Thien Chiet-Chai v Raymond Murphy D Cruz (WA-22NCC-363-08/2021)

[2] After hearing both applications, I allowed encl. 5 and dismissed encl. 13. This judgment contains the full grounds for my decision. S/N pzBvyd2a40y00LDv0zFN5A Enclosure 5 Background Facts [3] During the second half of year 2020, the Defendant informed the Plaintiff that he will be dealing with the relevant authorities for respective “Letters of Award” to be issued for 3 solar projects in the state of Johor (“the Solar Projects”) through the Defendant’s 3 companies, RDA Ventures One Sdn Bhd (“RDAV 1”), RDA Ventures Two Sdn Bhd (“RDAV 2”) and RDA Ventures Three Sdn Bhd (“RDAV 3”). RDAV 1, RDAV 2 and RDAV 3 are referred together to as “the 3 Companies” herein. [4] Further, the Defendant informed the Plaintiff that before the applications can be made to the relevant authorities for the Solar Projects, the Defendant’s companies have to secure a land in Johor for the Solar Projects and also execute respective lease agreements with the land owner for use of the land for a period of 23 years (“the Lease”). The Defendant then requested to borrow RM4,800,000.00 from the Plaintiff to enable the Defendant to make the lease payments to the land owner. [5] As security for borrowing the RM4,800,000.00, the Defendant proceeded to execute a Letter of Guarantee and Undertaking (by an Individual) dated 23.12.2020 in favour of the Plaintiff for the sum of RM4,800,000.00. The Defendant’s solicitors, Messrs. Tunku Munawwir & Solomon S/N pzBvyd2a40y00LDv0zFN5A by way of 2 emails on 28.12.2020 and 30.12.2020, confirmed with the Plaintiff’s solicitors that the total amount of RM4,800,000.00 had been received. [6] In relation to the Solar Projects, the Defendant, on 1.2.2021, as the sole shareholder of each of the 3 Companies executed 3 Conditional Share Sale Agreements (“the 3 Conditional Share Sale Agreements”) in respect of each of the 3 Companies with Skyline Titan Energy Sdn Bhd (“Skyline”) to sell 99% of his respective shareholdings therein. [7] Around April 2021, the Defendant again requested to the Plaintiff to borrow another RM500,000.00 for the Solar Projects. As additional security, the Defendant proceeded to execute a Letter of Guarantee and Undertaking (by an Individual) dated 12.4.2021 in favour of the Plaintiff for the sum of RM500,000.00. The Plaintiff then transferred RM500,000.00 to the Defendant’s solicitors’ (Messrs. Tunku Munawwir & Solomon) AmBank clients’ account. The Defendant also confirmed with the Plaintiff that his solicitors had received the RM500,000.00. [8] Around May 2021, the Defendant again requested to the Plaintiff to borrow a further RM500,000.00 for purposes of the Solar Projects. As additional security, the Defendant again proceeded to execute a Letter of Guarantee and Undertaking (by an Individual) dated 31.5.2021 in favour of the Plaintiff for the said sum of RM500,000.00. At the S/N pzBvyd2a40y00LDv0zFN5A request and instruction of the Defendant, the Plaintiff transferred this additional sum of RM500,000.00 to another of the Defendant’s company’s (RDA Ventures Sdn Bhd) bank account at AmBank. The Defendant had also confirmed with the Plaintiff that he had received the additional RM500,000.00. [9] The Letter of Guarantee and Undertaking (by an Individual) dated 23.12.2020, the Letter of Guarantee and Undertaking (by an Individual) dated 12.4.2021 and the Letter of Guarantee and Undertaking (by an Individual) dated 31.5.2021 are referred together as “the Letters of Guarantee”) [10] Between April and May 2021, the Defendant repaid to the Plaintiff the sum of RM300,000.00. [11] Subsequently the Defendant, through his solicitors, Messrs. Tunku Munawwir & Solomon, gave notice to the solicitors for Skyline by way of a Notice of Termination dated 21.6.2021 (“the 1st Notice of Termination”) to terminate the 3 Conditional Share Sale Agreements, citing that the reason for the termination as the Defendant being unable to fulfil the Conditions Precedent as stated in the 3 Conditional Share Sale Agreements. In the Notice of Termination, the Defendant’s solicitors stated that the Defendant will take action to refund the following sums: S/N pzBvyd2a40y00LDv0zFN5A a) The sum of RM4,800,000 received from the Plaintiff pursuant to the Letter of Guarantee & Undertaking (by an Individual) dated 23.12.2021 by 31.7.2021; b) The sum of RM200,000 received from the Plaintiff pursuant to the Letter of Guarantee & Undertaking (by an Individual) dated 12.4.2021 by 15.7.2021; and c) The sum of RM500,000 received from the Plaintiff pursuant to the Letter of Guarantee & Undertaking (by an Individual) dated 31.5.2021 by 5.7.2021. [12] Messrs. Tunku Munawwir & Solomon then wrote to the solicitors for Skyline on behalf of the Defendant by way of a letter dated 23.6.2021 (“the 2nd Notice of Termination”) amending the 1st Notice of Termination to state that the Defendant will take action to refund the following sums: a) The sum of RM4,800,000 received from the Plaintiff pursuant to the Letter of Guarantee & Undertaking (by an Individual) dated 23.12.2021 by 31.7.2021; b) The sum of RM200,000 received from the Plaintiff pursuant to the Letter of Guarantee & Undertaking (by an Individual) dated 12.4.2021 by 28.6.2021; and c) The sum of RM500,000 received from the Plaintiff pursuant to the Letter of Guarantee & Undertaking (by an Individual) dated 31.5.2021 by 15.7.2021. S/N pzBvyd2a40y00LDv0zFN5A [13] A few days prior to 28.6.2021, the deadline for the payment of the RM200,000.00, the Plaintiff reminded the Defendant on the repayment. On 30.6.2021, the Defendant sought indulgence from the Plaintiff till 4.7.2021 to make the repayment but no payment was made. The Plaintiff subsequently instructed his solicitors, Messrs. Chew Kar Meng, Zahardin & Partners to issue a letter of demand to the Defendant dated 5.7.2021 to demand for the repayment of the RM200,000.00. [14] With regards to the sum of RM500,000.00, no payment was made by the Defendant by the deadline of 15.7.2021. The Plaintiff subsequently instructed his solicitors, Messrs. Chew Kar Meng, Zahardin & Partners to issue the letter of demand to the Defendant dated 19.7.2021 to demand for the repayment of the RM500,000.00. [15] With regards to the sum of RM4,800,000.00, despite several reminders before the deadline of 31.7.2021 and several follow-ups after 31.7.2021, there was still no payment from the Defendant. The Plaintiff subsequently instructed his solicitors, Messrs. Chew Kar Meng, Zahardin & Partners to issue the letter of demand to the Defendant dated 3.8.2021 to demand for the repayment of the RM4,800,000.00. S/N pzBvyd2a40y00LDv0zFN5A [16] No payment was forthcoming from the Defendant after the issuance of the 3 letters of demand. The Plaintiff then filed this Writ Action on 19.8.2021 to claim for, inter alia: a) The amount of RM 200,000.00 as at 16.7.2021; b) The amount of RM 500,000.00 as at 29.7.2021; and c) The amount of RM4.800.000.00 as at 13.8.2021. [17] The Plaintiff then filed this application on 2.9.2021 in encl. to apply to record summary judgment against the Defendant for the remedies prayed for in the Writ Action. Law on Summary Judgment (O. 14 ROC 2012) [18] It is trite that once an application under O. 14 of the ROC 2012 is shown to have been correctly and properly filed, the burden shifts and thus rests on the defendant who desires to resist the application to raffidavit in supporte a defence which shows a “bona fide triable issue”, in the sense of an issue which justifies and warrants the matter to be considered at the trial proper. [19] Order 14 r. 3 of the ROC 2012 provides that unless the defendant satisfies the Court with respect to the claim, or the part of a claim, to which the application relates that:- S/N pzBvyd2a40y00LDv0zFN5A

there is an issue or question in dispute which ought to be tried or

there ought for some other reason to be a trial of that claim or part, [20] The Court may give such judgment for the plaintiff against the Defendant on that claim or part as may be just having regard to the nature of the remedy or relief claimed. [21] It is useful to refer once again to the often quoted decision of the former Supreme Court in National Company For Foreign Trade v. Kayu Raya Sdn Bhd [1984] 2 MLJ 300 which ruled as follows: “We think it appropriate to remind ourselves once again that in every application under Order 14 the first considerations are (1) whether the case comes within the Order and (b) whether the plaintiff has satisfied the preliminary requirements for proceeding under Order 14. For the purposes of an application under Order 14 the preliminary requirements are:

the defendant must have entered an appearance;

(ii) the statement of claim must have been served on the defendant; and

(iii) the affidavit in support of the application must comply with the requirements of Rule 2 of the Order 14. S/N pzBvyd2a40y00LDv0zFN5A ... If the plaintiff fails to satisfy either of these considerations, the summons may be dismissed. If however, these considerations are satisfied, the plaintiff will have established a prima facie case and he becomes entitled to judgment. The burden then shifts to the defendant to satisfy the Court why judgment should not be given against him.” [22] The Plaintiff has satisfied these preliminary requirements, and this is not disputed by the Defendants. Thus, the burden is now firmly on the Defendants to show that there is a triable issue that does not justify summary judgment to be entered against them. If the Defendants can demonstrate even one triable issue, this Court will not grant summary judgment. But it has to be a genuinely triable issue as would require a trial in order to determine it (see Voo Min En & Ors v. Leong Chung Fatt [1982] 2 MLJ 241). Issues [23] From the submissions and affidavits filed, the Court has narrowed down the triable issues to be considered as follows: a) Whether the sum of RM5,500,000.00 paid by the Plaintiff to the Defendant was actually an investment in the Solar Projects and not a loan to the Defendant; and b) Whether the Defendant is entitled to the RM4,824,192.00 as per his Counterclaim and if that amount can be set off against the Plaintiff’s claim. S/N pzBvyd2a40y00LDv0zFN5A Findings and analysis of the Court Whether the sum of RM5,500,000.00 paid by the Plaintiff to the Defendant was actually an investment in the Solar Projects and not a loan to the Defendant [24] The Defendant’s position is that the monies amounting to RM5,500,000.00 paid by the Plaintiff to the Defendant was an investment in the Solar Projects invested by the Plaintiff were towards the acquisition of shares in the 3 Companies wherein the Plaintiff holds around 99% of the shares in the 3 Companies which are held by the Plaintiff’s proxies, identified by the Defendant as Lee Sze Yeen dan Ee Hood Liang. In this sense, the Defendant appears to take the position that the sum of RM5,500,000.00 in question is not a loan from the Plaintiff to the Defendant which is subject to repayment. In this regard, the Defendant contended and submitted as follows: a) The Plaintiff through the aforementioned proxies acquired 99% of the shares of the Companies and still owns these shares, then any investment has been made on behalf of the companies will directly benefit the Plaintiff; and b) When the 3 Companies make profits, the Plaintiff who holds 99% of the shares in the 3 Companies will benefit. S/N pzBvyd2a40y00LDv0zFN5A [25] The Defendant exhibited 2 letters dated 17.2.2021 and 4.3.2021 from Pejabat Setiausaha Kerajaan Johor and Majlis Perbandaran Pengerang to a company called RDA Venture Sdn Bhd to support the Defendant’s contention that the Solar Projects exist and that the Defendant had paid for the Lease. [26] The Plaintiff, on the other hand, submitted that the sum of RM5,500,000.00 paid by the Plaintiff to the Defendant was a loan to the Defendant which is to be repaid and not an investment in the Solar Projects as there is cogent and incontrovertible evidence though the Letters of Guarantee, the 1st Notice of Termination and the 2nd Notice of Termination to support the Plaintiffs assertion that the sum was borrowed by the Defendant and that the Defendant had promised to pay back this sum to the Plaintiff. The Defendant’s solicitors, in the 1st Notice of Termination and 2nd Notice of Termination, stated that the Defendant promised to refund the sums of RM4,800,000, RM200,000 and RM500,000 on 3 dates. [27] The Plaintiff also submitted that other circumstances would show that the sum of the RM5,500.000.00 is not an investment: a) The Plaintiff never had any power, discretion or control over the monies borrowed by the Defendant, including the payment methods in disbursing the sum of RM5,500,000.00 or even the recipients of the S/N pzBvyd2a40y00LDv0zFN5A monies and this was all decided by the Defendant in his absolute discretion; b) The Defendant’s pleadings and averments “the Plaintiff's claim is premature” as stated in para.s 7, 8 and 9 of the Defence and Counterclaim as well as para.s 9(b) and 9(c) of the Defendant’s affidavit in reply is a judicial admission that the sums paid by the Plaintiff to the Defendant are to be refunded; and c) The “investment” in the 3 Companies does not benefit the Plaintiff as the Defendant was applying for the Solar Projects for himself as the 2 letters dated 17.2.2021 and 4.3.2021 from Pejabat Setiausaha Kerajaan Johor and Majlis Perbandaran Pengerang are all addressed to the Defendant’s company, RDA Venture Sdn Bhd. Further, the Defendant on his own was able to terminate the 3 Conditional Share Sale Agreements. [28] Upon examining the evidence and submissions, I find no merits in the submissions of the Defendant. The documentary evidence adduced by the Defendant does not support the contention that there is an investment by the Plaintiff of an amount of RM5,500,000.00 which was paid towards the acquisition of the shares in the 3 Companies which the Defendant alleges are owned by the Plaintiff through proxies. S/N pzBvyd2a40y00LDv0zFN5A [29] The 3 Letters of Guarantee clearly show that an amount of RM5,500,000.00 was loaned by the Plaintiff to the Defendant subject to terms. The Defendant did not and never disputed executing the 3 Letters of Guarantee. [30] The Letter of Guarantee and Undertaking (by an Individual) dated 23.12.2020 shows that the sum of RM4,800,000.00 was a sum that was given to the Defendant by the Plaintiff as an advance to be utilised by the Defendant to facilitate the execution of the Lease Agreements: “THEREFORE, on the premise of my representations, assurances and confirmations to you above and IN CONSIDERATION of you depositing in advance the total sum of RM4,800,000.00 by 12.00 noon, 28th December 2020 (to facilitate RDA Ventures One, Two and Three's execution of the required Lease Agreements…” [31] The Defendant clearly stated in the Letters of Guarantee and Undertaking (by an Individual) dated 12.4.2021 and 3.5.2021 that the sums were borrowed and that these would be refunded after a certain period. [32] In the Letter of Guarantee and Undertaking (by an Individual) dated 12.4.2021 the Defendant stated: “I wish to borrow a further sum of RM500,000.00 for the purposes of the above Project, to be deposited into my appointed solicitors' clients’ account as follows to be utilised according to my instructions…” ….. S/N pzBvyd2a40y00LDv0zFN5A

on or before 21st May 2021 (that Is, 30 days from date of deposit of the abovesaid/RM500,000.00), I will refund and pay to you the sum of RM500,000.00 (free (interest), including (if applicable) all costs, charges and expenses which you may incur in enforcing payment of all of or any part of the money or amounts hereby guaranteed.” [33] In the Letter of Guarantee and Undertaking (by an Individual) dated 3.5.2021 the Defendant stated: “I wish to borrow a further sum of RM500,000.00 for the purposes of the above Project, to be deposited into my appointed solicitors' clients’ account as follows to be utilised according to my instructions…” …..

on or before 11th June 2021 (that is, 30 days from date of deposit of the abovesaid/RM500,000.00), I will refund and pay to you the sum of RM500,000.00 (free (interest), including (if applicable) all costs, charges and expenses which you may incur in enforcing payment of all of or any part of the money or amounts hereby guaranteed.” [34] There is a clear and unequivocal statement and admission by the Defendant through the 1st Notice of Termination and 2nd Notice of Termination that he has received the sum of RM5,500,000.00 from the Plaintiff pursuant to the 3 Letters of Guarantee and Undertaking and that he will take action to refund the RM5,500,000.00 to the Plaintiff in instalments by 3 separate dates. [35] In the 1st Notice of Termination it was stated: S/N pzBvyd2a40y00LDv0zFN5A “In accordance with the said Clause 8 also, our Client will take action to refund the following sums:

the sum of RM4,800,000 received from THIEN CHIET-CHAI pursuant to the Letter of Guarantee & Undertaking dated 23.12.2021 - this will be done by 31.7.2021;

the sum of RM200,000 received from THEN CHIET-CHAI pursuant to the Letter of Guarantee & Undertaking dated 12.4.2021 this will be done by 15.7.2021;

the sum of RM500,000 received from THEN CHIET-CHAI pursuant to the Letter of Guarantee & Undertaking dated 31.5.2021 - this will be done by 5.7.2021.” [36] In the 2nd Notice of Termination it was stated: “Further to your e-mail dated 21.6.2021, we are instructed by our Client to confirm that the penultimate paragraph of our letter is to be amended as follows: ‘In accordance with the said Clause 8 also, our Client will take action to refund the following sums:

the sum of RM4,800,000 received from THEN CHIET-CHAI pursuant to the Letter of Guarantee & Undertaking dated 23.12.2021 - this will be done on or before 31.7.2021;

the sum of RM200,000 received from THEN CHIET-CHAI pursuant to the Letter of Guarantee & Undertaking dated 12.4.2021 - this will be done on or before 28.6.2021;

the sum of RM500,000 received from THIEN CHIET-CHAI pursuant to the Letter of Guarantee & Undertaking dated 31.5.2021 this will be done on or before by 15.7.2021.’” S/N pzBvyd2a40y00LDv0zFN5A [37] It is also relevant that the Defendant did not issue such further letters to deny the Plaintiff’s claim or inform the Plaintiff that the RM5,500,000.00 need not be refunded or repaid back for whatever other reasons. The Defendant had ample opportunity to do so from the point the 1st Notice of Termination was issued on 21.6.2021 until the filing of the Writ Summons on 19.8.2021, nearly 2 months later but kept silent. In not contradicting the contents the 1st Notice of Termination and 2nd Notice of Termination issued by his solicitor, he has affirmed that the contents of the letters are accurate and applicable. This proves that the Plaintiff’s assertion and claim against the Defendant are valid. In considering whether the Defendant has successfully raised an arguable issue, the Court has considered the fact that the defendant did not deny the Plaintiff’s claim at the first available opportunity. See Enco Systems Sdn Bhd v. Soon Hin Hardware Sdn Bhd (2009) 9 MLJ 535 (High Court). [38] The language in the 1st Notice of Termination and 2nd Notice of Termination was also plain and unambiguous in confirming the Defendant’s expressed statements and intentions that the Defendant had confirmed receiving the RM5,500,000.00 from the Plaintiff pursuant to the Letters of Guarantee and had agreed to take action to refund the RM5,500,000.00 to the Plaintiff, thus acknowledging his liability to the Plaintiff. The Court should not delve into the mind of the Defendant to disclose his undisclosed intention and only take the meaning of the words used by the Defendant. See Perbadanan Kemajuan Negeri Selangor v. S/N pzBvyd2a40y00LDv0zFN5A Selangor Country Club Sdn Bhd [2017] 2 MLJ 819 (Court of Appeal) and Dawn City Car (M) Sdn Bhd v. Bank Islam Malaysia Berhad [2016] 4 MLJ 86 (Court of Appeal). [39] I agree with the Plaintiff’s submissions that the Plaintiff could not have paid the sum of RM5,500,000.00 to the Defendant as an investment because the Plaintiff never had any power, discretion or control over the monies borrowed by the Defendant. The word “investment” was never mentioned by the Defendant to the Plaintiff or between the Defendant and the Plaintiff in relation to the sum of RM5,500,000.00 or its component parts as shown in contemporaneous documents before the Court. It was the Defendant, not the Plaintiff, who decided the payment methods in disbursing the borrowed monies or even the recipients of the borrowed monies. Also, the fact that Defendant himself was able to terminate the 3 Conditional Share Sale Agreements without reference to the Plaintiff, the supposed investor and beneficial owner of the 3 Companies, is contrary to the contention of the Defendant that the Plaintiff was not an investor or beneficial owner of the 3 Companies. [40] I accept that even if there was any investment in the 3 Companies (which the Plaintiff alleges has a 99% beneficial ownership), this does not benefit the Plaintiff as the 2 letters dated 17.2.2021 and 4.3.2021 from Pejabat Setiausaha Kerajaan Johor and Majlis Perbandaran Pengerang are addressed to “Pengarah Urusan, RDA Ventures Sdn Bhd” S/N pzBvyd2a40y00LDv0zFN5A and not to any of the 3 Companies. This had nothing to do with the Plaintiff. The borrowed sums of RM5,500,000.00 cannot have been an “investment” by the Plaintiff for the benefit of the Plaintiff and the 3 Companies as these were never seen or received by the Plaintiff. [41] I agree with the Plaintiff’s submission that there is a judicial admission that the sums paid by the Plaintiff to the Defendant are to be refunded as the Defendant had pleaded and averred that “the Plaintiff's claim is premature” in para.s 7, 8 and 9 of the Defence and Counterclaim as well as para.s 9(b) and 9(c) of the Defendant’s affidavit in reply. [42] In para. 9 of the Defence and Counterclaim and also para. 9(c) of the Defendant’s affidavit in reply, the Defendant had pleaded that: “Defendan akan meminta pemilik tanah untuk memulangkan ‘refund’ wang tersebut daripada pemilik tanah tersebut dan menyatakan tuntutan Plaintif adalah para-matang.” [43] In para. 7 (2nd line) of the Defence and Counterclaim and para. 9(b) of the Defendant’s affidavit in reply, the Defendant pleaded: “...Plaintif tahu dan sedar bahawa wang sebanyak RM4,500,000.00 tersebut telah dibayar kepada pemilik tanah bagi pajakan tanah tersebut untuk dan telah memberitahu bahawa Plaintif harus menunggu untuk pemulangan semula wang tersebut daripada DYMM Sultan Johor...” S/N pzBvyd2a40y00LDv0zFN5A [44] In para. 8 of the Defence and Counterclaim, the Defendant had pleaded that: “ ...Defendan menyatakan bahawa Plaintif tahu dan sedar bahawa duit tersebut belum matang untuk diberikan ini disebabkan duit tersebut telah diberikan kepada pemilik tanah untuk pajakan...” [45] A judicial admission made in a pleading stands on a higher footing than evidentiary admission and the Defendant’s failure to rebut the admission to avoid the legal consequences of his admission would entitle the Plaintiff to enter judgment against him. See Yam Kong Seng & Anor v. Yee Weng Kai (2014) MLJU 476 (Federal Court). [46] In effect, the Defendant has pleaded that he will be asking the landowner of the Lease to refund the monies or that, for the Plaintiff to get back his monies before refunding the monies. It therefore can be reasonably inferred from the Defendant’s own pleadings that the Defendant needs time to refund the monies borrowed from the Plaintiff after he has received the monies back from the landowner. This is not a valid defence as there is no agreement between the Plaintiff and the Defendant that the Plaintiff would only be refunded after the Defendant has received the monies from the landowner. [47] Even if 99% of the 3 Companies are now held by the Plaintiff or his proxies, this would have no bearing on and does not negate the liability of the Defendant to refund the S/N pzBvyd2a40y00LDv0zFN5A RM5,500,000.00 to the Plaintiff as there is clear evidence that the RM5,500,000.00 given by the Plaintiff to the Defendant was a loan to the Defendant due to the admissions in the 1st Notice of Termination and 2nd Notice of Termination. The Defendant contended that when the 3 Companies make profits, the one who will benefit from this investment will be the Plaintiff holding 99% of the shares of the 3 Companies. So, what of it? The Defendant has not explained why this is a valid defence. The Defendant has thus raised an issue which is not arguable. The Court cannot accept as a triable issue an issue that is not arguable as held in Voo Min En & Ors v. Leon Chung Fatt

2 MLJ 241 (Federal Court) where it is stated that: “It is not enough for a defendant to raise an issue or any issue. The defendant must instead raise such issue as would require a trial in order to determine it. In other words, the issue raised must be an arguable issue.” Whether the Defendant is entitled to the RM4,824,192.00 as per his Counterclaim and if that amount can be set off against the Plaintiff’s claim [48] The Defendant submitted that he has a legitimate Counterclaim against the Plaintiff premised on the following: a) The Defendant has expended a significant of money for the purpose of the operation of the Solar Projects and the Plaintiff has not reimbursed such fees as contained in the Conditional Share Sale Agreements S/N pzBvyd2a40y00LDv0zFN5A as contained in cl. 5.1 of the Conditional Share Sale Agreements; and b) All expenses incurred towards the Solar Projects must be repaid back by the Plaintiff to the Defendant and the Plaintiff did not take into account these figures. [49] The Defendant’s Counterclaim against the Plaintiffs is for: a) An order that the Plaintiff pays back all expenses incurred by the Defendant in the Solar Project as contained in cl. 5.1 of the Conditional Share Sale Agreements in the amount of RM4,824,192.00; and b) General damages, aggravated damages and exemplary damages. [50] Therefore, the Defendant submitted that whether the Defendant is entitled to the RM4,824,192.00 as per his Counterclaim and if that amount can be set off against the Plaintiff’s claim can only be decided in a full trial and not by way of Summary Judgment [51] The Plaintiff submitted that cl. 5.1 of each of the 3 Conditional Share Sale Agreements does not entitle the Defendant to reimbursement by the Plaintiff of certain expenses incurred and therefore the Defendant does not S/N pzBvyd2a40y00LDv0zFN5A have a basis for his Counterclaim against the Plaintiff. In this regard the Plaintiff contended and submitted as follows: a) The 1st Notice of Termination was issued on 21.6.2021 because the Energy Commission Letter of Award (“EC LOA”) for the 3 Companies was not procured, a condition precedent in the Conditional Share Sale Agreements was not fulfilled; and b) As the EC LOA was not procured and the Purchaser did not need to pay the reimbursement to the Defendant which was stipulated in cl 5.1 to be paid together with part of the Balance Purchase Price for the Sale Shares paid by the Purchaser to the Vendor pursuant to cl 4.1(a) of the Conditional Share Sale Agreements. [52] Upon examining the evidence and submissions, I find no merits in the submissions of the Defendant that there is a legitimate counterclaim by the Defendant against the Plaintiff relating to the project expenditure. [53] My first observation is that the Defendant’s argument that he is entitled to the RM4,824,192.00 is premised on cl. 5.1 of the Conditional Share Sale Agreements. Yet, the parties to the Conditional Share Sale Agreements are the Defendant as Purchaser and Skyline as the Vendor, not the Plaintiff. Clause 5.1 in the Conditional Share Sale Agreement in respect of RDAV 1 provides as follows: S/N pzBvyd2a40y00LDv0zFN5A “Refund to Vendor

5.1 Notwithstanding anything contrary stated in this Agreement, the Purchaser expressly acknowledges that the Vendor has incurred the following expenditure relating to RDAV 1 prior to the date of the Agreement and agrees to reimburse this sum to the Vendor together with the payment stated in Clause 4.1 (a). [54] Clause 5.1 in the Conditional Share Sale Agreements in respect of RDAV 2 and RDAV 3 are identical save for references to RDAV 2 and RDAV 3 respectively. [55] As the sum of RM4,824,192.00 is to be refunded by Skyline as Vendor according to cl. 5.1 of the Conditional Share Sale Agreements, there is no basis for the Defendant to say that it should be the Defendant who is liable to pay for the sum. [56] Notwithstanding, a further examination of how cl. 5.1 operates will show that other conditions will have to be fulfilled before the sum is reimbursed to the Defendant.

Cost of incorporating RDAV1: RM2,800.00

(b): First Year Lease Payment: RM1,498,750

(c): Lease Stamping Fee: RM28,364

(d): Lease Registration Fee: RM150.00

(e): Solicitor's Fees for preparing RM 28,000.00

Purchaser's share of the Vendor's Solicitors' legal fees for attending to preparation of Share Sale and Shareholders' Agreement RM 50,0000.00 Total: RM1,608,064.00 S/N pzBvyd2a40y00LDv0zFN5A [57]

RM15,748,800.00 within fourteen (14) days from the date the EC LOA for RDAV 1 is delivered to and accepted by the Purchaser;” [59] Clause 4.1(a) in the Conditional Share Sale Agreements in respect of RDAV 2 and RDAV 3 are identical save for references to RDAV 2 and RDAV 3 respectively. [60] The Vendor (the Defendant) was supposed to first fulfil the Conditions Precedent in the conditional Share Sale Agreement, one of which is “to procure the issuance of the EC LOA in favour of the 3 Companies with a minimum tariff of RM0.36 / KWH” which he was unable to fulfil. This condition precedent is stated in cl. 2.1(b) of the Conditional Share Sale Agreements. Clause 2.1(b) of the Conditional Share Sale Agreement in respect of RDAV 1 is reproduced below: S/N pzBvyd2a40y00LDv0zFN5A “2.

2.1 The Vendor and the Purchaser herein agree and confirm with each other that this Agreement and the payment of the Balance Purchase Price (or any part thereof) shall be conditional upon the fulfilment by the Vendor of the following condition set out herein below within ninety (90) days (or such other extended period as the Parties herein may mutually agree) from the date of this Agreements ….

to procure the issuance of the EC LOA in favour of RDAV 1 with a minimum tariff of RM0.36/KWH..” [61] Clause 2.1(b) in the Conditional Share Sale Agreements in respect of RDAV 2 and RDAV 3 are identical save for references to RDAV 2 and RDAV 3 respectively. [62] The 1st Notice of Termination was issued on 21.6.2021 because the EC LOAs were not procured and this was stated so in the 1st Notice of Termination. [63] Premised on the above I therefore conclude that the Defendant did not have a genuine claim for the expenditure against Skyline or the Plaintiff and a set-off does not arise. This is fortified by the fact that the Defendant never sent any demand for the amount, responded to the Plaintiff’s letters of demand or instituted any claim against Skyline. S/N pzBvyd2a40y00LDv0zFN5A Conclusion [64] Considering the totality of the facts and circumstances of the case as disclosed in the affidavit evidence, it was quite clear to me that the Plaintiff had clearly met the preliminary requirements in an O. 14 application in accordance with the principles established by National Company For Foreign Trade v. Kayu Raya Sdn Bhd [supra] and further, applying the leading Supreme Court case of Bank Negara Malaysia v. Mohd Ismail Ali Johor & Ors [1992] 1 CLJ 627. Accordingly, I held that the contentions of the Defendant do not amount to triable issues or constitute any reasonable defence. [65] The Court ordered costs of RM6,000.00 to be paid by the Defendant. Enclosure 13 Background facts [66] The chronology of the facts leading to this application by the Defendant is set out below. [67] On 20.8.2021, Plaintiff served the sealed Writ Summons dated 19.8.2021 and Statement of Claim dated 19.8.2021 on the Defendant by way of personal service. S/N pzBvyd2a40y00LDv0zFN5A [68] On 30.8.2021, the Defendant served his Memorandum of Appearance dated 30.8.2021 on the Plaintiff’s solicitors. [69] On 23.92021 the Defendant served his Defence and Counterclaim dated 23.9.2021 on the Plaintiff’s solicitors; [70] On 7.10.2021 the Plaintiff served his Reply to Defence and Defence to Counterclaim dated 30.9.2021 (encl. 11) on the Defendant’s solicitors. [71] On 11.10.2021, during the case management of this matter, the Plaintiff’s solicitor informed the learned Senior Assistant Registrar that Plaintiff had filed the Reply to Defence and Defence to Counterclaim. The Defendant’s solicitor requested permission from Court to file a Reply to the Plaintiff’s Defence to Counterclaim within 14 days from 7.10.2021. The Defendant’s solicitor insisted that it is the Defendant’s right to file the Reply. The Court directed the Defendant’s solicitor to file a formal rejoinder application first, and fixed 14.10.2021 as the next case management date for an update on the status. [72] On 13.10.2021, instead of filing the rejoinder application, the Defendant filed the Reply to the Defence to Counterclaim and served the Reply on the Plaintiff’s solicitors. S/N pzBvyd2a40y00LDv0zFN5A [73] On 14.102021, during case management before the learned Senior Assistant Registrar, the Plaintiff’s solicitor objected to the filing of the Reply citing a contravention of O. 18 r. 4 the ROC 2012. The Plaintiff’s solicitor further requested that the Court not to accept and that the Court rejects the Reply. Due to the Plaintiff’s solicitors’ objections to the Reply, the Defendant’s solicitor requested that the Defendant be allowed to file an Application for Leave for the Defendant’s Reply to Defence to Counterclaim to be accepted in these proceedings. The Court fixed 20.10.2021 as the next case management date for the Defendant’s solicitors to file the Application for Leave. [74] On 18.10.2021 the Defendant filed his Application for Leave (encl. 13). [75] In this application (encl. 13) the Defendant seeks, inter alia, the following orders: a) Leave is given to the Defendant to use encl. 11, and if not granted, alternatively file a Reply to the Defence to Counterclaim; and b) If leave in para. (a) above is granted an order that the Defendant be allowed within 7 days from the date of the order to file an Amended Reply. S/N pzBvyd2a40y00LDv0zFN5A Findings and analysis of the Court [76] The Defendant’s submissions as put forward in the Defendant’s Written Submissions are as follows: a) There are no reasons to file a rejoinder application, since all the Defendant did was to file a Reply to the Plaintiff’s Defence to Counterclaim; b) The Counterclaim is a standalone suit, and therefore it will have a Statement of Claim, Statement of Defence and Reply to Defence; and c) The Plaintiff did not plead in his affidavit how he will be prejudiced by the inclusion of encl. 13. [77] I scrutinised the Defendant’s affidavit in support to look for reasons as to why this Reply to the Defence to Counterclaim is necessary. In para. 6 of the Defendant’s affidavit in support, the Defendant stated that leave to file the Reply needs to be given to enable the Defendant to reply to the Plaintiffs Defence to Counterclaim. It appears, that the Reply is necessary because the Defendant was not able to respond to the Plaintiff’s Reply in the Original Action. This was stated in para 9 of the Defendant’s affidavit in support which is reproduced below: “Maka, saya memohon agar saya diberikan kebenaran untuk memfailkan Jawapan Kepada Pembelaan dalam Tuntutan balas sahaja ini S/N pzBvyd2a40y00LDv0zFN5A disebabkan kami tidak boleh menjawab kepada jawapan yang dibuat oleh Plaintif dalam tindakan asal. Malahan permohonan kami adalah bona-fide dan juga tidak akan meprejudiskan pihak Plaintif dalam Tindakan asal.” [78] It is convenient for reference to state the provision in O. r. 4 of the ROC 2012 which governs the requirement on filing pleadings after a reply or a defence to a counterclaim if filed. It provides that: “Pleadings subsequent to a reply or a defence to a counterclaim shall not be served except with the leave of the Court.” [79] Therefore, the provision under this rule is mandatory and leave of Court must be obtained. The pleading is liable to be struck out if no leave is obtained. [80] In a Counterclaim, the effect of filing a pleading after the defence to the counterclaim without the leave of Court is stated in In Eon Bank Berhad v. Foreswood Indus SB [1999] MLJU 158 where the High Court struck out the defendant’s reply to defence to counterclaim on the basis that no leave was obtained by the defendant. The High Court held: “It is clear that the provision under Rule 4 of Order 18 is mandatory, leave of the Court must be obtained. This means that after the pleading is closed no pleading, e.g. a rejoinder, shall be served unless with the leave of Court. It is mandatory that leave must be obtained before a rejoinder is filed and served.” S/N pzBvyd2a40y00LDv0zFN5A [81] It is clear that in filing and serving to the Plaintiff’s solicitors encl. 11, the Reply to the Plaintiff’s Defence to Counterclaim without obtaining the leave of Court the Defendant blatantly contravened O. 18 r. 4 of the ROC 2012. The Defendant’s Reply to the Defence to Counterclaim in encl. 11 cannot be accepted by the Court and is struck out. [82] Now that encl. 11 is out of play I turn to the Defendant’s prayer for leave to file a Reply to the Defence to Counterclaim. [83] The Plaintiff submitted that the Defendant had failed to comply with the requirement that a proposed reply is to be adduced during the leave application. The Plaintiff referred the Court to Malaysian Civil Procedure 2021, Volume I (Sweet & Maxwell), page 246, para. 18/4/1: “An application for leave to serve a rejoinder or subsequent may be made inter partes through a notice of application. Leave will not be granted ex parte. (Monck v. Smythe [1895] 1 Ir R 200. Leave to serve a rejoinder or subsequent pleadings will not be granted unless it is required on matters which must be specifically pleaded in compliance with r 8 (see Harry v. Davey (1876) 2 ChD 721; 34 LT 842; Norris v. Beazley (1877) 2 CPD 80; 35 LT 845). At the hearing, the proposed answer to the plaintiff’s reply should be produced.” (Emphasis added) S/N pzBvyd2a40y00LDv0zFN5A [84] In my view, the purpose of producing a Reply in such a leave application (either by attaching it to the Notice of Application or exhibited in the affidavit in support) is for the Court and the respondent to given notice of the contents of the Reply and to assess whether it is necessary to file the Reply. In this case, the Reply was already disclosed to the Plaintiff and the Court through encl. 11, although filed irregularly. In the circumstances of this case the Court accepts that the Reply has been produced. [85] Despite the Reply being produced, the Court still finds that the Defendant has failed to show why the Reply is necessary due to matters which need to be specifically pleaded for leave to file the Reply to the Defence to Counterclaim to be granted. [86] Leave to serve a rejoinder or subsequent pleadings will not be granted unless it is required to matters which must be specifically pleaded in compliance with O. 18 r. 8 ROC 2012 and will only be granted if it is necessary. In Harry v. Davey [1876] 34 LT 842 the test was stated: “... when a defendant requires no statement of claim to be delivered, and delivers his statement of defence, and subsequently apply for leave to deliver a special rejoinder to the plaintiff’s statement in reply, the court will not grant the application unless good cause be shown.” S/N pzBvyd2a40y00LDv0zFN5A [87] Norris v. Beazley (1877) 2 CPD 80 indicates that leave to deliver a rejoinder or subsequent pleading will not be granted unless it is necessary in order to raffidavit in supporte matters which must be specifically pleaded. The court held that the rejoinder was objectionable on the ground that it was a mere repetition of what had already been pleaded. [88] Paragraphs 6 and 9 of the Defendant’s affidavit in support states nothing as to why the Reply is necessary. Therefore, the Defendant has not shown any legitimate basis for leave to be granted. Conclusion [89] In conclusion, encl. 13 is dismissed. Therefore: a) The Defendant’s Reply to Defence to Counterclaim filed on 13.10.2021 (encl. 11) is struck out on the basis of contravening O. 18 r. 4 of the ROC 2012; and b) No leave is granted for the Defendant to refile the Reply to Defence to Counterclaim. S/N pzBvyd2a40y00LDv0zFN5A [90] The Court ordered costs of RM2,000.00 to be paid by the Defendant. 3 June 2022 ATAN MUSTAFFA YUSSOF AHMAD Judge Kuala Lumpur High Court (Commercial Division) Counsel: For the Plaintiff: HW Chew (Messrs Chew Kar Meng, Zahardin & Co.) For the Defendant: Ramesh Lachamanan (Messrs. Nith, Gowri, Lachman & Partners) S/N pzBvyd2a40y00LDv0zFN5A