENDANTS GROUNDS OF JUDGMENT Introduction Enclosure 15

This was the Defendants' application to set aside the Judgment in Default of Appearance (the JID) dated 11.8.2025. 07/07/2026 14:48:24 BA-22NCvC-275-07/2025 Kand. 39

Having considered the affidavits filed by the parties and the written submissions, I dismissed the application with costs of RM3,000.00 in favour of the Plaintiff. The JID was allowed to remain in force. The Parties

The Plaintiff is a company carrying on business in the sale of motor vehicle spare parts and accessories.

At the material time, the First Defendant was a director of the Plaintiff, and the Second Defendant was the First Defendant's wife. Background Facts

The Plaintiff commenced this action by way of a writ and filed the statement of claim on 7.7.2025.

The Plaintiff's claim was that the First Defendant, while acting as a director of the Plaintiff, had misused his position by directing payments due to the Plaintiff into his personal account and the account of the Second Defendant. The Plaintiff further alleged that cash payments received from customers were not accounted for to the Plaintiff.

According to the Plaintiff, its internal review revealed that a total sum of RM1,074,181.40 had been misappropriated. The Plaintiff further alleged that the Defendants subsequently acknowledged liability through a Letter of Acknowledgement and Guarantee dated 26.9.2024 and agreed to repay the amount.

The Plaintiff also relied on evidence of partial repayments amounting to RM173,703.10. After taking those repayments into account, the Plaintiff claimed an outstanding balance of

The Defendants did not enter an appearance within the prescribed period. On 11.8.2025, the Plaintiff obtained the JID.

The Plaintiff thereafter commenced garnishee proceedings to enforce the Judgment.

Following the garnishee proceedings, the Defendants filed the present application seeking to set aside the Certificate of Non-Appearance, the JID and the consequential garnishee proceedings. The Application and Parties' Submissions

By Enclosure 15, the Defendants apply to set aside the JID on the following grounds:

The Plaintiff opposes the application and raises the following objections:

The Plaintiff further relies on the Letter of Acknowledgement and Guarantee, evidence of payments received into the personal accounts of the Defendants, and evidence of partial repayments made after the Plaintiff's reconciliation exercise as demonstrating that the Defendants do not possess a genuine defence to the Plaintiff's claim. Issues for Determination

Having considered the application and the parties' submissions, the issues for determination are whether the JID was regularly obtained, whether the Defendants have disclosed a bona fide defence on the merits or any genuine triable issue, and whether this is a proper case for the Court to exercise its discretion to set aside the JID. The Law

The applicable principles are well settled. The Court must first determine whether the Judgment is regular or irregular. In Yap Ke Huat & Ors v Pembinaan Warisan Murni Sejahtera Sdn Bhd & Anor [2008] 4 CLJ 175; [2008] 1 MLRA 276, the Court of Appeal held that where a judgment is irregular, it ought to be set aside ex debito justitiae. Where the Judgment is regular, the discretion to set aside is not exercised as of right. The Defendants must show a defence that has some substance. In Evans v Bartlam [1937] AC 473, the Court recognised that a regularly obtained judgment may be set aside where the defendant demonstrates a defence on the merits.

In Hasil Bumi Perumahan Sdn Bhd & Ors v United Malayan Banking Bhd [1994] 1 CLJ 328; [1993] 1 MLRA 642, the Supreme Court held that the proposed defence must not be a sham defence. It must raise a bona fide issue that ought to be tried.

Similarly, in Lau Pick Huong v Soh Huang Siah [2014] 8 CLJ 488, the Court held that a defence on the merits means a defence that discloses an arguable and triable issue. A bare assertion is not enough.

An Affidavit of Service is prima facie evidence of service. In Kha Seng Group Sdn Bhd v Lee Mun Swee & Ors [2012] MLRHU 1505, the Court recognised that bare denials of service are generally insufficient to displace an affidavit of service, particularly where the affidavit contains identifying particulars and is supported by contemporaneous documents.

With those principles in mind, I turn to the facts of this application. Analysis and Findings Whether the JID was Regularly Obtained

The Defendants' principal complaint is that they were never served with the writ and statement of claim. They also deny that the signatures appearing on the acknowledgement documents relied upon by the Plaintiff are theirs.

I have carefully considered the Affidavit of Service together with the acknowledgement documents. The Plaintiff asserts that those documents bear signatures said to be those of the Defendants. The acknowledgement documents also contain the corresponding four digits of the Defendants' identification numbers.

Although the Defendants deny the signatures, I accept that expert evidence would not ordinarily be expected at this stage of the proceedings. Nevertheless, the denial remains unsupported by any other objective material. Apart from the denial itself, no contemporaneous document, explanation or other evidence was produced to support the contention that the signatures appearing on the acknowledgement documents were not theirs.

The Court is therefore left with an Affidavit of Service supported by contemporaneous documents on the one hand and denials on the other. The Affidavit of Service does not stand alone. It is supported by acknowledgement documents bearing signatures and corresponding identification particulars. By contrast, the Defendants rely principally on their denial that the signatures are theirs and that service was effected. While those denials are entitled to consideration, they do not, without more, displace the evidential value of the Affidavit of Service.

I accept that a challenge to service is a serious matter. However, a party seeking to dispute a regular Affidavit of Service must do more than merely deny receipt. The Court must examine the totality of the evidence before it.

In the present case, I observe the Defendants did not provide any satisfactory explanation as to how the corresponding identification particulars appeared on the acknowledgement documents. They also did not provide any material to cast real doubt on the service process deposed to in the Affidavit of Service

As mentioned earlier, an Affidavit of Service constitutes prima facie evidence of service (see the case of Kha Seng Group Sdn Bhd), and bare denials of the same are generally insufficient to displace a regular Affidavit of Service; the burden lies on the Defendants.

Having considered the evidence as a whole, I am not persuaded that the Defendants have displaced the evidential value of the Affidavit of Service.

I therefore find that the Plaintiff has sufficiently established service of the writ and statement of claim and that the JID was regularly obtained. Whether the Defendants Disclosed a Bona Fide Defence on the Merits

Having found the Judgment to be regular, the burden falls upon the Defendants to demonstrate a bona fide defence on the merits or a genuine triable issue.

The Defendants assert that they have a defence with a reasonable prospect of success. However, that assertion alone is not sufficient. The Court must be able to identify, from the affidavits, the substance of the proposed defence.

Having reviewed the Defendants' affidavits and submissions, I find that their challenge is directed principally at the issue of service only.

Beyond disputing service, the Defendants do not meaningfully address the substance of the Plaintiff's claim. In particular, they do not provide any substantive explanation regarding:

(a) the alleged receipt of monies into personal accounts;

(b) the Letter of Acknowledgement and Guarantee relied upon by the Plaintiff;

(c) the Plaintiff's reconciliation and computation;

(d) the alleged partial repayments; or

(e) the basis upon which the Plaintiff's claim is said to be unsustainable.

This is a significant omission. The Plaintiff's claim is not pleaded merely as a general debt. It is supported by pleaded allegations of diversion of payments, receipt of monies into personal accounts, a written acknowledgement and partial repayments.

The Defendants were therefore required to do more than say that they have a defence. They had to put forward enough material to allow the Court to identify a genuine triable issue.

No proposed defence was exhibited. I accept that the absence of a draft defence is not automatically fatal. However, where no draft defence is filed, the affidavit evidence must disclose the defence with sufficient clarity. In this case, it does not.

I also note that the Plaintiff's Affidavit in Reply contains detailed assertions regarding the alleged admissions, receipt of monies and subsequent repayments. Those assertions were not substantively addressed by the Defendants.

In Ng Hee Thoong & Anor v Public Bank Bhd [1995] 1 CLJ 609; [1995] 1 MLRA 48, the Court of Appeal recognised that where a positive assertion on a material issue is not properly contradicted, the failure to do so may be treated as an admission.

In Public Finance Berhad v Zainal bin Osman t/a Putera Fotot Studio [2001] 1 LNS 331; [2001] 4 MLRH 1, the Court held that where the affidavit discloses no defence on the merits or no arguable issue, the application to set aside ought to be dismissed.

Similarly, in Wong Cheng Yong (t/a Chengy Enterprise) & Anor v Confast Hardware & Fasteners Sdn Bhd [2018] MLJU 1230, the Court emphasised that bare denials unsupported by material facts are insufficient.

Applying those principles, I am unable to identify any bona fide defence on the merits. What emerges from the Defendants' affidavits is largely a challenge to service rather than a substantive answer to the Plaintiff's claim.

The Defendants have not shown why the Plaintiff's claim is unsustainable. They have not identified any factual or legal basis upon which the claim ought to fail.

I therefore find that the Defendants failed to demonstrate a bona fide defence on the merits or any genuine triable issue warranting the setting aside of the Judgment. The Plaintiff's Preliminary Objections

The Plaintiff raised a preliminary objection that the Defendants' application was brought under the wrong provisions of the Rules of Court 2012.

I did not dismiss the application solely on that ground. The relief sought by the Defendants was clear. They sought to set aside the JID and the consequential orders. In my view, the Court should consider the substance of the application and not dispose of it merely on the basis of an incorrect reference to the applicable provision.

The Plaintiff also relied on Order 42 rule 13 and submitted that the application was filed outside the prescribed time without any application for extension of time. I accept that the Defendants did not give a satisfactory answer to this point. However, because the Defendants challenged service and knowledge of the proceedings, I considered it appropriate to address the substance of the application.

The procedural matters raised by the Plaintiff were therefore not treated as the sole basis for dismissal. They were, however, relevant to the overall exercise of discretion, particularly after I found that service had been sufficiently established. Exercise of Discretion

Having found that the Judgment was regularly obtained and that the Defendants failed to disclose a bona fide defence, I was not persuaded that the Court should exercise its discretion in their favour.

I also took into account the timing of the application. The Defendants only took active steps to challenge the Judgment after the garnishee proceedings affected their bank accounts. While that fact alone is not determinative, it is relevant in assessing the bona fides of the application and the exercise of discretion.

This Court is also mindful of the judiciary's continuing efforts to reduce delays and ensure the expeditious disposal of cases. Litigants who are the subject of court proceedings must similarly act with diligence and promptitude. Court orders and court processes cannot be ignored and attended to only when enforcement measures begin to produce adverse consequences. Parties who choose not to act when required do so at their own risk.

In the circumstances of this case, the timing of the application reinforces my conclusion that this is not a proper case for the Court to exercise its discretion in favour of the Defendants.

I emphasise that I have not treated the absence of a defence as curing an irregular judgment. My finding on the absence of a bona fide defence is made after my finding that service was sufficiently established and that the Judgment was regularly obtained.

Taking the circumstances as a whole, I am not persuaded that this is a proper case to set aside the JID. Conclusion and Orders

For the reasons stated above, I find no merit in the Defendants' application in Enclosure 15. Accordingly, the application is dismissed. The JID dated 11.8.2025 shall remain in force. Costs of RM3,000.00 are awarded to the Plaintiff, subject to allocatur. Dated this: 6 July 2026 ~signed~ (NOOR HAYATI BINTI HAJI MAT) JUDGE HIGH COURT OF MALAYA SHAH ALAM, SELANGOR Representative: For the Plaintiff : Lee Jie Xin Messrs Law Chambers of Lee J. X. For the Defendants : Lim Jae-Han Messrs Lim Yeoh & Partners