Per : Murali a/l Subramaniam v Ex-Parte : Tan Sri Datuk Nadraja a/l Ratnam (BA-29NCC-8655-09/2016)

This is an appeal by the Judgment Debtor (JD) against the decision of the Deputy Registrar of the Shah Alam High Court on 15.5.2017 in dismissing the JD’s Summons in Chambers of 10.3.2017 opposing the Judgment Creditor’s (JC) Creditor’s Petition (“CP”) (Enclosure 23) for the Receiving Order and Adjudicating Order (“ROAO”) and the striking out application of the CP by JD (Enclosure 24) (pages 10-13 of the Common Core Bundle). 2

I dismiss both appeals with cost and my grounds follow.

The relevant factual background giving rise to this appeal based on the written submission of the counsels may be briefly stated as follows:

The JC had filed a defamation suit against the JD by way of Writ of Summons dated 30.7.2015 and Statement of Claim dated 9.12.2015 at the Kuala Lumpur High Court.

On 29.7.2016, the Kuala Lumpur High Court gave Judgment in favour of the JC (“the Judgment”) and awarded the sum of RM250,000.00 as damages and RM97,247.47 as costs to the JC (“monetary part”). On 19.8.2016, the JD filed a Notice of Appeal against the entire decision of the Kuala Lumpur High Court.

Meanwhile the JC filed a Bankruptcy Notice (“BN”) dated 9.9.2016 that the JD is required to pay the Judgment sum of RM349,287.30. Upon JD’s failure to comply with the BN, led to the filing of the CP dated 11.11.2016, premised on the Judgment.

The JD claimed that the JD then filed an application for Stay of Execution of the monetary part of the Judgment pending outcome of his appeal to the Court of Appeal (pages 86-87 of 3 Core Bundle and paragraph 6 of JD’s counsel’s written submission) on 7.2.2017.

The Kuala Lumpur High Court heard the application and submission by both parties and granted a Conditional Stay of Execution Order on 15.2.2017. The JC claimed that the Conditional Stay Order stated among others as follows: “Perenggan 3.1 hingga 3.6 di dalam Penghakiman Mahkamah Tinggi bertarikh 29.7.2016 digantung pelaksanaannya sehingga, tetapi tidak termasuk, tarikh perbicaraan Notis Usul Plaintiff (Responden di Mahkamah Rayuan) bertarikh 16.11.2016 di hadapan Mahkamah Rayuan di dalam Rayuan Sivil No. W-02(NCVC)(W)-1576- 08/2016 untuk jaminan kos terhadap Defendan dan bahawa Plaintif hendaklah bebas untuk mengusul Mahkamah Rayuan untuk permohonannya bagi jaminan kos terhadap Defendan seolah-olah tidak terdapat sebarang penggantungan pelaksanaan Penghakiman Mahkamah Tinggi bertarikh 29.7.2016” and, “Defendan harus membayar kepada Plaintif jumlah sebanyak RM50,000.00 iaitu sebahagian daripada awad kos yang diputuskan oleh Mahkamah Tinggi di bawah Penghakiman Mahkamah Tinggi bertarikh 29.7.2016 dalam tempoh tiga (3) minggu dari tarikh Perintah ini iaitu pada atau sebelum 8.3.2017, dan sekiranya Defendan gagal berbuat demikian, perintah penggantungan pelaksanaan bersyarat di dalam 4 perenggan 1 di atas ini akan luput serta merta tanpa keperluan sebarang perintah lanjut.”

The JC claimed that based on the Conditional Stay Order, the JD must pay the sum of RM50,000.00 to the JC by 8.3.2017, failing which, the Conditional Stay Order lapses without the need for a further order. It was claimed by JC that in any event, the Condition Stay Order lapses the day before the hearing of the JC’s Notice of Motion in the Court of Appeal for security for costs where the Notice of Motion was heard on 14.3.2017, the Conditional Stay Order dated 15.2.2017 subject to the fulfilment of paragraph 2 of the Conditional Stay Order, will lapse on 13.3.2017.

The JC claimed that before the Deputy Registrar of the Bankruptcy Court, the JC’s position was that the act of bankruptcy had been committed which was not disputed by JD and at the time the CP was filed, no Stay of Execution was granted which was not disputed by the JD (paragraph 8 of JC’s counsel’s written submission).

The JC claimed that on 7.3.2017, a day prior to the deadline of 8.3.2017, the JD without any prior notice to the JC’s solicitors, wrote to the High Court to purportedly seek clarification with the learned High Court Judge in respect with paragraph 1 of the Stay Conditional Order dated 15.2.2017. The JC claimed that during the appointment with the Kuala Lumpur High Court Judge, the issue as to whether the sum of RM50,000.00 is payable to the JC or to his solicitors was 5 addressed was clarified by the JC’s solicitors that payment is to be made to the JC, the plaintiff.

It was claimed by the JC that after the appointment, the JD attended the JC’s solicitor’s office to purportedly pay the sum of RM50,000.00 despite being fully aware that the payment ought to be made to the JC himself as per paragraph 2 of the Conditional Stay Order dated 15.2.2017 and thus the JC’s solicitors refused to accept the monies and advised the JD to comply with the said Conditional Stay Order.

The JC claimed that it was not disputed that the JD did not pay up to the JC the sum of RM50,000.00 by 8.3.2017 as directed in the Conditional Stay Order of 15.2.2017 to which the said Order lapsed as of 9.3.2017. The JC claimed that the JC’s solicitors had on 9.3.2017 notified by letter to JD of his non-compliance where the JD did not reply the letter denying that the Conditional Stay Order dated 15.2.2017 had expired on 8.3.2017.

It was claimed by JC that the JD acted unilaterally made payment of the RM50,000.00 into Court on 9.3.2017 as purported payment to comply with the Conditional Stay Order of 15.2.2017 and on 9.3.2017 filed his Notice of Intention to Oppose the CP and on 10.3.2017 filed his Summons in Chambers to set aside the BN and CP.

The JC claimed that JD’s conduct is to portray that the said Order of 15.2.2017 was still in force and that JD was in compliance and exhibited an affirmed affidavit which was 6 filed at the trial court on 10.3.2017. The JD disclosed before the Deputy Registrar that the purported affidavit of compliance is the subject matter of a pending striking out application in the Trial Court (High Court) under Order 41 rule 6 of the Rules of Court 2012 (ROC 2012).

The JC stated before the Deputy Registrar that the JD had also exhibited two other applications, where firstly, an application to amend paragraph 1 of the Conditional Stay Order of 15.2.2017 which is intended to support the JD’s argument that the Conditional Stay Order has not lapsed as at 13.3.2017 (Enclosure 99) and secondly, an application to amend prayer 2 of the Conditional Stay Order (Enclosure 116).

The JD’s Notice to Oppose, Summons in Chambers and the CP were heard on 15.5.2017 before the Deputy Registrar which was dismissed and the Deputy Registrar allowed the ROAO dated 15.5.2017.

The JC claimed that after the ROAO was granted close to 2 months, enclosures 99,111 and 116 were heard before the Trial Court on 12.7.2017 which allowed the JD’s application to amend the Conditional Stay Order dated 15.2.2017 and the Trial Court held that the JD had complied with the Conditional Stay Order dated 15.2.2017 and that Order was extended until disposal of the JD’s appeal to the Court of Appeal (pages 19-22 of the Common Core Bundle). 7

The JC’s solicitors wrote to the President of the Court of Appeal on 6.7.2017 requesting that the hearing of the JD’s appeal to the Court of Appeal be expedited which was allowed on 6.7.2017 to be fixed for hearing on 30.8.2017.

The JC did not object to the application for a stay of proceedings pending the appeal (Enclosure 40) which was recorded by the Deputy Registrar with no order as to costs. JD’s submission [4] At the beginning of the submission, the learned counsel for JD averred that the JC’s arguments were full of falsity. The JD raised about the Conditional Stay Order (page 86 of the Common Core Bundle) pending appeal at the Court of Appeal until the appeal is finally disposed of and submitted that the JD did not pay the sum of RM50,000.00 but it was the JC’s solicitor who refused to accept and the JD had to deposit the amount into Court. The Court heard the JD’s counsel’s submission that the JD wanted to pay the RM50,000.00 to JC but could not locate nor found JC’s house. [5] In relation to the validity period of the Stay of Execution, it was submitted that the Conditional Stay Order was until the Appeal (pages 284-285 of the High Court Judge’s Ground of Judgment of 12.7.2017) and highlighted to this Court the confusion as reflected in the learned High Court Judge’s Ground of Judgment (pages 282, 283 and 285 paragraph 16) that is before the AORO was given. The counsel for the JD submitted that the learned High Court Judge had explained (at page 285): 8 “32. In the present circumstances, it is clear that when enclosure 90 came up for hearing, the plaintiff wanted to pin the defendant down to a substantial payment of costs and also that the CA security for costs should not scuttled or jeaopardized. And in so far as the defendant was concerned, the bankruptcy petition had to be stated by a stay of execution as any bankruptcy would have ruined him. It was on that premise that I had granted a stay of execution pending appeal so that these objectives will be achieved. But the plaintiff is now reading the stay order as giving him a right to carry out any form of execution (including bankruptcy)as from the date of hearing of the CA security for costs onwards even if the sum of RM50,000.00 is paid as per the stay order.

…. The intention of this Court at all times was that upon payment of RM50,000.00, the defendant is to have a complete stay of execution pending disposal of the appeal but without in any way affecting or jeopardizing the CA security for costs. That in a nutshell is what I had intended. But the wordings of the stay order in its present form is no doubt inelegantly worded and is the source of the problem. It suffers from a mis-wording.

Of course, the entire problem could have been averted, if the necessary steps had been taken by those advising the defendant to protect his interests and do the necessary to ensure that the stay order is tightened up so that it truly reflects the intention of the Court. ….” [6] It was averred by the JD’s counsel that the JD should not be adjudged bankrupt as there is a stay of execution of the Judgment and 9 relied on the authority of the High Court Melaka, the case of Re Tan Eng Niang; ex p Ng Choo Kwan & Sons Hardware Sdn. Bhd. [2003] 4 MLJ 679. JC’s Submission [7] The learned counsel for the JC advanced several arguments and its first contention was that no stay of the High Court Judgment when the BN was first filed and that when the CP was filed, there was still no stay of the High Court Judgment. The JC’s counsel averred that following the original Conditional Stay Order, the JD must pay the sum of RM50,000.00 to the JC by 8.3.2017, failing which, the Conditional Stay Order lapses without the need for a further order. [8] It was submitted by JC’s counsel that in any event, the Condition Stay Order lapses the day before the hearing of the JC’s Notice of Motion in the Court of Appeal for security for costs. As the Notice of Motion was heard on 14.3.2017, the Conditional Stay Order dated 15.2.2017 subject to the fulfilment of paragraph 2 of the Conditional Stay Order, will lapse on 13.3.2017. [9] The JC’s counsel also submitted that there is no prejudice to the JD if parties to the proceedings await the outcome of the JD’s appeal to the Court of Appeal on 30.8.2017. [10] The JC’s counsel averred that it had submitted to the Deputy Registrar that it should not go behind the sealed and perfected Conditional Stay Order dated 15.2.2017 and that Enclosure 99 and Enclosure 116 (amendment to Prayer 2 of the said Conditional Stay 10 Order) for the Trial Court (High Court of Kuala Lumpur), are not relevant to the proceedings before the Deputy Registrar. [11] The JC’s counsel averred that the JD failed to seek a stay of proceedings before the Bankruptcy Court under section 97 of Bankruptcy Act 1967 pending the disposal of the various applications before the Trial Court to which the Deputy Registrar had relied and dismissed the Summons in Chambers of the JD and proceeded with the CP where the ROAO was granted on 15.5.2017. [12] The JC’s counsel submitted that the Deputy Registrar in dismissing the Summons in Chambers and granting the ROAO dated 15.5.2017 could have only looked at the perfected and sealed Conditional Stay Order dated 15.2.2017 which was in existence at that material time. It was averred by JC’s counsel that the Deputy Registrar went by the plain and literal reading of the sealed and perfected Conditional Stay Order dated 15.2.2017 as it was not amended at that material time and that the new Conditional Stay Order dated 12.7.2017 does not have a retrospective effect. [13] It was also submitted by the JC’s counsel that the Deputy Registrar’s decision on 15.5.2017 cannot be reviewed on appeal on the ground that it was an erroneous exercise of her powers on the strength that the new Conditional Stay Order dated 12.7.2017 only came to be decided by the Trial Court, 2 months after the Deputy Registrar pronounced her decision on 15.5.2017. [14] The JC’s counsel pointed out to this Court that the JD is persistently pursuing the wrong procedure to have the ROAO reviewed 11 and submitted that if there was a stay, the JD should have applied to annul the ROAO following section 105 of Bankruptcy Act 1967. APPEAL [15] This appeal was heard three times before me on 17.8.2017,

6.9.2017 and 24.9.2017.The decision of this Court was announced on 24.9.2017. Reason being, what could have been clarified on 6.9.2017 and proceeded with decision had to be adjourned as the counsel for JD took medical leave without notice. To our surprise it was only on the morning of 6.9.2017 that a medical card showing the clinic’s appointment of 5.9.2017 sometime in the morning and a medical certificate dated 6.9.2017 were produced by another lawyer without informing the counsel for JC. The JC’s counsel objected to such conduct and wrote to this Court that the JD’s counsel could not be on medical leave when she had attended a press conference on 6.9.2017 which appeared in a Tamil newspaper. [16] Counsels as a matter of professional etiquette, are supposed to bring to the Court’s attention authorities that even favour his opponent’s case and he can proceed to distinguish his case from such authorities: Pacific Forest Industries Sdn Bhd & Anor v Lin Wen-Chih & Anor [1009] 6 MLJ 293, Federal Court. I was appalled by the declining standard of professionalism and reminded that if any of the counsels require to take sick leave, to be honest about it and communicate to the opponent’s lawyer if not to the Court, as not to waste the Court’s time. Lying is an atrocious behaviour and not apologizing makes two mistakes too many and are unethical. 12 [17] At the hearing of 17.8.2017, it was brought to this Court’s attention that the JD’s appeal to the Court of Appeal is fixed on 30.8.2017. This appeal before this Court is on the Deputy Registrar’s decision. The Court sought clarification for the facts and authorities on the conditional stay order to be submitted by both counsels and the Court of Appeal’s decision of 30.8.2017, fixed to be heard on 6.9.2017. [18] The dispute before me involves a bankruptcy matter where at the High Court of Kuala Lumpur, it was ruled that the JD committed defamation against the JC and was ordered to pay damages and costs amounting to RM 349, 287.30, the Judgment sum. The JD’s counsel applied for a stay of execution pending appeal and a Conditional Stay Order was allowed on 15.2.2017 where the condition stated that the sum of RM50,000.00 must be paid on or before 8.3.2017. As the Judgment sum was not paid, a BN was filed by the JC against the JD at the Shah Alam High Court. [19] I had the opportunity to scrutinize the original Conditional Stay Order as this was one of the issues raised with regards to the Deputy Registrar’s decision which are reproduced here in part as follows: “Defendan harus membayar kepada Plaintif jumlah sebanyak RM50,000.00 iaitu sebahagian daripada awad kos yang diputuskan oleh Mahkamah Tinggi di bawah Penghakiman Mahkamah Tinggi bertarikh 29.7.2016 dalam tempoh tiga (3) minggu dari tarikh Perintah ini iaitu pada atau sebelum 8.3.2017, dan sekiranya Defendan gagal berbuat demikian, perintah penggantungan pelaksanaan bersyarat di dalam perenggan 1 di 13 atas ini akan luput serta merta tanpa keperluan sebarang perintah lanjut..” [20] Upon careful perusal, I do not find any ambiguity in the original Conditional Stay Order where the condition literally stated that the Defendant must pay the Plaintiff the sum of RM50,000.00 on or before 8.3.2017. I could not find in the original Conditional Stay Order that the sum RM50,000.00 is to be held by the Plaintiff’s solicitor as stakeholder nor such application was ever made by the JD’s counsel before the High Court which is also normal practice for counsels to submit as such before the court. Indeed the learned High Court Judge pointed out that in normal practice, payment will be made between counsels rather than made directly to the plaintiff, however I take the view that the Conditional Stay Order of 15.2.2017 speaks for itself with no other possible interpretation that could give effect to it. [21] The original Conditional Stay Order was amended minus the monetary part RM50,000.00 which is retained and dated 12.7.2017 (particularly at pages 20-21 of the Common Core Bundle), is reproduced in parts as follows: “A. Perintah Pergantungan Pelaksanaan bertarikh 15.2.2017 terpinda membaca seperti berikut:

Perenggan 3.1.hingga 3.36 di dalam Penghakiman Mahkamah Tinggi bertarikh 29 Julai 2016 digantung perlaksanaannya sehingga pelupusan penuh dan muktamad Rayuan Defendan di Mahkamah Rayuan berkenaan Penghakiman tersebut tetapi tanpa prasangka 14 kepada perbicaraan Notis Usul Plaintif (Responden di Mahkamah Rayuan) bertarikh 16 November 2016 di hadapan Mahkamah Rayuan di dalam Rayuan Sivil No. W-02(NCVC)(W)-1576-08/2016 untuk jaminan kos terhadap Defendan dan bahawa Plaintif adalah bebas untuk mengusul Mahkamah Rayuan untuk permohonan-nya bagi jaminan kos terhadap Defendan seolah-olah tidak terdapat sebarang penggantungan perlaksanaan Penghakiman Mahkamah Tinggi bertarikh 29 Julai 2016;

Defendan harus membayar ke Mahkamah jumlah sebanyak RM50,000.00 iaitu sebahagian daripada awad kos yang diputuskan oleh Mahkamah Tinggi di bawah Penghakiman Mahkamah Tinggi bertarikh 29 Julai 2016 pada atau sebelum 9 Mac 2017, dan sekiranya Defendan gagal berbuat demikian,

Penggantungan Perlaksanaan Bersyarat di dalam perenggan 1 di atas ini akan luput serta-merta tanpa keperluan sebarang perintah lanjut; dan

Tiada perintah terhadap kos. B. Jumlah RM50,000.00 yang telah dibayar ke dalam Mahkamah melalui Alliance Bank Malaysia Berhad Cashiers Cheque No. 930809 adalah pematuhan penuh perintah pergantungan pelaksanaan tersebut; C. …. 15