Perkasa Sutera Sdn Bhd v Kerajaan Malaysia & Jkr Malaysia (WA-21C-4-04/2019)

JABATAN KERJA RAYA MALAYSIA DEFENDANTS GROUNDS OF DECISION 2 Introduction [1] This is an opposed application to discontinue the suit with liberty to refile. [2] The Plaintiff is a private limited company involved in the construction business. [3] The First Defendant is the Federal Government of Malaysia and the Second Defendant is a department within the Ministry of Works of the First Defendant. Background and Preliminary [4] By a contract no. JKR/IP/CKUB/199/2012 dated 17 December 2012 (“Contract”) that included the PWD 203A standard form of conditions of contract, the Plaintiff was appointed by the Defendants as the completion main contractor to carry out and complete the remaining outstanding works at UiTM Cawangan Selangor Kampus Sungai Buloh-Fakulti Pergigian (‘Project”) that was abandoned by the original main contractor. 3 [5] The carrying out of the works in the Project could not be completed by 11 September 2013 which is the time stipulated in the Contract and the Plaintiff was granted several extension of time pursuant to the Contract by the superintending officer of the Defendants. [6] The works in the project was finally completed on 1 September 2015. [7] As the result of the delayed completion of the works in the Project, the Plaintiff claimed for prolongation loss and expense against the Defendants. [8] However, the Defendants counterclaimed that the Plaintiff contributed to the delayed completion of the Project. Consequently, the Defendants refused to pay the prolongation loss and expense claimed by the Plaintiff and the Defendants deducted liquidated and ascertained damages for late completion for the Plaintiff’s payment. [9] By reason of the disputes and differences that have arisen between the parties including on the final accounts that were issued by the superintending officer of the Defendants, the Plaintiff initiated this suit on 3 April 2019. [10] After the close of pleadings in the suit, I noticed at pre-trial case management that there is an arbitration provision in the Contract which 4 was not adhered to by the parties. Since the disputes and differences substantially encompassed construction final accounting, the parties upon my suggestion consented to have disputes and differences determined via court annexed arbitration pursuant to s. 24A of the Courts of Judicature Act 1964. Accordingly and again with the consent of the parties, I so ordered and have on 30 October 2019 appointed Miss Tan Swee Im as the arbitrator (“Arbitrator”). [11] The commencement of the arbitration hearings have been disrupted by the imposition of the Movement Control Order in March 2020 after the submission of the bundles of documents and witness statements. [12] Subsequently, the Arbitrator on 1 July 2020 directed the Plaintiff to submit a detail list of the loss and expenses claimed to the Defendants which the Plaintiff complied by submitting matrix of its loss and expenses claims involved. Furthermore, the Plaintiff on 2 July 2020 submitted a further witness statement for purposes of the forthcoming re-scheduled hearing. [13] The Defendants on 1 August 2020 replied challenging the Plaintiff’s matrix of loss and expenses claim particularly that they were unsubstantiated with actual documentary evidence. [14] In consequence, the Plaintiff on 17 August 2020 submitted an additional bundle of document comprising the documentary evidence to 5 substantiate its loss and expenses claim but which was strenuously objected by the Defendants. [15] The Plaintiff thereafter on the first day of the scheduled resumed hearing on 19 August 2020 intimated to the Arbitrator that the Plaintiff wishes to withdraw/discontinue the suit with liberty to refile and the Arbitrator accordingly directed that this be made before me. [16] I thereafter met the parties several times to try to get them to compromise and put them back on track to conclude the arbitration including the Plaintiff to pay for any abortive costs of the arbitration hearings. Since the Defendant was adamant that the Plaintiff’s additional bundle of document submitted on 17 August 2020 cannot be utilized in the arbitration, the Plaintiff was constrained to apply to withdraw the suit with liberty to refile. However the Defendants replied that the suit must be withdrawn without liberty to refile. [17] In the circumstances, I therefore directed the Plaintiff to file a formal application for withdrawal of the suit which the Plaintiff complied on 21 April 2021 (“Application”). [18] The affidavits which were filed for purposes of the Application are as follows: 6

Plaintiff’s affidavit in support affirmed by Dato’ Mohamed Feisal bin Ibrahim dated 20 April 2021; and

(ii) Defendants’ affidavit in reply affirmed by Shamala a/p Jaganathan dated 5 May 2021. [19] After hearing the parties on 31 May 2021, I allowed the Application subject to the following conditions:

The Plaintiff shall pay the Arbitrator fees of RM5000.00 for her partial services rendered;

(ii) The Plaintiff shall pay the Defendants costs of RM10,000.00;

(iii) The re-commencement of the Plaintiff’s action against the Defendants shall be by way of arbitration as agreed by the parties under the Contract. [20] I furnish the supporting grounds of my decision hereinbelow. 7 Contentions and Findings [21] The Plaintiff submitted that this is a proper case for withdrawal with liberty to refile based on the principles propounded by the Court of Appeal in Newlake Development Sdn Bhd v Zenith Delight Sdn Bhd & Ors [2017] 1 LNS 527. In that case Zabariah Mohd Yusof JCA (now FCJ) held as follows: “23. Before granting the order for discontinuance of an action, the court must be satisfied that: i) if a defendant is dominus litis, the general rule is to refuse leave to discontinue (see Overseas Union Finance Ltd v. Lim Joo Chong [1971] 1 LNS 101; [1971] 2 MLJ 124); ii) the case is not at an advanced stage; if so, care must be taken not to permit discontinuance. What constitutes an advanced stage depends on the facts and circumstances of the case (see Fox v. Star Newspaper Company [1898] 1 QB 636; iii) the plaintiff may have gained an interim interlocutory advantage between the date of issue of the writ and the point of time he seeks to discontinue (O'Neal v. Mann [2000] FCA 1680); iv) there is no miscarriage of justice occasioned by its refusal to permit the discontinuance; v) it will not prejudice the opponent to the application or take away from him any advantage to which he is fairly and reasonably entitled.” The Plaintiff also referred and relied on the cases of Perbadanan Pengurusan Sri Pantai v Tan Siew Chin Sdn Bhd [2011] MLJU 957, Muhamad Nur Hafiz bin Roslan v Jakel Trading Sdn Bhd [2019] MLJU 732 and Dilantha Ranjula Bandara Malagamuwa & Ors v ADM 8 Ventures (M) Sdn Bhd & Ors [2018] 1 LNS 1441 where discontinuance was allowed with liberty to refile. [22] The Defendants however vehemently opposed and submitted that the Plaintiff’s action in wanting to discontinue the suit is plainly unreasonable and unacceptable because the Plaintiff has realized its weaknesses and omissions in its loss and expense claims that they were not substantiated with documentary evidence after having been pointed out by the Defendants in one of their proposed witness statement. Thus, the Defendants submitted that this is a belated attempt by the Plaintiff to resuscitate its case which is highly unfair and undoubtedly prejudicial to the Defendants in losing a litigation advantage. It is a second bite by the Plaintiff of the proverbial cherry to fix the loopholes in its case after having sighted the Defendants’ pivotal defence. In this respect, the Defendants also relied on the Court of Appeal cases of Newlake Development Sdn Bhd v Zenith Delight Sdn Bhd & Ors (supra) as well as Punj Lloyd Oil & Gas (M) Sdn Bhd v Etiqa Insurance Bhd & Ors [2016] 5 CLJ 549 where Abdul Aziz Rahim held as follows: “[21] The High Court in Hanhyo Sdn Bhd v. Marplan Sdn Bhd & Ors [1991] 3 CLJ 1783; [1991] 2 CLJ (Rep) 684, also considered and laid down the principles in respect of discontinuance. Lim Beng Choon J, held at p. 693 that: The principles that can be extracted from the aforementioned cases are that the Court would not compel a plaintiff to continue his action against a defendant if he does not want to do so provided no injustice is caused to the defendant. Injustice would be caused to the defendant if:

the discontinuance was made with ulterior motive to obtain a collateral advantage as in the case of Castanho v. Brown & Root Ltd; 9

the discontinuance was not made bona fide by the plaintiff but it was made in order to obtain an advantage to which he has no right to retain since he has ceased to be dominis litis as the defendant has a perfectly good defence - see Overseas Union Finance Ltd v. Lim Joo Chong [1971] 1 LNS 101 case;

by the discontinuance of the action the defendant would be deprived of an advantage which he has already gained in the litigation - see Covell Matthews & Partners v. French Wools Ltd. case."” The Defendants therefore submitted that the discontinuation should be disallowed and the Application dismissed. That notwithstanding, the Defendants also referred and relied on the cases of KK Jadum Anak Eken & Ors v Saremas Sdn Bhd & Ors [2017] MLJU 2229 and Raub Oil Mill Sdn Bhd v Andrew Kam Tai Yeow [2019] MLJU 490 where the discontinuance was allowed but without liberty to refile in the event the court is minded to allow the Application. [23] It is provided as follows in Order 21 rule 3 of the Rules of Court 2012 (“RC”): “3. Discontinuance of action with leave (O. 21 r. 3)

Except as provided by rule 2, a party may not discontinue an action (whether begun by writ or otherwise) or counterclaim, or withdraw any particular claim made by him therein, without the leave of the Court, and the Court hearing an application for the grant of such leave may order the action or counterclaim to be discontinued, or any particular claim made therein to be struck out, as against any or all of the parties against whom it is brought or made on such terms as to costs, the bringing of a subsequent action or otherwise as it thinks just.

An application for leave under this rule shall be made by a notice of application.” 10 [24] From the provision in Order 21 rule 3 of the RC cases cited by the parties particularly the case of Newlake Development Sdn Bhd v Zenith Delight Sdn Bhd & Ors (supra), the grant of leave to discontinue a suit is discretionary as well as may be subjected to conditions as the court deems fit if the discontinuation is allowed. [25] Based on the facts as disclosed before me, the critical consideration is the Defendants’ opposition of the additional bundle of documents tendered by the Plaintiff in substantiation of its loss and expense claims at the eve of the hearing, seemingly in response to the evidential deficiency highlighted by the Defendants in the one of their witness statements. [26] In the premises, the principal complaint of the Defendants is the loss of their tactical advantage otherwise enjoyed if the additional bundle of documents which should be inadmissible in this suit. By so discontinuing the suit, the Plaintiff would be able to re-commence a new suit with the additional bundle of documents included; hence the Plaintiff’s evidential deficiency duly rectified. [27] It is not prescribed in Order 21 RC as to exactly when a discontinuation application would not be permitted. Based on the case laws as cited, it must not be at the advanced stage of the suit. This is obviously fact sensitive and it is my view that a discontinuation application made prior to the hearing actually having commenced is not too late and 11 hence permissible; see also JPK (M) Sdn Bhd (dalam likudasi mendakwa melalui Cheng & Co Corporation Recovery Sdn Bhd) v Sunny Tech (M) Sdn Bhd & Ors [2018] MLJU 94. The Plaintiff here intimated to the Arbitrator on the first day of the hearing at the opening before any witnesses are called that the Plaintiff wishes to discontinue the suit. [28] Next, I observed from the pleadings that it is the Plaintiff that is dominus litis and not the Defendants because the Defendants are mere defendants without a counterclaim against the Plaintiff. [29] More importantly, I find that the Arbitrator has at all material times also not yet ruled on whether the additional bundle of documents produced by the Plaintiff, albeit late, will be admitted in evidence or otherwise. In the circumstances, I find that it is presumptuous of the Defendants to assert that they would suffer a miscarriage of justice of losing a tactical advantage. It might have been different if the Arbitrator has already ruled in favour of the Defendants disallowing the reception of the additional bundle of documents. [30] In any event, it is a balancing act as to whether miscarriage of justice has occurred. I am of the view that parties generally should in the interest of substantive justice be given the opportunity to fully ventilate their case as they see fit including the adduction of evidence not fully produced as directed at pre-trial case management subject to payment of costs, unless 12 substantial prejudice has occasioned. This is so even if the Plaintiff might have been alerted by the Defendants on the inadequacy of the evidence adduced by the Plaintiff. It is my view that justice should be administered and dispensed based on the substantive merits of the case with all relevant evidence available adduced before the court. For example in a typical prolongation loss and expenses claim, I do not see why a plaintiff that has made a claim based on formula computation should be precluded and estopped from adducing, albeit late, documentary evidence of the loss and expenses actually incurred to justify the computation when criticized by the defendant for lack of justification. Justice should ultimately be adjudged on whether the plaintiff has proved its claim based on the best evidence available. [31] In the circumstances here, I find that the Defendants are hoping to capitalize on procedural justice over substantive justice to exclude relevant Plaintiff’s documentary evidence, albeit adduced late, but which I do not countenance. Consequently, I cannot fathom there would occasion a real loss or deprivation of advantage on the part of the Defendants other than a tactical procedural/technical advantage that constituted blatant disregard of justice as asserted by the Defendants. There is no other evidence of substantive prejudice caused demonstrated by the Defendants. 13 [32] The principal case of Raub Oil Mill Sdn Bhd v Andrew Kam Tai Yeow (supra) of purportedly similar facts relied upon by the Defendants are, in my view, distinguishable in that the plaintiff therein required more time to gather further evidence to overcome its inadequacies but the Plaintiff here has already adduced its further evidence but the adduction has been strenuously resisted by the Defendants. Conclusion [33] It is for the foregoing reasons that I allowed the Application as so ordered. Dated this 31 May 2021 t.t. LIM CHONG FONG JUDGE CONSTURCTION COURT 1 HIGH COURT KUALA LUMPUR 14 COUNSEL FOR THE PLAINTIFF: WILLIAM FOO HIAP SIONG (SIOW YOONG KEE WITH HIM) SOLICITORS FOR THE PLAINTIFF: FOO HIAP SIONG COUNSEL FOR THE DEFENDANT: SHARMALA A/P JAGANATHAN SOLICITORS FOR THE DEFENDANT: JABATAN PEGUAM NEGARA MALAYSIA