Tan Kian Soon v MD Zukri Bin Sallleh (BA-12ANCC-25-10/2016)

This is an appeal by the Appellant (the Plaintiff), against the Sessions Court’s decision in dismissing the Appellant’s Notice of Application for Summary Judgment against the Respondent (the Defendant), on 30.9.2016.

The Appellant’s application under Order 14 of the Rules of Court 2012 (ROC 2012) is for a claim of RM518,203.00 with interest at 5% per annum from 8.10.2012 until judgment and 5% per annum from the date of judgment until full settlement and cost.

This appeal is heard together with the other appeal, case number BA- 12ANCC-31-12/2016 between the same parties, where the Appellant is appealing against the Sessions Court’s decision which dismissed the Appellant’s Notice of Application to strike out the Respondent’s counterclaim under Order 18 rule 19 of the ROC 2012. The Respondent had filed a counterclaim against the Appellant for a sum of RM2,600,000.00.

For ease of reference, in this judgment, the parties will be referred to as they were in the Sessions Court. 3

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

The Plaintiff is an individual having its address is at No. 15, Jalan BJ/29, Taman Balakong Jaya, 43200 Cheras, Selangor.

The Plaintiff claimed that by a letter of 9.4.2012 from the Pejabat Pengarah Tanah dan Galian, Wilayah Persekutuan (the “Local Authority”) to the Defendant, the Local Authority had agreed to grant a title of a piece of land, Lot 165, Jalan Jelatek, Seksyen 88, Bandar Kuala Lumpur (the said Land) to the Defendant. According to the Plaintiff, before the title of the said Land can be issued to the Defendant, the Defendant is required to pay a premium of RM518,203 in accordance with Form 5A and the Plaintiff advanced the sum RM518,203.00 on Defendant’s request, on or around 8.10.2012 and the Form 5A dated 9.4.2012 following section 81 and section 82 of the National Land Code 1965 was issued to the Defendant.

The particulars of Plaintiff’s claim (at page 16 of the Appeal Record): “a) Cukai tanah bagi tahun pertama RM 621.00 b) Bayaran Premium 5A RM 517,192.00 c) Bayaran Ukur RM 250.00 d) Lain-lain bayaran RM 140.00 RM 518,203.00” 4

The Plaintiff claimed that in return for the monetary advancement, the Defendant agreed to sign a formal agreement where the terms were among others, the Plaintiff is to be appointed with the Power of Attorney to act for and behalf for the Defendant for the said Land; the said Land is to be sold off and the proceeds are to be divided between them where Defendant will repay Plaintiff RM517,901.00 and the balance will be divided equally between the Plaintiff and the Defendant.

The Plaintiff claimed that the Defendant refused to sign the agreement and the sum of RM518,203.00 failed to be repaid to the Plaintiff.

The Plaintiff also claimed that in the alternative, the payment made to the Local Authority for RM518,203.00 for the issuance of the title of the said Land had benefitted the Defendant and was never intended to be paid as gratuitous, hence the Defendant is responsible to return the advancement of RM518,203.00 to the Plaintiff based on section 71 of the Contracts Act 1950.

The Defendant denied that the he had agreed to any monetary advancement from the Plaintiff and claimed that there was no agreement to sign any contract with the Plaintiff nor did he direct the Plaintiff to advance the amount of RM518,203.00 for the said Land. 5

The Defendant also claimed that in the alternative, the Plaintiff may on its own personal capacity or willingness, advanced the RM518,203.00 to the Defendant without the Defendant’s knowledge in order to get Defendant’s assistance for projects where the Defendant had access and/or the Plaintiff felt obliged to repay for Defendant’s assistance for successfully getting the projects which benefitted the Plaintiff (paragraph 4.3, pages 20- 21 of Defendant’s Defence, Appeal Record).

The Defendant claimed that the Plaintiff had guaranteed to give money of RM2,600,000.00 as an incentive or for the return of Defendant’s assistance in getting the projects and honorary which will be proven during the trial. The Defendant claimed that the Plaintiff had agreed during one negotiation between the Plaintiff and the Defendant, in the presence of one Tengku Ibrahim, the Plaintiff will pay the Defendant RM1,000,000.00 as full settlement but the Plaintiff failed to pay and the Defendant is claiming for the RM2,600,000.00.

The Defendant then filed a counterclaim against the Plaintiff for a sum of RM2,600,000.00 alleging that the Plaintiff had given an undertaking to the Defendant for successfully obtaining all the projects and the honorary which the projects are as listed Defendant’s Defence and Counterclaim (paragraphs 4.3 – 4.5 of Defence and Counterclaim at pages 21-23 Appeal Record). 6 Plaintiff’s Submission [6] The learned counsel for the Plaintiff advanced several grounds for this appeal and the main contention is that the Session Judge had failed to consider the Plaintiff’s alternative claim against Defendant under section 71 of the Contracts Act 1950 which is for the refund of the premium and other miscellaneous charges. The Plaintiff’s counsel relied on the Privy Council case of Siow Wong Fatt v Susur Rotan Mining Ltd & Anor [1967] 2 MLJ 118 on the four conditions that must be satisfied to establish a claim under section 71 which was also followed by the Supreme Court in the case of New Kok Ann Realty Sdn Bhd v Development & Commercial Bank Ltd., New Hebrides (in liquidation) [1987] 2 MLJ 57. [7] It was submitted by the Plaintiff’s counsel that the four conditions had been satisfied, that the Plaintiff’s act by paying the said Land’s premium and other miscellaneous charges were lawful, that the payment enabled the Defendant to obtain the title to the said Land, the payment was not intended to be done gratuitously and it was submitted that the Defendant enjoyed the benefit from the Plaintiff’s act. [8] It was also averred by the Plaintiff’s counsel that based on the principle of unjust enrichment following the case of Sediaperak Sdn Bhd v Baboo Chowdhury [1999] 5 MLJ 229, the Plaintiff’s payment which was not done gratuitously had unjustly enriched the Defendant as owner of the said Land without returning the sum of RM518,203.00 to the Plaintiff. 7 [9] The Plaintiff’s counsel contended that the Defendant’s affidavit in reply were merely bare denials and the Defendant had made contradictory statement in its application to remove the private caveat entered by Plaintiff (page 84 of the Appeal Record) by stating that the Defendant had paid the premium whereas in his Defence (paragraph 4.3 of Defence and Counterclaim, page 20 of Appeal Record), it was stated that the payment was made by Plaintiff in exchange for Defendant’s assistance. Defendant’s Submission [10] The learned counsel for the Defendant submitted that the contract exhibited by the Plaintiff is not a valid contract under section 10 of Contracts Act 1950 and there was no consent from both parties to the contract which was not denied by the Plaintiff. It was also contended that the Plaintiff failed to prove that there was an intention to create legal relations between the Plaintiff and the Defendant, relying on the case of

Ismail bin Mohd Yunos & Anor v First Revenue Sdn Bhd [2000] 5 MLJ It was also argued that the Plaintiff failed to satisfy the elements of a contract under section 3 of the Contracts Act 1950. [11] The Defendant’s counsel in its submission argued that the Defendant denied all the evidence adduced by the Plaintiff and asserted that the Plaintiff had failed to prove the existence of monetary advancement of RM518,203.00 as there were no words stating that it was made by Plaintiff to the Defendant (pages 88 – 96 of Appeal Record). The Defendant’s counsel also contended, among others, that the cheque is not the same as the receipt (page 89 of Appeal Record) as the cheque number states 8 “017908” whereas the receipt number is “019232”. In addition, the cheque was issued under the name of ‘HSBC Amanah Malaysia Bhd’ without stating the purpose of its payment which is for the premium under Form 5A as alleged by the Plaintiff. [12] The Defendant’s counsel contended that the Defendant has a defence as the Plaintiff’s claim is doubtful and can only be proven at the trial, referring to the Federal Court’s case of Ng Yik Seng & Anor v Perwira Habib Bank Malaysia Berhad [1980] 2 MLJ 83. THE SESSIONS COURT’S DECISION [13] Some of the decision of the Sessions Court is reproduced here as follows: “Mahkamah berpendapat defendan telah membangkitkan isu fakta dan memplidkan juga butir-butir projek yang telahdidapatkan bagi manfaat plaintif. Mahkamah mendapati isu-isu yang ditimbulkan oleh defendan itu adalah isu yang boleh dibicarakan. Malahan Defendan juga telah membuat tuntutan balas yang jumlahnya melebih dari tuntutan plaintiff bagi “set off” jumlah yang didahulukan oleh plaintif bagi mendapatkan hartanah tersebut yang kemudiannya untuk dijual dan hasilnya untuk dibahagi dua dan dikongsikan bersama-sama. Mahkamah berpendapat jikalau pun tuntutan balas itu dibicarakan di Mahkamah ini maka defendan hendaklah bersetuju untuk suatu award yang dalam bidang kuasa Mahkamah Sesyen sahaja dan 9 Mahkamah ini tidak ada bidang kuasa untuk memerintahkan jumlah yang melebihi amaun RM1 juta.

Mahkamah berpendapat oleh kerana semua isu tersebut adalah isu fakta dan percanggahan adalah ketara, maka Mahkamah berpendapat isu ini perlu dibicarakan secara perbicaraan penuh dengan pihak-pihak memanggil saksi-saksi dan mengemukakan keterangan dokumen bagi menyokong pernyataan mereka. Mahkamah berpendapat kes ini tidak sesuai diadili secara perbicaraan melalui affidavit. Mahkamah berpandangan merit kes plaintif dan defendan wajar didengar bagi menilai keterangan semua pihak secara keseluruhan. ……… ………

Mahkamah berpendapat pengataan defendan mempunyai percanggahan apabila dalam pembelaannya di perenggan 4.3 beliau mengatakan “kemungkinan plaintif dengan kerelaanya membayar RM518,203.00 tanpa pengetahuan defendan kerana ingin dapatkan bantuan bagi projek-projek lain yang defendan ada akses/ mungkin rasa terhutang budi atas jasa dan pertolongan defendan yang telah berjaya mendapatkan projek untuk plaintif..”, sebaliknya dalam affidavit defendan pula beliau menafikan telah menerima wang sejumlah yang dinyatakan di atas. Dalam pembelaanya defendan memberi gambaran beliau sememangnya 10 ada terima wang yang telah didepositkan itu namun ianya bukan untuk tujuan penjualan hartanah sebaliknya untuk bayaran lain seperti mana yang dinyatakan. Namun dalam affidavitnya pula defendan menafikan telah menerima wang tersebut atas beberapa alasan iaitu nama defendan tidak dicatatkan di atas cek tersebut selain tujuan bayaran juga tidak dinyatakan dan bercanggah dengan apa yang dinyatakan oleh plaintif, wang pos tiada butiran penerima dll alasan lagi.

Mahkamah berpendapat suatu perbicaraan penuh perlu dijalankan utnuk menentukan pihak manakah yang bercakap benar dan yang boleh membuktikan alegasi dan fakta masing-masing. Pada pendapat Mahkamah, oleh kerana fakta tersebut telah ditimbulkan oleh defendan, maka beban bukti adalah atas defendan untuk membuktikan tuntutan balas beliau. Oleh yang demikian pendengaran secara perbicaraan penuh adalah forum yang wajar dan sesuai bagi memutuskan semua isu yang telah dibangkitkan tersebut. ….. Oleh yang demikian, atas alasan-alasan tersebut, Mahkamah menolak permohonan tersebut dengan kos RM3000-00.” 11 THE COURT’S FINDING [14] There are preliminary requirements to be followed for an application under Order 14 ROC 2012. The burden is on the plaintiff to prove and once the burden is discharged by the plaintiff, the onus then shifts to the defendant to raise triable issues. This was decided in the Federal Court case of Cempaka Finance Bhd v Ho Lai Ying (trading as KH Trading) [2006] 2 MLJ 685. The Federal Court in an earlier case of National Company For Foreign Trade v Kayu Raya Sdn Bhd [1984] 2 MLJ 300 held that, in order for the Plaintiff to satisfy the preliminary requirements, the plaintiff will have to establish a prima facie case and he will then be entitled to the judgment. The burden then shifts to the defendant to satisfy the Court why the judgment should not be given to the plaintiff, that there is a triable issue or some other reason that there ought to be a trial. [15] It is of pertinence to note that in this case, it would be for the Plaintiff to prove that it has a prima facie case that the Defendant is legally liable to pay the sum of RM518,203.00. Based on the Federal Court’s decision in National Company for Foreign Trade (supra) case, the preliminary requirements are:

The defendant must have entered an appearance;

The statement of claim must have been served on the defendant; and 12

The affidavit in support of the application must comply with the requirements of Rule 2 of Order 14. Following the case of National Company for Foreign Trade (supra), unless the plaintiff satisfies either of the three requirements, the applications may be dismissed. [16] Based on ‘Malaysian Court Practice, Rules of Court 2012, Desk Edition 2017’, for an application under Order 14 rule 2 of ROC 2012, the plaintiff is not required to proof that there is triable issue, it is for the plaintiff to state his belief in the affidavit that there is no defence to the claim. In reference to the requirements laid out in National Company for Foreign Trade (supra) case, this Court finds that the Plaintiff had fulfilled the preliminary requirements and the Plaintiff had in its Affidavit stated its belief that the Defendant has no defence to this claim (paragraph 17 of Plaintiff’s Affidavit, page 74 of Appeal Record). [17] The Plaintiff’s Additional Affidavit of 15.9.2016 stated that the monetary advancement for the said Land which benefitted the Plaintiff was not intended to be gratuitous and demanded for the return of the amount RM518,203.00 in accordance with section 71 of the Contracts Act 1950. Following section 71 of the Contracts Act 1950, “Where a person lawfully does anything for another person, or delivers anything to him, not intending to do so gratuitously, and such other person enjoys the benefit thereof, the latter is bound to make 13 compensation to the former in respect of, or to restore, the thing so done or delivered.” The Plaintiff claimed that the payment for the said Land was done lawfully and was not intended as gratuitous. The Plaintiff’s act of objection by entering a private caveat and under statutory declaration shows its objection to the Defendant in taking the said Land. Based on the Privy Council’s case of Siow Wong Fatt (supra) as submitted by Plaintiff’s counsel, that such payment as alleged by the Plaintiff for the Defendant was lawful and was not gratuitous indeed benefitted the Defendant. This Court finds that the plaintiff had established its claim under section 71 of the Contracts Act 1950. [18] Turning to the evidence, upon careful perusal of the Plaintiff’s Amended Statement of Claim, the evidence submitted by the Plaintiff comprising the receipts for the premium paid, the bank draft of HSBC by the Plaintiff, the caveat application on the said Land with the statutory declaration by the Plaintiff (pages 123 – 125 of the Appeal Record), proved to show the consistency in the Plaintiff’s claim. The HSBC cheque of the Plaintiff dated 3.10.2012 to HSBC Amanah Malaysia Berhad (page 92 of the Appeal Record) bears the exact amount for the required premium and the bank draft to the Local Authority bears the Plaintiff’s cheque number of 56-14019. However, the amount on the bank draft is more than the premium amount and the cheque issued, stating RM517, 912.00 (page 93 of the Appeal Record), to which based on Plaintiff’s pleading, the amount of RM517,902.00 be returned to Plaintiff (paragraph 7(c)(i) of Amended Statement of Claim, page 16 of the Appeal Record). The Plaintiff in its 14 Affidavit, stated its belief that the defendant has no defence to this claim (paragraph 17 of Plaintiff’s Affidavit, page 74 of Appeal Record). [19] This Court also finds that the Plaintiff did not claim for contractual relationship nor the existence of a power of attorney but for the return of the advancement based on a failed monetary arrangement (paragraphs 11 and 12 of Affidavit in Support, page 73 of the Appeal Record). The caveat entered by the Plaintiff on the said Land dated 15.1.2015 stating that the Plaintiff had paid the Defendant the sum of money RM517,901.00 for the title to be registered and claimed that the Defendant had agreed to transfer to the Plaintiff in exchange for development, together with Plaintiff’s Statutory Declaration under section 21 of the Statutory Declaration Act 1960 (pages 123-125 of Appeal Record). [20] When times are good, payment could be arranged for a land to be transferred and registered by issuance of title to the interested person who may not be the one who paid the premium. This is consistent with the view that payment made upon trust without any proof of written agreement between parties. The Plaintiff averred in its pleading that its claim is not on the basis of any agreement. Therefore this Court viewed that the agreement which is unsigned and unstamped as claimed by the Plaintiff will not assist this Honourable Court. This Court viewed that the prima facie case established by the Plaintiff is based on its Amended Statement of Claim, the receipts for the premium and other charges in the name of the Defendant, the Plaintiff’s cheque and bank draft (pages 88-93 of the Appeal Record), the caveat entered by the Plaintiff on the said Land, the affidavits of the Plaintiff and the Defendant’s defence. 15 [21] The onus then shifts to the Defendant to show that the judgment should not be given to the Plaintiff. Based on the Supreme Court’s decision of Bank Negara Malaysia v Mohd Ismail & Ors [1992] 1 MLJ 400, in relation to the defence, the requirement under Order 14 ROC 2012 is that, it is for the Court to be satisfied on affidavit evidence that the defence not only raised an issue but also that the said issue is triable. There are a number of authorities as reference on defence. It has been decided in the case of Perwira Habib Bank Malaysia Berhad v Samuel Pakianathan [1993] 2 MLJ 423, a Supreme Court decision that summary judgment may still be given notwithstanding that the Defendant had filed a counterclaim. [22] Upon careful perusal of the Defendant’s defence, the Court finds that firstly, the Defendant did not dispute that the Statement of Claim/ Amended Statement of Claim had been served on the Defendant, that the Defendant had entered appearance and that the Plaintiff had affirmed an affidavit verifying the facts on which the Amended Statement of Claim are based upon: Wasco Lindung Sdn Bhd vLustre Metals & Minerals Sdn Bhd [2015] 2 CLJ 427. Secondly, the Court finds that the Defendant denied on the premium made by the Plaintiff, that the Defendant averred that the premium paid was a gratuitous payment for the projects and honorary and that in the alternative, had claimed that the Plaintiff may have paid without Defendant’s knowledge (paragraphs 4.2, 4.3, 4.4 of the Defendant’s Defence and Counterclaim, pages 20-21 Appeal Record). [23] The Defendant in its Affidavit In Reply stated his denial of the advancement by the Plaintiff (paragraphs 6.1 – 6.4 of the Defendant’s Affidavit In Reply 4.8.2016, at pages 77 – 78 of Appeal Record) and 16 averred that only through a full trial where witnesses will be called, can decide whether it is the Defendant or the Plaintiff whom agreed to pay for the Defendant. In the latter, the relevant sentence at paragraph 6.1 is reproduced here: “… Pembuktian pembayaran tersebut hanya dapat dibuktikan melalui perbicaraan penuh untuk menentukan sama ada saya atau Plaintif bersama-sama bersetuju bahawa Plaintif akan membuat bayaran bagi pihak saya.” This Court finds no statement to prove that the Defendant had in fact paid the premium for the said Land to rebut the Plaintiff’s claim. [24] In addition, merely denying with no documentary evidence to rebut, the onus stays with the Defendant. In fact, the Defendant’s averment on the gratuitous payment and that it was paid without Defendant’s knowledge would be an admission that there was monetary advancement, following section 17 of Evidence Act 1950. As Defendant had admitted that such monetary advancement took place, there is no requirement for witnesses to be called to testify. The other aspect of law of concerned is the Defendant’s alternative defence that the payment was made without Defendant’s knowledge in order to gain from projects. Such commission or incentives as how the Defendant puts it, would be contrary to public policy and the Court as a vital institution of democratic governance must be firm in sending out a principled message that unregulated incentive which is against public policy, is unlawful. Therefore, this Court finds that there was no other reason for the case to go to trial: Order 14 rule 3(1) of ROC 2012. 17 [25] This appeal arises from a summary judgment under Order 14 ROC

It is incumbent upon the Court to have the overall view to ascertain whether the Defendant has a real or bona fide defence. This Court has carefully perused the affidavits and documentary evidence and finds that the Defendant did not deny that there was an advancement arrangement. The Defendant’s admission that the Plaintiff paid without the Defendant’s knowledge and the argument that such payment was gratuitous as to repay Defendant’s assistance, proves to show that there is a prima facie case of monetary advancement. [26] In light of the above reasons, the Plaintiff has on the balance of probabilities, a prima facie case for summary judgment to be entered against the Defendant. I therefore allowed the appeal with cost. The Plaintiff’s counsel had asked for a consequential order, for a stay of execution. This Court holds the view that a stay of execution must be applied, as this Court treats this appeal and the other appeal under Order 18 rule 19 ROC 2012, as two separate proceedings. This Court finds no defence to Plaintiff’s claim and as Defendant’s counterclaim is not less than the Plaintiff’s claim, the Plaintiff should apply for a stay of execution until the trial of counterclaim to which the other appeal under Order 18 rule 19 ROC 2012 is allowed. Dated: 23 October 2017 (ZALITA BINTI DATO’ ZAIDAN) Judicial Commissioner Shah Alam High Court 18 SOLICITORS FOR THE APPELLANT: P.Y. CHONG LEE MAN HENG Tetuan H.M. Lee P-O3-01, Impian Meridian Commerze Jalan Subang 1, USJ 1 47600 Subang Jaya Selangor Darul Ehsan [Rujukan: 1948/JM/16/L] Tel: 03-5891 6810 Fax: 03-5891 6820 SOLICITORS FOR THE RESPONDENT: ASHMADI BIN OTHMAN Tetuan Zulpadli & Edham No. 24, Jalan Perumahan Gurney 54000 Kuala Lumpur [Rujukan: ZE(E)/L/1704/16]