Tenaga Nasional Berhad v My Seven Vacation Sdn. Bhd. (A-02(IM)(NCVC)-488-03/2019 Didengar Bersama A-02(IM)(NCVC)-521-03/2019)

1 DALAM MAHKAMAH RAYUAN MALAYSIA (BIDANG KUASA RAYUAN) RAYUAN SIVIL NO.: A-02(IM)(NVCV)-488-03/2019 ANTARA TENAGA NASIONAL BERHAD … PERAYU (NO. SYARIKAT: 200866-W) DAN

1. MY SEVEN VACATION SDN. BHD. (NO. SYARIKAT: 876333-K)

2. SECRET GARDEN HOTEL (NO. SYARIKAT: IP0324753-A) … RESPONDEN-RESPONDEN (Dalam perkara Guaman Sivil No. AA-22NCVC-135-09/2016 Dalam Mahkamah Tinggi Malaya di Ipoh 2 Antara

1. My Seven Vacation Sdn. Bhd. (No. Syarikat: 876333-K)

2. Secret Garden Hotel (No. Syarikat: IP0324753-A) … Plaintif-Plaintif Dan Tenaga Nasional Berhad … Defendan (No. Syarikat: 200866-W) [DIDENGAR BERSAMA DENGAN] DALAM MAHKAMAH RAYUAN MALAYSIA (BIDANG KUASA RAYUAN) RAYUAN SIVIL NO. A-02(IM)(NCVC)-521-03/2019 ANTARA TENAGA NASIONAL BERHAD … PERAYU (NO. SYARIKAT: 200866-W) 3 DAN 1. CHEW THAI KAY (NO. K/P: 680607-08-5269)

2. KIAN KUANG COLDSTORAGE TRADING SDN. BHD. (NO. SYARIKAT: 616340-U) (Dahulunya dikenali sebagai Wan Huat Coldstorage Trading Sdn. Bhd.) … RESPONDEN-RESPONDEN (Dalam perkara mengenai Mahkamah Tinggi Malaya Di Ipoh Guaman No. AA-22NCVC-81-06/2018 Antara 1. Chew Thai Kay (No. K/P: 680607-08-5269)

2. Kian Kuang Coldstorage Trading Sdn. Bhd. (No. Syarikat: 616340-U) 4 (Dahulunya dikenali sebagai Wan Huat Coldstorage Trading Sdn. Bhd.) … Plaintif-Plaintif Dan Tenaga Nasional Berhad …Defendan (No. Syarikat: 200866-W) CORUM: MARY LIM THIAM SUAN, JCA (Now FCJ) HAS ZANAH BINTI MEHAT, JCA VAZEER ALAM BIN MYDIN MEERA, JCA JUDGMENT OF THE COURT INTRODUCTION [1] There are two appeals before us, namely Rayuan Sivil No: A-02(IM) (NVCV)-488-03/2019 (“Appeal 488”) and Rayuan Sivil No: A-02(IM) (NCVC)-521-03/2019 (“Appeal 521”) filed by the appellant/defendant (“the 5 appellant”) against two separate injunction orders granted in different suits to the respondents/plaintiffs (“the respondents”) to prevent the appellant from disconnecting the supply of electricity to the respondents’ premises. Both orders were granted by the same Learned Judicial Commissioner at the Ipoh High Court. [2] We heard the appeals together as the issues are identical. After perusing the appeal records, considering the submissions, both oral and written, we dismissed both appeals with costs in the cause. We now give our reasons for the same. BACKGROUND FACTS Appeal 488 [3] The appellant in the suit is the sole provider of electricity in Peninsular Malaysia and is a licensee under the Electricity Supply Act 1990 (‘the Act’) with statutory powers to take action for offences committed under the Act, in particular for the tampering of the appellant’s meters and the theft or pilferage of electricity. 6 [4] For appeal 488, both the 1st and 2nd respondents are the appellant’s registered customers for electricity supply to their respective premises. Both the 1st respondent and the 2nd respondent are operators of a restaurant business with common directors. The 1st respondent carried out its business at No 42 Lorong Cheah Cheng Lim, 30350, Ipoh Perak (“premise 1”), and the 2nd respondent at No 42A Lorong Cheah Cheng Lim, 30350, Ipoh Perak (“premise 2”). Premise 1 is adjacent to premise 2 (collectively referred to as “the Premises”). [5] During an inspection on 11.08.2016, the appellant’s employees discovered the tempering of meters at the Premises. The appellant then issued a Notice of Disconnection of Electricity Supply (“NDES”) on 11.08.2016 (on the same day of the inspection), notifying the respondents that the electricity supply to the Premises would be disconnected under section 38(1) of the Act (both NDES to the Premises are collectively referred to as “NDES 1”). [6] In NDES 1, the respondents were duly informed of the intended disconnection of electricity to the Premises on 8.9.2016. 7 [7] It was not a matter of dispute that the meters had been rectified with no outstanding electricity bills for the Premises since that inspection on 11.08.2016. [8] On 5.9.2016, the respondents filed a writ against the appellant for the following reliefs, among others:

(ii) the respondents do not owe any monies to the appellant resulting from the 11.8.2016 inspection; and

(iii) that the NDES 1 dated 11.8.2016 to be declared null and void. [9] On 6.9.2016, the respondents filed an ex-parte application for an interim injunction against the appellant from carrying out the disconnection as stipulated in NDES 1 until the final disposal of the action. The High Court granted the ex parte interim injunction on 7.9.2016. The appellant’s applications to set aside the ex-parte interim injunction and inter-partes application to set aside the said injunction were dismissed by the High Court. 8 [10] Aggrieved, the appellant filed an appeal to this Court against the decision. On 31.10.2017, this Court allowed the appellant’s appeal against the said High Court’s decision. [11] Following the decision of this Court, on 3.8.2018, the appellant issued the 2nd NDES (“NDES 2” RR VOL.2B (part C) Enc 4 pdf page 18- 19/hardcopy at pages 215-222). [12] The respondents subsequently filed another application in Enclosure 69 for an interim injunction to restrain the appellant from carrying out the intent of NDES 2. The High Court again allowed the injunction, hence this appeal before us. Appeal 521 [13] The 2nd respondent is a company carrying out the business of processing, freezing and cold storage of seafood at No. 1541, Lorong Kerapu, Taman Sejahtera, 35400 Hutan Melintang, Perak (“the Premise”). [14] The appellant inspected the Premise on 7.6.2018, where the appellant’s employees also discovered tampering of the electricity meter. 9 [15] The Premise had originally belonged to the 1st respondent, but it was subsequently acquired by the 2nd respondent by way of a sale and purchase agreement dated 31.3.2009. That said, at the inspection date, the 1st respondent remained as the registered user of the appellant. [16] As a consequence of the tempering of the electricity meter, the appellant issued the notice of disconnection of electricity supply (NDES) for execution on 3.7.2018. [17] On 27.6.2018, the respondents filed a writ against the appellant for:

(ii) an injunction to prohibit the appellant from disconnecting the electricity supply to the Premise; and

(iii) a declaration that the NDES dated 7.6.2018 is null and void. 10 [18] On 28.6.2018 (before the disconnection date), the respondents applied for an interim injunction in Enclosure 4, premised on the following grounds:

(ii) corrective measures had been taken on the alleged tampered meter; therefore, the appellant cannot continue with its action to disconnect the supply of power to the Premise;

(iii) any disconnection to be carried out at this juncture would cause irreparable damage to the 2nd respondent’s business; and

(iv) the appellant will not suffer any loss if the disconnection is not carried out at this juncture, pending the final disposal of the respondent’s suit. 11 [19] For the avoidance of doubt NDES 2 in Appeal 488 and NDES in appeal 521 hereinafter will be referred to as “NDES” unless expressly stated. The Premises in Appeal 488 and the Premise in Appeal 521 will be collectively referred to as “the Premises”. FINDINGS OF THE HIGH COURT [20] In both cases, after considering various arguments advanced by the respondents and the appellant, his lordship allowed both applications for an interim injunction pending the disposal of the suits. [21] On the preliminary issue of locus standi in Appeal 521, his lordship was satisfed that the 2nd respondent had sufficiently established that it has a legitimate interest and business at the Premise to apply for an injunction. His lordship had also rejected the preliminary issue on res judicata and estoppel raised in Appeal 488, with a view that the application under enclosure 69 is premised differently from the earlier application where the interim injunction granted had been set aside by the Court of Appeal. [22] On the application for an injunction pending the disposal of the suit, his lordship applied the principles in Keet Gerald Francis Noel John v. 12 Mohd Noor Abdullah & Ors [1995] 1 CLJ 293; [1995] 1 MLJ 193 and concluded that the respondents would suffer greater injustice by not granting the injunction to maintain the status quo pending the trial proper of the suit. His lordship opined that on a balance of convenience and justice of the case, the scale tilted for the respondents in the granting of an injunction. [23] On the appellant’s statutory powers to disconnect the electricity supply, his lordship had considered the legal issue raised by both parties on s. 38(4) the Act. His lordship referred to and followed the Court of Appeal’s decision in Mayaria Sdn. Bhd. & Anor v. Tenaga Nasional Berhad [2015] 6 CLJ 788. That being the case, the legality of the NDES by the appellant remains an issue to be determined at the trial. ISSUES IN THESE APPEALS [24] There are some common issues in both Appeals, namely:

(ii) whether there has been a correct application of section 38 of the Act in relying on Mayaria. Separately, the preliminary issues were:

(ii) for Appeal 521 on locus standi of the 2nd respondent since it is not the registered user with the appellant for the electricity supply; and

(iii) the required undertaking as to damages was not given at the High Court proceedings and it was not at all averred in the affidavit in support of the application. 14 DECISION [25] On the issues impacting the 2nd respondent in Appeal 521 (legal standing, being the Premise owner is the actual user of the power supply though not being the registered user), the 2nd respondent was given a concession by the appellant to take legal action against them. In the circumstances, we believe that we do not need to deal with this issue at this stage. We would, however, like to stress that this concession is only limited to the case in this appeal and does not apply elsewhere. The appellant argued that the respondents are not entitled to an injunction as they failed to provide the required undertaking as to damages. However, through their counsel in open Court, the respondents gave the said undertaking as to damages. Therefore, this is no longer an issue. [26] The appellant further argued that the respondents are not entitled to the injunction since the appellant has the statutory right to disconnect under section 38 of the Act. It was wrong on the respondents to rely on Mayaria as the case was decided before the amendment to section 38. The proper authority is Karun Klasik Sdn. Bhd. v. Tenaga Nasional Berhad [2018] 9 CLJ 184, which was decided after the said amendment. With the amendment of subsection (4) of section 38, the appellant must 15 disconnect the supply after the discovery of tampering where the appellant can issue a written statement, and this statement shall be prima facie evidence of the amount due from the registered customer or user. [27] It was submitted before us by the respondents’ learned counsel that it is in the public domain that the Federal Court affirmed the decision in Mayaria (supra) by a Corum of five on 4.9.2019. However, unfortunately, we were informed that no written judgment is available. The Federal Court decision was supposedly pronounced after the decision of this case at the High Court. [28] We are of the considered view that considering the Federal Court’s said decision in Mayaria, suffice to say that his lordship was correct in exercising his discretion in granting the injunction against the appellant from disconnecting the electricity supply pending the hearing of the main suits. We agree with his lordship’s conclusion that Mayaria is the case on point as the facts are similar. [29] However, learned counsel for the appellant submitted that the amendment by Act A1501 to section 38, particularly subsection (4) of the Act that came into force on 1.1. 2016 by [PU(B) 501/2015] was after this 16 Court’s decision in Mayaria and, therefore, altered the position in Mayaria. [30] We have perused the amendment. We find that with the amendment, subsections (1) and (3) were substituted with the new provisions, new subsection 1B was inserted, and consequential amendment to the other subsections. For convenience, we reproduced section 30 of the amending Act A1501 to appreciate the provisions that have been amended as follows:

(30) Section 38 of the principal Act is amended-

(14) and any reasonable expenses directly incurred by the licensee under this section including expenses incurred in respect of reconnection of electricity in the manner as have been directed by the Commission: Provided that and subject to subsection (4), if the licensee does not proceed with a claim for such loss of revenue and expenses in Court, the licensee may only claim against the consumer for the said loss of revenue and expenses for a period not exceeding six months retrospectively from the date the offence was discovered under subsection (1).”;

(ii) in paragraph (a)- 18

(1) Where any person employed by a licensee finds upon any premises evidence which gives reasonable grounds for him to believe that an offence has been committed under subsection 37(1), (3) or (14), the licensee or any person duly authorized by the licensee shall within three working days from the date of such finding inform the Commission in writing, and the licensee may, upon giving not less than forty-eight hours’ notice from the same date in such form as may be prescribed, cause the supply of electricity to be disconnected from the said premises.

(1A) Notwithstanding any other provisions in this Act, where a police officer not below the rank of Assistant Superintendent applies to a supply authority or a licensee for the disconnection of the supply of electricity to any premises for a period not exceeding one calendar month under section 21A of the Common 19 Gaming Houses Act 1953 [Act 289], the supply authority or the licensee or any person authorized by the supply authority or the licensee shall immediately disconnect or cause the supply of electricity to be disconnected from those premises.

(1B) Upon receiving such information under subsection (1), the Commission may verify the matter, and in cases where it finds that no offence has been committed, the supply of electricity shall be reconnected immediately.

(2) If the supply of electricity has been disconnected under subsection

(1), it shall not be reconnected until the licensee at his discretion gives permission for reconnection. Provided that the period of disconnection shall not exceed three months.

(2A) Notwithstanding subsection (2), if the supply of electricity has been disconnected under subsection (1A), it shall not be reconnected without the written permission of a police officer, not below the rank of Assistant Superintendent.

(3) The licensee may require the consumer to pay him for the loss of revenue due to the offence committed under subsections 37(1), (3), and

(14) and any reasonable expenses directly incurred by the licensee under this section, including expenses incurred in respect of reconnection of electricity in the manner as have been directed by the Commission: 20 Provided that and subject to subsection (4), if the licensee does not proceed with a claim for such loss of revenue and expenses in Court, the licensee may only claim against the consumer for the said loss of revenue and expenses for a period not exceeding six months retrospectively from the date the offence was discovered under subsection (1).

(4) A written statement by an employee of the licensee duly certified by the licensee or any person authorized by the licensee specifying-

(5) The amount stated in the written statement under subsection (4) shall, within the period specified in the statement, be due and payable to the licensee, and in default of payment, such amount shall be recoverable by civil action in a court. [emphasise added] 21 [32] We also reproduced the pre-amendment provisions of section 38 as follows:

38. Disconnection of supply of energy

(1) Where any person employed by a licensee finds upon any premises evidence which in his opinion proves that an offence has been committed under section 37 (1), 37 (3), or 37 (14), the licensee or any person duly authorized by the licensee may, upon giving not less than twenty-four hours’ notice, in such form as may be prescribed, cause the supply of electricity to be disconnected from the said premises.

(1A) Notwithstanding any other provisions in this Act, where a police officer not below the rank of Assistant Superintendent applies to a supply authority or a licensee for the disconnection of the supply of electricity to any premises for a period not exceeding one calendar month under section 21A of the Common Gaming Houses Act 1953, the supply authority or the licensee or any person authorised by the supply authority or the licensee shall immediately disconnect or cause the supply of electricity to be disconnected from those premises; and 22

(2) If the supply of electricity has been disconnected under subsection

(1), it shall not be reconnected until the licensee, at his discretion, gives permission for reconnection: Provided that the period of disconnection shall not exceed three months.

(2A) Notwithstanding subsection (2), if the supply of electricity has been disconnected under subsection (1A), it shall not be reconnected without the written permission of a police officer, not below the rank of Assistant Superintendent.

(3) The licensee may require the consumer to pay him for the loss of revenue due to the offence committed under section 37 (1), 37 (3), and 37

(14) and any expenses incurred by the licensee under this section, including expenses incurred in respect of the reconnection of electricity supply.

(4) A written statement by an employee of the licensee duly certified by the licensee or any person authorized by the licensee specifying-

(5) The amount stated in the written statement shall, within the period specified in the statement, be due and payable to the licensee, and in default of payment, such amount shall be recoverable by civil action in a court. [33] We remind ourselves not to venture into the merit of the substantive case as the issue before us is whether there are serious issues to be tried for his lordship at the High Court to exercise his discretion in granting an interim injunction pending the hearing of the suits. However, upon perusal of the amended section 38 of the Act, particularly subsection (4), we are unable to find the provision that enable the appellant as a provider of the electricity supply to disconnect the supply after the offending meter has been rectified or remedied and further loss of revenue has ceased. Therefore, in our view, the amendment has not altered the position as determined by the Federal Court in affirming this Court’s decision in Mayaria. The appellant’s statutory right to disconnect is still relevant and constitutes a serious question that must be addressed substantively and fully determined at the trial. 24 [34] Our view is further fortified by the rationale or the reasons of the amendment as explained in paragraph 31 of the Explanatory Statement of the Amendment Bill as follows:

31. Clause 30 seeks to amend section 38 of Act 447 to ensure that only in clear and proven cases of electricity theft under the Act can a licensee disconnect supply to a consumer. The Commission may also verify whether such offences had been committed and if it has not been committed, the Commission may direct the reconnection of supply of electricity by the licensee. The licensee shall also have to prove that it had suffered losses and reasonable expenses before it can claim against the consumer concerned, and the licensee can only recover such losses or expenses through a court action and not by disconnection of supply of electricity and the licensee may only claim for the loss of revenue and expenses for a period of six months only unless it is a claim in Court. [emphasise added] [35] The arguments by the appellant’s learned counsel are evidently contradictory to the legislative intent. We can only interpret the law as the legislature passes it. It is trite that we cannot improve on it or read deeming provisions into it. An examination of the structural amendment of subsection (4) of section 38 invites a judicial determination whether the appellant has a right to disconnect the supply of electricity after the meter 25 had been rectified and is in good working order with no further loss of revenue occasioned to the appellant. [36] Based on the foregoing reasons, we do not find any merit in both appeals, and we unanimously dismissed the appeals with costs in the cause. DATED: 25 FEBRUARY 2021 (HAS ZANAH BINTI MEHAT) JUDGE COURT OF APPEAL Counsels/Solicitors: For the Appellant: Raja Ahmad Mohzanuddin Shah Raja Mohzan and Jason Cheong Kak Lok together with him. (Messrs. Azmi & Associates) Shamsul Bahrin Manaf, Prithi Verma & Maizura Mohamed Amin (Messrs. Prithi Junainah & Associates) For the Respondents: CM Lai and Loh Cien Zen & Maisarah together with him (Messrs. C.M. Lai & Partners)