Teoh Chuan Aik & seorang lagi v Wafong Credit Sdn Bhd & satu lagi (AB-22NCVC-17-04/2021)

PLAINTIFFS TEOH CHUAN AIK

LIM WEI WAH (NO. KP: 680819 – 06 – 5382)

DEFENDANTS WAFONG CREDIT SDN BHD (NO. SYARIKAT: 98703 – D)

BH KOH, SOONG, ZARIN & PARTNERS 2 JUDGMENT (Enclosure 27) [1] Enclosure 27 pertains an application by the first defendant (D1) to amend its defence to include a counterclaim. The application is made under Order 20 rule 5 of the Rules of Court 2012 (ROC). [2] O20 r 5 ROC relates to amendment of a pleading which has already been filed. It does not apply to the present case, as there is no counterclaim made in the defence by D1. To quote Jessel MR in the age-old case of Furnes v Booth (1876) 4 Ch: A pleading which asks no cross-relief against a plaintiff either alone or with some other persons is not a counterclaim. [3] Thus, reliance on O20 r 5 ROC by D1 to amend its defence to include a counterclaim is misconceived. Rules wise, D1 ought to have employed the correct provision of the ROC to move this court to make a counterclaim. That being, O15 r 2 ROC. The wordings of O15 r 2(1) is crystal clear, which renders the following –

Counterclaim against plaintiff. (O.15, r.2)

Subject to rule 5(2), a defendant in any action who alleges that he has any claim or is entitled to any relief or remedy against a plaintiff in the action in respect of any matter (whenever and however arising) may, instead of bringing a separate action, make a counterclaim in respect of that matter; and where he does so he shall add the counterclaim to his defence. 3 …” [4] This court is not questioning the viability of the alleged counterclaim by D1, but the mode and manner by which this court is moved for making a counterclaim is erroneous. [5] At the outset, before pursuing with the application under O20 r 5 in enclosure 27, counsel for D1 had informed this court that it has in fact made a counterclaim dated 27.7.2021 without leave of this court, which is found in enclosure 25. Prayer is for it to be withdrawn. Ensuing, order in terms of the withdrawal was granted. With that there is no counterclaim by D1 on record. As D1 is mindful of pursuing with a counterclaim against the plaintiffs, this court cannot restrain them from doing so, provided the right avenue under the ROC is employed. However, an application to amend its defence to include a counterclaim lacks basis under adjectival law, simply because there is no counterclaim to start with, in order to make an amendment. [6] D1’s intention to make a counterclaim against the plaintiffs is explicit from their written submission at paragraph 1(c) of Enclosure 41, which reads as: As submitted earlier, the main purpose of this amendment is to include a counterclaim for a relief/remedy (for Plaintiffs to repay D1 the principal sums which they have been 4 benefited from – Section 66 Contract Act 1950 [Tab B] had this court decided that both the agreements entered by the parties are null and void. At the risk of repetition, the remedy/relief in the proposed counterclaim is inextricably intertwined with the Plaintiffs claim. (Emphasis is mine) As alluded to above, D1 is entitled to do so. But for all intents and purposes, it is freshly instituting a counterclaim, thus the relevant rule applicable is O15 r 2(1) and not O20 r 5 of the ROC. [7] To iterate, basis for the counterclaim by D1 against plaintiffs is not questioned by this court, as they have right to make one. But the mode employed does not comply with ROC, which must be obeyed by D1 (See: Ratnam v Cumarasamy & Anor (1965) 31 MLJ 228 PC). Moreover, His Lordship Gopal Sri Ram JCA (as he then was) in the case of Cheow Chew Khoon (t/a Cathay Hotel) v Abdul Johari bin Abdul Rahman (1995) 1 MLJ 457 decided – “An originating process requiring an intitulement must state, with sufficient particularity, either in its heading or in its body, the statute or rule of court under which the court is being moved, otherwise it would be an embarrassing pleading and liable to be struck out, unless sooner amended.” Such is the fate that has befallen Enclosure 27. As submitted by the learned counsel for the plaintiffs, Mr. Gurbachan Singh with all resolve, clarity and frankness, that to amend a pleading, in this case 5 defence by D1 would only include adding, alteration or substitution of an existing plea and never a fresh plea to make a counterclaim. [8] As an early alert to parties, including counsel for D1, the above reasoning was rendered in open court, albeit briefly, with the hope that it would assuage D1 by embarking on the most appropriate course of action under ROC. Nonetheless, D1 chose instead to appeal against the decision of this court to the Court of Appeal (COA), when valuable time and effort could be saved by pursuing an application under O15 r 2(1) ROC. For completeness, the brief grounds of judgment read out in open court is the following: For decision - Enclosure 27 & 17. Mr. Gurbachan Singh for Plaintiffs. Encik Mohd Azmi for D1. Cik Siti Aishah bagi pihak D2. First plaintiff present.

Enclosure 27 – After having perused the notice of application with supporting and adverse affidavits filed, this court decides the following – a. The application is twofold, firstly to amend the plaintiff's statement of claim to include a counter claim and secondly to withdraw the counter claim filed which was done without leave of this court. b. In respect of prayer (b) order in terms is granted. 6 c. With regard to prayer (a), order in terms is refused as the application is premised on O 20 rule 5 ROC 2012 which is inapplicable. The applicable rule to include a counter claim with leave of court has to be pursuant to Order 15 rule 2 ROC 2012. d. This court does not question the viability of the counter claim as submitted by the plaintiff but the basis for the application is wrong in law.