Ss Motor Century Sdn Bhd v 1. ) Wawasan Sinar Gemilang Sdn Bhd (WA-22NCvC-642-11/2023)

WAWASAN SINAR GEMILANG SDN BHD

2.

3.

4.

PHUN BOOI MOOI ... DEFENDANTS GROUNDS OF JUDGMENT (Enclosure 37) [1] This was an application by the 4th Defendant (‘D4’) and 5th Defendant (‘D5’) to strike out the Plaintiff’s Writ and Statement of Claim (‘SoC’) dated 15.11.2023 pursuant to limbs (a) to (d) of O. 18, r. 19(1) of the Rules of Court 2012 (‘RC 2012’). 27/05/2025 10:04:45 WA-22NCvC-642-11/2023 Kand. 86 [2] The Plaintiff is a company incorporated under the Companies Act 1965 with its registered address at No. 4-1, Suite 2, Bangunan Simvest, Jalan Seri Bintang 4 (7/36), Bukit Sri Bintang, 52100 Kuala Lumpur and business address at 6, Jalan Metro Perdana Barat 11, Taman Perindustrian Sri Edaran, 52100 Kuala Lumpur (‘Plaintiff’s Factory’). The Plaintiff is in the business of wholesaling and trading of motorcycle spare parts. [3] The 1st Defendant (‘D1’) is also a company incorporated under the Companies Act 1965 with its registered address at No. 19 (Suite A), Jalan Forest Heights 8, Forest Heights, 70450 Seremban, Negeri Sembilan and business address at No. 6, Jalan 9/34B, Off Jalan Kepong, Sri Edaran Industrial Park, 52100 Kuala Lumpur (‘D1’s Factory’). D1 carries out paper coating and varnish works at D1’s Factory, which is adjacent to the Plaintiff’s Factory. [4] The 2nd Defendant (‘D2’) and 3rd Defendant (‘D3’) are the directors of D1. [5] D4 and D5 are the registered owner of the property known as PN26981, Lot 55065, Mukim Batu, Daerah Kuala Lumpur (‘Property’) where D1’s Factory is located. [6] The Plaintiff alleged that, on 24.8.2023, a fire which originated from D1’s Factory had spread to the Plaintiff's Factory. The Plaintiff's workers contacted the Fire and Rescue Department (‘FRD’) and the firemen extinguished the fire. [7] The Plaintiff was informed by the FRD that the source of the fire was because there had been a “resistance heating” on the motor of the machine in D1’s Factory, which is attributed to the flammable material around the machine. [8] Due to the damage from the fire, the Plaintiff's Factory could not be used and occupied, thus resulting in loss of business to the Plaintiff. The Plaintiff brought this action against D4 and D5 as the landowners. [9] It is undisputed fact that the Plaintiff had signed the Discharge, Indemnity and Subrogation Form dated 13.12.2023 with Takaful Ikhlas General Berhad (‘Takaful Ikhlas’) and the Property Discharge and Subrogation Forms dated 23.1.2024 with Generali Insurance Malaysia Berhad (‘Generali’). [10] Pursuant to the abovementioned Forms, the Plaintiff was paid RM1,462,383.27 by Takaful Ikhlas and RM3,661,995.42 by Generali. [11] On 11.6.2024, Takaful Ikhlas and Generali made a claim for the said amounts against D1 vide Suit No. WA-22NCC-386-06/2024 (‘Suit 386’). Suit 386 was transferred from the Commercial Division of the Kuala Lumpur High Court to this Court on 8.10.2024 and registered as Civil Suit No. WA-22NCvC-174-03/2025 (‘Suit 174’). On 17.3.2025, an order was made for the present suit to be heard together with Suit 174. [12] The cause papers in relation to encl. 37 are as follows:

Notice of Application dated 17.7.2024 (encl. 37);

D4’s and D5’s Affidavit In Support (‘AIS’) affirmed by D5 on 16.7.2024 (encl. 36);

the Plaintiff’s Affidavit In Reply (‘AIR’) affirmed by its Director, See Soo Sien on 13.8.2024 (encl. 38); and

D4’s and D5’s AIR affirmed by D5 on 30.8.2024 (encl. 40). [13] D4 and D5 relied on all four limbs under O. 18, r. 19(1) of the RC 2012 in their attempt to strike out the Writ and SoC, which reads as follows: “Striking out pleadings and endorsements (O. 18, r. 19)

(1) 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.”. [14] D4 and D5 contended that the Plaintiff has no reasonable cause of action against them and the claim against them is frivolous, vexatious and an abuse of court process because –

the relationship between D1, D4 and D5 is one of landlord and tenant and vicarious liability cannot attach to D4 and D5 as there is no employer-employee relationship between D1, D4 and D5;

D4 and D5 are not responsible for the operation and maintenance of the machines on the Property. This responsibility lies solely with D1 and D1 is not an agent or servant of D4 and

the Plaintiff has no locus standi to bring the suit against D4 and D5, having subrogated all of its right and remedies for any claim in respect of the fire incident to Takaful Ikhlas and Generali. [15] The Plaintiff retorted that D4’s and D5’s contentions are baseless and without merit for the following reasons:

as a tenant of D1’s Factory, D1 is a servant and/ or agent to the owner of D1’s Factory who are D4 and D5 and therefore, D4 and D5 are vicariously liable to the Plaintiff [see Wong It Yong v Lim Gaw Teong & Anor [1969] 1 MLJ 79 (FC)]. Furthermore, D1 was carrying out the works, which led to the fire, with D4’s and D5’s consent; and

the Plaintiff has the right to bring the action against D4 and D5 regardless of the subrogation of rights (see paragraphs 129 and 136 - 139 in the judgment in Dr Kok Choong Seng & Anor v Soo Cheng Lin & Another Appeal [2017] 10 CLJ 529). [16] In considering the instant application, I am guided by the trite legal principles as follows:

it is only in plain and obvious cases that recourse should be had to the summary process under O.18, r. 19(1) of the RC 2012, namely where a claim is on the face of it obviously unsustainable. The degree of unsustainability must appear on the face of the claim without having to go into lengthy and mature consideration in detail of the issues of law and/ or fact. The summary procedure 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. The court must be satisfied that there is no reasonable cause of action or that the claims are frivolous or vexatious [see Bandar Builder Sdn Bhd & Ors v United Malayan Banking Corporation Bhd [1993] 3 MLJ 36 (SC) and Seruan Gemilang Makmur Sdn Bhd v. Kerajaan Negeri Pahang Darul Makmur & Anor [2016] 3 CLJ 1 (FC)]. The discretionary power may only be exercised in plain and obvious cases where the case has no chance of success [see Pengiran Othman Shah Bin Pengiran Mohd Yusoff v Karambunai Resorts Sdn Bhd (formerly known as Lipkland (Sabah) Sdn Bhd) [1996] 1 MLJ 309 (CA]. So long as the SoC discloses a reasonable cause of action, however weak the claim is, it cannot be struck off summarily [see Abdul Rahim Abdul Hamid & Ors v Perdana Merchant Bankers Bhd & Ors [2000] 2 CLJ 457 (CA), Dato’ Raja Ideris Raja Ahmad & Ors v Teng Chang Khim & Ors [2012] 2 CLJ 288 (CA)]. The court will assume that the contents of the statement of claim are true [see Tuan Haji Ishak Bin Ismail & Ors v Leong Hup Holdings Bhd and

in determining an application pursuant to limb (a) of O.18, r. 19(1) RC 2012, O. 18, r. 19(2) provides that no evidence shall be admissible on an application under the said limb. This means that limb (a) must be considered without having regard to the AIS and AIR. The court must be satisfied that the statement of claim as it stands is insufficient, even if proved, to entitle the plaintiff to the relief which it asked for (see Thong & Anor v Saw Beng Chong [2013] 3 MLJ 235 (CA) and Amanah Raya Bhd v. Ong Chin Hoo [2019] 6 CLJ 41);

in the context of limb (b) of O.18, r. 19(1) RC 2012, the word “scandalous” means wholly unnecessary and irrelevant and not merely unpleasant allegations. The words “frivolous or vexatious” refer to a groundless action of statement with no prospect of success, often raised to embarrass or annoy the other party to the action. The court has to consider the affidavit evidence adduced by the parties (see Harapan Permai Sdn Bhd v Sabah Forest Industries Sdn Bhd [2011] 2 MLJ 192 (CA) and Thong’s case (supra)];

if a party introduces a pleading which is unnecessary or tends to delay, prejudice or embarrass the trial, the pleading becomes one which is susceptible to be struck out pursuant to limb (c) of O.18, r. 19(1) RC 2012. A pleading becomes embarrassing when it is not clear what is being pleaded (see Duta Arif Sdn Bhd & Ors v Chartered Development Corp & Ors [2008] 6 MLJ 139); and

as regards limb (d) of O.18, r. 19(1) RC 2012, an abuse of the process of the court refer to situations where the court’s process is used for an unlawful object and not for the actual purpose intended to achieve justice. The judge is entitled to consider the affidavit evidence [see Thong’s case (supra)]. [17] The Plaintiff pleaded, among others, that D4 and D5 owe a duty of care towards the Plaintiff, and that they have breached the said duty and committed negligent acts against the Plaintiff. It was further pleaded in the alternative that D4 and D5 failed to ensure the fire, which is a nuisance, did not escape from D1’s Factory, and this in turn had caused the fire at the Plaintiff’s Factory. As a result of D4’s and D5’s breach of the duty of care, the Plaintiff is said to have suffered damage and loss to the Plaintiff’s Factory. D4 and D5, being the owner of the D1’s Factory, are alleged to be vicariously liable towards the Plaintiff. This is due to the fact that “… the 1st Defendant, as a tenant of the Defendant’s Factory, is a servant and/or agent to the owner of the Defendant’s Factory who are the 4th and 5th Defendants. …” (see paragraphs 19, 20, 21, 21A, 22, 23, 24, 28 and 29 of the SoC). [18] After having considered the Plaintiff’s pleaded case against D4 and D5 in the SoC, the affidavit evidence [only for the application pursuant to all the limbs under O. 18, r. 19(1) of the RC 2012 except for limb (a)] and the submissions of the Plaintiff, D4 and D5, I allowed the application in encl. 37 primarily on the ground that I accepted D4’s and D5’s argument that vicarious liability cannot attach to D4 and D5. [19] The learned counsel for D4 and D5 relied on the decision by the English Court of Appeal in Mohamud v WM Morrison Supermarkets PLC [2014] 2 All ER 990 where a two-stage test was approved. The first stage involves a consideration of the relationship between the primary wrongdoer and the person alleged to be liable, and whether that relationship is capable of giving rise to vicarious liability. The second stage relates to whether there is a sufficiently close connection between the wrongdoing and the employment so that it would be fair and just to hold the employers vicariously liable. [20] Pursuant to the Tenancy Agreement dated 5.12.2022 (exhibit “PBM- 1”, encl. 36), the relationship between the Plaintiff, D4 and D5 is merely one of landlord and tenant. In the absence of an employer – employee relationship between the Plaintiff, D4 and D5, there is no nexus between them which is capable of giving rise to vicarious liability on the part of D4 and D5. [21] Additionally, D4 and D5 have no control of D1’s business operation and they are not responsible in operating and maintaining the machinery in D1’s Factory on the Property. D1 cannot be said to be the agent or servant to D4 and D5. [22] The factual matrix in Wong It Yong (supra) was a motor vehicle accident and the question which arose at the trial was whether the owner of the car was liable for the negligence of the driver. The learned trial judge found that the owner was vicariously liable for the driver’s negligence and this decision was affirmed on appeal. The Federal Court held that it was to the advantage of the owner who wanted to sell the car, to allow the intending purchaser to test drive the car for one or two days and therefore when the accident happened, the driver was driving the car partly, if not wholly, on the owner’s business or for the owner’s purposes. In arriving at the decision, the Court referred to the following passage by Denning L.J. in Ormrod’s case [1953] 2 All ER 753 at p 754: “It has often been supposed that the owner of a vehicle is only liable for the negligence of the driver if that driver is his servant acting in the course of his employment. That is not correct. The owner is also liable if the driver is his agent, that is to say, if the driver is, with the owner’s consent, driving the car on the owner's business or for the owner’s purposes. In the present case the driver was, by mutual arrangement driving the car partly for his own purposes and partly for the owner’s purposes. …”. [23] As submitted by D4 and D5, Wong It Yong involves the scenario of an owner and the driver of a vehicle rather than land owners and the tenant. No other case authority was submitted by the Plaintiff to support its defence to the striking out application. [24] Based on the foregoing reasons, D4’s and D5’s application was allowed under limbs (a), (b) and (d) of O. 18, r. 19(1) RC 2012. Costs of RM3,000.00 was ordered to be paid by the Plaintiff to D4 and D5, subject to allocator. [25] On a final note, at the time of penning these grounds of judgment, the trial for this suit and Suit 386 had commenced on 22.4.2025 where the 1st witness for the Plaintiff in the present suit has completed his evidence. One day before the trial, the Plaintiffs in Suit 174 (Takaful Ikhlas and Generali) had filed an application pursuant to O. 15, r. 6 and O. 92, r. 4 of the RC 2012 (encl. 58) for an order that D4 and D5 in the instant suit to be added as defendants in Suit 174. The application was heard on 5.5.2025 and order in terms was granted. It is observed that, in support of the application, the Plaintiffs had relied on the case authorities of Sri Inai (Pulau Pinang) Sdn Bhd v Yong Yit Swee & Ors [2003] 1 MLJ 273, Lim Leng Neo and Others v Syed Ahmad bin Omar bin Yahya [1913] 1 MC 21 and Billion Origin Sdn Bhd v Newbridge Networks Sdn Bhd & Anor (Yap Burgess Rawson International Sdn Bhd, third party) [2006] 6 MLJ 768, all of which were not cited by the Plaintiff in respect of the current application in encl. 37. Dated: 23 May 2025 (ALIZA SULAIMAN) Judge High Court in Malaya (NCvC2) Kuala Lumpur Counsels/ Solicitors: For the Plaintiff: Dinesh Nandrajog (Sara Anne Lee Xin with him) Messrs. Nandrajog Advocates & Solicitors 3-9-9, Tower 3, UOA Business Park No. 1, Jalan Pengaturcara U1/51A Section U1 40150 Shah Alam Selangor For the 4th and 5th Defendants: Thayakugan Rajendram (Sabrina Ameen with him) Messrs. Othman Hashim & Co Advocates & Solicitors 6th Floor, Wisma Kah Motor No. 566, Batu 3 ½, Jalan Ipoh 51200 Kuala Lumpur