Stone World Sdn Bhd v Engareh (M) Sdn Bhd (WA-24NCVC-1237-06/2018)

Plaintiff’s 1st. Affidavit affirmed by their Accounts Manager on 28.6.2018 (‘Plaintiff’s AIS’) (Enclosure 2);

Defendant’s Affidavit in Reply (No.1) affirmed by their Technical

Plaintiff’s 2nd. Affidavit affirmed on 6.8.2018 (Enclosure 10); and

Plaintiff’s 3rd. Affidavit affirmed on 9.8.2018 (Enclosure 11). [3] A Certificate of Urgency (Enclosure 5) was filed by the Plaintiff on 28.6.2018 requesting for an early date for the hearing of the OS in view of the appeals pending in the Court of Appeal against the decision of the High Court on 25.1.2018 which had dismissed the 3 Plaintiff’s appeals against the orders of the Senior Assistant Registrar (‘SAR’) on the assessment of damages. [4] This Court heard oral submissions by learned counsel for the Plaintiff, Mr. Robert Low and learned counsel for the Defendant, Mr. Tan Keng Teck on 13.9.2018. Thereafter, having given full consideration to the Affidavits and written submissions filed as well as the oral arguments, I ordered that the OS be dismissed with costs on 4.10.2018. [5] The Plaintiff being dissatisfied, now appeals against my entire decision. For purposes of these grounds of decision, I shall refer to the Plaintiff as “SW” and the Defendant as “Engareh” so as to avoid any confusion that may arise since I will have to allude to the earlier court judgments and orders involving the same parties. Factual Background [6] The events leading to the filing of the OS began in 2010 and involves several orders of the court. The chronology of events have been well encapsulated in the “Plaintiff’s Outline Submission” dated 27.8.2018 (Enclosure 14) and the “Defendant’s Written Submission” dated 23.8.2018 (Enclosure 12). Therefore, in setting out the chronology, I 4 have made extensive reference to those submissions. In addition, learned counsels had submitted the “Plaintiff’s Skeletal Reply” dated 5.9.2018 (Enclosure 15), the “Defendant’s Skeletal Submission” dated 7.9.2018 (Enclosure 16) and the “Plaintiff’s Final Reply” dated 12.9.2018 (Enclosure 17) as well as the Plaintiff’s ANNEXURE A setting out the three previous orders given by the High Court in the form of a flow chart. [7] According to the Statement of Claim in Suit 85 (refer Exhibit “SAM-4” in the Plaintiff’s AIS), Engareh is in the business of importing and processing of marble and granite stones sourced from countries such as China, Italy, Oman and Spain. From the middle of 2006, Engareh began supplying stones to dealers and wholesalers in the construction material industry. Among the projects in which Engareh had supplied and installed such stones are Marina Bay Sands in Singapore and Moon Light Bay in Penang. [8] In 2008, Engareh had engaged SW to carry out works in cutting and/or processing marble and/or granite stones which were provided and/or supplied by Engareh. Subsequently, their commercial relationship turned sour and this resulted in the commencement of Suit 85 for the return of blocks, slabs and cut to size imported stone 5 materials and compressed marble slabs (‘said materials’) on the basis of conversion and/or wrongful detention of the said materials. [9] The specific prayers pleaded in Engareh’s Statement of Claim are as follows:

an order for SW to deliver-up of the said materials within 14 days or in the alternative, an order that Engareh or its representative be permitted to collect the said materials from SW’s premises in Pasir Gudang, Johor;

an order to assess damages for loss of use of the said materials from 21.8.2010 to the date of return of the said materials;

alternatively, costs of RM486,629.90 incurred by Engareh for the purchase of materials used to replace the said materials held by SW for use in the then current projects; and

an order for the payment of damages for the detention and/or conversion of the said materials and for such damages to be assessed. 6 [10] SW had filed a counterclaim for the sum of RM268,496.54 which premised upon, amongst others, sums due and owing for works carried out in processing of the marble and/or granite stones and transportations charges (which can be seen in the same Exhibit “SAM-4” in the Plaintiff’s AIS). [11] The trial of Suit 85 was held before Prasad Sandosham Abraham JC (as His Lordship then was). On 28.7.2011, His Lordship pronounced judgment upon the following terms:

In respect of Engareh’s claim:

SW to deliver-up the said materials within 14 days or alternatively, Engareh’s representatives be permitted to collect the said materials from SW’s premises in Pasir Gudang, Johor;

(ii) damages for the loss of use of the said materials from 21.8.2010 until the date that the said materials are returned were to be assessed; 7

(iii) an order for the payment of damages for the detention and/or conversion of the said materials and for such damages to be assessed; and

(iv) interest at the rate of 8% on the total damages to be assessed from 21.8.2010 until full settlement; and

SW’s counterclaim was allowed with costs and the total claim and damages were to be assessed by the SAR on the basis of quantum meruit. [12] For purposes of these grounds, I shall adopt the same acronyms as used in the Plaintiff’s Outline Submission. Thus, the above mentioned judgment of His Lordship Justice Prasad Abraham will be referred to as the “Initial Judgment”. The Initial Judgment and the Grounds of Judgment dated 6.10.2011 are shown as Exhibit “SAM-5” in the Plaintiff’s AIS. [13] Thereafter, a clarification session was conducted before His Lordship Justice Prasad Abraham whereby an order was made on 16.7.2013 (‘Clarification Order’; refer Exhibit “SAM-6” of the Plaintiff’s AIS) directing that SW is to deliver-up the said materials to Engareh within 8 30 days from the date of notification of the address for delivery in Johor by Engareh through their solicitors. The other orders of the Initial Judgment were maintained. [14] Almost two years later, in May 2015, Engareh filed a Notice of Application (‘NoA’) seeking the following orders under O. 37, r. and/or O. 92, r. 4 of the Rules of Court 2012 (‘RoC’):

a consequential order to direct the Registrar of the Court to assess damages for the loss of the value of the said materials; and

an order to direct the Registrar of the Court to assess the damages and/or losses granted to Engareh pursuant to the terms of the Initial Judgment and the Clarification Order. [15] The NoA was heard before Justice Nor Bee Arifin (as Her Ladyship then was). On 16.10.2015, Her Ladyship granted an order in terms of the prayers in the NoA (‘Consequential Order’). The Consequential Order and the Grounds of Judgment dated 13.6.2016 in respect thereof are as per Exhibit “SAM-8” of the Plaintiff’s AIS. 9 [16] SW then proceeded to appeal against the Consequential Order. On 18.8.2016, the Court of Appeal dismissed SW’s appeal. [17] Pursuant to the Initial Judgment, Clarification Order and/or Consequential Order, two separate applications for assessment of damages proceedings were commenced by the parties respectively. Trial of these proceedings were conducted jointly before the SAR. [18] On 7.8.2017, the learned SAR ordered that SW pay Engareh a sum of RM3,735,232.97 as damages and Engareh pay SW a sum of RM10,000.00 as nominal damages assessed (‘Assessment Orders’). The Assessment Orders and the Grounds of Judgment by the learned SAR can be seen in Exhibits “SAM-9” and “SAM-10” of the Plaintiff’s AIS. [19] Appeals were lodged to the High Court against the Assessment Orders but these were dismissed on 25.1.2018. Further appeals were filed by SW to the Court of Appeal and at the time when the OS was heard, the appeals had been fixed for hearing on 24.9.2018 (‘Assessment Appeals’). 10 [20] For the sake of completeness, it should also be mentioned that Engareh commenced winding-up proceedings against SW vide Kuala Lumpur High Court Winding-Up Petition No.: WA-28NCC-675- 10/2017 on 10.10.2017 (‘Winding-Up Petition’) for SW’s alleged inability to pay their debt amounting to RM5,529,782.16 comprising the sum of RM3,735,232.97 awarded by the learned SAR based on the Assessment Orders and interest at a rate of 8% per annum from 21.8.2010 until 20.8.2016 based on the Initial Judgment. The Winding-Up Petition is shown as Exhibit “SAM-12” in the Plaintiff’s AIS. [21] On 14.3.2018, the parties entered into a Consent Order wherein it was agreed, inter alia, that the sum of RM5,529,782.16 would be transferred to Engareh’s solicitors to be held as stakeholders pending disposal of the Assessment Appeals and will be released in accordance with the decision of the Court of Appeal. The Consent Order was expressly stated to be without prejudice to any, and all, rights of action which SW may have against Engareh. 11 SW’s contention [22] SW sought to challenge, via impeachment proceedings, the propriety and/or validity of the Consequential Order. It is SW’s contention that whilst the Consequential Order was obtained purportedly on the basis of the Court’s jurisdiction and powers to grant consequential orders, the pith and substance of the Consequential Order as granted is in effect a variation of the Initial Judgment. [23] Learned counsel for SW submitted that although couched and clothed in the guise of an application for consequential orders, the Consequential Order did not come within the purpose of consequential orders and was therefore granted in want of jurisdiction. Hence, the Consequential Order should be set aside pursuant to the principles set out in Badiaddin bin Mohd Mahidin & Anor v Arab Malaysian Finance Bhd [1998] 1 MLJ 393 and/or section 44 of the Evidence Act 1950 [Act 56] [‘Evidence Act’]. [24] In addition, it was submitted that, consistent with the judgments of the Federal Court in Badiaddin and Seruan Gemilang Makmur Sdn Bhd v Kerajaan Negeri Pahang Darul Makmur & Anor [2016] 3 MLJ 1, impeachment proceedings must be by way of a fresh action and the 12 filing of the OS is in accordance with the pronouncements of the apex Court. [25] In light of the factual circumstances in this case, the issues on the applicability of the doctrine of res judicata and estoppel would naturally arise. To this, SW argued that no estoppel arises in instances where the Court giving the initial order/judgment which is sought to be impugned had no jurisdiction to do so in the first place. In this regard, SW contended that unless the issue of jurisdiction was expressly raised and/or challenged, no estoppel will arise against a party seeking to subsequently mount a challenge via impeachment proceedings. SW, it was said, did not specifically raise the issue of jurisdiction and/or challenge the jurisdiction of the High Court in relation to the form and substance of the Consequential Order when opposing the NoA leading to the grant of the Consequential Order. Therefore, the issue of estoppel as against SW does not arise. [26] Apart from the above, SW drew a distinction between claims for conversion and detinue in terms of the reliefs that can be granted. Relying on the authority of Perbadanan Kemajuan Negeri Selangor v. Teo Kai Huat Building Contractor [1982] 2 M.L.J. 165, it was submitted that a successful plaintiff in a claim for conversion would 13 obtain judgment for pecuniary damages only whereas in a claim in detinue, a successful plaintiff would obtain a judgment for delivery-up of the chattel or payment of its value to be assessed, and for payment of damages for its detention. Furthermore, based on the Federal Court decision in the same case, an action in detinue may result in a judgment in one of three mutually exclusive forms as follows:

for the value of chattel as assessed and damages for its detention;

return of the chattel or recovery of its value as assessed and damages for its detention; or

return of the chattel and damages for its detention. [27] SW contended that although the Initial Judgment was in the third form as set out in subparagraph 26(c) above, the Initial Judgment also included an order for delivery-up, which is an order that can only be granted in a claim in detinue. Furthermore, the Consequential Order was in the first form as per subparagraph 26(a) and hence, this amounts to a variation of the Initial Judgment. 14 [28] Relying on Decil Imex Sdn Bhd v Pembinaan Punca Cergas Sdn Bhd [2014] 8 MLJ 61, it is SW’s submission that the power of the court to grant consequential orders is limited to working out the rights declared by the final order of the court. It does not enable the court to deal with matters which do not arise in the course of working out the judgment nor does it allow the court to vary the terms of the order. In this case, it was contended that the High Court had no jurisdiction or power to effectively vary the Initial Judgment from one form to a different form. [29] Flowing from all of the above, Mr. Robert Low submitted that the assessment of damages conducted by the SAR is a nullity and prayed for the Consequential Order and the Assessment Order in relation to the assessment of damages in favour of Engareh be set aside; and the High Court Order dated 25.1.2018 in relation to the appeal filed by SW against the Assessment Order be set aside. Engareh’s contention [30] Engareh urged this Court to consider the points of arguments raised by SW during the previous court proceedings where there were at 15 least six occasions when SW could have raised the issue of want of jurisdiction but did not, namely during the hearing of the –

NoA for the Consequential Order;

appeal against the Consequential Order;

application for assessment of damages;

appeal against the Assessment Orders;

Winding-Up Petition; and

striking out application for the Winding-Up Petition (filed by SW on 7.2.2018 under O. 18, r. 19 RoC and dismissed by the Court on 2.3.2018 as seen in Exhibit “AR-2” of the Defendant’s AIR). Therefore, it was submitted that the OS cannot succeed because SW is caught by the principles of res judicata and issue estoppel. 16 [31] In addition, learned counsel for Engareh submitted that in so far as SW’s challenge on the quantum of damages is concerned, these matters were pending appeal at the Court of Appeal at the time when the OS was heard. The issue of the imposition of decretal interest was adjudicated in the striking out application for the Winding-Up Petition. Hence, these cannot form the basis for impeaching the Consequential Order in the present OS. [32] In response to SW’s contentions as regards Badiaddin’s case, Mr. Tan Keng Teck submitted that in order to set aside the Consequential Order, SW must show that there was a failure on the part of Engareh which contravened a substantive statutory prohibition rendering the Consequential Order null and void on the ground of illegality or lack of jurisdiction. It was further submitted that the inherent and discretionary jurisdiction contemplated in Badiaddin should not be applied in this case because the Consequential Order was not made in blatant defiance of a substantive statutory provision but merely contravened a procedural requirement. [33] In any event, it was submitted that by applying the Federal Court decision in Takako Sakao (f) v Ng Pek Yuen (f) & Anor (No. 2) [2010] 2 MLJ 181, the High Court was fully empowered to grant the 17 Consequential Order and the exercise of that power has in fact been upheld by the Court of Appeal. Furthermore, citing the case of Asia Commercial Finance (M) Berhad v. Kawal Teliti Sdn. Bhd. [1995] 3 CLJ 783, the OS is nothing more than an attempt by SW to re-open a dispute which has been fully ventilated in the High Court and the Court of Appeal and it tantamount to an abuse of the court process. The Law [34] The intitulement in the OS makes reference to section 44 of the Evidence Act and O. 28 and O. 92, r. 4 RoC. [35] Section 44 of the Evidence Act reads as follows: “Fraud or collusion in obtaining judgment or incompetency of court may be proved

Any party to a suit or other proceeding may show that any judgment, order or decree which is relevant under section 40, 41 or 42, and which has been proved by the adverse party, was delivered by a court not competent to deliver it or was obtained by fraud or collusion.”. 18 [36] Sections 41 and 42 of the Evidence Act as referred to in section 44 of the same Act pertain to the relevancy of a final judgment, order or decree of a court in the exercise of its probate, matrimonial, admiralty or bankruptcy jurisdiction; and the relevancy and effect of judgments, orders or decrees other than those mentioned in section 41, respectively. These provisions are of no relevance in the determination of the OS. [37] On the contrary, section 40 of the Evidence Act is of significance in this matter as it codifies the doctrine of res judicata. The doctrine operates to preclude a party from re-agitating in subsequent proceedings a complaint or an issue that has, or could have been disposed of in earlier proceedings between the same parties (see the judgment of Gopal Sri Ram JCA in Chee Pok Choy & Ors v. Scotch Leasing Sdn Bhd [2001] 2 CLJ 321). The said provision is as follows: “Previous judgments relevant to bar a second suit or trial

The existence of any judgment, order or decree which by law prevents any court from taking cognizance of a suit or 19 holding a trial is a relevant fact when the question is whether the court ought to take cognizance of the suit or to hold the trial.”. [38] O. 28 and O. 92, r. 4 RoC set out the OS procedure and the inherent powers of the Court to make any order as may be necessary to prevent injustice or to prevent an abuse of the process of the Court, respectively. [39] In the course of his submissions, learned counsel for SW had referred to O. 45, r. 4 RoC as the remedy that Engareh should have pursued consequent to SW’s failure to deliver-up the said materials in accordance with the Clarification Order. O. 45, r. RoC reads as follows: “Enforcement of judgment for delivery of movable property (O. 45, r. 4)

(1) Subject to these Rules, a judgment or order for the delivery of any movable property which does not give a person against whom the judgment is given or order made 20 the alternative of paying the assessed value of the property may be enforced by one or more of the following means:

a writ of delivery to recover the property without alternative provision for recovery of the assessed value thereof (which is referred to as a “writ of specific delivery” in this rule);

in a case in which rule 5 applies, an order of committal.

Subject to the provisions of these Rules, a judgment or order for the delivery of any movable property or payment of their assessed value may be enforced by one or more of the following means:

a writ of delivery to recover the property or its assessed value;

with the leave of the Court, a writ of specific delivery; 21

in a case in which rule 5 applies, an order of committal.

A writ of specific delivery, and a writ of delivery to recover any movable property or their assessed value, may include provision for enforcing the payment of any money adjudged or ordered to be paid by the judgment or order which is to be enforced by the writ.

A judgment or order for the payment of the assessed value of any movable property may be enforced by the same means as any other judgment or order for the payment of money.”. [40] The explanation for section 44 of the Evidence Act is provided in Augustine Paul’s Evidence: Practice and Procedure, 2nd. Edition, Malayan Law Journal Sdn Bhd, 2000, namely, that any party to a suit or other proceeding may show that any judgment, order or decree which is relevant under section 40, 41 or 42 and which has been proved by the adverse party was – 22

delivered by a court not competent to deliver it; or

obtained by fraud or collusion. Section 44 of the Evidence Act is thus an exception to the doctrine of res judicata as provided for under section 40 of the same Act: see Ramly Ali FCJ in Seruan Gemilang Makmur Sdn Bhd v Kerajaan Negeri Pahang Darul Makmur & Anor [2016] 3 MLJ 1 at page 16. [41] In this OS, SW seeks to show that the Consequential Order was delivered by the High Court on 16.10.2015 in want of jurisdiction and hence, impeachment may lie as established in Badiaddin’s case. His Lordship Mohd Azmi FCJ at page 409 of the report of that case said: “It is of course settled law as laid down by the Federal Court in Hock Hua Bank’s case that one High Court cannot set aside a final order regularly obtained from another High Court of concurrent jurisdiction. But one special exception to this rule (which was not in issue and therefore not discussed in Hock Hua Bank) is where the final judgment of the High Court could be proved to be null and void on ground of illegality of lack of jurisdiction so as to bring the aggrieved 23 party within the principle laid down by a number of authorities culminating in the Privy Council case of Isaacs v Robertson [1985] AC 97 where Lord Diplock while rejecting the legal aspect of voidness and voidability in the orders made by a court of unlimited jurisdiction, upheld the existence of a category of orders of the court ‘…which a person affected by the order is entitled to apply to have set aside ex debito justitiae in the exercise of the inherent jurisdiction of the court, without his needing to have recourse to the rules that deal expressly with proceedings to set aside orders for irregularity, and give to the judge a discretion as to the order he will make’. … For my part, I must hasten to add that apart from rules of natural justice, in any attempt to widen the door of the inherent and discretionary jurisdiction of the superior courts to set aside an order of court ex debito justitiae to a category of cases involving orders which contravene ‘any written law’, the contravention should be one which defies a substantive statutory prohibition so as to tender the defective order null 24 and void on ground of illegality or lack of jurisdiction. It should not for instance be applied to a defect in a final order which has contravened a procedural requirement of any written law. The discretion to invoke the inherent jurisdiction should also be exercised judicially in exceptional cases where the defect is of such a serious nature that there is a real need to set aside the defective order to enable the court to do justice. In all cases, the normal appeal procedure should be adopted to set aside a defective order, unless the aggrieved party could bring himself within the special exception.”. [emphasis added] [42] In the course of His Lordship’s judgment, Ramly Ali FCJ in Seruan Gemilang Makmur Sdn Bhd at pages 17 and 18 of the report had discussed the line of authorities which have established the requirement that the impeachment action must be by way of fresh action. The fact that by filing the OS, SW has fulfilled this requirement was not challenged. 25

Was the High Court empowered to grant the Consequential Order? - The hearing of Engareh’s NoA, the decision and the appeal [43] As stated earlier, Engareh’s NoA seeking consequential orders from the Court was made under O. 37, r. 4 and/or O. 92, r. 4 RoC. The NoA, Affidavit In Support (‘AIS’) affirmed by Engareh’s Director on 18.5.2018, SW’s Affidavit In Reply (‘AIR’) affirmed by their Accounts Manager on 9.6.2015 and Engareh’s Written Submission are shown in Exhibit “SAM-7” of the Plaintiff’s AIS. [44] O. 37, r. 4 RoC provides the power of the Court to order assessment by the Registrar or at trial in the following terms: “The Court may, in the case of any such judgment as is mentioned in rule 1, order either―

that the assessment of the damages shall be made by the Registrar; or 26

that the action shall proceed to trial before a Judge in respect of the damages, and where the Court orders that the action shall proceed to trial, Order 34 shall apply with the necessary modifications.”. [45] According to Engareh’s AIS, the filing of the NoA was necessitated by SW’s failure, refusal and/or neglect to comply with the terms of the Initial Judgment and/or the Clarification Order for the delivery of the said materials. SW challenged the NoA by claiming that the warehouse address given by Engareh’s solicitors refers to a piece of land for phase by phase development and there was in fact no warehouse. Furthermore, it was averred in SW’s AIR that the parties had agreed for the said materials to be collected on 10.12.2012 but on that date, no one from Engareh or their representatives were present at the given address to manage the collection of the said materials. [46] At this juncture, it is critical to note the further averments in SW’s AIR which are as follows: 27 “7. I refer to paragraph 16 of the said Plaintiff’s Affidavit and verily state that although this Honourable Court has ample jurisdiction to make consequential orders, nevertheless a direction for an assessment of damages of loss of the value of the said materials which is still in the Defendant’s warehouse would only cause injustice to the Defendant.

I am advised by the Defendant’s solicitors and verily believe that until the Plaintiff has not collected or taken steps to collect the said materials (stones), Plaintiff cannot proceed with assessment of damages.”. [emphasis added] SW had acknowledged that the Court is seized of jurisdiction to make consequential orders. [47] In the Written Submissions, Engareh’s counsel had referred to Power Root (M) Sdn Bhd v Director General of Customs [2014] 2 MLJ 271, Takako Sakao and Ezzen Heights Sdn Bhd v Ikhlas Abadi Sdn Bhd (Soh Yuh Mian, Intervener) [2011] 4 MLJ 173 as authorities to persuade the Court to exercise its inherent powers under O. 92, r. 28 RoC to prevent an injustice to Engareh who have been denied the fruits of their litigation by SW’s conduct in refusing to deliver the said materials to Engareh according to the terms of the Initial Judgment and the Clarification Order. By retaining possession of the said materials, SW has caused the condition of the same to deteriorate and become fragile due to the impact of weather. Under the circumstances, Engareh was constrained to then seek orders from the Court for assessment of damages for the loss of the value of the said materials apart from assessment of the damages and/or losses granted to Engareh by virtue of the Initial Judgment and Clarification Order. [48] In Her Ladyship’s judgment, Justice Nor Bee Arifin (as Her Ladyship then was) recognised that Engareh filed the NoA as a consequence of SW’s failure to comply with the Initial Judgment and Clarification Order and Her Ladyship also noted that learned counsel for SW did not provide any written submissions although directions were given by the Court (refer paragraphs 5 and 8 of the Grounds of Judgment in Exhibit “SAM-8” of the Plaintiff’s AIS). 29 [49] Next, Her Ladyship proceeded to set out the findings of the Court in the following words: “9. Adalah jelas bahawa setakat pemfailan permohonan ini, defendan masih enggan mematuhi Penghakiman bertarikh 28.7.2011 dan Perintah bertarikh 16.7.2013. Keterangan affidavit defendan menunjukkan sememangnya tidak ada penghantarserahan yang dibuat antara tempoh 1.1.2014 sehingga 31.1.2014 di alamat yang diberikan kepadanya. Tiada sebarang alasan diberikan oleh defendan mengapa mereka gagal berbuat demikian. Dakwaan defendan bahawa tiada gudang bukanlah alasan yang bermerit. Perintah bertarikh 16.7.2013 tidak menghendaki alamat suatu gudang di Johor diberikan tetapi satu alamat penghantaran sahaja. Jika plaintif menyatakan alamat tersebut adalah alamat bagi maksud penghantarserahan bahan-bahan tersebut sebagai mematuhi Perintah bertarikh 16.7.2013, maka menjadi kewajipan dan tanggungjawab defenden untuk menghantarserah ke alamat tersebut, tidak kira sama ada alamat tersebut bukannya suatu gudang tetapi hanya satu tapak tanah pembinaan berperingkat mengikut tafsiran defendan. Pergantungan kepada surat- 30 surat di ekshibit SAM-3 juga tidak bermerit. Kesemua surat tersebut dikeluarkan sebelum Perintah bertarikh 16.7.2013.

Keengganan defendan untuk mematuhi kedua-dua perintah Mahkamah telah lama berlarutan. Plaintif telah dinafikan hasil litigasinya untuk sekian lama. Tidak ada pertikaian bahawa bahan-bahan tersebut berada pada setiap masa yang material dalam milikan defendan. Juga tidak ada pertikaian bahawa keadaan semasa bahan-bahan tersebut semakin teruk terjejas dan mudah pecah (fragile) akibat kesan cuaca. Ini bermakna jika sekali pun defendan mahu menghantarserah bahan-bahan tersebut sekarang, nilai asal bahan-bahan tersebut sudah tentunya begitu merosot atau berkemungkinan tidak langsung membawa apa-apa nilai. Keengganan berterusan defendan dan tindakannya yang dengan jelas dan nyata membelakangkan kehendak Penghakiman dan Perintah tersebut telah menyebabkan ketidakadilan kepada plaintif yang kehilangan manfaat daripada hasil litigasinya.

Adalah undang-undang yang mantap bahawa Mahkamah ini mempunyai bidang kuasa untuk memberikan 31 perintah sampingan (sila rujuk kes Takako Sakao (f) v Ng Pek Yuen (f) & Anor (No.2) 2010 2 MLJ 181, Ezzen Heights Sdn Bhd v Ikhlas Abadi Sdn Bhd (Soh Yuh Mian, intervener) [2011] 4 MLJ 173 Power Root (M) Sdn. Bhd. v Director General of Customs [2014] 2 MLJ 271). Permohonan ini saya benarkan demi menegakkan keadilan kepada plaintif. Saya mengarahkan defendan membayar kos sebanyak RM2,000.00.”. [50] In the final part of the judgment, Her Ladyship addressed the issue of SW having obtained leave to commence contempt proceedings against Engareh’s director under O. 52, r. 3 RoC on 24.8.2015. That issue has no bearing in the determination of the OS which is before this Court. [51] Subsequently, SW filed a Notice of Appeal against the Consequential Order on 4.11.2015. The grounds of appeal set out in the Memorandum of Appeal dated 18.12.2015 are that the learned Judge erred in law and in fact in – 32

granting an order for assessment of damages when a prior order for the return of the material/stones was not complied with by the Respondent and it was premature to order assessment;

proceeding with the application when leave was granted for committal proceedings against the Respondent on similar issues, i.e. the non-compliance of the prior order for the return of the material/stones, and that a contemnor ought not to be heard until he has purged his contempt; and

not considering the factual matrix of the case which shows that there was no warehouse provided for the delivery of the material/stones and the numerous default of the Respondent to take delivery of the stones. [52] Having perused the cause papers and the Grounds of Judgment in relation to the NoA and the Memorandum of Appeal, it is evident that –

SW had every opportunity at the High Court to raise the issue of jurisdiction, the correctness of the Order in the RoC as cited 33 by Engareh in the NoA, the nature of the order sought and anything to that effect but SW did not do so;

the same opportunity arose at the Court of Appeal but again, for reasons only known to SW, the point on the lack of jurisdictional powers to grant the Consequential Order was not brought up;

the Court of Appeal had dismissed SW’s appeal against the

SW did not seek leave to appeal to the Federal Court under section 96 of the Courts of Judicature Act 1964 [Act 91]. [53] Following from the above, it is my considered view that the High Court was empowered to grant the Consequential Order since the Court of Appeal has affirmed the said decision of the High Court. The Consequential Order was granted in the interest of justice to Engareh who was faced with an opponent bent on defying whatever judgment and/or order pronounced by the court. The Court of Appeal in Takako Sakao had reiterated the settled legal position that the court has ample jurisdiction to make consequential orders to give effect to its judgment and to ensure that such judgments in particular cases is not 34 defeated by intervening events (refer to page 184 of the report). Further, the Court of Appeal recognised that the Court have ample jurisdiction to fashion specific relief to meet the justice of the case based on the peculiar facts before the Court as described at pages 185 - 186 of the report in the following words: “In the present case, the appellant and the first respondent as partners, that is to say, as joint venturers, agreed to embark on a joint venture which involved the acquisition of the subject property for the purposes of the partnership, that is to say, the joint venture, and the first respondent with the agreement of the appellant, her co-joint venturer, who believed her to be acting for their joint purposes, acquired the property in her name but subsequently sought to retain the land for her own benefit. Hence, this court regarded her as a constructive trustee. And in the circumstances of the present case, the just and equitable remedy would have been to sell the subject property and to have the net proceeds divided equally between the parties. However, subsequent events have made this impossible as the second respondent who though bound by the constructive trust has unilaterally sold off the subject property and pocketed the 35 purchase price. The property has gone into the hands of a person who is not alleged to have acquired it with notice of the trust in the appellant’s favour. So it cannot now be regained in specie and restitution in integrum decreed. Does this mean that the appellant is bereft of any remedy? We do not think so. We do not think that the second respondent should be allowed to thumb its nose at our judgment.”. [emphasis added] [54] It is pertinent to note that in the present case, there were intervening events and these were largely attributable by SW’s own conduct such that even if the said materials had been delivered to Engareh, the original value of the said materials as contemplated at the end of the trial which led to the order for delivery-up of the said materials within 14 days of the Initial Judgment had been greatly diminished or otherwise rendered completely worthless. Under such circumstances, the Court must surely be empowered under its inherent powers to make such orders as it did and the decision of the Court has been affirmed by the Court of Appeal. 36 - whether the Consequential Order had contravened a substantive statutory prohibition [55] As regards the issue of whether the Consequential Order had contravened a substantive statutory prohibition, learned counsel for Engareh relied on the decision by the Court of Appeal in Tenaga Nasional Bhd v. Prorak Sdn Bhd & Anor [2000] 1 CLJ 553. At page 561 of the law report, the Court held that the default judgment which had been entered against the appellant for the sum claimed together with interest and cost was irregular because it had been entered in breach of an express understanding between counsel and sanctioned by the Court that only the issue of liability was to be tried. It was also held that the default judgment was not an order made in defiance of a statutory provision but it was a final order nonetheless. [56] The necessity to carefully maintain the distinction between a final order of a court tainted by procedural irregularity and one made in contravention of statute had been stressed in the passage from the judgment in Badiaddin’s case as quoted in paragraph 41 above. That distinction was reiterated by Gopal Sri Ram JCA in Tenaga Nasional Bhd in these words: 37 “The inherent jurisdiction in a court to set aside final orders made by it is one that must be exercised with much circumspection. It may be exercised in the case of an order made in contravention of an Act of Parliament. But the jurisdiction does not extend to a final order that is procedurally defective and hence merely irregular.”. [57] Furthermore, His Lordship pointed out the importance to note that Badiaddin was “a case in which the plaintiff had brought a fresh action to rid himself of a final order made in contravention of the Malay Reservation Enactment (FMS Cap 142)” and was therefore an exceptional case. This can be seen in His Lordship’s Mohd Azmi FCJ summary on the reasoning Badiaddin in the following manner: “To summarize, Mohd Noor Abdullah J was correct in law in exercising the inherent jurisdiction of the High Court to set aside ex debito justitae the October 1990 order of Mustapha Hussain J for the following reasons. The third party charge having been lawfully declared invalid by the High Court in 1988 by virtue of s 8(i) of the Enactment, the principal order made in 1990 for restitution of benefits or compensation against the appellants which in effect was an order to 38 enforce an invalid third party security for repayment of loan purportedly decreed under s 66 of the Contracts Act 1950 was made without or in excess of jurisdiction, and in consequence, the order of sale of the appellant’s land could not be sustained. Secondly, the sale order itself was in effect an order of execution to satisfy a judgment by the sale of the reservation land by public auction or private treaty (which should be construed in the circumstances as an order of attachment in execution of the said judgment) and therefore contravened the prohibition imposed by s 13 of the Enactment, a legislation especially permitted and protected by art 89 of the Federal Constitution not only relating to reservation land existing before Merdeka Day, but also in respect of new reservation land.”. [58] However, the accuracy of the terms “exceptional cases” or “exceptional circumstances” was examined by the Federal Court in Serac Asia Sdn Bhd v. Sepakat Insurance Brokers Sdn Bhd [2013] 6 CLJ 673 where it was held as follows: “[31] It is settled law that the High Court cannot set aside a final judgment/order regularly obtained from another High 39 Court unless the judgment was made in defiance of a substantive statutory prohibition which renders it null and void on the grounds of illegality or lack of jurisdiction. Only in that exceptional case can a defective judgment be struck out ex debito justitiae. It is thus only in this situation that a High Court may exercise its inherent jurisdiction to strike out a regularly obtained judgment of another court of concurrent jurisdiction. (see Badiaddin’s case) [32] The Court of Appeal in Selvam Holding said that besides the situation above, Badiaddin seemingly had “extended the scope and extent of the inherent and discretionary jurisdiction of a court” to set aside an order “where in exceptional cases, the justice of the case requires the court to intervene and correct an earlier order that contains a serious defect and there is a need to have it set aside”. [33] We have carefully re-examined Badiaddin and could not find anywhere in its ratio to say that the court’s inherent jurisdiction has an extended scope to correct an earlier regular judgment or order in exceptional circumstances other 40 than where the judgment had been granted in contravention of a statute. … [35] We are thus in agreement with the appellant’s stand that an earlier judgment can only be impeached when it is prohibited by statute; and that Badiaddin to us merely reaffirmed that rule and does not extend the inherent jurisdiction of the court to correct a perfected order or judgment beyond any statutory prohibition. This established rule was explained in Tenaga Nasional which we had earlier adverted to. In our view, that part of the holding of the Court of Appeal in Selvam Holdings should not be interpreted as giving the courts a broad power to set aside a previous perfected orders under the guise of “exceptional cases”. We think that the Badiaddin’s phrase “to intervene and correct a serious defect in the order” should be read in the context of where an order was obtained in a manner which contravened a statute, resulting in that order being illegal or made outside the jurisdiction of the court. It is in this respect that the court’s inherent jurisdiction may be exercised, to strike out an earlier 41 order, ex debito justitiae and without the need for file a fresh suit.”. [emphasis added] [59] Based on the elucidation in Serac Asia, it is incumbent on SW to show that the Consequential Order was granted in contravention of a statute. This, in my opinion, SW has failed to do. Therefore, SW’s challenge against the Consequential Order based on the legal principles in Badiaddin must fail.

(ii) Res judicata and issue estoppel [60] The authorities cited by learned counsel for Engareh on the doctrine of res judicata and issue estoppel certainly lend much weight in reinforcing their points of argument. Peh Swee Chin FCJ in the case of Asia Commercial Finance (M) Berhad had discussed the doctrine of res judicata or the doctrine of estoppel per rem judicatum at length and for present purposes, it is suffice for me to refer to the following passages from His Lordship’s judgment at pages 791 – 793 of the report: 42 “What is res judicata? It simply means a matter adjudged, and its significance lies in its effect of creating an estoppel per rem judicature. When a matter between two parties has been adjudicated by a Court of competent jurisdiction, the parties and their privies are not permitted to litigate once more the res judicata, because the judgment becomes the truth between such parties, or in other words, the parties should accept it as the truth; … The public policy of the law is that it is in the public interest that there should be finality in litigation … … Thus, there are in fact two kinds of estoppel per rem judicatum. The first type relates to cause of action estoppel and the second, to issue estoppel, which is a development from the first type. … The cause of action estoppel arises when rights or liabilities involving a particular right to take a particular action in Court 43 for a particular remedy are determined in a final judgment and such right of action ie. the cause of action, merges into the said final judgment; … … … the issue estoppel literally means simply an issue which a party is estopped from raising in a subsequent proceeding. However, the issue estoppel, in a nutshell, from a consideration of case law, means in law a lot more ie. that neither of the same parties or their privies in a subsequent proceeding is entitled to challenge the correctness of the decision of a previous final judgment in which they, or their privies, were parties. … … There is one school of thought that issue estoppel applies only to issues actually decided by the Court in the previous proceedings and not to issues which might have been and which were not brought forward, either deliberately or due to negligence or inadvertence, while another school of thought 44 holds the contrary view that such issues which might have been and which were not brought forward as described, though not actually decided by the Court, are still covered by the doctrine of res judicata … We are of the opinion that the aforesaid contrary view is to be preferred; it represents for one thing, a correct even though broader approach to the scope of issue estoppel. … It is particularly important to bear in mind the question of public policy that there should be finality in litigation in conjunction with the exploding population; the increasing sophistication of the populace with the law and with the expanding resources of the Courts being found always one step behind the resulting increase in litigation.”. [emphasis added] [61] I am of the view that the principle of issue estoppel that operates in the case before this Court is on the broader approach as explained by His Lordship Peh Swee Chin FCJ. Issues which might have been and which were not brought forward, either deliberately or due to negligence or inadvertence, though not actually decided by the Court, are still covered by the doctrine of res judicata. SW, could, and should, have raised the argument that Engareh’s recourse was under 45 O. 45, r. 4 RoC (enforcement of judgment for delivery of movable property) rather than O. 37, r. 4 and / or O. 92, r. 4 RoC as prayed in the Defendant’s NoA dated 19.5.2015 (exhibit “SAM-7” in the Plaintiff’s AIS) at the hearing of that application but they did not do so. Neither was this point taken up in the appeal. [62] This Court is conscious that the period between the date of the Initial Judgment until the date of the Consequential Order is 4 years and 3 months, and almost 3 years has passed since the date of the Consequential Order until the date of hearing of the OS. In light of the continuous contumelious refusal by SW to comply with the Initial Judgment, Clarification Order, Consequential Order and Assessment Orders, SW should not be allowed to attempt to re-litigate the matter under the guise of an impeachment proceeding. This is an apt case where the public policy aspect in that there should be finality in litigation as is of utmost relevance and must be upheld. The doctrine and principles of res judicata and issue estoppel should apply in the interest of justice to Engareh. 46 Conclusion [63] Based on the foregoing reasons, the OS (Enclosure 1) is dismissed. Costs of RM8,000.00 as prayed for by Mr. Tan Keng Teck and conceded by Mr. Robert Low as a fair amount was awarded to Engareh, subject to payment of the allocatur fee. (ALIZA SULAIMAN) JUDICIAL COMMISSIONER HIGH COURT NCvC 1 KUALA LUMPUR Dated: 24 JANUARY 2019 Counsel for the Plaintiff : Robert Low (Ahmad Shahrizal Abdul Aziz & Ms. Khong Mei-Yan with him) (Messrs. Ranjit Ooi & Robert Low) Counsel for the Defendant: Tan Keng Teck (Messrs. Lim Kian Leong & Co.)