Positive Prospect Sdn Bhd v Koperasi Kemas Negeri Sembilan Berhad (NA-A52NCvC-86-09/2024)

These appeals arise from the Defendant’s Notice of Appeal against the decision made by this Court dated 12th of March 2025 wherein the Plaintiff’s interlocutory application to strike out Defendant’s Counter Claim pursuant to Order 18 Rule 19(1)(a)(b)(c) of the Rules of Court 2012 was granted, and also in another decision dated 20th of March 2025 wherein the Plaintiff’s interlocutory application for Judgement based on Admission pursuant to Order 27 Rule 3 of the Rules of Court 2012 was granted. 19/05/2025 12:22:07 NA-A52NCvC-86-09/2024 Kand. 46

Being dissatisfied with those 2 rulings, the Defendant has filed 2 Notices of Appeal seeking to overturn the decision made by this Court. For convenience purposes, 1 single Grounds of Judgement is prepared by this Court.

The full background facts of the case are set out in the Plaintiff’s Statement of Claim. Plaintiff initiated this action by way of Writ of Summon against the Defendant on the 10th of September 2024 for the recovery of deposit amounting to RM 240,000 and interest at the rate of 5% per annum to be paid by the Defendant from the 1st of September 2024 until the full and final settlement of the amount claimed.

Meanwhile, the Defendant’s Counter Claim are for a declaration that Plaintiff failed to execute the SNP through its pre-mature notice of termination dated 1st of April 2022 and that the Defendant is allowed to forfeit the amount of RM 250,000 deposited.

Summarily, this claim by the Plaintiff arising from a breach of Sale and Purchase Agreement (hereinafter referred to as the SNP) which has been agreed upon and entered into by both Plaintiff and Defendant dated 09th February 2021, for the sale and purchase of 2 parcels of land with a selling price of RM 25,000.000.

Plaintiff asserted that on the 01.02.2021, an amount of RM 250,000 has been paid and forwarded to the Defendant together with a copy of the SNP through Plaintiff’s Solicitor, in which the Defendant was supposed to comply within 6 months or at the latest on or before 08.08.2021 according to Clause 2A of the SNP.

However, on the 1st of April 2022, Defendant has informed Plaintiff on the termination of the SNP for Defendant’s failure to meet with the stipulated conditions of the 6 months period.

Upon that, Plaintiff had initiated a legal proceeding against the Defendant at the Session Court of Seremban dated 23rd of March 2023 case number NA-A52NCVC-30-03/2023 (hereinafter referred to as “previous suit”). Fortunately, both Plaintiff and the Defendant had come to an agreement and therefore a Consent Judgement has been obtained against both Plaintiff and the Defendant on the 1st of March 2024.

The terms of the Consent Judgement in short are as follows:

The Defendant agreed to pay to the Plaintiff an amount of RM 150,000 in 2 instalments (first within 1 month and the 2nd within 6 months or at the latest on or before 31st of August 2024); and

Failure of the Defendant to comply with the terms of settlement, Plaintiff is given the freedom to refile a legal proceeding against the Defendant claiming for the deposit amounting to RM 250,000 (deducting any amounts been paid, that is Defendant has paid an amount of RM 10,000 on the 23rd of April 2024). [10] Subsequently, Plaintiff filed another legal proceeding before this Court against the Defendant for the recovery of the sum of RM 240,000 arising from the same matter and issue (hereinafter referred to as the “current suit”). [11] In this current suit, Plaintiff filed 2 interlocutory applications as follows:

Order 27 Rule 3 of Rules of Court 2012, asserting that the Defendant had made clear admissions in its pleadings through a Consent Judgement and Letter of Admission in the previous suit, arising from the same matter, thereby entitling the Plaintiff to judgment without the need for a full trial; and

Order 18 Rule 19(1)(a)(b)(c) of the Rules of Court 2012 to strike out Defendant’s Counter Claim. [12] In supports of Plaintiff’s claim, Plaintiff referred to Exhibit HA-1 the SNP, Exhibit HA-2, a letter by Plaintiff’s solicitor together with a cheque for the amount of RM 250,000, Exhibit HA-3 letter of termination of the SNP, Exhibit HA-4 Writ Summon and Statement of Claim for the previous suit as well as Exhibit HA-5 that is the Consent Judgement obtained on the 1st of March 2024 for the previous suit. [13] In addition to that, Plaintiff claimed that the application should be allowed on the following reasons:

The Defendant’s obligation to pay is clear, admitted and undisputed; and

The Defendant’s admission to pay in his letter dated 28th of August 2024 has confirmed that there are no disputed issues; and

The Defendant has no merits in his defend against the Plaintiff’s claim. LEGAL PRINCIPLES: ORDER 27 RULE 3 OF THE COURT RULES 2012 [14] The application made by the Plaintiff is pursuant to Order 27 Rule 3 of the Rules of Court 2012 which provides that where a party has made an admission of facts or liability, the opposing party may apply for judgment based on such admission. Order 27 Rule 3 of the Rules of Court 2012 says: “3. Judgment on admission of facts (O. 27 r. 3)

Where admissions of fact are made by a party to a cause or matter either by his pleadings or otherwise, any other party to the cause or matter may apply to the Court for such judgment or order as upon those admissions he may be entitled to, without waiting for the determination of any other question between the parties, and the Court may give such judgment, or make such order, on the application as it thinks just.

An application for a judgment or order under this rule shall be made by a notice of application.” [15] This court, in perusing and determining the Plaintiff’s application, considered the following principles in pursuant to Order 27 Rule 3 of the Rules of Court 2012: a) Whether the admission made by the defendant was clear, unequivocal, and unambiguous. b) Whether the admission was sufficient to dispose of the matter summarily without requiring further evidence. c) Whether granting judgment on admission would be just and fair in the circumstances of the case. [16] In determining the above principles, and after perusing the application made by the Plaintiff together with affidavits as well as submission filed by both parties, this Court is of the opinion that this case warrant for a judgement being obtained by the Plaintiff by way of Judgement based on Admission. [17] This Court refers to the case of Peng Wei & Anor v. Ambang International Sdn Bhd & Ors [2025] CLJU 786 which held that: “Judgment on Admission of Facts [47] Order 27 Rule 3 of the ROC 2012, provides- "Judgment on admission of facts (O. 27, R. 3 ).

Where admissions of fact are made by a party to a cause or matter either by his pleadings or otherwise, any other party to the cause or matter may apply to the court for such judgment or order as upon those admissions he may be entitled to, without waiting for the determination of any other question between the parties, and the court may give such judgment, or make such order, on the application as it thinks just.

An application for a judgment or order under this rule shall be made by a notice of application.". [48] In the case of Wong Kian Wah v. Ng Kien Boo [2018] CLJU 1013; [2018] 1 LNS 1013; [2018] MLRAU 250, the Court of Appeal held- [6] On the face of admitted facts, it was plainly wrong for the learned Judge to conclude that the plaintiff had not proved the case. Admission can come before the writ is filed, or during the case management, or even during the trial. The pleading rules play little significance when parties to an action actually admit the sum claim and such admission may even be contrary to the pleaded case. This is set out in O. 27 r. 3 of RC 2012, which reads as follows:

"Judgment on admission of facts (O. 27, r. 3 )

Where admissions of fact are made by a party to a cause or matter, either by his pleadings or otherwise, any other party to the cause or matter may apply to the Court for such judgment or order as upon those admissions he may be entitled to, without waiting for the determination of any other question between the parties, and the Court may give such judgment, or make such order, on the application as it thinks just.

An application for a judgment or order under this rule shall be made by a notice of application." [7] A notice of application is not necessary if an order has to be made at the trial. In the instant case, the sum admitted during the trial was not in issue, and in consequence, s. 17 of EA 1950 will entitle a judgment in favour of the appellant as opposed to the dismissal of the plaintiff's claim in totality. [8] For reasons stated above the appeal is allowed with judgment for the plaintiff in the sum of RM2.7 million, with interests, as prayed in the statement of claim, with no order as to costs. Deposit was to be refunded. [49] The Court of Appeal's decision in Wong Kian Wah (supra) clearly held that admissions can come at any time, even before the writ is filed and that "The pleading rules play little significance when parties to an action actually admit the sum claim". [50] Additionally. the Plaintiffs have relied on the case of Lee Ho Ang v. Golden Base Construction Sdn Bhd [2019] CLJU 2098, that held- [7] I am of the following view regarding O. 27 r. 3(1) RC:

a plaintiff may apply to court to enter a judgment or order under O. 27 r. 3(1) RC against a defendant when there is a clear "admission of fact by the defendant (Factual Admission) - please see the judgment of Mohamed Dzaiddin J (as he then was) in the High Court in Ong Gim Huat v. Toh Suan Lin Amy [1992] CLJU 40; [1992] 1 LNS 40; [1992] 4 MLRH 285; [1992] 2 MLJ 610, at 614;

a Factual Admission may be made by a party as follows-

a Factual Admission may be made in a-

Defence; or

(ii) defence to a counterclaim [Defence (CC)];

when a party fails to "traverse" an allegation of fact as follows-

the Defence fails to traverse a factual averment pleaded in

(ii) the Defence (CC) has not traversed a factual allegation pleaded in a counterclaim. [51] Further, in Yam Kong Seng & Anor v. Yee Weng Kai [2014] 6 CLJ 285, the Federal Court held- [15] To enable us to ascertain whether there was a judicial admission we need to refer to para 8 of the defence. It reads as follows: "8... Further defendants 1 & 2 aver that the defendants were ready and willing at all material time to settle the said amount within six months but as there was no mutual agreement as to a fixed rate of interest or whether there was any interest at all, the date of breach was not fixed, and lack of a unequivocal written demand all of which put the whole outstanding sum for repayment in dispute..." [16] The above averment was in response to para 12 of the statement of claim wherein the appellants averred that the company and the respondent had confirmed in writing of the amount owing and payable to them. It is trite law that a judicial admission made in a pleading stands on a higher footing than evidentiary admission (Sarkar's Law of Evidence) with the respondent's admission therein be made the foundation of the rights of the parties (Satish Mohan Bilal v. State of UP [1986] AIR All 126). Any failure on the part of the respondent to rebut the admission to avoid the legal consequences of his admission would entitle the appellants to enter judgment against him. [17] Having perused the defence in particular para 8, we find that there is clear judicial admission of the debt owed. The question that must follow would be whether the respondent was avoiding responsibility to pay up. In Jacob and Goldrein's Pleadings: Principles and Practice [1990] pp 133-134 in dealing with confession and avoidance, the following is stated: Confession and Avoidance Meaning The term 'confession and avoidance' is the description of a plea in the defence which, while expressly or impliedly admitting or confessing or assuming the truth of the material facts alleged in the statement of claim, seeks at the same time to avoid or destroy the legal consequences of those facts. The plea is invoked by alleging fresh or additional facts to establish some legal justification or excuse, or some other ground for avoiding or escaping legal liability. The defendant, as it were, confesses the truth of what is alleged against him but proceed immediately to 'avoid' the effect of such allegations. [18] Having scrutinised the defence we find that the respondent has failed to avoid legal liability. With there being judicial admission by the respondent sufficient to hold him liable to the amount claimed the answer to the first question of law in this appeal must be answered in the positive. [52] Therefore, based on the above cited cases, to invoke Order 27 Rule 3 of the ROC 2012, there must be either an admission of fact made by the Defendants in their Defence or a failure on the part of the Defendants to rebut the allegations made by the Plaintiffs and the admission can also come before the filing of the Writ. [53] Consequently, this Court, upon considering all the relevant facts and submissions, allows Enclosure 46 on the basis of the Defendants' admissions in their Defence and the Defendants' Affidavit in Reply that stated..“ [18] This Court refer to the case of Wong Kian Wah v. Ng Kien Boon [2018] CLJU 1013 [2018] 1 LNS 1013, decided by Court of Appeal, that says: “[6] On the face of admitted facts, it was plainly wrong for the learned judge to conclude that the plaintiff had not proved the case. Admission can come before the writ is filed or during the case management or even during the trial. The pleading rules play little significance when parties to an action actually admits the sum claim and such admission may even be contrary to the pleaded case. This is set out in Order 27 rule 3 of RC 2012 which reads as follows:

"Judgment on admission of facts (O. 27, r. 3 )

Where admissions of fact are made by a party to a cause or matter either by his pleadings or otherwise, any other party to the cause or matter may apply to the Court for such judgment or order as upon those admissions he may be entitled to, without waiting for the determination of any other question between the parties, and the Court may give such judgment, or make such order, on the application as it thinks just.

An application for a judgment or order under this rule shall be made by a notice of application." [19] This Court also refer to another case of Maybank Islamic Bhd v. M-10 Builders Sdn Bhd & Anor [2015] 4 CLJ 526 which held that: “Whether the Issue Of Liability Resolved Pursuant to the Consent Judgement [82] The court was informed by the respective party at the outset that in respect of the case at hand there was already a consent judgment recorded in terms of liability relating to the MOD facility and what was left was for the plaintiff to prove the quantum during the trial. [83] It was the plaintiff's contention that the issue of liability could not be ventilated, as the matter has been resolved vide the consent judgment dated 27 March 2013 ("CJ"). Therefore, it was not opened to the defendants to raise the issue of illegality as the defendants had agreed to enter into the CJ in terms of liability and what was left to be ventilated before this court was the issue of quantum (see pp. 885 to 886 of "B4"). Citing the case of Perwira Habib Bank (M) Bhd v. Penerbitan ASA Sdn Bhd & Ors [1997] CLJU 229; [1997] 1 LNS 229; [1998] 5 MLJ 297 the plaintiff claimed that the doctrine of estoppel would apply to the factual matrix of this case. [84] Further pursuant to O. 27 r. 3 of the Rules of Court 2012 an admission of fact made by a party to a cause or matter either by pleadings or otherwise shall render the court to give judgment in respect of that admission. Therefore, the plaintiff contended that the defendants were estopped from raising the issue of liability as this had been admitted vide the CJ entered into between both the plaintiff and the defendants. [85] The defendants on the other hand submitted that the plaintiff was prohibited from relying on a contract that is prohibited by Shariah. As the murabahah contract was, illegal as shown above I am of the view that despite the CJ having been executed it did not mean that this court had no jurisdiction to decide on the issue of illegality. Learned counsel submitted that pursuant to s. 24 of the Contracts Act 1950, the murabahah contract was null and void and unenforceable against the defendants due to illegality.” [20] This Court in addition to that also refer to the case of Mawar Awal (M) Sdn Bhd v. Kepong Management Sdn Bhd & Anor [2005] 6 MLJ 132 which held that: “[27] (1) Clause 3.3 of the sale and purchase agreement dated 2 April 1999 states that the first defendant 'shall grant' to the plaintiff a power of attorney to be prepared, stamped and registered at the High Court; this was, in fact, a mandatory obligation posed on the first defendant.

The wording of cl. 3.3 of the sale and purchase agreement was clear and unequivocal and the court must give effect to it because the said clause could be specifically enforced without the need of supervision for its performance.” [21] Although this case primarily discussed on Summary Judgment, this case highlights the importance of clear admissions in determining whether a matter should proceed to trial. The court ruled that where an admission is plain and straightforward, judgement should be granted without unnecessary delay. [22] In another case of Bank Negara Malaysia v. Mohd Ismail & Ors [1992] 1 MLJ 400, it was held that: “ Under Order 14 of the Rules of the High Court 1980, when a fact was asserted by one party and denied by another, and such denial was equivocal or lacking in precision or was inconsistent with undisputed contemporary documents or other statements by the same deponent or was inherently improbable in itself, the judge had a duty to reject such assertion or denial, thereby rendering the issue as not triable.” [23] This case established that a judgement on admission should only be granted in cases where the admission is unambiguous and leaves no room for dispute. The court held that if there is any triable issue, the matter should proceed to trial. [24] Refer also to cases of Pasupathy Kanagasaby v. Masterskill (M) Sdn Bhd & Anor & Another Appeal [2017] CLJU 106 [2017] 1 LNS 106, Caveman IT Services Sdn Bhd v. Tokutomi Industries Sdn Bhd [2014] CLJU 617 [2014] 1 LNS 617, TM Technology Services Sdn Bhd v. B.H.O Sdn Bhd [2024] CLJU 916. FINDING OF THIS COURT [25] Upon careful examination of the pleadings, affidavits, and submissions of both parties, this Court found that: a) The Defendant had made express admissions in his Consent Judgement as well as his letter of admission to pay that were material to the Plaintiff’s claim; b) The admissions were not qualified or conditional, thereby satisfying the requirements under Order 27 Rule 3 of the Rules of Court 2012; c) The Defendant failed to provide any valid justification or explanation to retract or challenge the admissions made; and d) There was no necessity for a full trial, as the admissions sufficiently established the Plaintiff’s entitlement to judgement. LEGAL PRINCIPLES: ORDER 18 RULE 19(1)(a)(b)(c) OF THE COURT RULES 2012 [26] The application made by the Plaintiff seeking to strike out the Defendant’s Counter Claim is pursuant to Order 18 Rule 19(1)(a)(b)(c) of the Rules of Court 2012 which says:

Striking out pleadings and endorsements (O. 18 r. 19)

The Court may at any stage of the proceedings order to be struck out or amended any pleading or the endorsement, of any writ in the action, or anything in any pleading or in the endorsement, on the ground that-

it discloses no reasonable cause of action or defence, as the case may be;

it is scandalous, frivolous or vexatious;

it may prejudice, embarrass or delay the fair trial of the action; or

it is otherwise an abuse of the process of the Court, and may order the action to be stayed or dismissed or judgment to be entered accordingly, as the case may be.

No evidence shall be admissible on an application under subparagraph (1)(a).

This rule shall, as far as applicable, apply to an originating summons as if it were a pleading. [27] The Plaintiff initiated an application to strike out the Defendant’s Counterclaim on the basis that it disclosed no reasonable cause of action, was frivolous, vexatious, and constituted an abuse of the court process. And more so, it is contradictory with Consent Judgement entered into by both Plaintiff and the Defendant dated 1st of March 2024. [28] On the other hand, the Defendant opposed the application, arguing that the Counterclaim raised triable issues warranting adjudication. [29] The power of the Court to strike out pleadings is governed by Order 18 Rule 19 of the Rules of Court 2012, which provides that the Court may strike out any pleading that: a) Discloses no reasonable cause of action or defence; b) Is scandalous, frivolous, or vexatious; c) May prejudice, embarrass, or delay the fair trial of the action; or d) Constitutes an abuse of the court’s process. [30] This Court refers to the case of Bandar Builder Sdn Bhd & Ors v United Malayan Banking Corporation Bhd [1993] 4 CLJ 7, which held that striking out applications should only be granted in plain and obvious cases where the claim or defence is "obviously unsustainable. This case held that: “The principles upon which the Court acts in exercising its power under any of the four limbs of O. 18 r. 19(1) Rules of the High Court are well settled. It is only in plain and obvious cases that recourse should be had to the summary process under this rule (per Lindley M.R. in Hubbuck v. Wilkinson [1899] 1 QB 86, p. 91), and this summary procedure can only be adopted when it can be clearly seen that a claim or answer is on the face of it "obviously unsustainable" (Attorney-General of Duchy of Lancaster v. L. & N.W. Ry. Co. [1892] 3 Ch. 274, CA). It cannot be exercised by a minute examination of the documents and facts of the case, in order to see whether the party has a cause of action or a defence (Wenlock v. Moloney[1965] 1 WLR 1238; [1965] 2 All ER 871, CA.). The authorities further show that if there is a point of law which requires serious discussion, an objection should be taken on the pleadings and the point set down for argument under O. r. 3 (which is in para materia with our O. 33 r. 2 Rules of the High Court) (Hubbuck v. Wilkinson) (supra). The Court must be satisfied that there is no reasonable cause of action or that the claims are frivolous or vexatious or that the defences raised are not arguable.” [31] Additionally, in Gulatis Global Business Sdn Bhd v. Qijan Technologies Sdn Bhd & Ors [2025] CLJU 682 it was held that: “Legal Principles on Striking out of Claims [45] The principles governing applications to strike out are well-established in our jurisprudence. In the seminal case decided by the Supreme Court of Bandar Builder Sdn Bhd & Ors v. United Malayan Banking Corporation [1993] 4 CLJ 7; [1993] 1 MLRA 611; [1993] 3 MLJ 36; [1993] 2 AMR 1969, laid down the following principles which were affirmed by the Federal Court in Tan Wei Hong & Ors v. Malaysia Airlines Bhd [2018] 9 CLJ 425; [2018] 6 MLRA 433; [2019] 1 MLJ 59; [2018] 6 AMR 529. The tests being:

It is only in plain and obvious cases that recourse should be had to the summary process under this rule;

This summary procedure can only be adopted when it can be clearly seen that a claim or answer is, on the face of it, "obviously unsustainable";

It cannot be exercised by a minute examination of the documents and facts of the case in order to see whether the party has a cause of action or a defence; and

The court must be satisfied that there is no reasonable cause of action or that the claims are frivolous or vexatious or that the defences raised are not arguable. [46] In coming to its decision to strike out the Plaintiff's claim against the 4th Defendant, this Court was minded as emphasized by the Court of Appeal in Siva rasa Rasiah & Ors v. Che Hamzah Che Ismail & Ors [2012] 1 CLJ 75; [2012] 1 MLJ 473;[2012] 1 AMR 20, at p480: "the stress is not only on the word 'unsustainable' but also on the word 'obviously'... the degree of unsustainability must appear on the face of the claim without having to go into lengthy and mature consideration in detail." [32] In the case of Tuan Haji Ishak bin Ismail v Leong Hup Holdings Berhad & Other Appeals [1996] 1 CLJ 393, the court clarified that the "plain and obvious" standard requires an objective assessment, ensuring that only cases with no reasonable basis are struck out. FINDING OF THIS COURT [33] Upon careful examination of the Defendant’s Counterclaim, it was evident that the pleadings failed to disclose a reasonable cause of action. Certainly, the Consent Judgement entered upon by both Plaintiff and the Defendant are conclusive and binding on both parties, therefore, the Defendant has no triable issue that warrants for a trial. As a matter of fact, the Defendant’s Counter Claim was filed merely intended to delay the execution of the Consent Judgement. [34] Furthermore, the Defendant’s arguments did not sufficiently demonstrate how the Counterclaim could withstand scrutiny under Order 18 Rule 19(1)(a)(b)(c) of the Rules of Court 2012. [35] This Court, therefore, exercised its discretion to strike out the Counterclaim, ensuring that judicial resources were not expended on meritless claims. CONCLUSION [36] Based on the foregoing reasons, and after a thorough and careful evaluation of the 2 applications, this Court is satisfied that the Plaintiff had met the threshold for Judgement on Admission under Order 27 Rule 3 of the Rules of Court 2012 and for a Striking Out of the Defendant’s Counter Claim under Order 18 Rule 19(1)(a)(b)(c) of the Rules of Court 2012. [37] Accordingly, the Plaintiff’s application was granted, and judgment was entered in favors of the Plaintiff. Likewise, the application by the Plaintiff to strike out the Defendant’s Counter Claim is allowed even though the decision to strike out the Defendant’s Counter Claim (Encl 14) was made prior to the decision on Judgement based on Admission (Encl 6), as it causes no miscarriage of Justice due to that both applications are interconnected. [38] In view of the reasons above, this Court beliefs that the decision was made in accordance with established legal principles and judicial discretion. As for cost, this Court has awarded a sum of RM 3,000 to the Plaintiff. Dated: 18th of May 2025 (NORINA BINTI ZAINOL ABIDIN) Judge Civil Session Court (4) Seremban NEGERI SEMBILAN Counsel: For the Plaintiff: Nurul Fatihah Mohamad Arof; Lope Maizura & Co For the Defendant: Praveen Panislevam; Nor Affizza & Co.